JP Morgan Chase reports third-quarter 2022 net income of $9.7 bln, including $959 mln of net investment losses

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JP Morgan reported Net income of $9.7 billion, down 17%, driven by a net credit reserve build of $808 million compared to a net reserve release of $2.1 billion in the prior year.

The current quarter included net investment securities losses of $959 million resulting in a decrease of $729 million (after tax) to net income.

Net revenue was $33.5 billion, up 10%. Net interest income (NII) was $17.6 billion, up 34%. NII excluding Markets was $16.9 billion, up 51%, driven by higher rates.

Noninterest revenue was $15.9 billion, down 8%, driven by lower Investment Banking fees, $959 million of net investment securities losses in Corporate and lower net production revenue in Home Lending, largely offset by higher CIB Markets revenue.

Noninterest expense was $19.2 billion, up 12%, driven by higher structural expense, primarily compensation, and continued investments in the business, including technology and marketing.

The provision for credit losses was $1.5 billion, including a net reserve build of $808 million. Net charge-offs of $727 million were up $203 million.

The net reserve build in the current quarter included $937 million in Wholesale, reflecting loan growth and the impact of updates to the Firm’s macroeconomic scenarios, partially offset by a reserve release of $150 million in Home Lending.

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The prior year provision was a net benefit of $1.5 billion, reflecting a net reserve release of $2.1 billion and $524 million of net charge-offs.

“In Consumer & Community Banking, we again ranked #1 in U.S. retail deposits, we were the fastest growing bank among the top 20 and we are now #1 in the top 3 largest markets based on the most recent FDIC data.

Average deposits were up 9%, and debit and credit card sales were up 13%. In the Corporate & Investment Bank, we maintained our #1 ranking in Global Investment Banking although fees were down 47% compared to a record prior year.

Markets revenue grew 8% driven by strong client activity in Fixed Income. Commercial Banking loans were up 13% on higher revolver utilization and new loan originations. Asset & Wealth Management reported solid results with revenue up 6% as higher net interest income more than offset the impact of lower market levels,” commented Jamie Dimon, Chairman and CEO.