Jul. 15, 2014, 8:46 AM
- The trading environment for H2 will probably look a lot like H1, says JPMorgan (NYSE:JPM) CFO Marianne Lake, perhaps sandbagging to set up the bank to blow past estimates again in Q3.
- The conference call is now underway and can be heard here.
- Q2 earnings presentation is here.
- Dimon: I feel great. I'm getting the best treatment from the best doctors in the world. The prognosis remains excellent. His preference is stay on as CEO for 3-7 more years, but the board is preparing for succession. He touts JPMorgan's deep bench and says any of the current team could run a major financial company.
- More from Lake: Speaking on the earnings call, she says the momentum in business banking - originations rose 46% Y/Y and 27% Q/Q in Q2 - has continued into Q3.
- Previously: JPMorgan +1.8% after blowing past estimates
- JPM +2.5% premarket
Jul. 15, 2014, 7:17 AM
- Q2 earnings of $6B or $1.46 per share includes $500M or $0.13 per share in after-tax legal expense. Estimates were for earnings of $1.31 per share. About $3B returned to shareholders - $1.5B stock buyback and $0.40 dividend.
- Consumer & Community Banking net income of $2.4B fallsl 21% Y/Y, with net revenue of $11.4B off 5%. Net interest income of $7B falls 2%. Noninterest revenue of $4.5B down 9% thanks to mortgage slowdown (originations fell 66% from a year ago). Credit loss provision of $852M compared with a benefit of $19M a year ago. Noninterest expense of $6.5B falls 6% driven by job cuts in mortgages.
- Corporate & Investment Bank net income of $2B fallsl 25% Y/Y on revenue of $9B, off 6% (excluding impact of DVA). Banking revenue of $3.1B off 2%, with higher advisory fees and equity underwriting fees offset by lower debt underwriting fees. Markets & Investor Services revenue of $5.9B falls 12%, with fixed income revenue of $3.5B off 15%.
- Conference call at 8:30 ET
- Previously: JPMorgan Chase beats by $0.30, beats on revenue
- JPM +1.8% premarket
Jul. 15, 2014, 7:04 AM
Jul. 14, 2014, 5:30 PM
Apr. 11, 2014, 9:19 AM
- "It feels good to have a quarter with such a small number and have put such large issues behind us," says JPMorgan (JPM) CFO Marianne Lake on the earnings call, talking about the bank's legal expenses. Quickly added: "I want to remind you that we still expect legal expenses to be lumpy quarter over quarter for the next couple of years as we work through remaining issues.”
- Presentation slides
- On the currently "challenging" banking environment, Lake notes the bank's pipeline is at its strongest level since 2012 and utilization rates have stabilized. "We are cautiously optimistic that improved lending trends will continue in 2014."
- Noting lame growth in commercial and industrial loans, ISI's Glenn Schorr wants to know why, given far stronger action across the industry. Lake: We're very disciplined on credit, so we're not chasing growth "at the cost of liberal credit structures or overly aggressive pricing and also the fact that we continue to see some of our loans refinanced away from us."
- The bank's weak quarter was inline with Nomura's Steve Chubak's estimates, and he says consensus remains too high for 2014 overall. Look for cuts and downgrades from the rest of the Street.
- Shares -3.6% premarket
- Previous earnings coverage
Apr. 11, 2014, 7:18 AM
- Not too much of surprise to anyone paying attention in recent weeks - JPMorgan (JPM) misses badly on both lines and leads off its Q1 results press release with "given industry-wide headwinds in Markets and Mortgage."
- Consumer & Community Banking revenue of $10.5B fell 10% from a year ago, with net income of $1.9B off 25%. Net interest income of $7B fell 3%. Noninterest revenue of $3.4B fell 22% as mortgage business continues to evaporate (off 68% from a year ago). Credit loss provisions rose to $816M from $549M a year ago. Noninterest expense of $6.4B fell 5% from last year as jobs were cut in mortgage banking.
- Corporate & Investment Bank net income of $2B fell 24% from a year ago on revenue of $8.6B off 15% (DVA alters the numbers a bit, but not materially). Fixed income markets revenue of $3.8B fell 21% from last year.
- Commercial Banking net income of $578M fell 3% from a year ago on revenue of $1.7B off 1%.
- Dividend this quarter is going to $0.40 per share from $0.38. $400M of stock bought back in Q1; authorization of $6.5B through Q1 of 2015.
- ROTCE of 13%; Basel III Tier 1 common ratio of 9.5%.
