JP Morgan posts weaker-than-expected profit

<p>The bank said that net revenue was $23.5 billion, down from $25 billion the year before.</p>

Banking giant JP Morgan Chase today (October 14th) posted lower-than-expected profits for the third quarter of the year.

It had a net income of $6.8 billion (£4.5 billion), up from $5.5 billion during the same period last year. It earned $1.32 a share, which missed analysts' estimates of $1.37 per share.

In addition, the bank said that net revenue declined by 6.4 per cent. It was $23.5 billion this quarter, down from $25 billion the year before. It also reported that sales of its loan products had increased by 15 per cent year-on-year.

The bank has been hampered by weak demand for loans and low interest rates, which have remained near zero since 2008.

The US Federal Reserve decided in September to leave interest rates unchanged to due concerns about the global economic slowdown.

JP Morgan's chief executive Jamie Dimon said in a statement: "We had decent results this quarter.
"We saw the impact of a challenging global environment… We continue to focus on our commitments, optimise our balance sheet and manage our expenses."

Legal costs

Revenue in JP Morgan's corporate and investment bank was down 10 per cent from a year earlier. JP Morgan's chief financial officer Marianne Lake added the summer's "generally quite challenging" market conditions led to a decline in revenue in the division.

The bank also reported $1.3 billion in legal costs for the period. The bank was in settlement talks this year with the US Department of Justice and the Federal Reserve over an investigation into the bank's foreign-exchange sales and trading activities. 

It paid almost $1 billion in recent years due to a range of investigations into alleged wrongdoing. The bank also settled a related lawsuit in January agreeing to pay institutional investors about $100 million.

Furthermore, in 2013, JP Morgan agreed to a record $13 billion settlement with US authorities for misleading investors during the US housing crisis and collapse in prices.

The bank's shares were down 1.7 per cent today to $60.49 in after-market trading.

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