JP Morgan has reported strong second quarter results – despite declines in markets revenues – meeting expectations that the bank would still perform well despite fears of a recession.
The bank achieved a net revenue of $42,4 billion, up 34% year-on-year, which contributed to a net income of $14.7 billion this quarter, up considerably by 67% compared to the same period last year.
The increase in revenues can be partially attributed to growth in JP Morgan’s corporate and investment bank (CIB) division, which saw banking revenue total $4.2 billion, up 29% year-on-year, alongside investment banking revenues reaching $1.1 billion, up 11% compared to the same period last year.
However, markets revenue offset overall gains within the CIB division, with markets revenue totalling $7 billion, down 10% year-on-year.
Fixed income markets revenue was down 3% compared to the same period last year, dropping to $4.6 billion in Q2 2023.
Equity markets revenue also declined, totalling $2.5 billion, down 20% compared to a strong second quarter for the division last year.
“Almost all of our lines of business saw continued growth in the quarter […] In the Corporate & Investment Bank, investment banking fees remained challenged, although we gained market share YTD,” said Jamie Dimon, chairman and chief executive of JP Morgan.
“While we expect material capital changes with the finalisation of Basel III and probable changes to come for bank liquidity, we will manage to any new requirements as we have demonstrated in the past; however, we caution that material regulatory changes would likely have real world consequences for markets and end users.”
Over the last quarter, JP Morgan expanded its rates algo franchise to support the wider electronification of rates trading. The expansion made JP Morgan’s rates algo offering equal to its long-standing FX offering in terms of analysis and tools available.
The move also saw the bank become the first dealer to go live on Bloomberg for automated treasury execution.