JPMorgan Profit Drops 29% in Investment Banking
April 13, 2012
Net income in JPMorgan Chase’s investment banking business was down 29 percent in the first quarter, from a year ago. That drop came as overall income at the retail, commercial and investment banking firm was essentially flat.
Net income was $1.7 billion, down from $2.4 billion in the first quarter of 2011.
Revenue in investment banking was $7.3 billion down, from $8.2 billion.
The drops, the company said, were partically due to “a lower benefit from the provision for credit losses, partially offset by lower noninterest expense.’’
Investment banking fees were $1.4 billion, down 23%. Underwriting fees were $818 million, down 16%, equity underwriting fees of $276 million were down 27% and advisory fees of $281 million were down 34%.
Combined Fixed Income and Equity Markets revenues were $6.0 billion, down 10 percent.
Net revenue included a $907 million loss from a reassessment of values on structured and derivative products. This resulted from a tightening of credit spreads, it said.
The was composed of $352 million in Fixed Income Markets, $130 million in Equity Markets and $425 million in the firm’s Credit Portfolio. Excluding the impact of that assessment, net revenue was $8.2 billion and net income was $2.2 billion.
Overall, JPMorgan Chase reported first-quarter 2012 net income of $5.4 billion, compared with net income of $5.6 billion in the first quarter of 2011. Earnings per share were $1.31, compared with $1.28 in the first quarter of 2011.
Jamie Dimon, Chairman and Chief Executive Officer, commented on financial results: First quarter revenue was $27.4 billion, up 6 percent. “While several significant items affected our results, overall, the firm's performance in the first quarter was solid,’’ chairman and chief executive Jamie Dimon said.