NEW YORK -- JPMorgan Chase & Co.'s second-quarter profit rose 4 percent as the bank made up for lower revenue by cutting expenses.
The largest U.S. bank by assets said Tuesday that it earned $5.78 billion, or $1.54 a share, in the latest quarter, up from $5.57 billion, or $1.46 a share, a year earlier. Net revenue totaled $23.81 billion, down from $24.68 billion. Revenue at three of the four JPMorgan businesses fell or was flat. The only business where it grew was asset management.
But as revenues declined, JPMorgan was able to compensate by cutting expenses, reducing payroll, and through a $330 million gain as its corporate tax rate fell. Barclays' analysts said the tax benefit was the main driver behind the bank's ability to beat Wall Street expectations of $1.43 a share.
The bank increased its loan portfolio by 12 percent from a year ago and 5 percent from the previous quarter, an optimistic sign for growth in the broader economy.
"It's solid to strong pretty much across the board," Marianne Lake, the bank's chief financial officer, said about the loan growth on a conference call with investors Tuesday morning.
At JPMorgan's investment bank, net income rose 10 percent as lower expenses offset revenue declines both in its trading and investment banking advisory business.
In consumer banking, net income edged up 1 percent, helped by higher sales and loan growth in its auto and credit card division, as well as reduced expenses.
JPMorgan and other banks have been trimming their balance sheets and selling off businesses for several years. Head count at the bank was 237,459, down 3 percent from a year earlier. Legal expenses, which had been a major issue during the past few years, also declined.
The JPMorgan bankers who help provide advice on mergers and acquisitions continued to see strong performance, increasing revenue from last quarter and last year.
JPMorgan's results for the latest quarter were not shaped by any of the big fines or one-time costs that have been so significant in recent years.
The bank's chief executive, Jamie Dimon, said in a statement: "This quarter was another example of the power of our platform and risk discipline, and of being there for our clients -- as we always are -- in good times and in volatile markets."
Dimon told analysts Tuesday that he may stop participating in the firm's quarterly earnings conference call, letting Lake do all the talking from now on.
"Don't be surprised one of these days if I don't show up -- don't read anything into it" or assume he's hiding from bad news, Dimon said at the end of Tuesday's call. Lake does "such a good job, that I've become unnecessary to be on all of them, and I can obviously go do other things."
Lake, who is on the New York-based firm's operating committee, is often mentioned as a possible successor for Dimon, who has said he wants to keep the top job another five years.
Dimon, 59, has made headlines for his outspoken opinions on regulators, competitors and economic policy. In an April 2012 conference call, the CEO dismissed reports that derivatives bets were distorting credit indexes, calling the controversy a "tempest in a teapot." Those words came back to haunt him as that year's large trading losses in London ballooned to $6.2 billion.
JPMorgan is one of the first big U.S. banks to announce earnings, along with Wells Fargo, which reported results Tuesday that matched analysts' estimates. Like JPMorgan, revenue at Wells Fargo was lower.
Shares of JPMorgan rose 95 cents, or 1.4 percent, to close Tuesday at $68.74.
Information for this article was contributed by Ken Sweet of The Associated Press; by Nathaniel Popper of The New York Times; and by Hugh Son of Bloomberg News.
Business on 07/15/2015