The quarterly results from JPMorgan exceed the consensus
Friday, July 16th, 2010JPMorgan Chase reported better than expected results in the second quarter with a decline in provision for credit losses, something that gives hope to investors that things return to normal in the bank.
However, the action declined substantially over 2% as investors aggrieved by his assessment of economic conditions.The KBW bank index was weakening even more, 2.45%.
Moreover, the bulk of quarterly earnings from revenue sources that are not stable, such as reduced bad debt provisions, while in some segments, like the conventional mortgage, there are more and more bad debt, which bodes ill for banks such as Citigroup and Bank of America, which publishes Friday.
Income trading at JPMorgan has declined but it is better than expected, which is perhaps a positive sign for banks such as Goldman Sachs Group and Morgan Stanley, who announce their quarterly results next week.
"The results are just adequate and there is a little less than it seems," said Doug Kass (Seabreeze Partners Management).
The outstanding loans of the bank has continued to decline, showing it is reluctant to risk new loans yet.She says she can not yet assess how the reform of financial regulation will affect its accounts, information, precisely, investors were waiting impatiently.
ONE LESS OPTIMISTIC DG
The CEO Jamie Dimon appeared less optimistic about the future than it was in the first quarter, when he said that the economic recovery of the United States could be solid.
"It is too early to measure the improvement that we observe from now" in the consumer credit, which yields "are unacceptable", he has merely stated Thursday.
"We do not know what will happen to house prices and we believe we are not alone," he later told analysts.
The bank reported a net profit of 4.8 billion dollars (3.7 billion euros) or $ 1.09 per share, against 2.7 billion (28 cents per share) for the corresponding period last year.
Net income for the investment bank fell 6% to $ 1.38 billion. The second quarter was marked by markets that have evolved sawtooth, alternating example falls in the stock exchanges with peaks rising in the bond market.
The income earned by the JPMorgan bond, commodity and currency has dropped 28% to 3.56 billion.The bond trading has been a major driver of earnings of all major banks.
The bank posted a windfall of $ 1.5 billion, or 36 cents per share, due to the reduction in provision for credit during the quarter.Excluding this benefit, the result announced by JPMorgan – 73 cents – more than analysts' consensus that emerged at 67 cents per share, according to Thomson Reuters I / B / E / S.
The bank does not renew every quarter this year discount stores but Jamie Dimon said it was the thing that needed to be done during this quarter.
He said that the bank has a solid liquidity, having repurchased $ 500 million of its shares in the first half, but noted that the bank would be more certain of its capital before increasing its dividend.
Many banks want to raise the dividend but regulators see it a bad eye, which makes more likely redemptions.
The bank said its losses on consumer loans, mortgages, credit cards and other debts had declined in the second quarter both compared to the first three months of the year versus the second quarter 2009.
JPMorgan has finally reported a charge of $ 550 million charge related to the British banking bonuses. She had previously launched a warning on that charge, saying it would be an "important" in the quarter.
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