JP Morgan posts 52% jump in first-quarter profit on strong consumer business

The biggest US bank's profit increased to $12.62 billion in the three months to the end of March

A JP Morgan branch in New York. Revenue at the lender's consumer and community banking unit rose 80 per cent to $5.2 billion. Reuters

JP Morgan Chase's profit climbed in the first quarter as higher interest rates boosted its consumer business, with the biggest US lender remaining resilient through the banking crisis in March.

The lender's solid performance in the quarter underscores how big banks — with diversified businesses and trillions of dollars in assets — have withstood the crisis in part because they were required by regulators to hold more capital after the 2008 mortgage crisis.

JP Morgan's shares rose by 5 per cent in premarket trading after the lender reported a 52 per cent increase in profit to $12.62 billion, or $4.10 a share, in the three months ended March 31.

Chief executive Jamie Dimon said the US consumer and economy remains healthy but cautioned that the banking crisis could turn lenders more conservative and may affect consumer spending.

“The storm clouds that we have been monitoring for the past year remain on the horizon, and the banking industry turmoil adds to these risks,” he said.

Revenue at the lender's consumer and community banking unit rose by 80 per cent to $5.2 billion on the back of higher interest rates.

The Federal Reserve raised rates by a quarter of a percentage point last month.

JP Morgan's net interest income, a measure of how much it earns from lending, surged 49 per cent to $20.8 billion.

However, its Wall Street investment banking business remained a sore point.

Revenue at the unit fell 24 per cent, weighed down by a tepid market for mergers, acquisitions and stock sales. Equity trading revenue slid 12 per cent. Fixed-income trading revenue was flat.

Overall revenue jumped 25 per cent to $38.3 billion.