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JPMorgan Q4 Profit Up 18%, Results Beat Estimates

JPMorgan Chase & Co. (JPM) reported a profit for the second quarter that increased 18 percent from last year, driven by broad growth and the strong underlying performance across its business segments. Both earnings per share and revenue for the quarter beat analysts' expectations.

In the Friday pre-market trade, JPM is trading at $107.85 up $0.99 or 0.93 percent.

Jamie Dimon, Chairman and CEO said, "We see good global economic growth, particularly in the U.S., where consumer and business sentiment is high. Because of this broad growth and the strong underlying performance across each of our businesses, the company delivered record results this quarter."

Dimon added, "The healthy U.S. consumer drove double digit growth in client investment assets, card sales and merchant processing volumes."

The company said Commercial Banking revenue grew 11%, with particular strength in investment banking and treasury services, as well as solid loan growth. Asset & Wealth Management business continued to perform well with positive net long-term and liquidity inflows and continued loan growth.

Net income for the second quarter grew 18 percent to $8.32 billion from last year's $7.03 billion, with earnings per share increasing to $2.29 from $1.82 in the prior year.

On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $2.22 per share for the quarter. Analysts' estimates typically exclude special items.

The provision for credit losses was $1.21 billion, down from $1.215 million in the prior year.

Total net revenue rose 8 percent to $27.75 billion from $25.58 billion in the prior-year quarter. On a Managed Basis, net revenue was $28.39 billion, up 6% from $26.67 billion in the previous year. Wall Street expected revenues of $27.36 billion for the quarter.

Net interest income was $13.6 billion, up 9%, driven by the impact of higher rates and loan growth, partially offset by lower Markets net interest income. Non-interest revenue was $14. 7 billion, up 4%, driven by higher Markets revenue, investment banking fees and auto lease income, partially offset by lower Card net interchange income.

Noninterest expense was $15.97 billion, up 8%, driven by higher compensation expense, investments in technology, auto lease depreciation, volume-related transaction costs, and a loss of $174 million on the liquidation of a legal entity.

Consumer & Business Banking net revenue was $6.1 billion, up 17%, predominantly driven by higher net interest income as a result of higher deposit margins and growth.

Markets & Investor Services revenue was $6.5 billion, up 12%, predominantly driven by 13% higher Markets revenue of $5.4 billion.

Additionally, the company announced new capital distribution plan, which includes a meaningful increase in dividends and repurchases. It distributed $6.6 billion distributed to shareholders in the second quarter, with $4.7 billion of net repurchases and common dividend of $0.56 per share.

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