JP Morgan Q3 profits beat estimates but provisions jump

JP Morgan reported better-than-expected third quarter profits despite a large increase in credit loss provisions and a sharp drop in markets revenues.

For the three months ending in September, the Wall Street heavyweight posted a 7% jump in its earnings per share versus a year ago to reach $1.76, versus analysts' estimates calling for EPS of $1.65.

That was on the back of a 3% rise in managed revenues to $26.2bn and despite a 14% increase in provisions for credit losses to $1.45bn. The latter was mainly the result of a $303m net reserve build in the consumer portfolio.

Commenting on the lender's results, chief Jamie Dimon highlighted how JP Morgan had for the first time taken the lead at the national level for total US deposits.

Regarding the operating environment, Dimon said: "The global economy continues to do well and the US consumer remains healthy with solid wage growth".

Worth noting, markets revenue was down by 21%.

On a more positive note however, its asset and wealth management arm clocked in with a record $1.9trn of assets under management, which was up by 10% on a year ago. Net income at the wealth management arm also set a new record, Dimon noted.

Average core loans grew by 7% year-on-year and were 2% ahead on the prior quarter.

Return on tangible common equity was flat at 13%.

As of 1218 BST, shares of JP Morgan were 0.44% lower to $96.68.