NEW YORK — The improving economy left its mark on JPMorgan Chase & Co.'s first-quarter earnings, as delinquencies continued to decline and the company had to set aside less money for bad loans.
The profit of the nation's second largest bank by market capitalization rose 55% from a year earlier, to $3.3 billion; the provision for credit losses for all loans JPMorgan manages shrunk 30%, to $7 billion, and helped results in several lines of business ranging from consumer to large corporate lending.
Chairman and Chief Executive Jamie Dimon said earnings "reflected another strong quarter for the investment bank," particularly in fixed-income and equity trading, "and continued solid performance" at the company's asset-management and commercial- and retail-banking operations.
"Unfortunately, these good results were partially offset by high losses in the consumer credit portfolios," he said in a press release.
Shares were up 3.1% to $47.30 premarket. As of Tuesday's close, the stock had risen 49% in the past year.
Profits at JPMorgan, the first major bank to report results, were lifted mainly by investment banking--the division's revenue rose 69% from the fourth quarter and earnings were up 30% from the previous quarter. Volatile revenue in retail banking and credit cards were also up slightly from the fourth quarter, though both businesses generated a loss.
Largely helped by its success in providing services to big companies, the bank managed to avoid posting a loss during the recession even as other major banks were pushed far into the red.
JPMorgan reported a profit of 74 cents a share, up 85% from a year earlier and flat from the fourth quarter. Analysts polled by Thomson Reuters had most recently forecast earnings of 64 cents on $26.46 billion in revenue.
Revenue on a managed basis, which excludes the impact of credit-card securitizations and is on a tax-equivalent basis, rose 5% to $28.17 billion.
Managed credit-loss provisions were down from $10.06 billion a year earlier and $8.9 billion in the previous quarter. The year-to-year drop was led by a reversal to a $462 million benefit for the investment-banking segment on repayments and loan sales, while the credit-card business had a 25% decline in provisions.
