U.S. largest bank JPMorgan Chase on Friday posted better-than-expected earnings in the second quarter, thanks to hefty gains from Visa shares, higher investment banking fees, asset management fees and net interest income.
JPMorgan Chase earned 18.15 billion U.S. dollars of net income in Q2, rising 35 percent from the previous quarter and up 25 percent from the same period of 2023, according to a release by the banking giant.
JPMorgan Chase had 4.26 U.S. dollars of adjusted earnings per share and 50.99 billion U.S. dollars of revenues in the last quarter, higher than analysts’ estimate of 4.19 U.S. dollars per share and 49.87 billion U.S. dollars, respectively.
Still, JPMorgan Chase would see shrinkage of net income in the quarter if the one-time income related to Visa shares is excluded.
JPMorgan Chase recorded a net gain of 7.9 billion U.S. dollars related to conversion of its holdings of Visa shares and 1 billion U.S. dollars of donation of Visa shares to pre-fund contributions to JPMorgan’s foundation in the second quarter.
Notably, JPMorgan Chase booked 22.9 billion of net interest income in Q2 up 4.5 percent year on year, as the Federal Reserve continues to refrain from lowering benchmark interest rates so as to tame inflation.
JPMorgan Chase registered 2.3 billion U.S. dollars of investment banking fees in Q2 surging 50 percent year on year.
“While market valuations and credit spreads seem to reflect a rather benign economic outlook, we continue to be vigilant about potential tail risks,” said Jamie Dimon, chairman and chief executive officer of JPMorgan Chase.
Dimon warned of the complex and dangerous geopolitical situation and the existence of multiple inflationary forces including large fiscal deficits, infrastructure needs, restructuring of trade and remilitarization of the world.
Inflation and interest rates may stay higher than the market expects and the full effects of quantitative tightening on this scale remains unknown, he added.
