Massive net profits increase for JPMorgan

18 January 2007

JP Morgan Chase has reported record quarterly income for the fourth quarter of 2006 and strong earnings growth, exceeding analysts' expectations.

The investment bank said in a statement that its earnings over the last three months of the year soared to $3.9 billion on record revenue of $16.1 billion, profit from continuing operations rose to $3.91 billion, up from $2.64 billion for the same period of 2005.

JP Morgan's earnings for the quarter rose by 68 per cent, boosted by strong performance in its investment banking and trading arms, making 2006 the company's most successful year on record.

Jamie Dimon, JP Morgan chief executive, said: "During the fourth quarter, we posted both record revenue and income from continuing operations, reflecting increasingly strong results across most of our businesses, especially in investment banking, where fees were at a record level and markets results improved significantly from the prior year."

The US stock market bounced back from a slump during 2006 and, although JP Morgan witnessed a slide in its retail business last year, it significantly outpaced a profit increase of 22 per cent recently announced by rival bank Lehman Brothers.

Investment banking revenues were up by 48 per cent over the fourth quarters of 2006 to $4.72 billion, while asset management also produced record revenue and earnings, as assets under management exceeded $1 trillion.

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