JPMorgan's main businesses lukewarm in first quarter
By David Henry and Dan Wilchins
NEW YORK (Reuters) - JPMorgan Chase & Co posted higher first-quarter profit on Friday as it spent much less money on mortgage-related litigation, but most of its major businesses turned in tepid performances, and the bank's overall revenue declined.
The results reflected the pressure the largest U.S. bank is under, even as it recovers from the disastrous "London Whale" trading losses that cost more than $6 billion last year. Many of the gains came from accounting judgments rather than increased customer demand. JPMorgan shares dipped 0.2 percent to $49.21.
Profit in its consumer banking segment fell 12 percent to $2.6 billion, and ignoring accounting adjustments, its corporate and investment banking profit dropped 2 percent to $2.5 billion.
The difficulty in the businesses bodes poorly for other Wall Street banks, which are due to report next week. Shares of Goldman Sachs Group Inc fell 1.2 percent to $147.31, and Citigroup Inc, due to report on Monday, fell 1.1 percent to $44.36.
For JPMorgan, commercial banking and asset management profit rose, but the growth was too small in dollar terms to affect overall results.
Chief Executive Jamie Dimon said in a statement that loan growth was soft across the industry in the first quarter compared with the fourth quarter, noting that small businesses remained cautious.
In some areas, the bank made more loans. Mortgage lending volume, for example, rose to $52.7 billion in the quarter from $38.4 billion last year. The gain came even as Wells Fargo & Co, the biggest U.S. mortgage lender, said its volume slowed.
But JPMorgan's profit from home lending fell. As the housing market recovers, more banks are stepping into the mortgage market, weighing on profitability. Continued...