Post by : Bianca
Haleem
New York: JPMorgan Chase has announced a 9% increase in its fourth-quarter profit on an adjusted basis, buoyed by a robust U.S. economy and strong results from both its consumer and investment banking sectors.
The largest bank in the U.S. reported earnings of $13.03 billion, or $4.63 per share, during this quarter. The results reflected a one-off charge of 60 cents per share due to JPMorgan's recent acquisition of the Apple Card credit card portfolio from Goldman Sachs.
In conjunction with this acquisition, JPMorgan has set aside $2.2 billion in loan-loss reserves to prepare for possible future losses associated with the Apple Card operations. Excluding this reserve adjustment, the bank achieved an adjusted profit of $5.23 per share, significantly outperforming analysts' predictions of $4.85 per share, as reported by FactSet.
Quarterly revenue for the bank surged 7% year-over-year to reach $45.8 billion, indicative of strong consumer spending and stable business activities.
JPMorgan's CEO Jamie Dimon conveyed optimism about the overall U.S. economy, despite a slight softening in labor markets. “Conditions do not appear to be worsening,” Dimon stated. “Consumers are continuing to spend, and businesses remain generally robust. With fiscal stimulus, deregulation, and the latest monetary policy changes, these trends are likely to persist.”
Despite these positive results, JPMorgan shares dropped nearly 3% in morning trading and closed around $314.74, as investors considered broader political and regulatory uncertainties.
JPMorgan is among the first prominent U.S. banks to disclose its earnings this season. Market focus is also shifting towards Washington, particularly after President Donald Trump reiterated his support for legislation to limit credit card interest rates to 10%.
In other news, Federal Reserve Chair Jerome Powell revealed that the Justice Department has issued subpoenas related to his testimony concerning the Fed's building renovations, marking a significant elevation in tensions between the White House and the central bank.
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