JPMorgan Chase (JPM) Earnings 4th Quarter 2022

Jamie Dimon, Chairman and Chief Executive Officer of JPMorgan Chase & Co., speaks during the annual membership meeting of the Institute of International Finance (IIF) in Washington, DC, on Thursday, October 14. 13th, 2022.

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JPMorgan Chase on Friday released fourth-quarter earnings and revenue that beat expectations as the bank’s interest income rose 48% on higher interest rates and loan growth.

Here’s what the company reports:

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Here's what bank stock investors need to know ahead of fourth-quarter earnings

  • Earnings of $3.57 per share, which exceeds estimate of $3.07 after excluding non-recurring items, according to Refinitiv.
  • Revenue of $35.57 billion vs estimate of $34.3 trillion

The New York-based bank said earnings were up 6% from the year-ago period to $11.01 billion, or $3.57 per share. Revenue rose 17% to $35.57 billion, driven by the increase in net interest income to $20.3 billion, beating StreetAccount’s estimate by $1 billion as the bank saw an increase in average Loans rose 6%.

But the bank reported a provision for loan losses of $2.3 billion in the quarter, up 49% from the third quarter, which topped StreetAccount’s estimate of $1.96 billion as it raised money set aside for expected failures. The company’s shares fell slightly in morning trade.

The move was spurred by a “slight deterioration in the company’s macroeconomic outlook, now reflecting a mild recession in the central case,” as well as credit growth from customers using its Chase credit cards, the bank said.

The recession, in which US unemployment could hit 4.9%, is expected to hit in the fourth quarter of this year by JPMorgan economists, CFO Jeremy Barnum said in a media briefing on Friday.

The company’s leap in credit delivery surpassed that of competing giants Bank of America Spirit Wells Fargoeach of which recorded smaller increases in the quarter.

While JPMorgan CEO Jamie Dimon said on Friday that the US economy “remains strong for now” thanks to well-funded consumers and businesses, he pointed to a number of risks to that outlook.

“We still do not know the ultimate impact of the headwinds stemming from geopolitical tensions, including the war in Ukraine, the fragile state of energy and food supplies, persistent inflation that has eroded purchasing power and pushed up interest rates , and the unprecedented quantitative tightening,” Dimon said.

Quantitative tightening refers to central banks’ moves to shrink their balance sheets by halting or reversing previous bond-buying programs.

JPMorgan, the largest US bank by assets, is being closely watched for clues as to how the industry is steering an economy at a crossroads.

Analysts expected a mixed bag of conflicting trends from the banks. Higher rates are helping lenders collect more interest income, but some of that increase has been offset by higher provisions for expected credit losses as the economy slows.

Dimon rocked markets last year when he said a Federal Reserve-sponsored economic “hurricane” was headed for the United States

JPMorgan shares are up 4% this year compared to the 6% rise in the KBW Bank Index.

The other major retail banks, including Bank of America, Wells Fargo and Citigroupalso released results Friday while Goldman Sachs Spirit MorganStanley Report Tuesday.

This story evolves. Please check again for updates.

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