NEW YORK (Reuters) - JPMorgan Chase & Co posted higher first-quarter profit on Friday as it spent less money on litigation, but most of its major businesses turned in tepid performances, and the bank's overall revenue declined.
The results reflected the pressure the largest U.S. bank is under even as it recovers from the disastrous "London Whale" trading losses that cost more than $6 billion (3.9 billion pounds) last year. JPMorgan's shares fell 1 percent to $48.80 in premarket trading. Profit in its consumer banking segment fell 12 percent to $2.6 billion, and ignoring accounting adjustments, its corporate and investment banking profit dropped 2 percent to $2.5 billion. Profit rose in commercial banking and asset management, but the growth was too small to have had much impact on overall results. Chief Executive Jamie Dimon said in a statement that loan growth was soft across the industry in the first quarter compared with the fourth quarter, noting that small businesses remained cautious and were not investing their capital. JPMorgan's corporate and private equity unit, which housed the group that posted the London Whale trading losses, had a profit of $250 million in the first quarter of 2013, compared with a $1.02 billion loss in the same period a year earlier. The bank also enjoyed a big benefit from declining litigation expenses, which were close to nil in the first quarter of 2013 versus about $2.5 billion in last year's first quarter. With that change, net income for the overall bank rose to $6.53 billion, or $1.59 a share, from $4.92 billion, or $1.19 a share, a year earlier. Total revenue fell 3.6 percent to $25.12 billion. Year-ago results were reduced by 12 cents a share due to losses from the London Whale credit derivatives trades. Results for both periods included other special items. Income in mortgage banking, which helped boost profits last year, fell in the first quarter to $673 million, from about $980 million last year. Profit margins from lending have been shrinking across the industry. |
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