JPMorgan Chase profit falls on loan loss provisions in September quarter | World News
JPMorgan Chase’s profit dropped in the third quarter as a bigger provision for potential loan defaults offset gains from investment banking, the bank said on Friday.
Banks are building up stockpiles – which act as a safeguard when borrowers default on their loans – to typical levels as consumers deplete the savings they built up during the pandemic.
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Consumers’ financial health remains solid despite elevated interest rates and fears over unemployment.
Still, CEO Jamie Dimon maintained his guarded tone on the economy, despite stock markets reaching record highs and the Federal Reserve beginning a long-awaited cycle of rate cuts.
“We have been closely monitoring the geopolitical situation for some time, and recent events show that conditions are treacherous and getting worse,” Dimon said.
“There is significant human suffering and the outcome of these situations could have far-reaching effects on both short-term economic outcomes and more importantly on the course of history.”
Net interest income (NII) – the difference between what a lender earns on loans and pays on deposits – grew 3% to $23.5 billion.
The bank’s Wall Street operations were a bright spot as the prospect of monetary easing by the Fed spurred a rally in equities in the third quarter.
Investment banking revenue grew 29% to $2.4 billion. This is higher than the management’s guidance of 15% last month.
The lender set aside $3.11 billion as provisions for credit losses, compared with $1.38 billion a year earlier.
Profit was $12.90 billion for the three months ended Sept. 30, compared with $13.15 billion a year ago.
Shares rose about 1% to $214.79 in premarket trading.
First Published: Oct 11 2024 | 5:13 PM IST
