J.P. Morgan Chase & Co. said on Friday its fourth-quarter net profit fell to $3.7 billion, or 90 cents a share, from $4.8 billion, or $1.12 a share, in the same period a year ago.
Revenue dropped to $22.19 billion from $26.72 billion.
Analysts surveyed by FactSet Research, on average, forecast a quarterly profit of 93 cents a share on revenue of $23.06 billion.
J.P. Morgan said that several significant items affected the bank's fourth-quarter results, including a $567 million pretax debit-valuation-adjustments loss which reflected the tightening of its credit spreads.
"The firm's returns on tangible common equity for the fourth quarter of 2011 and the full year 2011 were 11% and 15%, respectively," said CEO Jamie Dimon in a statement.
"We believe these returns were reasonable given the environment, although the return for the fourth quarter was modestly disappointing."
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NEW YORK (MarketWatch) — J.P. Morgan Chase & Co.’s fourth-quarter earnings fell 23% as revenue from its investment banking arm declined.
As the first major bank to report for the fourth quarter, J.P. Morgan’s results offer a glimpse into what is largely expected to again be a bleak quarter for the nation’s largest financial institutions.
J.P. Morgan /quotes/zigman/272085/quotes/nls/jpm JPM -2.44% itself had already warned as much; Chief Executive Jamie Dimon last month said the bank expected investment banking revenue in the fourth quarter to again take a hit from rocky capital markets that have pushed potential clients to the sidelines.
The investment banking arm posted an 52% decline in profit to $726 million as revenue fell 30%. At the bank’s retail services business, which handles consumer and small-business clients, profit was up 16% to $533 million from a year earlier.
“The firm’s returns on tangible common equity for the fourth quarter of 2011 and the full year 2011 were 11% and 15%, respectively. We believe these returns were reasonable given the environment, although the return for the fourth quarter was modestly disappointing,” said Jamie Dimon, J.P. Morgan’s chairman and chief executive, in the earnings press release.
Across the bank, credit-loss provisions totaled $2.18 billion, down from $3.04 billion a year earlier and below the $2.41 billion set aside in the third quarter.
J.P. Morgan reported a profit of $3.73 billion, or 90 cents a share, compared with $4.83 billion, or $1.12 a share, a year earlier. The latest period included net charges of 6 cents a share related to debit valuation adjustments, litigation reserves and benefits from reduced loan loss reserves, primarily related to credit card.
Revenue fell 17% to $22.2 billion.
Analysts surveyed by Thomson Reuters were looking for a per-share profit of 90 cents on revenue of $23 billion.
Shares were recently trading down 2% to $36.10 before the market open in New York. Through Thursday’s close, the stock is down 17% over the past 12 months.
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