Wall Street banks JP Morgan, Citi and Goldman Sachs report bumper profit
Some of Wall Street’s biggest banks reported a surge in profit today on the back of a rebound in dealmaking and strengthening equity markets toward the end of last year.
JPMorgan Chase, the US’s biggest lender, said profit had jumped 50 per cent to $14bn (£11.41bn) through the final quarter as its dealmakers and traders made hay in rebounding markets.
The bank’s operations were lifted by a 49 per cent jump in investment banking fees and 21 per cent higher trading revenue in the final three months, beating its own forecast in December.
“Businesses are more optimistic about the economy, and they are encouraged by expectations for a more pro-growth agenda and improved collaboration between government and business,” said chief executive Jamie Dimon, adding that government spending, inflation, and geopolitical conditions could still pose risks in the year ahead.
Despite warnings it was set for a slowdown this year, the lender lifted its 2025 forecasts for net interest income, the difference between what it earns on loans and pays out on deposits, above analysts’ expectations.
The performance was followed by JP Morgan’s Wall Street rivals who posted a boost in earnings across the board.
Goldman Sachs beat market expectations with its biggest profit since the third quarter of 2021, fuelled by a rise in fees from dealmaking, debt sales and strength in trading.
The investment bank’s shares rose 2.6 per cent before market open Wednesday as it earned $11.95 (£9.74) per share in the fourth quarter. That was ahead of the $8.22 (£6.70) expected by analysts, according to estimates compiled by the London Stock Exchange Group.
Investment banking fees for the firm rose 24 per cent to $2.05bn (£1.67bn) in the period.
Meanwhile Citigroup beat estimates for fourth-quarter profit with $2.9bn (£2.36bn) in the final quarter and announced a $20bn (£16.30bn) buyback programme today. However, it cut a key target for profitability by a percentage point after investing heavily in a turnaround effort.
“2024 was a critical year and our results show our strategy is delivering as intended and driving stronger performance in our businesses,” said Jane Fraser, Citi’s chief executive, in a statement. “Our net income was up nearly 40 per cent to $12.7bn (£10.35bn) and we exceeded our full-year revenue target, including record years in Services, Wealth and U.S. Personal Banking.”
Additional reporting by Reuters