JPMorgan boosts 2022 earnings forecast

JPMorgan Chase boosted its 2022 profit guidance on Monday, on expectations it will benefit from higher interest rates.

The Wall Street bank told investors that it expects net interest income, excluding corporate and investment bank lending, to come in at $56bn in 2022. That compares to its initial forecast for NII of $50bn, made in January, which was then increased to a "couple billion" more than $53bn.

The latest outlook is based on the assumption that the Federal Reserve will increase short term rates to 3% by the end of the year. Higher rates allow lenders to earn more on the loans they make.

JPMorgan, which made the comments at an investor conference, its first since 2020, also maintained its 17% medium-term target for return on tangible common equity, and said it could be met as soon as this year. ROTCE is a key measure of bank profitability.

Earlier this year, chief financial officer Jeremy Barnum said headwinds, including rising costs, could mean the bank would not achieve the 17% target for the next one to two years.

But chief executive Jamie Dimon told investors on Monday that there was now a "very good chance" of the bank meeting the target in 2022, and exceeding it in 2023 if there is a "benign" credit environment.

Forecast expenses for the current year were left unchanged, at around $77bn

As at 1330 BST, shares in JPMorgan were ahead 2% in pre-market trading.