JPMorgan Chase beats by $0.38, beats on revs
- Reports Q3 (Sep) earnings of $4.37 per share, excluding non-recurring items, $0.38 better than the FactSet Consensus of $3.99; revenues rose 6.5% year/year to $43.31 bln vs the $41.43 bln FactSet Consensus.
- Average loans up 1% YoY and QoQ; average deposits up 1% YoY and QoQ
- The provision for credit losses was $3.1 billion, reflecting net charge-offs of $2.1 billion and a net reserve build of $1.0 billion. Net charge-offs of $2.1 billion were up $590 million, predominantly driven by Card Services. The net reserve build included $882 million in Consumer, primarily in Card Services, and $144 million in Wholesale. The prior-year provision was $1.4 billion, reflecting net charge-offs of $1.5 billion and a net reserve release of $113 million. Jamie Dimon, Chairman and CEO, commented: "The Firm reported strong underlying business and financial results in the third quarter, generating net income of $12.9 billion and an ROTCE of 19%. In the CIB, investment banking fees grew 31%, while Markets revenue was resilient, rising 8%. Payments fees grew by double-digits as investments are fueling organic growth. In CCB, we ranked #1 in U.S. retail deposits for the fourth consecutive year. Card loans increased 11%, and we saw robust acquisition of 2.5 million accounts. Finally, in AWM, asset management fees rose 15%, and long-term net inflows were a record $72 billion." Dimon added: "We await our regulators' new rules on the Basel III endgame and the G-SIB surcharge as well as any adjustments to the SCB or CCAR. We believe rules can be written that promote a strong financial system without causing undue consequences for the economy, and now is an excellent time to step back and review the extensive set of existing rules -- which were put in place for a good reason -- to understand their impact on economic growth, the viability of both public and private markets, and secondary market liquidity. Regardless of the outcome of these rules, we have an extraordinarily strong balance sheet, evidenced by total loss-absorbing capacity of $544 billion plus cash and marketable securities of $1.5 trillion, while our riskiest assets, loans, total $1.3 trillion. On share repurchases, given that market levels are at least slightly inflated, we maintain our modest pace of buybacks, although we reserve the right to adjust this at any time."
- Guidance: Expect FY2024 net interest income of ~$91B, market dependent. Expect FY2024 net interest income excluding Markets of ~$91B, market dependent. Expect FY2024 adjusted expense of ~$92B, market dependent.