JPMorgan Chase has recorded its best ever third quarter for investment banking fees, helping the bank to beat its earnings forecasts for the three months and taking the sting out of the division’s recent troubled listings including WeWork and Peloton.
America’s biggest bank was the lead manager in WeWork’s defunct initial public offering and also had a key role in listing Peloton, whose shares fell sharply after it floated in late September.
JPMorgan said that its investment banking division enjoyed an 8 per cent rise in revenues for the quarter, which came in at $1.9bn. Chief executive Jamie Dimon said the bank had “particularly strong” performance in debt capital markets and equity capital markets, where IPOs are run.
Other parts of the bank also performed strongly, leading to group revenues of $29.3bn for the third quarter, higher than the $27.3bn a year earlier and the $28.5bn expected by a Bloomberg analysts poll. Earnings per share for the quarter was $2.68, versus $2.34 a year ago and the $2.456 expected by Bloomberg’s poll.
“JPMorgan Chase delivered record revenue this quarter, demonstrating broad-based strength and the resilience of our business model despite a more challenging interest rate backdrop,” Mr Dimon said. However he struck a note of caution for the future, warning that US economic growth has “slowed slightly”.
Average loans in JPMorgan’s consumer bank fell 4 per cent in the third quarter, while home lending was down 12 per cent, and credit card sales volumes were up 10 per cent. Net interest income rose 2 per cent, to $14.4bn.
In the investment bank, markets revenues were up 14 per cent year-on-year, consistent with Mr Dimon’s previous guidance of a double-digit rise. Fixed income revenues were up 25 per cent, to $3.6bn, against a previous year which suffered from “less favourable market conditions”, JPMorgan said.
Shares in JPMorgan have risen 19 per cent this year.