Welcome upside surprise: JPMorgan's first quarter earnings

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Much of the industry was looking forward to JPMorgan's first quarter earnings results as a solid first read on what to expect from other big consumer and investment banks. The bank delivered a solid upside surprise, earning $1.31 a share in the quarter, compared with estimates of $1.13 a share. The most pleasant surprise was revenue, which came in at $25.2 billion, which topped analysts' estimates and represented a 25 percent increase sequentially and a 6 percent increase from year-ago levels.

The results confirm the hope that trading results and consumer mortgage activity were strong enough to help the industry end the revenue malaise that set in during the second half of 2011. Net revenue in the investment bank was down year-over-year but up nearly 70 percent from the fourth-quarter.

Excluding an expected DVA, fixed income and equity markets combined revenue was $6.4 billion, down only 3 percent year-over-year. Rates-related and equity activity was especially strong. On the retail banking side, net revenue was up 20 percent sequentially and 40 percent year-over-year. Mortgage-related activity turned a profit of $461 million, compared to a $1.1 billion loss a year ago, and revenue was up 80 percent. Mortgage production-related activity was at all-time highs. This bodes well for other banks, the hybrid consumer/investment banks and the more pure investment banks.

For more:
- here are the earnings

Related articles:
More earnings estimate jockeying
Earnings reporting period gets underway

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