JPMorgan Chase reports lower profits, gives cautious economic outlook

JPMorgan Chase reported a drop in second-quarter profits on Thursday (Jul 14), reflecting the impact of a weakening macroeconomic outlook that led it to set aside funds in case of bad loans.

The big US bank’s earnings came in at US$8.6 billion for the quarter, down 28 per cent from the year-ago period in results that missed analyst expectations.

Chief executive Jamie Dimon said key elements in the US economy remained healthy, but that macroeconomic headwinds including inflation “are very likely to have negative consequences on the global economy sometime down the road”.

The bank temporarily suspended share buybacks with Dimon saying that the pause was needed to quickly meet higher capital requirements and “allow us maximum flexibility to best serve our customers, clients and community through a broad range of economic environments”.

The results offer the first look at how Wall Street fared in a tumultuous 3 months characterised by changing outlooks on prospects for the economy. AFP, BLOOMBERG