Skip to Content

JPMorgan’s profit spikes 155% as US economy booms

<i>Michel Euler/Pool/AFP/Getty Images</i><br/>JP Morgan CEO Jamie Dimon looks on during the inauguration of the new French headquarters of US' JP Morgan bank on June 29 in Paris.
POOL/AFP via Getty Images
Michel Euler/Pool/AFP/Getty Images
JP Morgan CEO Jamie Dimon looks on during the inauguration of the new French headquarters of US' JP Morgan bank on June 29 in Paris.

By Matt Egan, CNN Business

JPMorgan Chase is minting money as the US economy races back from the pandemic.

America’s largest bank said Tuesday it hauled in $11.9 billion in profit during the second quarter, up 155% from the same period of 2020.

JPMorgan’s bottom-line growth was driven in part by $3 billion of net reserve releases that underscore the bank’s confidence in the economic recovery.

Revenue fell 8% to $30.5 billion as JPMorgan’s booming Wall Street business cooled from elevated levels.

CEO Jamie Dimon said in a statement consumer and corporate balance sheets remain “exceptionally strong as the economic outlook continues to improve.” He pointed to a sharp decline in bad loans as evidence of the “increasingly healthy condition of our customers and clients.”

“We are encouraged by the continued progress against the virus and the economic recovery that is underway, especially the United States,” Jeremy Barnum, JPMorgan’s chief financial officer, told reporters during a conference call.

Barnum acknowledged, however, that there is “elevated uncertainty” about the evolution of the pandemic and the Delta variant is one element of that uncertainty.

Another risk to the recovery is surging inflation. Consumer prices surged in June at the fastest annual rate since 2008. Prices for used cars, airfare and appliances like washing machines skyrocketed.

Dimon is not so sure that prices will cool off as quickly as the Federal Reserve expects.

“Inflation could be worse than people think. I think it’ll be a little bit worse than what the Fed thinks. I don’t think it’s only temporary,” Dimon said during a conference call with analysts.

Americans are spending way more than pre-Covid

Inflation is being driven up in part by surging demand as consumers spend aggressively. JPMorgan said combined debit and credit card spending surged 45% in the second quarter from a year earlier. Spending is now 22% above 2019 levels.

Dimon pointed to “accelerating growth” across all categories, including travel and entertainment, which surpassed 2019 levels by 13%.

“Travel and entertainment has really turned a corner,” Barnum said.

The bank’s consumer deposits soared by 25% from a year earlier. Investment assets were up 36%, lifted by record stock prices and people adding more cash to portfolios.

JPMorgan’s Wall Street arm slowed down a bit. Total markets revenue tumbled 30%, led by a 44% decline for fixed income markets.

Yet JPMorgan continues to haul in fat fees from advising on M&A and IPO deals: Global investment banking revenue jumped 37% to $1.2 billion.

“Capital markets have just been wide open,” Barnum said.

™ & © 2021 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

Article Topic Follows: CNN - Business/Consumer

Jump to comments ↓

CNN Newsource


ABC 17 News is committed to providing a forum for civil and constructive conversation.

Please keep your comments respectful and relevant. You can review our Community Guidelines by clicking here

If you would like to share a story idea, please submit it here.

Skip to content