JPMorgan Chase Profit Beats Estimates On Investment Banking Boost

JPMorgan Chase (JPM) posted profit that exceeded analysts’ expectations on better-than-expected credit losses and as loan growth accelerated.

The largest U.S. lender, whose results are often seen as a barometer of the health of the American economy, posted a profit of $10.4 billion U.S., or $3.33 U.S. per share, in the fourth quarter ended December 31, compared with $12.1 billion U.S., or $3.79 U.S. per share, a year earlier.

Analysts on average had expected earnings of $3.01 U.S. per share, according to Refinitiv data.

A trading shortfall at JPMorgan was cushioned by another strong quarter for its investment bank as global mergers and acquisitions activity shattered all-time records in 2021.

Wall Street banking remained strong for most of the past year, as large, cash-flush companies embarked on a dealmaking spree, helping drive up investment banking fees to their highest level on record.

Large U.S. banks have benefited from higher consumer spending, while their trading arms gained from exceptional volatility in financial markets last year. However, soaring inflation and a potential Omicron-induced economic slowdown are set to challenge profit growth in the coming months.

Other large U.S. banks including Citigroup (C) and Wells Fargo (WFC) also report results today (January 14). Goldman Sachs (GS), Wall Street's premier investment bank, reports Q4 earnings on January 18, while Morgan Stanley (MS) and Bank of America (BAC) round out the big bank earnings season on January 19.