JP Morgan profits soar
J.P. Morgan Chase & Co.’s fourth-quarter earnings quadrupled as the banking giant showed it was coming out of the financial crisis strongly.
For the quarter to 31 December the bank posted a profit of $3.28bn (£2bn) up from $702m in the equivalent period in 2008.
Staff at the bank’s 25,000-strong investment banking division – 5,000 of them based in London – can now expect to see bonus increases in excess of 30 per cent.
Average payouts of $463,000 are anticipated from an estimated pay and bonus pot of $29bn.
The company will pay an estimated £300m to the UK government under its new bonus tax.
An improvement in equity and debt markets has helped fuel the bank’s recovery following the collapse of the mortgage market.
Jamie Dimon, the bank’s chief executive, said that he remained “cautious” as many Americans still faced a tough economic outlook.
He added: “Though these results showed improvement, we acknowledge that they fell short of both an adequate return on capital and the firm’s earnings potential.”
JP Morgan received a $25bn injection of funds from the US government’s bailout, known as the Troubled Asset Relief Programme (Tarp), but repaid it all in June.
It has fared the best out of the US banks during the financial crisis, swallowing up rivals Bear Stearns and Washington Mutual in 2008 and never posting a quarterly loss.
It is the first of the major banks to report its fourth-quarter results. Citigroup reports on Tuesday and Bank of America Wednesday.