JPMorgan profit jumps on higher investment banking fees, accounting gain
2024.07.12 07:17
(Reuters) – JPMorgan Chase (NYSE:)’s profit rose in the second quarter, buoyed by rising investment banking fees and an $8 billion accounting gain from a share exchange deal with Visa (NYSE:).
Investment banks have benefited from a resurgence in capital-raising activity both in debt and equities markets.
Wall Street banks are also seeing an uptick in fee income from advising on M&A deals as companies become more confident on the U.S. economy’s ability to avoid a major downturn.
“While market valuations and credit spreads seem to reflect a rather benign economic outlook, we continue to be vigilant about potential tail risks,” CEO Jamie Dimon said adding that the risks included a changing geopolitical situation, which remains the most dangerous since World War II.
The largest U.S. bank’s profit was $18.15 billion, or $6.12 per share, for the three months ended June 30, compared with $14.47 billion, or $4.75 per share, a year earlier, it said on Friday.
The bank benefited from a plan to exchange some of its shares in Visa, the world’s largest payment network.
Investment banking fees grew 50%, compared with a low base, but was higher than an earlier company prediction of 25% to 30%.
JPMorgan also extended its gains from lending, with net interest income (NII) – the difference between what it earns on loans and pays out on deposits – growing 4% to $22.9 billion versus a year earlier.
Lending has remained healthy even as banks compete for deposits and face pressure to shell out more to depositors to store their money.
