JPMorgan (JPM) Tops Q3 EPS by 44c; Revenue Beats
JPMorgan (NYSE: JPM) reported Q3 EPS of $4.33, $0.44 better than the analyst estimate of $3.89. Revenue for the quarter came in at $39.9 billion and managed revenue was $40.7 billion, versus the consensus estimate of $39.55 billion.
Jamie Dimon, Chairman and CEO, commented on the quarter: “The Firm delivered another quarter of solid results, generating net income of $13.2 billion and an ROTCE of 22%—although, we acknowledge that these results benefit from our over-earning on both net interest income and below normal credit costs, both of which will normalize over time. Our CET1 capital ratio rose even further to 14.3%. Our total loss-absorbing capacity (equity plus long-term debt) is a formidable $496 billion, while loans, which are our riskiest assets, are at $1.3 trillion. Our liquidity is extraordinarily high with cash and marketable securities of $1.4 trillion. Looking ahead to Basel III finalization, we intend to adapt and manage to the new rules very quickly as we have shown in the past. However, we caution that such material regulatory changes would likely have real world consequences for markets and end users.”
imon continued: “Our lines of business saw continued momentum in the quarter, demonstrating the power of our years of investment and the value of our consistency and fortress principles. Across the Firm, we continued to add a sizable number of new clients and deepen relationships. In CCB, we again ranked #1 in U.S. retail deposits based on the most recent FDIC data, and we extended our leadership position as our growth from net new accounts was over 3x that of peers. In CIB, we maintained our #1 Dealogic rank and gained IB market share YTD. In CB, Payments revenue remained strong and was up 30%. And AWM saw AUM net inflows of $60 billion. Finally, we extended credit and raised $1.7 trillion in capital for businesses, governments, and U.S. consumers year to date.”
Dimon concluded: “Currently, U.S. consumers and businesses generally remain healthy, although, consumers are spending down their excess cash buffers. However, persistently tight labor markets as well as extremely high government debt levels with the largest peacetime fiscal deficits ever are increasing the risks that inflation remains elevated and that interest rates rise further from here. Additionally, we still do not know the longer-term consequences of quantitative tightening, which reduces liquidity in the system at a time when market-making capabilities are increasingly limited by regulations. Furthermore, the war in Ukraine compounded by last week’s attacks on Israel may have far-reaching impacts on energy and food markets, global trade, and geopolitical relationships. This may be the most dangerous time the world has seen in decades. While we hope for the best, we prepare the Firm for a broad range of outcomes so we can consistently deliver for clients no matter the environment. To conclude, I want to thank our extraordinary employees for all of their hard work in making us one of the most trusted financial institutions in the world.
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