JPMorgan's profits rise 18 percent, helped by lower taxes

Galtero Lara
Julio 13, 2018

JPMorgan Chase & Co.'s quarterly profit topped Wall Street's expectations on Friday, as trading revenue came in much higher than expected and demand for loans increased on the back of a strengthening USA economy.

USA banks are benefiting from a cut in corporate tax rates, hikes in interest rates and a growing economy that is driving demand from borrowers while holding down loan loss rates.

Shares of the largest USA bank by assets were up 1 per cent in premarket trading.

"We see good global economic growth, particularly in the USA, where consumer and business sentiment is high", said Jamie Dimon, JPMorgan's chairman and CEO, in a statement.

Total revenue was $28.39 billion, up from $26.67 billion a year earlier.

Like in the first quarter, JPMorgan benefited greatly from a much lower tax bill compared to a year earlier.

JPMorgan is the first of the big six Wall Street banks to report their quarterly results.

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Analysts and economists are watching loan demand at banks for signs of any impact from global trade tariffs on their business and expansion plans.

Earlier this week, Dimon was quoted in an Italian newspaper saying that U.S. business executives have warned U.S. President Donald Trump that the impact of trade tariffs on economic growth could offset the benefits of tax cuts.

Adjusted net income: $8.32 billion, a record high, up 18% from a year ago when results benefited from a legal settlement.

Net interest income rose 10 per cent as the U.S. Federal Reserve raised benchmark interest rates four times since the second quarter of 2017.

JPMorgan shares were up 1 percent in premarket trading to $107.70. The results from the New York-based bank beat analysts' expectations for earnings of $2.22 a share.

Corporate and investment banking: Net income was up 18% to $3.2 billion on revenue of $9.9 billion. Citigroup and Wells Fargo are reporting their results also on Friday, and next week Bank of America, Goldman Sachs and Morgan Stanley will report their results.

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