JPMorgan suspends buybacks after Q2 earnings miss

JPMorgan Chase announced the suspension of its share buybacks on Thursday, after its second quarter earnings tumbled by almost a third.

The US banking giant reported earnings per share of $276 and managed revenue of $31.63bn, both missing expectations for $2.88 and $31.95bn, respectively.

Its profit slid 28% year-on-year to $8.65bn, as it built up its reserves for bad loans by $428m amid an increasingly uncertain economic outlook.

“The US economy continues to grow and both the job market and consumer spending, and their ability to spend, remain healthy,” said chairman and chief executive officer Jamie Dimon.

“But geopolitical tension, high inflation, waning consumer confidence, the uncertainty about how high rates have to go and the never-before-seen quantitative tightening and their effects on global liquidity, combined with the war in Ukraine and its harmful effect on global energy and food prices are very likely to have negative consequences on the global economy sometime down the road.”

As a result, Dimon said JPMorgan would suspend its share repurchase programme “temporarily” to help it meet its regulatory capital requirements.

That move comes just a month after the bank kept its dividend unchanged, leaving it alone in a sea of distribution hikes among US banks.

At 1010 EDT (1510 BST), shares in JPMorgan Chase & Co were down 4.66% at $106.69.

Reporting by Josh White at Sharecast.com.