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JPMorgan Chase & Co. (JPM) Tops Q4 EPS Views; Income Rises 54%

January 16, 2013 7:00 AM EST Send to a Friend
(Updated - January 16, 2013 7:06 AM EST)

JPMorgan Chase & Co. (NYSE: JPM) reported Q4 EPS of $1.39, $0.23 better than the analyst estimate of $1.16. Revenue for the quarter came in at $24.4 billion versus the consensus estimate of $24.56 billion.

Basel I Tier 1 common1 of $140 billion, or 11.0%, up from 10.4% in the prior quarter; Estimated Basel III Tier 1 common1 of 8.7%3, up from 8.4% in the prior quarter; Loan loss reserves of $21.9 billion; Global Liquidity Reserve of $491 billion.

Net income for the quarter was $5.7 billion, compared with net income of $3.7 billion in the fourth quarter of 2011.

Jamie Dimon, Chairman and Chief Executive Officer, commented on the financial results: “For the third consecutive year, the Firm reported both record net income and a return on tangible common equity1 of 15%. The Firm’s results reflected strong underlying performance across virtually all our businesses for the fourth quarter and the full year, with strong lending and deposit growth. We also maintained our leadership positions and continued to gain market share in key areas of our franchise. As we highlight upfront in this release, there were several significant items that affected our results this quarter, but they largely offset each other.”

Dimon added: “We continued to see favorable credit conditions across our wholesale loan portfolios and strong credit performance in our credit card portfolio, where charge-off rates remain at historic lows. The real estate portfolios, while at elevated levels of losses, continued to show improvement as the housing market and economy continued to recover. As a result, we reduced the related allowance for credit losses by $700 million in the fourth quarter and we are likely to continue to see reductions in the allowance as the environment improves.”

Commenting on the balance sheet, Dimon said: “We strengthened our fortress balance sheet, ending the fourth quarter with a strong Basel I Tier 1 common ratio1 of 11.0%, up from 10.4% in the third quarter. We estimate that our Basel III Tier 1 common ratio1 was approximately 8.7% 3 at the end of the fourth quarter, up from 8.4% in the third quarter.”

Dimon added: “During the course of 2012, JPMorgan Chase was able to make more of an impact on our communities than ever before. The Firm provided credit1 and raised capital of over $1.8 trillion for our clients during the year. This included $20 billion for small businesses, up 18%. We also originated more than 920,000 mortgages; provided credit cards to about 6.7 million people; and raised capital and provided credit1 of approximately $85 billion for nearly 1,500 not-for-profit and government entities, including states, municipalities, hospitals and universities. As part of the 100,000 Jobs Mission, which JPMorgan Chase helped launch, since the beginning of 2011, the Firm has hired nearly 5,000 U.S. veterans and members of the National Guard and Reserve; and, through our nonprofit partners, we have provided 386 mortgage-free homes for deserving veterans and their families.”

“We are committed to doing our part to speed the recovery of the housing market. This includes working with struggling homeowners to modify their loans, or pursue other options to allow them to prevent foreclosure. Through these efforts, since 2009, we have offered more than 1.4 million mortgage modifications and completed 610,000 for both loans we own and those we service for others. With respect to Chase-owned mortgages, through modifications and short-sales, we have effectively forgiven more than $10 billion of principal and reduced borrowers’ interest payments by approximately $2 billion. Our efforts are not only helping people, they are also helping set the stage for a recovery in America’s housing market, which will ultimately reward our customers, shareholders and communities alike.”

Dimon concluded: “We are particularly proud that, through the turbulence of recent years, we never stopped serving clients and investing in the future of our franchise - opening new offices and branches, adding bankers in key markets, innovating and gaining market share. The capital strength and earnings power of the Firm is as strong as it has ever been, and our 260,000 employees are doing more than ever to serve our customers and clients, and support our communities around the world. Challenges still exist, but as we look forward to 2013, we remain optimistic.”

For earnings history and earnings-related data on JPMorgan Chase & Co. (JPM) click here.




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