JPMorgan Chase & Co. reported a significant increase in its profits (24 per cent year-on-year) for the third quarter driven by a lower bill for taxes and the increased rates of interest in the United States, thanks to the US Federal Reserve for raising interest rates three times this year itself, and which allowed the lender to charge more in interest from consumers and businesses alike for loans and advances.
The earning for the New York-based bank in the third quarter, as reported by it, was $8.38 billion which equates to $2.34 a share. The figures were more than what the bank had reported in the same period a year ago at $6.73 billion and $1.76 a share. According to FactSet, the third quarter results were much better than what the Wall Street was expecting and had anticipated with an expectation of earning of $2.26 a share.
“The U.S. and the global economy continue to show strength, despite increasing economic and geopolitical uncertainties, which at some point in the future may have negative effects on the economy,” Jamie Dimon, JPMorgan’s chief executive and chairman, said in a statement.
For the period under consideration, the bank reported a 6 per cent hike in its core loan portfolio and a 12 per cent rise in credit card sales volume.
The financial markets, that gad recently been going through a rough patch because of the trade war, the impending US sanctions on Iran and the turbulence in the emerging economies, had been eagerly awaiting the results from the large US banks such as JP Morgan and others. The US market just performed its worst in two days since February this year and therefore the corporate results have assumed high significance for investors.
The better than expected results saw JP Morgan’s shares rise by 1.3 per cent in pre-market trading. On the overall so far this year, the shares of the lender is up 1.1 per cent after it dropped by 6 per cent earlier in the week.
The slow but steady increase in interest rates undertaken by the US Fed over the last two years has been a big boon for most of the ;larger banks of the US including JPMorgan. In the third quarter, the bank noted a 9 per cent year-on-year increase in the net interest of the lender which is the money that the bank retains after collecting interest against loans advanced to clients and the paying out interest to depositors.
Banks generally make money from interest on the basis of the higher rates of interest that they charge from customers for loans and advances to customers and the lower rates of interest that they pay on deposits – after taking into account the expenses of maintaining the accounts.
The Republican-passed tax law also continues to benefits the banks. There has been a drop in the effective tax rate that JP Morgan paid in the third quarter at 21.6 per cent compared to the rate of 29.6 per cent in the same period a year earlier.
(Source:www.usatoday.com)
The earning for the New York-based bank in the third quarter, as reported by it, was $8.38 billion which equates to $2.34 a share. The figures were more than what the bank had reported in the same period a year ago at $6.73 billion and $1.76 a share. According to FactSet, the third quarter results were much better than what the Wall Street was expecting and had anticipated with an expectation of earning of $2.26 a share.
“The U.S. and the global economy continue to show strength, despite increasing economic and geopolitical uncertainties, which at some point in the future may have negative effects on the economy,” Jamie Dimon, JPMorgan’s chief executive and chairman, said in a statement.
For the period under consideration, the bank reported a 6 per cent hike in its core loan portfolio and a 12 per cent rise in credit card sales volume.
The financial markets, that gad recently been going through a rough patch because of the trade war, the impending US sanctions on Iran and the turbulence in the emerging economies, had been eagerly awaiting the results from the large US banks such as JP Morgan and others. The US market just performed its worst in two days since February this year and therefore the corporate results have assumed high significance for investors.
The better than expected results saw JP Morgan’s shares rise by 1.3 per cent in pre-market trading. On the overall so far this year, the shares of the lender is up 1.1 per cent after it dropped by 6 per cent earlier in the week.
The slow but steady increase in interest rates undertaken by the US Fed over the last two years has been a big boon for most of the ;larger banks of the US including JPMorgan. In the third quarter, the bank noted a 9 per cent year-on-year increase in the net interest of the lender which is the money that the bank retains after collecting interest against loans advanced to clients and the paying out interest to depositors.
Banks generally make money from interest on the basis of the higher rates of interest that they charge from customers for loans and advances to customers and the lower rates of interest that they pay on deposits – after taking into account the expenses of maintaining the accounts.
The Republican-passed tax law also continues to benefits the banks. There has been a drop in the effective tax rate that JP Morgan paid in the third quarter at 21.6 per cent compared to the rate of 29.6 per cent in the same period a year earlier.
(Source:www.usatoday.com)
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