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JPMorgan reports net income of $5.38bn

The annual dividend increased to $1.20 per share.

The financial services provider JPMorgan Chase & Co has reported a net income of $5.38bn for the first quarter ended 31 March 2012, a decrease of 3 per cent compared to $5.55bn for the same period in 2011.

Total net revenue increased by 6 per cent to $26.71bn, against $25.22bn last year.

Earnings per share were $1.31, up from $1.28 in the first quarter of 2011.

The net revenue of investment banking was $7.32bn (2011: $8.23bn). It totalled $7.65bn (2011: $5.46bn) for retail financial services and card services and auto divisions generated $4.71bn (2011: $4.79). In commercial banking, net revenue was $1.66bn (2011: $1.52bn). Treasury and securities services brought in $2.01bn (2011: $1.84bn), asset management raised $2.37 (2011: $2.4bn) and corporate/private equity made $1.69bn (2011: $1.51bn). 

Jamie Dimon, chairman and CEO of JPMorgan Chase, said:

The firm reported strong revenue for the first quarter of 2012 of $27.4bn, up 24 per cent compared with the prior quarter and up 6 per cent compared with prior year. While several significant items affected our results, overall, the firm’s performance in the first quarter was solid.

The firm’s return on tangible common equity for the first quarter of 2012 was 16 per cent, compared with 11 per cent in the prior quarter and 18 per cent in the prior year.

Dimon continued:

We are pleased that our results for the quarter reflected positive credit trends for our consumer real estate and credit card portfolios. Estimated losses declined for these portfolios, and we reduced the related loan loss reserves by a total of $1.8bn in the first quarter. However, with respect to our mortgage banking business, we expect to see elevated levels of costs and losses associated with mortgage-related issues for a while longer. Credit trends across our wholesale portfolios were stable and continued to be strong.

The annual dividend was increased to $1.20 per share. Spurred by the strong balance sheet, the board authorised a new $15bn equity repurchase programme.

Dimon added:

During the first quarter of 2012, the firm provided credit and raised capital of over $445bn for our commercial and consumer clients. We provided more than $4bn of credit to US small businesses, up 35 per cent compared with the prior year. We originated more than 200,000 mortgages in the first quarter. To help struggling homeowners, we have offered more than 1.3 million mortgage modifications since 2009, and completed more than 490,000.