[NEW YORK] US banking giant JPMorgan Chase reported a jump in third-quarter earnings Tuesday, as a large tax gain offset weaker performance in bond trading and some other businesses.
Earnings for the quarter came in at US$6.8 billion, up 22.3 per cent from the year-ago period. Revenues were down 6.4 per cent at US$23.54 billion.
JPMorgan, the biggest US bank by assets, said earnings in the corporate and investment bank segment fell 12.9 per cent. This closely watched business saw lower revenues in fixed-income trading, partly offset by higher revenues for equity market trading.
Chief financial officer Marianne Lake said there was "reasonably broad-based market turbulence" in the third quarter due to worries about the slowing Chinese economy and uncertainty about when the US Federal Reserve will raise interest rates.
The volatility also resulted in lower earnings in asset management. Client assets under management fell one percent to US$2.3 trillion, the result of "clients moving money out of market-sensitive categories," Ms Lake said.
On the positive side, JPMorgan scored a four per cent gain in consumer and community banking, thanks in part to stronger mortgage banking earnings and increased auto and credit card loans.
Total loans rose 8.9 per cent to US$809.5 billion.
Results were boosted by US$2.2 billion in tax benefits, including a gain of US$1.9 billion from resolving tax audits.
Ms Lake said the tax benefit was related to the financial crisis, but declined to elaborate. She said the large boost would not likely be repeated in future quarters.
JPMorgan cut non-interest expenses. Headcount is down about 6,700 from last year at 235,680.
"We had decent results this quarter," said chief executive Jamie Dimon in a statement.
"We saw the impact of a challenging global environment and continued low rates reflected in the wholesale businesses' results, while the consumer businesses benefited from favorable trends and credit quality."
Earnings for JPMorgan translated into US$1.32 per share, five cents below analyst expectations.
Shares of JPMorgan fell 1.4 per cent to US$60.71 in after-hours trade.