"The economy is facing significant turbulence (including geopolitical)", writes Jamie Dimon in a comment in the report.
He adds that customers seem to have been affected and become more cautious.
Shaky market, high valuations
According to Jamie Dimon, positive impulses may come from tax cuts and deregulation in the USA. However, among potential problems, the bank top points to the risks of high public deficits in the USA and a shaky market with high valuations of assets.
Dimon says that the uncertain environment means that JP Morgan sees reason to retain surplus capital and available liquidity in what he describes as a strong balance sheet.
JP Morgan made provisions to cover feared problem loans ahead, totaling 973 million dollars (approximately 9.5 billion kronor), which was significantly more than the 290 million that analysts had counted on.
The stock rises
JP Morgan simultaneously clears expectations on several key lines in the report. Total revenues rose to 46 billion dollars, against expected 44.4 billion. The profit per share amounts to 5.07 dollars, which was more than expected 4.61 dollars per share.
JP Morgan's stock, which had fallen by over 5 percent since the turn of the year, rises in advance trading. Among other things, since the market is taking hold of the fact that the bank has raised its forecast for this year's interest net, i.e., what the bank earns on the difference between lending and borrowing rates.
The San Francisco-based major bank Wells Fargo has also presented its report for the first quarter. There, the interest net landed somewhat lower than expected. However, the bank confirms its forecast for the full year and the stock follows JP Morgan's stock upwards.
The investment bank Morgan Stanley – a major player on Wall Street – also rises after an interim report with revenues and an interest net that were higher than expected in the first quarter.
