JPMorgan posts lowest profit since 2013 as it braces for a coronavirus-fueled recession
- JPMorgan Chase reported first-quarter earnings Tuesday that fell short of analysts' expectations.
- The bank's net revenue fell 3%, while earnings per share plunged more than 70% as it built up credit reserves in response to the novel coronavirus pandemic.
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JPMorgan Chase reported first-quarter earnings on Tuesday that fell short of the expectations of analysts polled by Yahoo Finance. The banking titan's net revenue slid 3% to about $28 billion, while its net income plunged 69% to $2.9 billion, the lowest level since 2013.
Here are the key numbers:
- Revenue: $28.3 billion versus the $29.7 billion estimate
- Earnings per share: $0.78 versus the $1.84 estimate
"JPMorgan Chase performed well in what was a very tough and unique operating environment - growing deposits in every line of business and providing loans as we extended credit and served as a port in the storm for our clients and customers," CEO Jamie Dimon said in the earnings release.
"The underlying results of the company were extremely good, however given the likelihood of a fairly severe recession, it was necessary to build credit reserves of $6.8 billion, resulting in total credit costs of $8.3 billion for the quarter," he added.
JPMorgan stock climbed about 1.7% in pre-market trading.
The bank attributed most of the decline in earnings per share to its decision to set aside billions of dollars to cover bad loans. It also suffered from losses in its credit adjustments business as well as bridge book markdowns.
JPMorgan posted steep declines in net income across its consumer and community banking, corporate and investment bank, and commercial banking divisions. Net income was roughly flat in its asset and wealth management segment.
