America’s biggest bank JP Morgan Chase posted higher first-quarter profits yesterday but revenues fell as most of its key businesses turned in weak performances.
The results reflected the pressure the largest US bank is under as it recovers from the disastrous “London Whale” trading losses that cost it more than $6 billion (£3.9bn) last year.
Profit in its consumer banking arm fell 12 per cent to $2.6bn while corporate and investment banking profit dropped 2 per cent to $2.5bn.
While profits rose in commercial banking and asset management, but the growth was too small to have had much impact on overall results. Chief executive Jamie Dimon said loan growth was weak across the industry in the first quarter compared with the fourth quarter.
He noted that small businesses in particular remained cautious and were not investing.
The bank also enjoyed a big benefit from declining litigation expenses, which were close to nil in the first quarter of 2013 versus about $2.5bn in last year’s first quarter.
That helped net profits for the overall bank rise to $6.53bn from $4.92bn, a year earlier. Total revenue fell 3.6 per cent to $25.12bn.
Income in mortgage banking, which helped boost profits last year, fell in the first quarter to $673 million, from about $980m last year.
Mortgage lender Wells Fargo also released results yesterday, reporting record first quarter profits.
Wells, the fourth biggest bank in the US, saw net income rise by 22 per cent to $5.2bn helped by cost cutting.