Revenues jumped in the first quarter as higher interest rates boosted the bank’s consumer business
JPMorgan Chase reported first-quarter revenue this week that beat analysts’ expectations thanks to a nearly 50% surge in net interest income amid higher interest rates.
The Wall Street bank posted a profit of $12.6 billion, or $4.10 per share, in the first three months of the year, up from $8.3 billion, or $2.63 per share, from the same period a year ago, a gain of 52%.
Revenue surged 25% companywide to $39.34 billion, driven by a sharp rise in net interest income due to the US Federal Reserve’s most aggressive rate-hiking campaign in decades. The bank’s net interest income, a measure of how much it earns from lending, surged 49% to $20.8 billion.
Revenue at the lender’s consumer and community banking unit soared by 80% to $5.2 billion on the back of higher interest rates.
JPMorgan CEO Jamie Dimon said that the US consumer and economy overall remain healthy but cautioned that the banking crisis could turn lenders more conservative and may affect consumer spending.
“The storm clouds that we have been monitoring for the past year remain on the horizon, and the banking industry turmoil adds to these risks,” he said, adding that banks will likely rein in lending as they become more conservative ahead of a possible downturn.
JPMorgan is the largest US bank with $3.67 trillion in assets. Its deposits soared to $2.38 trillion in the first quarter from the $2.34 trillion posted in the fourth quarter of last year. Analysts say that JPMorgan benefited from an influx of deposits as customers sought refuge in larger banks after two regional lenders, Silicon Valley Bank and Signature Bank, collapsed within days of each other in early March following massive deposit runs.
JPMorgan played a central role in rescuing a third troubled lender, First Republic, having helped lead efforts to inject it with $30 billion in deposits.
This article was originally published by RT.