- POSTED: 15 Jul 2014 21:06
US banking giant JPMorgan Chase on Tuesday reported a drop in second-quarter earnings on lower mortgage banking profits and weaker trading revenues.
NEW YORK: US banking giant JPMorgan Chase on Tuesday reported a drop in second-quarter earnings on lower mortgage banking profits and weaker trading revenues.
JPMorgan, the biggest US bank by assets, said earnings dropped 7.9 per cent to $5.99 billion compared with the second quarter last year.
The results reflected another quarter of weaker performance in mortgage banking, where net income fell by $433 million to $709 million. JPMorgan and other large banks have cut mortgage-finance staff as refinancings have slowed.
Also lower were results in stock and bond trading, with the latter suffering a 15 per cent drop in revenues compared with the year-ago period. Trading was also weak at JPMorgan and other leading banks in the first quarter.
It also set aside $852 million for credit losses, compared with a gain of $19 million a year ago.
Strong areas for JPMorgan included investment banking fees, which rose three per cent from a year ago. The bank also pointed to higher credit card and auto loans.
JPMorgan chief executive Jamie Dimon said business conditions are on the upswing.
"Toward the end of the second quarter, we saw encouraging signs across our businesses including an uptick in wholesale utilisation, strengthening pipelines in our commercial and business banking segments, and some improvements in markets activity," Dimon said.
"While it is too early to assume that this momentum will continue, we have confidence in the long-term growth of the economy."
JPMorgan's earnings translated into $1.46 per share, well above analyst estimates for $1.29.
Revenues dropped 2.3 per cent to $25.35 billion, more than the $23.76 billion forecast by analysts.
JPMorgan shares rose 2.2 per cent to $57.50 in pre-market trade.