JPMorgan Chase posted strong fourth-quarter results on Friday, including a $10.4 billion profit that beat forecasts. Still, JPMorgan Chase’s profit fell 14% from the same quarter a year earlier due to falling trading revenue.
“The economy continues to perform fairly well despite headwinds related to the Omicron variant, inflation and supply chain bottlenecks,” Dimon said in a statement. “Credit continues to be healthy…and we remain optimistic on US economic growth as business sentiment is upbeat and consumers benefit from job and wage growth.”
JPMorgan Chase and other big banks are benefiting from rising interest rates, making their loans more profitable, and from an economy that has recovered from the depths of the credit crunch. Commercial lending rates have been rising in anticipation of Fed rate hikes this year.
JPMorgan Chase also posted sharp increases in advisory fees on the back of a booming environment for merger activity, as well as strong demand for initial public offerings. JPMorgan Chase said global investment banking fees rose 37% from a year earlier.
But rising interest rates could slow the recovery. The Federal Reserve has hinted that it will raise rates three or even four times this year.
Dimon said in response to a question from CNN’s Matt Egan that the Fed has to “thread the needle” to make sure it can keep inflation in check and not slow the economy too much.
Still, Dimon added in a CNN Business follow-up question that the economy is much better now than it was in March 2020 and that we should “count our blessings” on that.
Dimon said he wasn’t going to spend too much time worrying about what the Fed will do and when, because it would be a “waste of time.”
Wells Fargo beats forecasts
Rival Wells Fargo also reported strong results on Friday. Earnings and revenue beat analysts’ expectations. The bank has been taking steps to repair its public image after a series of scandals damaged its reputation and made it the target of increased scrutiny and regulation in Washington.
“The changes we have made to the company and the strong outlook for continued economic growth make us feel good about how we are positioned for 2022,” Wells Fargo CEO Charlie Scharf said in a statement. “But we are also aware that we still have a multi-year effort to satisfy our regulatory requirements, with setbacks likely to continue along the way, and we continue our work to move beyond exposures related to our historical practices.”