JP Morgan Chase & Co. (JPM), the largest bank in the United States by assets, posted strong earnings growth thanks to improved free reserves and stronger revenues from investment banking. The company released its financial results for the second quarter of 2021 (ended June) on Tuesday.
This was another successful quarter for the largest US bank, which is benefiting from the resurgence of the US economy and the Fed’s permission to reduce reserves that had been “frozen” as a precaution against potential loan defaults at the time of the pandemic. Earnings per share rose 174% year-on-year to $3.78 per share, beating the analyst average of $3.21 per share. The bank reported a quarterly profit of $11.9 billion, compared to $4.7 billion a year earlier. Despite an 8% decline in revenue, third-quarter revenues exceeded Wall Street predictions of $29.9 billion.
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The decline is attributed to the fact that JPMorgan’s income from fixed income markets (bond trading) decreased by 44% from last year. The revenue for this segment reached a record level last year as a result of the Federal Reserve supporting markets following the first signs of the Coronavirus pandemic.
● JPMorgan’s stock market revenues increased by 13% to $2.7 billion, a higher figure than analysts expected.
● Revenues from consumer banking increased 3.3% to $12.76 billion.
● The investment banking segment generated revenues of $3.4 billion, which is $300 million higher than analysts expected.
JP Morgan Chase & Co. (JPM) share price plunged -0.34% to $155.12 from the previous closing price of $155.65. The company’s market value reached $455.01 billion.