Jp Morgan Chase & Co. · NYSE:JPM
Jp Morgan Chase & — Q2 2003 Earnings Presentation
15 slides from Jp Morgan Chase &'s earnings presentation, Jul 18, 2003
Slide 1: Second Quarter 2003 Financial results
J U L Y 1 6, 2 0 0 3 S E C O N D Q U A R T E R 2 0 0 3 Financial results
Slide 2: Highlights: 2Q03
Highlights: 2Q03 Reported income up 78% from year-ago, 31% from 1Q; ROE of 17% LOB results IB: Strong trading, improving credit, market share gains CFS: Record results driven by mortgage JPMP: Narrower loss on MTM gains Expenses include addition to litigation reserve and real estate charges Strong l
Slide 3: Earnings per share
Earnings per share $ per share
Slide 4: Operating results
$ billions Operating results 1Actual ROE for all periods, not over/under. ROE 1H03 15%
Slide 5: Investment Bank
Investment Bank Continued strength in trading with controlled risk Improvement in credit quality High legal & vacant real estate charges $ millions Revenue of $4.3bn (?5% vs 1Q03) Fixed Income Capital Mkts 0.5 Equity Capital Mkts 0.1 IB Fees 0.18 Credit Portfolio 0.07 Treasury 0.15 Fixed Income Capi
Slide 6: Investment Bank league table summary
Investment Bank league table summary U.S. Equity & Equity-Related FY2002 1H03 Mkt Share 0.06 0.13 #6 #3 U.S. Investment Grade Bonds FY2002 1H03 Mkt Share 0.16 0.15 #2 #2 Global Syndicated Loans FY2002 1H03 Mkt Share 0.23 0.2 #1 #1 Global Announced M&A FY2002 1H03 Mkt Share 0.14 0.17 #5 #3 Source: Th
Slide 7: Chase Financial Services
Chase Financial Services Record volumes, revenues and profits in Home Finance, with strong risk management revenues Deposit growth but continuing spread compression Stable credit costs in Card and overall $ millions Revenue of $4.0bn (?8% vs 1Q03) 16% growth 3% growth 12% growth 4% growth 2% decline
Slide 8: JPMorgan Partners
JPMorgan Partners Book Value ($bn) Gains on direct investments reflect MTM as well as increase in cash realized gains Continue to reduce exposure 1Does not reflect agreement to sell current book value of $350mm. Private Equity Losses ($mm)
Slide 9: T&SS and IM&PB earnings
T&SS and IM&PB earnings ($ in millions) Growth in Treasury Services and Institutional Trust offset by weakness in Investor Services Investment Mgmt & Private Banking Operating Earnings 2Q02 82 1Q03 36 2Q03 69 ROE 6% 3% 5% ROTE1 21% 12% 21% Increase in revenues and pretax margin over 1Q03 Improved 3-
Slide 10: Operating expense
Higher incentive compensation on higher revenues Increased litigation reserve for expected Enron regulatory settlement and high vacant real estate charges $ billions Operating expense
Slide 11: Risk migration trends
Risk migration trends All Other Telecom Cable Merchant Energy Emerging Markets Note: Y-Axix is set to 16.5. Update scale when updating data 12/31/2002 8.7 2.3 2.2 2.2 1.2 16.6 3/31/2003 7.8 2.3 2.2 1.4 0.9 14.6 6/30/2003 7.4 2.1 2.3 0.7 0.3 12.8 1 Criticized: JPMorgan Chase's internal risk assessmen
Slide 12: Credit costs trend
Credit costs trend $ millions
Slide 13: Capital and assets
Payout ratio 40% Growth in nominal and risk weighted assets VIE consolidation in 3Q - - potential changes in structures; no immediate regulatory impact Column 1 12/31/2002 0.082 3/31/2003 0.084 6/30/031 0.0852 Tier 1 Capital Ratio Assets $759 $755 $803 RWA $456 $456 $483 1 Estimated Capital and asse
Slide 14: Summary
Summary Strength in trading and mortgage -- will moderate Improving risk profile Commercial credit Expected regulatory settlement of Enron Private equity exposure Strong franchise -- benefiting from positive operating leverage and market share gains
Slide 15: Forward-looking statements
This presentation contains statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of JPMorgan Chase's management and are subject to significant risks and uncertainties. These