The largest U.S. bank by assets said Tuesday that it earned $5.78 billion, or $1.54 a share, in the latest quarter, up from $5.57 billion, or $1.46 a share, a year earlier. Net revenue totalled $23.81 billion, down from $24.68 billion. Revenue at three of the four JPMorgan businesses fell or was flat. The only business where it grew was asset management.
But as revenues declined, JPMorgan was able to compensate by cutting expenses, reducing headcount, and through a $330 million gain as its corporate tax rate fell. Barclays' analysts said the tax benefit was the main driver behind the bank's ability to beat Wall Street expectations of $1.43 a share.
At JPMorgan's investment bank, net income rose 10 per cent as lower expenses offset revenue declines both in its trading and investment banking advisory business.
In consumer banking, net income edged up 1 per cent, helped by higher sales and loan growth in its auto and credit card division, as well as reduced expenses.
JPMorgan and other banks have been trimming their balance sheets and selling off businesses for several years. Headcount at the bank was 237,459, down 3 per cent from a year earlier. Legal expenses, which had been a major issue during the past few years, also declined.
JPMorgan is one of the first big U.S. banks to announce earnings, along with Wells Fargo, which reported results that matched analysts' estimates on Tuesday. Like JPMorgan, revenue at Wells Fargo was lower.
JPMorgan CEO Jamie Dimon said at the end of the company's earnings call that he may not participate in future calls, instead leaving the talking to Marianne Lake, the bank's chief financial officer.
"Marianne and (investor relations officer Sarah Youngwood) do such a good job that I've become unnecessary to be on all of them," he said.
Dimon said not to read anything into his statement, a reference to a health scare in recent years.
Shares of JPMorgan rose 95 cents to $69.04 on Tuesday. They are up 10 per cent for the year, more than the 6.2 per cent return of the KBW Bank Index, the stock index that closely tracks the banking and financial services sector.