Chillin' out till it needs to be funded
Dimon’s machine had a big plus smile on its face minutes ago as Revenues and Earnings from the World’s #1 bank came in beating all expectations by more than 5% on sales and more than 12% on profits. The bank published Q1 earnings of $5.4 bln, more than ever before and not below 2011 Q1 numbers as expected. Buyback’s the grinch for the competition as the EPS drove up vertically to $1.31 from a 90 cents Q4 and a $1.25 Q1 a year ago. The street would have been happy with a $25 bln revenue but apparently trading got more than everyone bargained for. Expenses are also up by almost $4 bln as Revenues rise $5 bln
The bank reported increase in Mortgage applications of 33% by volume as Credit Card volumes and Deposits / Business banking grew by 12% and 8% each. Commercial Banking finally caught fire again with a 16% growth reproducing the rate experienced by growth centers of Asia in US alone.
Asset Management finally reported Assets under supervision to $2 T and Treasury and Securities Services for the custody business and not the Iskil kinds were up 8 to a massive $17.9 Tln
The profits were aided by release of loan loss reserves and claims from Wamu released after the settlement in Mortgage and Credit Cards to $1.8 bln and WaMu in Corporate to $1.1 bln. However Litigation reserves of $2.5 bln hit Corporate and wiped off almost the entire gain while DVA hit another $900 mln. Thus net of these items the Bank’s profits shoot up to a $6.7 bln implying an EPS of $1.62 before the $12 bln in repurchase slotted for 2012
The bank added another 1.7 mln credit card customers in Q1 the same it added in 12 months last year yet originated only 200k mortgages. the bank management steps into an analyst conference in an hour from now.
Munis and Non Profits issuance including hospitals and Universities amounted to a good $13 bln for the investment bank in Q1 which remains the only one to net more than $1.2 bln in Advisory income according to Deal market data from ThomsonReuters
SME credit was just $4 bln though IG and HY credit together counted $118 bln and the bank claims to add $250 bln in Capital in Q1 for clients
Return on Q1 TCE is a 16% up almost 50% from Q4 sequentially. Card delinquency rates improved to a charge off of 4.37% and 30+ to 2.55% even as net charge offs for the bank improved from 3.5% to 2.60%
Retail Financial Services & Cards
5541 branches with 366 Private Banking locations, branches up by 33 from Q4 and Private client Services up by 104 locations since December
Mortgage production up 80% from last year to $1.6 bln and Servcicing revenue of $1.2 bln on loan originations of $38.4 bln out of applications of $59.9 bln(up 14% from last quarter though originations are flat)
Consumer & Business (SME) Banking revenues were $4.3 bln including NII of $2.7 bln and netting a lower run off portfolio income in both Mortgages and Consumer. Deposit margin was down to 2.68% from 2.76% in Q4. Client investment Assets improved 6% to $147 bln and Deposits $380.8 bln