Lifted by a surprise increase in revenue and strong growth in investment banking, JPMorgan Chase (NYSE:JPM) beat the Street on Thursday with a 13% rise in second-quarter profits.
The stronger-than-expected results from New York-based JPMorgan represent a bullish start to earnings season for the closely-watched financial sector.
JPMorgan said it earned $5.43 billion, or $1.27 a share, last quarter, compared with $4.8 billion, or $1.09 a share, a year earlier. Analysts had been calling for EPS of $1.21.
Adjusted-revenue jumped 7% to $27.41 billion, surpassing the Streets view of $25.13 billion. Like many financial services companies, JPMorgan capitalized on improving credit conditions. Credit-loss provisions were nearly cut in half to $1.81 billion, down from $3.36 billion a year earlier.
We are pleased to report that our results for the quarter reflected continued improvement in credit trends across our consumer and wholesale portfolios, CEO Jamie Dimon said in a statement.
JPMorgans investment bank reported a 37% rise in fees to $1.9 billion, including a 24% jump in debt underwriting fees to $866 million and a 29% increase in underwriting fees to $455 million. Advisory fees soared 69% to $601 million. The investment bank ranked No. 1 in global fees for the first six months of 2011.
Fixed-income and equity markets revenue climbed to $5.5 billion last quarter, up from $4.6 billion the prior year.
Wall Street responded positively to JPMorgans results, bidding the banks stock 2.95% higher to $40.70 ahead of the opening bell. Those gains trim JPMorgans 2011 loss to 6.6%.
Other big banks yet to report results such as Citigroup (NYSE:C) and Wells Fargo (NYSE:WFC) also saw their shares tick higher.