JPMorgan Surpasses Wall Street Forecasts Thanks To Rate Increases

The largest U.S. lender survived the March banking crisis because to rising interest income, which more than offset a decline in dealmaking. As a result, JPMorgan Chase & Co.’s first-quarter profit above Wall Street expectations.

The lender’s shares increased 6% as its performance demonstrated how big banks, with their diverse business portfolios and trillions of dollars in assets, fared better throughout the crisis than local banks.

The U.S. consumer and economy, according to Chief Executive Jamie Dimon, are still strong, but he issued a warning that the banking crisis may cause lenders to become more cautious and have an impact on consumer spending.

“The U.S. economy continues to be on generally healthy footings — consumers are still spending and have strong balance sheets, and businesses are in good shape,” Dimon said.

“However, the storm clouds that we have been monitoring for the past year remain on the horizon, and the banking industry turmoil adds to these risks.”

The second and third greatest bank failures in American history occurred last month when depositors withdrew their money from Silicon Valley Bank and Signature Bank.

JPMorgan increased loan loss provisions by 56% over the previous year to $2.3 billion. In the three months that ended on March 31, it reported a 52% increase in earnings to $12.62 billion, or $4.10 per share.

According to Refinitiv IBES data, the bank earned $4.32 per share after one-time expenses, exceeding analysts’ average projection of $3.41 per share.

“JPM is one of those household names in a sector that we were the most concerned about reporting better than expected earnings and that is certainly putting a bid in the stock and a bid in the market,” said Art Hogan, chief market strategist at B Riley Wealth in Boston.

Due to rising interest rates, the lender’s consumer and community banking division saw an 80% increase in revenue to $5.2 billion. Last month, the Federal Reserve increased interest rates by a quarter of a percentage point.

A measure of how much money the bank makes from lending, net interest income, increased 49% to $20.8 billion. The lender raised its NII forecast for this year from $74 billion to $81 billion, excluding market profits.

Its Wall Street investment banking division, though, continued to be a source of contention. The unit’s revenue decreased by 24% as a result of a weak market for mergers, acquisitions, and stock transactions. Revenue from equity trading fell 12%. Trading of fixed income generated no earnings.

The total revenue increased by 25% to $38.3 billion.

(Adapted from


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