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JPMorgan profit jumps on higher interest rates, lower taxes

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JPMorgan Chase & Co, the biggest US bank by assets, reported a 35 per cent surge in quarterly profit on Friday, helped by higher interest rates for loans and lower taxes.

[NEW YORK] JPMorgan Chase & Co, the biggest US bank by assets, reported a 35 per cent surge in quarterly profit on Friday, helped by higher interest rates for loans and lower taxes.

The bank's net income rose to US$8.71 billion, or $2.37 per share, in the first quarter ended March 31 from US$6.45 billion, or US$1.65 per share, a year earlier.

Analysts had estimated earnings of $2.28 per share, according to Thomson Reuters I/B/E/S. It was not immediately clear if the numbers were comparable.

Income tax expense was down 8.6 per cent at US$2.56 billion as the US corporate tax rate fell.

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Net interest income rose 9 per cent to US$13.5 billion, driven by higher interest rates and increased lending.

"2018 is off to a good start with our businesses performing well across the board, driving strong top-line growth and building on the momentum from last year," Chief Executive Officer Jamie Dimon said in a statement.

Net revenue rose 10.3 per cent to US$28.52 billion, beating the average analyst estimate of US$27.68 billion.

Many of JPMorgan's business lines have delivered higher profits in the past year as the economy grows, capital markets flourish and higher interest rates lift lending revenue more than the bank's cost of money.

Return on tangible common equity, a performance measure, was 19 per cent, compared with 13 per cent a year earlier. JPMorgan in February raised its return target for three years out to 17 per cent, largely because of lower tax rates.

REUTERS