JPMorgan strikes confident tone after better-than-expected results
By Sweta Singh
(Reuters) - JPMorgan Chase & Co (JPM.N: Quote) ended the year with a better-than-expected quarterly profit, helped by cost cuts and a smaller legal bill, and expressed confidence about its businesses in 2016 despite a grim start for stocks and energy prices.
The biggest U.S. bank by assets - the first big lender to report since the Federal Reserve raised its key interest rate in mid-December - said it expected net interest income to rise by about $2 billion as a result of the hike and loan growth.
JPMorgan forecast incremental increases in the amount of money set aside for losses on loans to the energy sector in the coming year, but said oil prices would need to remain at current levels for an extended period for provisions to be significant.
The bank's shares rose as much as 3.5 percent in morning trading. Other bank shares also rose, as investors took JPMorgan's results and positive noises about the U.S. economy as indicators of the health of the sector.
U.S. banks, like their global counterparts, have had a tough year as falling oil prices and worries about slowing growth in China contributed to weakness in credit markets.
However, Chief Executive Jamie Dimon told analysts that investors were adjusting to China's slowdown, and said there were winners and losers in the commodity rout.
"Hopefully this will all settle down and it's not the beginning of something really bad," he said.
"We're not forecasting a recession. We think the U.S. economy looks pretty good at this point." Continued...