By Senad Karaahmetovic
JPMorgan (NYSE:JPM) shares are up almost 6% in pre-market Friday after the banking giant smashed analyst estimates for the first quarter.
JPM delivered EPS of $4.10 on revenue of $38.3 billion, beating the consensus for earnings of $3.41 per share on revenue of $36.13B. Adjusted revenue soared 25% despite a 24% drop in investment banking revenue.
“Our years of investment and innovation, vigilant risk and controls framework, and fortress balance sheet allowed us to produce these returns, and also act as a pillar of strength in the banking system and stand by our clients during a period of heightened volatility and uncertainty,” said CEO Jamie Dimon.
Managed net interest income (NII) was reported at $20.83B, easily ahead of the $19.12B. CET1 ratio also beat expectations as it came in at 13.8% (vs 13.5%) while return on equity was reported at 18%, crushing the 15.2% consensus.
As a result, JPM boosted its FY NII forecast to $81B from the prior $73B. Analysts were expecting $73.69B.
The Q1 also saw a net reserve build of $1.1B, including $726 million in Wholesale and $416M in Consumer, “largely driven by a deterioration in the weighted-average economic outlook, including updates to the Firm’s macroeconomic scenarios and an increased probability of a moderate recession due to tightening financial conditions.”
Vital Knowledge analysts said the Q1 report “is a relief considering the environment.”