Some of its rivals have looked to primarily foreign investors for help. JPMorgan also said it remained well capitalized. Other divisions of JPMorgan, however, showed some signs of growth including the company's asset management, treasury and securities services and commercial banking businesses, which reported double digit profit increases. "We are not predicting a recession but we are prepared in almost every way possible," Dimon told analysts during a conference call. JPMorgan built up its loan loss reserves by $1.1 billion during the quarter to prepare for such an instance, particularly in the company's consumer credit businesses like credit cards and auto loans.
Last quarter, JPMorgan reported a rise in profit, beating Wall Street estimates, even as its investment banking business was hurt by turmoil in the global credit markets.ĭimon added that he remained "cautious" as the firm entered 2008 warning that the health of the economy remained a risk. JPMorgan has weathered tightening credit conditions better than rivals Merrill Lynch ( MER, Fortune 500) and Citigroup ( C, Fortune 500), which posted a record $9.8 billion fourth-quarter loss Tuesday and took a giant $18.1 billion write-down. The company also reported a $1.3 billion writedown in the company's investment banking arm, due to the decline in value of its subprime holdings, which include complex instruments known as collateralized debt obligations.Ĭhairman and Chief Executive Jamie Dimon said this segment of the business, which saw its profits plunge 88 percent in the quarter to $124 million from $1.01 billion a year ago, faces continuing uncertainty. "I thought the numbers were quite respectable given the pressure in the industry," said Nancy Bush, managing member at NAB Research LLC in Aiken, S.C. Shares of JPMorgan Chase ( JPM, Fortune 500) rose 4 percent in midday trading on the results.
Revenue rose 7 percent to $17.4 billion from $16.2 billion in the year-earlier period, beating estimates of $17.05 billion. JPMorgan Chase was expected to earn 93 cents a share for the quarter ended in December, according to analysts surveyed by earnings tracker Thomson Financial. The company earned $4.5 billion, or $1.09 a share, in the same period last year. The company said net income fell 34 percent to $3 billion, or 86 cents a share, during the fourth quarter.
NEW YORK () - JPMorgan Chase & Co., the second bank this week to post dismal results, reported a decline in quarterly earnings Wednesday after suffering a $1.3 billion subprime-related hit.
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