JPMorgan Chase & Co. (NYSE:JPM) reported its earnings for Q3 2015, which were highlighted by a staunch rise in profits – unfortunately the performance was underpinned by missed consensus expectations and declining revenues, according to a regulatory filing.
US markets were largely awaiting the first wave of banking earnings, led in part by JPMorgan (NYSE:JPM). Proponents of an autumn resurgence in share prices may have to wait a little longer however, as an uptick in profits at the lender was unable to allay weaknesses in revenues during Q3 2015. The performance was also devoid of the same concerns witnessed last quarter, in which foreign exchange (FX) costs helped erode would-be profits across several leading banks. The quarterly figures are also thankfully devoid of any large-scale fines levied against JPMorgan, given previous infractions and financial penalties against worldwide banks this year.
JPMorgan saw a sizable jump in its profits, with a net income of $6.8 billion ($6.3 billion after payments) in Q3 2015, largely fueled by a $2.2 billion tax benefit. This compares to a jump of 22.2% YoY from $5.13 billion in Q3 2014. Furthermore, on a per-share basis, JPMorgan earned $1.68 per share in Q3 2015, up 24.4% YoY from $1.35 per share in Q3 2014 – consensus estimates pinned earnings at $1.37 per share this quarter.
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However, the group’s core business saw declining revenues in Q3 2015. The largest US bank reported $22.8 billion this quarter, which constitutes a decline -6.9% YoY from $24.5 billion in Q3 2014. Much of the lender’s business also reported convoluted results, such as its consumer banking division, its largest business in terms of revenue and net income. More specifically, this entailed a 4.0% rise in profit during Q3 2015 and loss of revenues to the tune of -4.0% YoY – this decline in revenue exacerbated by a lower mortgage income.
According to Jamie Dimon, Chairman and CEO, in a recent statement on the financial earnings in Q3 2015, “We had decent results this quarter. We saw the impact of a challenging global environment and continued low rates reflected in the wholesale businesses’ results, while the consumer businesses benefited from favorable trends and credit quality. Overall, our risk management discipline and diversified platforms across the businesses are serving us well.”
“We continue to focus on our commitments, optimize our balance sheet and manage our expenses. We are also building the businesses for the future, dedicating resources to controls, cybersecurity and technology,” added Mr. Dimon.
At the time of writing, JPMorgan’s share prices (NYSE:JPM) are trading at $60.22 during US trading Wednesday, down -2.16% on the missed earnings.