Daily Lessons from Life 13 April 2012 - JPMorgan posts US$5.4b Q1 profit

"JPMorgan posts US$5.4b Q1 profit - AFP 13 April 2012

NEW YORK: US banking behemoth JPMorgan Chase on Friday announced it made US$5.4 billion in the first quarter of this year on growing revenue in its retail business, despite signs of a still-weak mortgage market.

Deposits were up, the number of checking accounts held by customers was up and the number of branches was also up as the bank's retail business improved.

"We are pleased that our results for the quarter reflected positive credit trends for our consumer real estate and credit card portfolios," said Jamie Dimon, the firm's CEO.

But in a sign that the US housing crisis is far from over, he added: "We expect to see elevated levels of costs and losses associated with mortgage-related issues for a while longer."

Against this backdrop, first-quarter profit was slightly down from the first quarter of 2011, when the bank made US$5.6 billion.

But the firm felt confident enough to bulk up the bank's reserve capital, upping its shareholder dividend and kicking off a US$15 billion equity buyback.

Last year JPMorgan Chase, which employs 260,000 people, made a record annual profit of US$19 billion."

I wonder why should banks be allowed to make such OBSCENE profit!

Lessons for me are:

1. you better be in the banking business than any other type of business since the return on investment is that much better!!;

2. how much of that profit comes from 'trading' rather than investing?

3. why should the WORLD chipped in to help the 'poor' bankers during the many financial crisis?

Congratulation to the shareholders of JPMorgan and hope that ordinary folks like us do not get impacted from this section!