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JP Morgan Q2 Earnings Fall Below Estimates, Halts Buybacks – $JPM $DIA

By John F. Heerdink, Jr.

Reportedly, JPMorgan Chase & Co’s (JPM) earnings fell short of analyst expectations as the bank built reserves for bad loans by $428 million, and suspended share buybacks.

Second-Quarter Highlights:

  • Earnings per share of $2.76 were reported versus $2.88 expected.
  • Managed revenue stood at $31.63 billion versus the $31.95 billion expected.
  • Profit declined 28% from a year earlier to $8.65 billion, or $2.76 a share.
  • Managed revenue edged up 1% to $31.63 billion, helped by higher interest rates, but was still below analysts’ expectations.
  • The bank had a $1.1 billion provision for credit losses in the quarter, including the $428 million reserve build and $657 million in net loan charge-offs for soured debt. 
  • Fixed income trading revenue climbed 15% to $4.71 billion, but was below analysts’ $5.14 billion estimates for the quarter.
  • Equities trading revenue also jumped 15%, to $3.08 billion, which edged out the $2.96 billion estimate.
  • Net interest income increased 19% to $15.2 billion for the quarter, exceeding analysts’ $14.98 billion estimates.

“But geopolitical tension, high inflation, waning consumer confidence, the uncertainty about how high rates have to go, and the never-before-seen quantitative tightening and their effects on global liquidity, combined with the war in Ukraine and its harmful effect on global energy and food prices are very likely to have negative consequences on the global economy sometime down the road,” warned Chairman and CEO, Jamie Dimon.

With the above outlook, JPMorgan has opted to “temporarily” suspended its share repurchases to help it reach regulatory capital requirements. Also, last month, the bank was forced to keep its dividend unchanged while rivals boosted their payouts.

JPMorgan Chase & Co (JPM) is a global financial service leader in investment banking, financial services for consumers and businesses, financial transaction processing, asset management, and commercial banking. To learn more about JPMorgan Chase & Co. (JPM) and to continue to track its progress please visit the Vista Partners JPMorgan Chase & Co. Coverage Page.

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(Read Original Story: JPMorgan Chase earnings fell 28% after building reserves for bad loans, bank suspends buybacks in CNBC)


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