Business

Q2: JPMorgan Posts 36% Jump Profit

Published

14 years ago

July 20, 2009

JP Morgan Chase & Co. posted a 36 per cent jump in second-quarter profit Thursday, easily surpassing analysts’ expectations, as strength in investment banking offset higher credit losses.
JPMorgan, the second big bank to report stronger earnings this week after Goldman Sachs Group Inc., earned $2.72 billion, up from $2 billion a year earlier. Revenues soared 39 per cent to $25.62 billion.
Results were driven by record investment banking fees and revenue in its bond business, much like Goldman Sachs.
“Both JPMorgan and Goldman Sachs were well positioned going into the crisis, and they are going to continue to pull ahead and dominate the sector,” said Len Blum, managing partner at Investment Bank Westwood Capital.
At JPMorgan’s investment bank, revenue jumped 33 per cent to $7.3 billion and profits more than tripled to $1.5 billion.
Those gains were partly offset by higher losses in consumer lending and credit cards. The bank said it set aside $9.7 billion for credit losses in the quarter, up from $4.29 billion a year earlier but down from the first quarter’s $10 billion.
CEO Jamie Dimon said in a statement that the company expects credit costs to remain high “for the foreseeable future.”
The profit came despite a $1.1 billion charge, or 27 cents a share, as JPMorgan repaid $25 billion in loans it received from the government as part of the Troubled Asset Relief Programme. The bank was also hit by a 10-cents-a-share FDIC special assessment penalty.
Earnings per share fell to 28 cents from 53 cents as the company had more stock outstanding than a year ago.
Despite the higher earnings, JPMorgan’s shares fell 52 cents, or 1.4 per cent, to $35.74 in early afternoon trading. Financial shares were broadly lower as a major lender to small businesses, CIT Group Inc., teetered on the edge of bankruptcy after talks with regulators about a rescue broke down late Wednesday.
Analysts surveyed by Thomson Reuters had forecast earnings of 4 cents per share on revenue of $25.89 billion.
During the most recent quarter, JPMorgan’s retail banking unit earned $15 million, a decrease of $488 million, or 97 per cent, from the prior year. That business was affected by a higher provision for credit losses and higher noninterest expenses, which were offset partially by more revenue from last year’s acquisition of the thrift Washington Mutual Inc.
Average deposits rose from 62.7 per cent to $348.1 billion from a year ago, and 0.7 per cent from the first quarter.
The WaMu acquisition also helped drive JPMorgan’s commercial banking unit’s income up 4 per cent to $368 million.
JPMorgan’s credit card division did poorly, however, because of surging defaults that have afflicted all credit card issuers. It posted a loss of $672 million compared with a profit of $250 million last year.
Asset Management and Treasury and Securities Services also did worse in the second quarter than in the same period last year.
JPMorgan said it extended $150 billion in new credit to consumers, corporations, small businesses, municipalities and non-profits and has approved 138,000 trial mortgage modifications in the quarter, bringing total foreclosures prevented since 2007 to 565,000.
JPMorgan was among 19 major banks that underwent the government’s “stress tests” in May to determine how banks would fair if economic conditions worsened. Unlike some of its competitors, JP Morgan was told it didn’t need to raise additional capital.

Business

Redeployed Customs Officers Assume Office At New Posts

Published

1 day ago

September 22, 2023

The Tide

Redeployed Zonal coordinators and controllers affected by the recent swapping exercise in the Nigeria Customs Service (NCS) have since taken over their new posts.
Assistant Comptroller General and Comptrollers affected by the change of batons have gone into action in the respective Zones and Area Commands respectively.
As at Press time, ACG Bello Jibo, the new Coordinator, Zone A, has begun to hold forth at the Harvey Road Zonal Headquarters in Yaba, Lagos.
Comptroller Dera Nnadi, Jaiyeoba, and Shuaibu have resumed their duties as Customs Area Controllers of Tincan Island Port, Apapa and Idiroko Commands respectively.
Comptroller Timi Bomodi has also begun overseeing customs activities at Seme-Krake Border Command.
In an exclusive chat with The Tide, Chairman, Seme Chapter of the Association of Nigeria Licensed Clearing Agent (ANLCA), Chief Oyekachukwu Ojinma (aka Sule) described the outgoing Controller of the Command, Comptroller Dera Nnadi, as a very hard-working and dedicated man, while welcoming the new Customs Area Controller to the border post.
The ANLCA Chairman expressed his wish for a successful tenure of office for Compt. Timi Bomodi.

