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JPMorgan Quarterly Results: ‘Record Year’ Despite Tax Reforms

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The US’ biggest lender, JPMorgan, has reported record revenue and net income.

Publishing fourth quarterly earnings before New York opened, JPMorgan Chase reported a net revenue of $25.5bn and a net income of $6.7bn. JPMorgan share earnings totalled $22bn, meaning shares were $1.76 each. Analysts had forecast $1.69 per share.

The lender also reported a 6% increase in core loans from 2016.

CEO and Chairman Jamie Dimon said:

“2017 was a record year on many measures for JPMorgan Chase as we added clients and customers and delivered record EPS. We had healthy growth in Treasury Services, Securities Services and Investment Banking – we were #1 in IB fees globally, a record for the firm. Commercial Banking and Asset & Wealth Management generated record revenue and net income.”

The lender had expected to lose $2bn from changes to the tax regime; figures today suggest a loss of $2.4bn.

Trump’s tax reforms, the largest in 30 years, slashed the corporate tax rate from 35% to 21%, leading to mass devaluations in deferred tax assets- the reimbursement expected from overpayment in tax.

Although banks are preparing to pay the one-off tax on their offshore earnings, JPMorgan has said such earnings will not be repatriated because of foreign requirements on capital and liquidity.

Dimon said:

“The enactment of tax reform in the fourth quarter is a significant positive outcome for the country. U.S. companies will be more competitive globally, which will ultimately benefit all Americans. The cumulative effect of retained and reinvested capital in the U.S. will help grow the economy, ultimately growing jobs and wages.”

Shares in JPMorgan have remained largely unaffected by the heavy losses. Since Trump’s May announcement, shares have been steadily increasing and now stand at $111.18 as New York opens.

(Source: Google Finance)

Other lenders, Citigroup, Bank of America as well as investment banks, Morgan Stanley and Goldman Sachs, are expected to publish results next week.

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