- CC at 8:30 ET
- Q1 results
- Shares -2.4% premarket
Apr. 11, 2014, 7:03 AM
Apr. 11, 2014, 12:05 AM
Apr. 10, 2014, 5:30 PM
Jan. 14, 2014, 9:03 AM
- "It is a tough rule," says JPMorgan (JPM) CFO Marianne Lake, speaking about the Volcker rule on the earnings call. "The regulators have laid out stringent standards," but they're not expected to have a material impact on the bank's results.
- Poor mortgage banking results aren't expected to turn soon as management guides for another decline in production in Q1.
- First there was the DVA, now there's the FVA. The bank in Q4 implemented a Funding Valuation Adjustment for its OTC derivatives and structured notes, "reflecting an industry migration towards incorporating the cost or benefit of unsecured funding into valuations." It resulted in a $1.5B charge in Q4 (against total net income of $5.3B, or $1.30 per share).
- Among the quarter's bright spots is asset management: Net inflows of $23B for the Q brought AUM to $1,598T, up 12% Y/Y. Net income for the unit of $568M is up 17.6% from a year ago.
- From the pre-call call with reporters: Asked if he's considered resigning or been pressured to do so, Jamie Dimon responds, "No, no, it's all up to the board" ... "Which you chair," responded the reporter.
- Presentation slides
- Earlier JPM earnings coverage
- Shares +0.6% premarket
Jan. 14, 2014, 7:19 AM
- Excluding a number of extraordinary charges and gains, Q4 EPS was $1.40 vs. the headline $1.30, consensus $1.33, and $1.35 a year ago. Among those items is a $1.1B or $0.27 per share charge for legal expenses, including the most recent settlement for the Madoff case. Revenue of $24.1B was off 1% from a year ago.
- Consumer & Community Banking net income of $2.4B up 19% Y/Y on revenue of $11.3B, off 8%. Net interest income of $7.1B is off 3% on continuing spread compression. Noninterest revenue of $4.3B is off 17% thanks to slow mortgage business (originations of $23.3B fell 54% from last year). Boosting the unit, though, is the provision for credit losses - just $72M vs. $1.1B a year ago. Noninterest expense of $7.3B off 8% Y/Y thanks to lower mortgage servicing costs.
- Corporate & Investment Bank net income of $858M off 57% Y/Y or revenue of $6B off 21% thanks to an accounting change and the DVA. Banking revenue of $3B is off 4%. Investment banking fees of $1.7B off 3% - led by lower fixed income underwriting fees of $801M off 19%.
- CC at 8:30 ET
- Press release
- JPM -0.8% premarket
Jan. 14, 2014, 7:00 AM
Jan. 14, 2014, 12:05 AM
Jan. 13, 2014, 5:30 PM
Oct. 11, 2013, 8:58 AM
- Even as recently as a few weeks ago, JPMorgan (JPM) had no clue litigation expenses would have escalated to where they are now," says CFO Marianne Lake on the earnings call (webcast) (presentation slides) (earnings supplement). For the first time, the bank disclosed the size of its litigation reserve (otherwise known as a big fat target for lawyers), and it's $23B as of the end of Q3.
- Evercore's Andrew Marquardt calculates core earnings to be $1.55 (vs. $1.42 reported by the bank), which beat his estimate of $1.40. He notes investment banking fees gained 6% Y/Y, while FICC (trading revenue) fell an expected 8%. Yes, there's those litigation costs, but they appear closer to the end than the beginning.
- Shares +1.2% premarket.
- Earlier: Q3 results.
Oct. 11, 2013, 7:21 AM
- EPS of $1.42 excludes litigation expense and reserves of $7.2B (vs. less than $1B a year ago), or $1.85 per share and also excludes the benefit of reserve releases of $992M, or $0.26 per share.
- Dimon: "The Board continues to seek a fair and reasonable settlement with the government on mortgage-related issues and one that recognizes the extraordinary circumstances of the Bear Stearns and WAMU transactions, which were undertaken at the request or encouragement of the U.S. Government."
- Consumer & Community Banking revenue of $11.1B is off 13% Y/Y. Tipped weakness on mortgage banking doesn't disappoint, with noninterest revenue off 27%. Total mortgage originations fell 17% from Q2, but that's all refi business as purchase originations rose 15%.
- Investment banking revenue of $8.2B is off 2% Y/Y, but includes a $397M DVA charge.
- Commercial banking revenue of $1.7B is off 7% Y/Y.
- Basel Tier 1 common ratio of 10.5%
- CC at 8:30 ET.
- Q3 results, press release.
- JPM +1.4% premarket.
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