JP Morgan barrels past third quarter forecasts helped by investment bank

The largest US bank by market value barrelled past analysts' earnings forecasts during the latest quarter on the back of hefty top-line growth in its investment banking and markets units that saw it achieve record revenues.

For the third quarter of 2019, JP Morgan Chase posted a 8.0% gain in managed net revenues to reach $30.1bn, for an 8.0% rise in net income to $9.08bn and a 35.0% jump in earnings per share to $2.68 (consensus: $2.46).

That was despite a 60% increase in credit loss provisions versus a year ago to reach $1.51bn.

JP Morgan boss, Jamie Dimon said: "We had record third quarter IB fees with particularly strong performance in [debt capital markets] and [equity capital markets], and year-to-date we maintained our #1 global ranking with share gains across products and regions.

"Markets performance was solid, reflecting improved client activity – particularly in Fixed Income. Commercial Banking turned in a solid performance with continued momentum in investment banking and treasury services. And in Asset & Wealth Management, both [assets under management] and client assets were a record helped by strong net inflows into long-term and liquidity products."

Non-interest expenses meanwhile were 5% higher at $16.42bn.

In Consumer &Community Banking, JP Morgan's most profitable unit, with a return on equity of 32%, average loans decreased by 4.0% with home lending loans falling by 12% on the heels of loan sales.

That unit's RoE was better than the 13% at JP Morgan's commercial and investment bank, 16% in commercial banking, and 24% in its wealth management unit.

The lender's total return on common equity improved from 14.0% to 15.0%.

Dimon said the US economy had slowed "slightly" and that the American consumer remained "healthy", offset by weaker capital spending mostly on the back of " increasingly complex geopolitical risks, including tensions in global trade".

Shares of JP Morgan were climbing 1.78% to $118.52 in pre-market trading as of 1225 BST.