JPMorgan's profit dips despite record revenue

One year trading in JPMorgan Chase

U.S. financial services company JPMorgan Chase reported a small drop in first-quarter profit as net revenue hit a record $26.9 billion US, up about $9 billion.

The company, which grew after absorbing competitors Washington Mutual and Bear Sterns last year, said profit for the three months ended March 31 was $2.1 billion (40 cents a share), compared with $2.4 billion (67 cents) in the first quarter of 2008.

The profit drop was driven by a near doubling in the provision for credit losses, to $10.1 billion, and much higher expenses, the company said Thursday in a news release.

Jamie Dimon, chairman and CEO, said the company has "extended approximately $150 billion in new credit to consumer and corporate customers during the first quarter," supporting the U.S. economy.

JPMorgan said its Tier 1 capital ratio, a key indicator of financial health, was estimated at 11.3 per cent at March 31, up from 8.3 per cent a year earlier. (The Royal Bank's ratio was 10.6 per cent in the end of its first quarter, Jan. 31.)

The company had about 219,500 employees on March 31, including more than 38,200 from Washington Mutual.

JPMorgan stock closed up 68 cents at $33.24 in New York. The 52-week range is $14.96 to $50.63.

JPMorgan took over Washington Mutual Inc. last fall. It was the largest U.S. savings and loan before JPMorgan bought its banking assets for $1.9 billion in a transaction arranged by U.S. regulators.

The holding company for Washington Mutual later filed for bankruptcy protection.

JPMorgan said March 2008 that it was going to buy Bear Stearns in a transaction intended to stop the panic in the U.S. financial businesses.

JPMorgan has assets of $2.1 trillion deployed in investment banking, financial services for consumers, small business and commercial banking, financial transaction processing, asset management and private equity.

It operates in more than 60 countries.