By: Nkpemenyie Mcdominic, Lagos

Business

‘Electricity Act Will Transform Power Sector’

Published

1 day ago

September 22, 2023

The Tide

Minister of Power, Adebayo Adelabu, has stated that the recently signed Nigerian Electricity Act, 2023, will play a fundamental role in transforming the power sector.
According to him, it will unlock the potential of the energy mix and promote the integration of renewable energy technologies into the grid system.
Speaking at the ongoing Nigeria Energy Conference and exhibition in Lagos, Adelabu said the Act aims to create an environment that supports sustainable growth and investment in the power industry by focusing on accelerated private investment and the promotion of renewable energy sources.
“As a game-changer that reformed the NESI, the Electricity Act will, undoubtedly, engender increased access to electricity and regulatory oversight, clean energy transition, improved service delivery, and infrastructural developments.
“In particular, the act will stimulate economic growth by creating a conducive environment for investment and competition. It will generate job opportunities, encourage entrepreneurship, and attract foreign direct investments”, he said.
The Minister called on operators in the power sector to intensify their efforts towards improving communication with the general public, emphasising that the Nigerian masses have a lot of roles to play in safeguarding power infrastructure.
He said issues such as vandalism, passing of meters, and damage to TCN and DisCo infrastructure must be addressed holistically to make significant gains in the power sector.
Adelabu emphasised that the power sector is a cornerstone for economic growth in the country and that the gains made over the years in the power sector can only be consolidated by unlocking equity investments and funds for power development.
He said: “Of course, a lot of investment is required in the power sector. In three weeks, I’ve seen humongous investments that have come into this sector.
“But what are the steps that are required for those investment opportunities to reap the benefit of those investments, additional investments in the form of equity and capex need to come into this industry.
“The power sector is not an industry for short-term players to invest in less than two to three years and expect to make maximum benefits.
“The industry requires medium to long-term investments. Investors must understand that the moment we can break even, we will start making profits in the power sector.
Adelabu also urged operators in the NESI value chain to improve their service delivery, adding that Nigeria’s energy expansion plan of 60,000 Megawatts by 2060 is an achievable target.
He, therefore, called on gas companies, GenCos, TCN, and DIScO to showcase their success stories in generating and transmitting power to the last mile that pays for all the segments of operators in the value chain.

Business

‘Nigeria Loses $1.5bn Annually To Malnutrition’

Published

1 day ago

September 22, 2023

The Tide

Minister for Budget and Economic Planning, Abubakar Bagudu, has said Nigeria loses $1.5 billion of its Gross Domestic Product (GDP) annually due to micronutrient deficiencies.
Bagudu therefore called for coordinated efforts to ensure a swift response with expected positive outcomes.
A statement released by the Ministry said the Minister disclosed this, last Tuesday, while speaking at the 53rd Annual General Meeting and Scientific Conference of the Nutrition Society of Nigeria in Abuja.
In the statement, Bagudu noted that the government was determined to tackle malnutrition through the inclusion of nutrition in the National Development Plan, and the Nigeria Agenda 2050.
“It is also a commitment to achieving optimal nutrition status for all Nigerians with particular attention to the vulnerable group as highlighted in the National Multisectoral Plan of Action for Food and Nutrition”, he said.
Bagudu, who urged experts in nutrition in the country to research and develop innovations that will boost nutrition, explained that doing this “would contribute towards achieving Sustainable Development Goals (SDGs), ensuring Universal Health Coverage, and bringing about significant positive changes in the nutrition sector in Nigeria”.
He told members of the Nutrition Society of Nigeria “to prioritise innovation and research in the field of nutrition towards the attainment of Sustainable Development Goals, Universal Health Coverage and transformation of the landscape of nutrition in Nigeria.
“Nigeria currently requires nutrition professionals who have extensive knowledge, good communication skills to address nutrition education, emotional intelligence as well and a good understanding of self-motivation and drive to address nutrition dynamics”.
The Minister urged the NSN to embrace technology, leverage digital solutions, and invest in research and development to find sustainable and scalable solutions to Nigeria’s nutrition challenges.
He assured members of the NSN that his ministry would strengthen coordination and provide the required leadership for the nutrition sector.
The Kwara State Governor, AbdulRahman AbdulRasaq, in his goodwill message, said the Nigerian Governors’ Forum (NGF) had identified areas of key commitments for the realisation of a healthier citizen and country, including increasing budgetary spending on nutrition and strengthening the nutrition profile.