The Banking and Strategy Initiative

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Bank Results Season: JP Morgan squeals up the pitch

The current JPMorgan logo used for company's I...

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wait a minute..This is the early release

JPMorgan Chase Reports First-Quarter 2011 Net Income of $5.6 Billion, or $1.28 per Share, on Revenue1 of $25.8 Billion

  • Retail Financial Services demonstrated good underlying performance; results offset by elevated credit costs and other mortgage-related costs
  • Fortress balance sheet strengthened: Basel I Tier 1 Common1 of $120 billion, or 10.0%; estimated Basel III Tier 1 Common1 of 7.3%; credit reserves at $30.4 billion, coverage ratio at 4.10% of total loans1
  • Increased quarterly common stock dividend to $0.25 per share; authorized new $15 billion multi-year common stock repurchase program, of which up to $8.0 billion of common stock repurchases is approved for 2011
  • First-quarter results included the following significant items:
    • $2.0 billion pretax ($0.29 per share after-tax) benefit from reduced credit card loan loss reserves
    • $1.1 billion pretax ($0.16 per share after-tax) loss from mortgage servicing rights asset adjustment for increased costs
    • $650 million pretax ($0.10 per share after-tax) expense for estimated costs of foreclosure-related matters
  • Over $450 billion in new and renewed credit provided to and capital raised for consumers, corporations, small businesses, municipalities and not-for-profits in the first quarter of 2011

With a million modifications completed, the bank can probably talk more comfortably about retail financial services and get to closing ou tthe modifications at greater speed. However Investment Banking and fee based income seems to have come through with a year on year EPS Growth of more than 80%  to $1.28 which is a sizable almost double-digit growth on December 2010 $1.16 per share as well

The bank has also balanced out additional profits from loan reserves with loan and foreclosure/modification related costs of $1.75 billion. Tier I Common ratio is up to 10% and the company has also promised an annual dividend of $1 per share

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