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JPMorgan Q3 Earnings Increase 22 Percent Year-Over-Year

money-fiveJPMorgan Chase, one of the nations largest lenders, announced that their 2015 third quarter net income reached $6.8 billion, or $1.68 a share, up 22 percent year-over-year, according to the bank's earnings statement released Tuesday.

According to the company, net revenue fell 6.4 percent year-over-year to $23.5 billion, driven by lower CIB markets revenue including business simplification and lower mortgage banking revenue.

As lower investment securities balances and lower trading net interest income were mostly offset by loan growth, net interest income declined 1 percent from last year to $11.2 billion and was up 2 percent from last quarter, driven by higher loan yields and balances.

Jamie Dimon, chairman and CEO at JPMorgan noted that the company 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," he said. "Overall, our risk management discipline and diversified platforms across the businesses are serving us well.”

The statement showed that noninterest expense was driven down 3 percent to $15.4 billion in the third quarter by lower CIB expense related to compensation and business simplification, but slightly offset by higher legal expenses.

JPMorgan's credit losses declined 10 percent to $682 million due to lower net charge-offs, which were largely offset by lower reserve releases.

The bank was also credited $2.2 billion after tax audits were resolved and deferred taxes were released.

“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.”

Mortgage banking net income with the company rose 29 percent year-over-year to $602 million, while net revenue fell 23 percent to $1.6 billion due to lower net servicing revenue and no non-recurring gain last year.

Noninterest expense was $1.1 billion for the third quarter, declining 13 percent due to mortgage efficiencies, the statement said.

Credit losses provisions were $534 million, a huge leap compared to a benefit of $19 million last year. JPMorgan explains that this was driven by a larger reduction in the allowance for loan losses reflecting improvement in home prices and delinquencies.

The third quarter provision reflected an allowance reduction of $575 million, of which $375 million was related to the purchased credit-impaired portfolio and $200 million was related to the non credit-impaired portfolio.

“Our position of strength allows us to make significant investments to transform the businesses we operate, deliver better experiences to our customers and clients, gain share and be positioned to be a long-term winner,"Dimon concluded.

Click here to view the earnings statement.

About Author: Xhevrije West

Xhevrije West is a talented writer and editor based in Dallas, Texas. She has worked for a number of publications including The Syracuse New Times, Dallas Flow Magazine, and Bellwethr Magazine. She completed her Bachelors at Alcorn State University and went on to complete her Masters at Syracuse University.
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