JPMorgan Chase showed once again on Thursday that it can weather a downturn in fixed-income trading by generating growth elsewhere.

An increase in corporate loans, the highest lending margin in four and a half years and record profit in asset management helped the lender top analysts’ estimates.

JPMorgan’s third-quarter results, which kicked off the industry’s earnings season, show that while calm and rising markets have given clients little reason to trade, the firm’s core lending and advisory businesses performed well, aided by three Federal Reserve rate increases in the past year. Revenue at the commercial bank surged to a record, and the retail bank posted higher profit than the firm’s investment bank for the first time in more than a year.

Net income rose 7.1% to $6.73 billion, or $1.76 a share, from $6.29 billion, or $1.58 a year earlier. Adjusted earnings per share were $1.75, beating the $1.65 average estimate of 21 analysts surveyed by Bloomberg.

Total revenue rose 2.7% to $26.2 billion, topping the $25.6 billion estimate.

Net interest margin, the difference between what banks charge borrowers and pay depositors, climbed to 2.37%, according to a news release. Interest income rose 10% to $13.1 billion.

Trading revenue tumbled 21%, steeper than the 20% forecast last month by Chief Executive Officer Jamie Dimon. Revenue from fixed-income trading slumped 27%, in line with analysts’ predictions. Equity-trading revenue slid 3.6%, missing estimates.

The shares dropped 0.6% to $96.30 in early trading at 7:22 a.m. in New York.

Provisions for loan losses increased 20% to $1.45 billion from the second quarter, higher than the $1.34 billion analysts expected.

Financial stocks have soared since President Donald Trump’s surprise election last year, and were the best performers among 11 major S&P 500 industries through the end of the third quarter, fueled by optimism that higher rates and lower taxes would goose profits. JPMorgan helped pace the advance, surging 42% in that span.

Bloomberg News

Bloomberg News