12 July 2024
If you are covering JP Morgan’s latest financial results, please find below a comment from Will Howlett, financials analyst at Quilter Cheviot:
“JP Morgan delivered another strong set of results as it reiterates guidance for the full year. While previously we have seen the retail bank driving profits in light of the high interest rate environment, the baton has now been handed to the investment bank, with good activity in fees and trading from that division. Ultimately, JPM has leveraged its scale to great effect and taken advantage of the turmoil seen in the regional banks by picking up First Republic at a bargain price and strengthening its position in high net worth.
“Strong profitability again highlights JPM's diversified business model and market leadership across the bank (retail deposits, credit cards, business banking, payments, markets, investment banking etc) which leads to those economies of scale. CEO Jamie Dimon again struck a cautious tone highlighting 'the geopolitical situation remains complex and potentially the most dangerous since World War II', and inflationary pressures relating to fiscal deficits, infrastructure, restructuring of trade and remilitarization of the world are very present. But for now JPM continues to be a company that can operate in a number of conditions.
“While its net interest margin is down sequentially, its credit quality remains strong and it is building capital reserves further, reflecting the healthy profitability of the bank. The recovery in investment banking, and interest rates remaining elevated if slightly lower, should help sustain JPM’s strong performance going forward.”
