BOTTOM LINE: JPMorgan, which is the largest U.S. bank by assets, earned $5.45 billion after payments to its preferred shareholders. That compares to a profit of $4.89 billion a year earlier. On a per-share basis, the bank earned $1.45, compared with $1.28 a year earlier. Net revenue at the bank was $24.1 billion, compared with $23.2 billion in the same period a year earlier.
TRADING BOON: Wall Street analysts have widely expected banks to report higher trading revenue this quarter, and JPMorgan met that expectation. Net revenue at the bank's corporate and investment bank rose 8 per cent to $9.58 billion, helped by volatility in currency and fixed income markets. Higher volatility typically means more commissions for banks because investors trade more. The bank's trading desks brought in revenue of $5.67 billion, up from $5.20 billion a year earlier.
The other parts of JPMorgan's investment bank also had a solid quarter. Investment banking fees reached $1.76 billion, up from $317 million a year earlier. Advisory fees, which companies pay to an investment bank to help with a merger or large transaction, were up 42 per cent year over year.
OIL WORRIES: JPMorgan's commercial bank had $61 million in credit losses last quarter, a substantial increase from the $5 million in losses a year earlier. Most of the losses, JPMorgan says, are tied to a portfolio of commercial loans to oil and gas companies.
JPMorgan Chief Financial Officer Marianne Lake said in a conference call with investors that the recent plunge in oil prices caused the bank to re-examine its loans energy companies and added $100 million to its loan-loss reserves. Lake said it is too early to tell if any of those loans will result in defaults or additional credit losses.
DOWNSIZING BANK BRANCHES: JPMorgan said had 32 fewer bank branches last quarter than three months earlier, and has cut headcount by 1,900 people since the start of the year. JPMorgan executives said earlier this year they were looking to close roughly 300 bank branches in 2015 as more customers turn to mobile banking and ATMs for everyday needs.
JPMorgan's total headcount was 135,908 people at the end of last quarter, down 7 per cent from a year earlier.
MORTGAGES: Chase lent out $24.7 billion in mortgages in the quarter, a jump from $17 billion the same period a year earlier. The rise in mortgage volume is notable since winter is typically a slow time for home buying. Most of the mortgage volume came as a result of people refinancing their mortgages, due to lower interest rates.
LEGAL: JPMorgan also had $687 million in pre-tax charges for legal expenses in the quarter.