JPMorgan Stock Gains On Q1 Results Above Street, AUM Strength

JPMorgan Chase

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(RTTNews) - Shares of JPMorgan Chase & Co. were gaining around 2 percent in the pre-market activity on the NYSE after the banking major reported Friday higher profit and revenues in its first quarter, both above market estimates, despite significant growth in provision for credit losses. Assets under management climbed from last year, driven by continued net inflows and higher market levels.

Jamie Dimon, Chairman and CEO, said, "The economy is facing considerable turbulence (including geopolitics), with the potential positives of tax reform and deregulation and the potential negatives of tariffs and "trade wars," ongoing sticky inflation, high fiscal deficits and still rather high asset prices and volatility. As always, we hope for the best but prepare the Firm for a wide range of scenarios."

During the quarter, the company repurchased $7 billion of common stock and announced a 12 percent increase in the common dividend. According to the firm, the increase in capital return was supported by its strong earnings generation and elevated capital levels.

In the quarter, net income grew 9 percent to $14.64 billion from last year's $13.42 billion. Earnings per share increased 14 percent to $5.07 from $4.44 last year.

The Wall Street analysts on average expected the company to report earnings of $4.64 per share. Analysts' estimates typically exclude special items.

Net revenue grew 8 percent to $45.31 billion from last year's $41.93 billion. On a managed basis, revenues increased 8 percent to $46.01 billion from last year's $42.55 billion.

The Street was looking for revenues of $44.1 billion for the quarter.

Consumer & Community Banking or CCB net revenue increased 4 percent year-over-year to $18.31 billion.

Commercial & Investment Bank or CIB net revenue was $19.67 billion, up 12 percent. Banking & Payments revenue grew 4 percent, and the growth was 2 percent in Investment Banking revenue. Investment Banking fees were up 12 percent, driven by higher debt underwriting and advisory fees. Payments revenue was up 2 percent.

Markets revenue was $9.7 billion, up 21 percent, primarily driven by higher Equity Markets revenue.

Asset & Wealth Management or AWM net revenue was $5.73 billion, up 12 percent, predominantly driven by growth in management fees.

In the quarter, net interest income was $23.4 billion, up 1 percent from last year. Net interest income excluding Markets dropped 2 percent to $22.6 billion, driven mainly by the impact of lower rates and deposit margin compression.

Noninterest revenue was $22.6 billion, up 17 percent from the prior year.

The provision for credit losses was $3.3 billion, a growth of 75 percent from last year's $1.88 billion.

Assets under management or AUM grew 15 percent from last year to $4.1 trillion. Average loans grew 2 percent, while average deposits fell 2 percent in the quarter.

In the pre-market activity on the NYSE, the shares were gaining around 1.5 percent to trade at $230.60.

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