The 2nd largest US bank JPMorgan has announced that profits have risen for the first time since 2007. This has beat all estimates from analysts putting a smile back on investors faces.
Second quater earnings had increased to $2.7 billion, which is 28 cents per share. Compared to $2 billion, 53 cents per share a year earlier.
14 analysts who surveyed the company estimated an average price share of 5 cents a share a while back. Investment banking revenue from trading and stock and bond underwriting is helping offset rising defaults on consumer loans, such as mortgages and credit cards. This has allowed Jamie Dimon (CEO) to post net income during every quarter of the US recession that started back in 2007. JPMorgan is the only bank within the nations top five to manage that feat. Lets hope the others are soon to follow.
Charles Bobrinskoy who is vice chairman of Ariel Investments in Chicago said “This is a real tribute to Jamie Dimon” in a recent television interview.
JPMorgans 15 percent gain this year on the New York Stock Exchange is the 2nd best performance in the 24 company KBW Bank Index just behind State Street Corp. The stock climbed 4.5% to $36.26 in composite trading yesterday.
The bank has made $1.47 billion in profit which has quadrupled since last years 2nd quarters earnings. The boost in profit was from fees from underwriting stock and bond deals and fixed income trading.
Goldman Sachs Group Inc recently said on july 14 that it made $3.44 billion in the quarter from trading and underwriting stock. Revenue was up from $9.43 billion last year to $13.8 billion this year ending month June 26.
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