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-JPMorgan Q2 profit rises 7% Y/Y to USD5.4bn, tops estimates.

BANKING AND CREDIT NEWS-July 15, 2011--JPMorgan Q2 profit rises 7% Y/Y to USD5.4bn, tops estimates(C)2011 M2 COMMUNICATIONS

15 July 2011 -- JPMorgan (NYSE:JPM) on Thursday posted a second-quarter 2011 net profit of USD5.4bn (EUR3.8bn), up 7% year-on-year and 6% on a quarterly basis and exceeding analyst forecasts.

The result topped the average Wall Street projection by USD0.06 a share, according to Thomson Reuters I/B/E/S.

The bank earned USD1.27 per share in April to June 2011 compared to USD1.09 per share, or a total net income of USD4.8bn, in the same quarter of 2010.

Net revenues added 7% year-on-year to USD27.4bn while loan-loss provisions fell by 46% to USD1.8bn.

The performance was boosted by solid investment banking income, continued loan expansion and steady outcomes across most of its businesses, the bank said in a statement. Credit card delinquencies and charge-offs improved and the bank lowered loan loss reserves by USD1bn in the card services segment reflecting steadier credit trends. Net income in the credit card division rose to USD911m in the second quarter of 2011 from USD343m in the prior year.

However, net charge-offs on the mortgage portfolio remained high despite progress to solve past problems and the bank cautioned it would take some time to address these issues and may "incur additional costs along the way".

JPMorgan said net profit at its investment bank gained 49% year-on-year to USD2.1bn due to higher net revenue and lower non-interest costs, partially offset by a lower benefit from the provision for credit losses.

Net income in the commercial banking fell 12% to USD607m.

The bank closed the second quarter of 2011 with a Basel I Tier 1 common ratio of 10.1% and an estimated Basel III Tier 1 common ratio of 7.6%, or well above what is required under the new regulations including additional buffers for major banks. JPMorgan repurchased USD3.5bn of stock in the period and will continue to buy back shares opportunistically, said its chairman and CEO, Jamie Dimon.

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Publication:M2 Banking & Credit News (BCN)
Article Type:Financial report
Date:Jul 15, 2011
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