Jamie Dimon, CEO of JP Morgan Chase, appears on CNBC’s Squawk Box at the 2020 World Economic Forum in Davos, Switzerland on January 22, 2020.
Adam Galica | CNBC
JPMorgan Chase surpassed analysts’ estimates for fourth-quarter earnings with better-than-expected commercial results and a boost with the release of money previously reserved for loan losses.
The company posted earnings of $ 3.79 per share, exceeding the estimate of $ 2.62 per share from analysts polled by Refinitiv. The bank would have exceeded estimates even without a 72-cent increase in earnings per share from credit reserve releases. The company generated $ 30.16 billion in revenue, exceeding the estimate of $ 28.7 billion.
“While vaccine developments and positive stimuli contributed to these reserve launches this quarter, our credit reserves of more than $ 30 billion continue to reflect significant short-term economic uncertainty and will allow us to withstand a much worse economic environment. than the current basic predictions of most economists, “said CEO Jamie Dimon in a statement.
A bright spot in 2020 for Wall Street was trade, which is set to be the best year since the financial crisis in terms of total revenue, thanks to the Federal Reserve’s unprecedented actions to sustain markets. Investment bankers also benefited, as open markets brought a growing demand for IPOs and a record wave of debt issuance.
Last month, CEO Jamie Dimon said he expected fourth quarter trading and investment bank revenues to be 20% higher than the previous year.
Analysts may ask Dimon about succession planning after a health scare last year. Although widely reported that Dimon underwent cardiac surgery last March, he only recently told the Wall Street Journal that his condition was so precarious that he thought he “might not survive”.
Analysts will also be curious about the pace of share buyback that the bank expects to do. JPMorgan announced a $ 30 billion share buyback program last month, after the Federal Reserve said the industry could restart buybacks in the first quarter.
JPMorgan’s shares fell 8.7% last year, compared to the 4.3% drop in the KBW Bank Index.
Here are the numbers:
- Earnings: $ 3.79 per share, versus $ 2.62 per share estimate, according to Refinitiv.
- Revenue: $ 30.16 billion, against $ 28.70 billion expected, according to Refinitiv.
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