JPMorgan Earnings Blow Past Expectations on $5.2 Billion Reserve Release

imageStock Markets1 hour ago (Apr 14, 2021 06:51AM ET)

(C) Reuters. JPMorgan Earnings, Revenue Beat in Q1

By Geoffrey Smith and Dhirendra Tripathi – JPMorgan (NYSE:JPM) set a blistering start to the first-quarter earnings season, reporting earnings per share nearly 50% ahead of expectations for the three months through March – albeit thanks largely to one-off factors and extraordinary conditions in capital markets.

Revenue was nearly 10% ahead of expectations at $33.12 billion, but the bank’s cost-income ratio ticked higher to 58% from 55% in the final quarter of 2020.

The numbers were juiced by the release of some $5.2 billion in reserves against possible loan losses that the bank had built at the start of the pandemic. The bank made $1.1 billion of fresh write-offs in the quarter.

CEO Jamie Dimon said in a statement that the bank’s remaining credit reserves of $26 billion “are appropriate and prudent, all things considered,” and stressed that the release of previous reserves should not be regarded as a recurring factor.

The corporate and investment bank arm flourished, as expected, against a backdrop of buoyant financial markets and a boom in the formation of Special Purpose Acquisition Companies. Overall revenue at the division was up 46% from a year earlier at $14.6 billion. Equity markets revenue was up 47% at $3.3 billion, while fixed-income revenue was up 15% at $5.8 billion.

Investment banking revenue was $2.9 billion, up $2 billion, as investment banking fees rose 57%.

The consumer bank, by contrast, put in a weaker performance, with home lending stagnating on the quarter and modest declines in consumer and auto loans, against a backdrop of steadily rising interest rates.

JPMorgan shares are up 21% from the beginning of the year, still down 4.69% from its 52 week high of $161.68 set on March 18. They are outperforming the S&P Global 100 which is up 8.82% from the start of the year.

Wells Fargo (NYSE:WFC) and Goldman Sachs (NYSE:GS) are also set to report before the opening bell.

Stay up-to-date on all of the upcoming earnings reports by visiting’s earnings calendar

JPMorgan Earnings Blow Past Expectations on $5.2 Billion Reserve Release

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.