JPMorgan Earnings Up 10% on Lower Costs, Legal Expenses

JPMorgan Chase & Co, the biggest US bank by assets, reported a better-than-expected quarterly profit for the last quarter of the year as it kept a tight lid on expenses and legal costs dropped sharply. Last year, the bank earned $4.93 billion, or $1.19 a share, during that same time period.

JPMorgan Chase kicked off bank earnings season with fourth-quarter results that beat dampened expectations amid continued cost cutting and strong growth in investment banking.

Net revenue at the bank totalled $22.89 billion, compared with $22.75 billion in the same period a year earlier.

Full-year profits were $24.4 billion, up 12.4 percent from 2014.

The stock is now up $1.16 to $58.50 on 19K shares. Noninterest expense was $14.3 billion, down 7%, driven by lower Corporate & Investment Banking expense, reflecting lower legal expense and lower compensation, as well as Consumer & Community Banking efficiencies. The businesses generated strong loan growth and credit quality, except for some stress in energy.

Fixed-income trading revenue edged down 3% to $2.57 billion, and equity trading declined 7% to $1.06 billion.

CEO Jamie Dimon said markets were “somewhat quieter” in the fourth-quarter, but hinted at signs of trouble ahead due to falling oil prices. (NYSE:JPM) by 9.2% during the fourth quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). Includes $417 million of after-tax firm-wide legal expense and $318 million of after-tax benefit related to a legal settlement. A year later, JPMorgan has trimmed that requirement to 10.5 percent, in part by purging about $200 billion of deposits and shrinking its trading book. The company returned $2.6 billion to shareholders in the quarter. JP Morgan’s consumer banking business reported a 10% rise in profit to $2.41bn.

Despite a challenging trading environment in the final stretch of 2015, JPMorgan Chase & Co. On average, equities analysts expect that JPMorgan Chase & Co. will post $5.88 EPS for the current fiscal year.

JPMorgan Chase & Co. has a 52-week low of $50.07 and a 52-week high of $70.61. The company presently has a consensus rating of “Buy” and a consensus target price of $71.65.

Gains in revenue from credit card and auto loans lifted the performance in JPMorgan’s consumer banking business, although mortgage banking returns were weaker than in the year-ago period.