JPMorgan Chase & Co. (JPM) – Get report It posted stronger-than-expected second-quarter earnings Tuesday, but said it would suspend its share buyback plans until at least the end of September and set aside more than $ 10 billion to absorb potential losses on bad loans.
JPMorgan said net income for the three months ending June was set at $ 4.7 billion, or $ 1.38 per share, 51% less than in the same period last year, but firmly ahead of the consensus forecast for Street of $ 1.04 per share. Group-managed revenue, JPMorgan said, rose 11.5% to $ 33 billion, again beating analyst estimates for a $ 30.3 billion account.
The bank said bad debt provisions for the second quarter totaled $ 10.5 billion, an increase of $ 9.3 billion from last year and more than the $ 8.3 billion recorded during the three months ending in March. Despite huge credit provisions, JPMorgan will continue to pay its quarterly dividend of 90 cents a share, the company said.
“Despite some recent positive macroeconomic data and significant and decisive government action, we still face a lot of uncertainty regarding the future path of the economy,” said CEO Jamie Dimon. “However, we are prepared for all eventualities as our balance of strength allows us to remain a port in the storm. We ended the quarter with enormous loss absorbing capacity: more than $ 34 billion in credit reserves and resources total liquidity of $ 1.5 trillion, plus $ 191 billion of CET1 capital, with significant earning power that would allow us to absorb even more credit reserves if necessary. ”
“That is why we can continue to serve all of our interest groups and pay our dividends, unless the economic situation deteriorates materially and significantly,” he added.
JPMorgan shares were marked 3.2% higher in pre-market trading immediately after the earnings release to indicate an opening bell price of $ 100.80 each, a move that still leaves stocks with an annual decline. of around 27.7%.
Capital markets trade revenue soared over the three months, as market volatility increased during the worst reaction to the horn virus crisis, with fixed income and commodity trading generating $ 9.7 billion in revenue, 80% more than last year, and stocks rose $ 2.4 billion in revenue.
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