April 13, 2012 07:09 AM Eastern Daylight Time
JPMorgan Chase Reports First-Quarter 2012 Net Income of $5.4 Billion, or $1.31 Per Share
REVENUE1 OF $27.4 BILLION, UP 24% OVER PRIOR QUARTER, UP 6% OVER PRIOR YEAR
SUPPORTED CONSUMERS, BUSINESSES AND COMMUNITIES
- Solid performance across most businesses, with particular strength in Investment Bank and improvement in Mortgage Banking
- Investment Bank reported strong performance driven by continued leadership and improved market conditions; maintained #1 ranking for Global Investment Banking Fees year-to-date
- Consumer & Business Banking average deposits up 8% and Business Banking loan originations up 8% compared with prior year
- Mortgage Banking application volume up 33% compared with prior year
- Credit card sales volume2 up 12% compared with prior year
- Commercial Banking reported seventh consecutive quarter of loan growth, up 16% compared with prior year
- Treasury & Securities Services reported record assets under custody of $17.9 trillion, up 8% compared with prior year
- Asset Management reported record assets under supervision of $2.0 trillion, up 6% compared with prior year
- Fortress balance sheet strengthened: Basel I Tier 1 common1 of $128 billion, or 10.4%; estimated Basel III Tier 1 common1of 8.4%
- Increased quarterly common stock dividend to $0.30 per share; authorized new $15 billion common equity repurchase program, of which up to $12 billion of repurchases is approved for 2012
- First-quarter results included the following significant items:
- $1.8 billion pretax benefit ($0.28 per share after-tax increase in earnings) from reduced loan loss reserves, related to mortgage and credit card
- $1.1 billion pretax benefit ($0.17 per share after-tax increase in earnings) from the Washington Mutual bankruptcy settlement, in Corporate
- $2.5 billion pretax expense ($0.39 per share after-tax reduction in earnings) for additional litigation reserves, predominantly for mortgage-related matters, in Corporate
- $0.9 billion pretax loss ($0.14 per share after-tax reduction in earnings) from debit valuation adjustments (“DVA”) in the Investment Bank, resulting from tightening of the Firm’s credit spreads3
- JPMorgan Chase Supported Consumers, Businesses and Our Communities
- Provided $62 billion of credit2 to consumers in the first quarter-- Issued new credit cards to 1.7 million people-- Originated over 200,000 mortgages
- Provided over $4 billion of credit to U.S. small businesses, up 35% compared with prior year
- Provided $118 billion of credit2 to corporations in the first quarter
- Raised $250 billion of capital for clients in the first quarter
- Nearly $13 billion of capital raised for and credit2 provided to 780 nonprofit and government entities in the first quarter, including states, municipalities, hospitals and universities
- Hired more than 3,400 U.S. veterans since the beginning of 2011
------------------------------------------------- - Provided $62 billion of credit2 to consumers in the first quarter
1 For notes on non-GAAP measures, including managed basis reporting, see page 13.
2 For notes on financial measures, see pages 13 and 14.
3 Whether positive or negative, the Firm does not consider DVA reflective of the underlying operations of the company.
NEW YORK--()--JPMorgan Chase & Co. (NYSE: JPM) today reported first-quarter 2012 net income of $5.4 billion, compared with net income of $5.6 billion in the first quarter of 2011. Earnings per share were $1.31, compared with $1.28 in the first quarter of 2011.
“We strengthened our fortress balance sheet, ending the first quarter with a strong Basel I Tier 1 common ratio of 10.4%. We estimate that our Basel III Tier 1 common ratio was approximately 8.4% at the end of the first quarter.”
Jamie Dimon, Chairman and Chief Executive Officer, commented on financial results: “The Firm reported strong revenue1 for the first quarter of 2012 of $27.4 billion, up 24% compared with the prior quarter and up 6% compared with prior year. While several significant items affected our results, overall, the Firm's performance in the first quarter was solid. The Firm’s return on tangible common equity1 for the first quarter of 2012 was 16%, compared with 11% in the prior quarter and 18% in the prior year.”
Dimon continued: "We are pleased that our results for the quarter reflected positive credit trends for our consumer real estate and credit card portfolios. Estimated losses declined for these portfolios, and we reduced the related loan loss reserves by a total of $1.8 billion in the first quarter. However, with respect to our Mortgage Banking business, we expect to see elevated levels of costs and losses associated with mortgage-related issues for a while longer. Credit trends across our wholesale portfolios were stable and continued to be strong."
Commenting on the balance sheet, Dimon said: “We strengthened our fortress balance sheet, ending the first quarter with a strong Basel I Tier 1 common ratio of 10.4%. We estimate that our Basel III Tier 1 common ratio was approximately 8.4% at the end of the first quarter.”
“Our strong balance sheet and earnings power allowed the Board to increase our annual dividend to $1.20 per share and authorize a new $15 billion equity repurchase program. The Company will constantly evaluate its best and highest use of capital. We will repurchase equity as deemed appropriate relative to our organic growth, investment opportunities, capital retention needs, and the stock price."
Dimon added: “JPMorgan Chase positively impacts the lives of millions of people and the communities in which they live. We are serving them each day, putting our resources and our voices to work on their behalf. During the first quarter of 2012, the Firm provided credit2and raised capital of over $445 billion for our commercial and consumer clients. We provided more than $4 billion of credit to U.S. small businesses, up 35% compared with the prior year. We originated more than 200,000 mortgages in the first quarter. To help struggling homeowners, we have offered more than 1.3 million mortgage modifications since 2009, and completed more than 490,000.”
Dimon concluded: “As we look toward the future, we continue to build our businesses by investing in infrastructure, systems, technology, and new products, and by adding bankers and offices around the world. The strengths that are embedded in this company — our people, client relationships, product capabilities, technology, global presence and fortress balance sheet — provide us with a foundation that is rock solid and an ability to thrive regardless of what the future brings.”