Financial Results

JP Morgan's Q1 Net Income Rises; Net Interest Income Slightly Disappoints

Editorial Staff 15 April 2024

JP Morgan's Q1 Net Income Rises; Net Interest Income Slightly Disappoints

The US banking group issued a broadly positive set of results. However, investors appeared to focus on the net interest income figures which, so reports said, were slightly disappointing. The bank's CEO said the bank was bracing for continued economic and geopolitical storms.

JP Morgan kicked off the quarterly reporting season by announcing a rise in net income for the three months to end-March, at $13.42 billion, up from $12.6 billion a year ago, and also rising from $9.31 billion in the final quarter of 2023.

Reported net revenue rose to $41.92 billion from $38.3 billion, the US-headquartered bank said in a statement on Friday. Results were helped by a cut in provision for credit losses, to $1.88 billion from $2.27 billion a year before. Noninterest costs rose to $22.76 billion from $20.1 billion. 

Return on common equity rose to $4.44 from $4.1 per share.

Net interest income excluding markets stood at $23.0 billion, a rise of 10 per cent, or up 4 per cent excluding First Republic, driven by the impact of balance sheet mix and higher rates, as well as higher revolving balances in card services, largely offset by deposit margin compression and lower deposit balances in consumer and community banking.

Media reports said the NII figure slightly disappointed analysts. Shares in the bank fell about 5 per cent in morning trade in New York.

Wealth, asset management
Within wealth and asset management, net income dipped 6 per cent year-on-year to $1.29 billion; net revenue rose 7 per cent to $5.109 billion, and noninterest costs rose 12 per cent to $3.46 billion. There was a net benefit of $57 million – reflecting a net reserve release – contrasting with a provision for credit losses of $28 million in Q1 2023.

Assets under management stood at $3.6 trillion, up 19 per cent; client assets rose 20 per cent to $5.2 trillion, driven by higher markets and inflows of client money.

“Many economic indicators continue to be favorable. However, looking ahead, we remain alert to a number of significant uncertain forces. First, the global landscape is unsettling – terrible wars and violence continue to cause suffering, and geopolitical tensions are growing. Second, there seems to be a large number of persistent inflationary pressures, which may likely continue. And finally, we have never truly experienced the full effect of quantitative tightening on this scale,” Jamie Dimon, chief executive, said. 

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