The hits keep coming for JPMorgan Chase (NYSE: JPM). The house that Dimon built continues to post impressive earnings, even while competitors are still feeling the sting of the 2008 financial crisis.
Today, JPMorgan Chase disclosed their fourth quarter results, and the results showed significant improvement. Net income jumped 47 percent as the company was able to set aside less money to cover loan losses, a similar theme to what we saw in the third quarter earnings release.The New York bank earned $4.83 billion, or $1.12 per share. That compares with $3.28 billion, or 74 cents a share, during the same quarter last year. Analysts surveyed by FactSet forecast the bank would earn $1 per share.
The news was not all good though. As noted earlier this week, the firm continues to be plagued by litigation stemming from angry investors from the financial crisis. The bank increased the amount set aside for litigation by $1.5 billion. In the fourth quarter, several private investors sent letters or sued banks and tried to get them to buy back bad home loans, saying that the loans were improperly written. In a call with the media, Chief Executive Officer Jamie Dimon said he believed that the hurdles for investors to force banks to buy back such loans are high and expects to fight the claims in court.
Income from JPMorgan’s investment banking unit fell 21 percent from last year, but was up 17 percent from the third quarter on higher fees related to underwriting debt issues. However, the widely watched salary and bonuses in this division increased over three times to $1.8 billion in the fourth quarter, compared to $549 million in the same quarter last year. The company in its release didn’t indicate when the bank would resume paying out its much-anticipated dividends. Momentum has been building after Dimon hinted in recent investor presentations that the bank could raise its annual dividend from 20 cents per share to as much as $1. If it gets approval from the Federal Reserve, JPMorgan could start paying higher dividends starting in the second quarter, which begins April 1.
For the full year, JPMorgan had net income of $17.37 billion, or $3.96 a share, up 48 percent from $11.73 billion, or $2.26 a share.
