JPMorgan beats earnings estimates on strengthening US economy

JPMorgan Chase’s earnings grew fivefold in the first quarter, as a strengthening US economy allowed it to release more reserves for potential bad loans and surging investment banking fees propped up results.

The largest US bank by assets on Wednesday pared back its loan loss reserves by $5.2bn, signalling confidence that government stimulus and rapid vaccine rollouts have staved off the severe recession economists once feared. 

“With all of the stimulus spending, potential infrastructure spending, continued Quantitative Easing, strong consumer and business balance sheets and euphoria around the potential end of the pandemic, we believe that the economy has the potential to have extremely robust, multi-year growth,” chief executive Jamie Dimon said in a statement.

Revenue grew 14 per cent to $33.1bn, led by a 65 per cent surge in investment banking fees from a strong quarter for dealmaking. Revenue in its trading business jumped 25 per cent, driven by its equities division.

Overall the bank reported net income of $14.3bn, or $4.50 a share, compared with $2.9bn, or 78 cents last year. Excluding the impact of one-time items like the reserve release, the bank reported earnings of $3.31 per share.

Analysts had forecast earnings of $3.10 per share on $30bn in revenue, according to FactSet.

Link to Original Story

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.