Jp Morgan Chase & Co. · NYSE:JPM
Jp Morgan Chase & — Q2 2011 Earnings Presentation
22 slides from Jp Morgan Chase &'s earnings presentation, Jul 14, 2011
Slide 1: Financial Results 2Q11
FINANCIAL RESULTS 2Q11 July 14, 2011
Slide 2: 2Q11 Financial highlights
2Q11 Financial highlights 2Q11 net income of $5.4B; EPS of $1.27; revenue of $27.4B1 2Q11 results include the following significant items: $ in millions, excluding EPS Preta Net Income2 Pretax EPS2 Card Services - benefit from reduced loan loss reserves $1,000 $620 $0.15 Corporate - benefit from
Slide 3: 2Q11 Financial results
2Q11 Financial results1 $ in millions, excluding EPS $ O/(U) 2Q11 1Q11 2Q10 1 Revenue ((FTE)) $27,410 $1,619 $1,797 1 Credit Costs 1,810 641 (1,553) Expense 16,842 847 2,211 Reported Net Income $5 431 $5,431 ($124) $636 Net Income Applicable to Common Stock $5,067 ($69) $704 Reported EPS $1.27 ($0.0
Slide 4: Investment Bank
Investment Bank1 $ in millions Net income of $2.1B on revenue of $7.3B $ O/(U) ROE of 21% 2Q11 1Q11 2Q10 IB fees of $1.9B up 37% YoY Revenue $7,314 ($919) $982 Investment Banking Fees 1,922 143 517 Ranked #1 YTD in Global Investment Banking Fixed Income Markets 4,280 (958) 717 Fees Equity Ma
Slide 5: Retail Financial Services
Retail Financial Services1 $ in millions Key drivers $ O/(U) Retail Banking 2Q11 1Q11 2Q10 Retail Financial Services Average deposits of $356.4B up 6% YoY and Net Interest Income $4,571 ($59) ($246) Noninterest Revenue 3,405 1,760 413 2% QoQ Revenue $7,976 $1,701 $167 Checking g accounts flat Yo
Slide 6: Retail Banking and Mortgage Banking, Auto & Other Consumer Lending
Retail Financial Services Retail Banking and Mortgage Banking Banking, Auto & Other Consumer Lending $ in millions Retail Banking net income of $1.1B, up 21% YoY: Total revenue of $4.6B up p 5% YoY driven by y $ O/(U) higher debit card revenue, deposit-related fees 2Q11 1Q11 2Q10 and investment
Slide 7: Retail Financial Services Real Estate Portfolios
Retail Financial Services Real Estate Portfolios $ in millions Net loss of $66mm compared with a net $ O/(U) loss of $236mm in the prior year 2Q11 1Q11 2Q10 Total net revenue of $1.2B down 11% Real Estate Portfolios Revenue $1,217 $53 ($148) YoY driven by a decline in net interest Expense 371 16
Slide 8: Home Lending update
Home Lending update Key statistics1 Delinquencies modestly improved in 2Q11 1Q11 2Q10 Q 2Q11 EOP owned portfolio ($B) Home Equity $82.7 $85.3 $94.8 Home equity and subprime mortgage Prime Mortgage, including option ARMs 2 61.3 62.6 66.3 net charge-offs are down, while prime Subprime Mortgage 10.
Slide 9: 2Q11 mortgage-related risks and reserves
2Q11 mortgage-related mortgage related risks and reserves Real Estate Portfolios Total reserves of $9 $9.7B 7B remain for the non-credit non credit impaired portfolio WaMu purchased credit-impaired portfolio reserves assume further HPI deterioration of 5% – Incremental 5% decline in HPI would
Slide 10: Card Services
Card Services $ in millions Net income of $911mm compared with $343mm $ O/(U) in the p prior yyear 2Q11 1Q11 2Q10 Credit costs of $810mm reflect lower net Revenue $3,927 ($55) ($290) Credit Costs 810 584 (1,411) charge-offs and a reduction of $1.0B to the Expense 1,622 67 186 allowance for loan
Slide 11: Commercial Banking
Commercial Banking1 $ in millions Net income of $607mm down 12% YoY $ O/(U) 2Q11 1Q11 2Q10 Average loan balances up 6% YoY and 2% Revenue $1,627 $111 $141 QoQ Middle Market Banking 789 34 22 4th consecutive quarter of increased Corporate Client Banking 339 49 54 loan balances Commercial Term L
Slide 12: Treasury & Securities Services
Treasury & Securities Services $ in millions Net income of $333mm up 14% YoY and 5% $ O/(U) QoQ Q Q 2Q11 1Q11 2Q10 Pretax margin of 27% Revenue $1,932 $92 $51 Worldwide Securities Services 1,002 53 47 QoQ increase due to seasonal activity in Treasury Services 930 39 4 securities lending and de
Slide 13: Asset Management
Asset Management $ in millions Net income of $439mm up 12% YoY $ O/(U) Pretax margin g of 29% 2Q11 1Q11 2Q10 Revenue of $2.5B up 23% YoY due to the effect of Revenue $2,537 $131 $469 higher market levels, net inflows to products with higher Private Banking 1,289 (28) 136 margins, higher valuat
Slide 14: Corporate/Private Equity
Corporate/Private Equity1 Net Income ($ in millions) Private Equity $ O/(U) 2Q11 1Q11 2Q10 Private equity gains of $816mm (pretax) Private Equity $444 $61 $433 Private Equity portfolio of $8.8B (6.6% of stockholders’ equity less goodwill) Corporate 58 (281) (584) Corporate Net Income $502 ($220)
Slide 15: Fortress balance sheet
Fortress balance sheet $ in billions Basel III capital requirements 2Q11 1Q11 2Q10 Regulator JPM requirements6 Basel I Tier 1 Common Capital1,2 $121 $120 $108 Current estimate 7.6% 1,2,3 Basel III Tier 1 Common Capital (Estimate) $120 $116 $108 2013 3.50% Basel I Risk-Weighted Assets 1 $1,197 $1,193
Slide 16: Outlook
Outlook Retail Financial Services Corporate / Private Equity Home Lending loss guidance: Private Equity Expect total quarterly net charge-offs of Results will be volatile $1.2B+/- Corporate Realized repurchase losses of $1.2B+/- $1.2B / Corporate, Corporate excluding Private Equity, Eq
Slide 17: Appendix
Agenda Page Appendix 16 FINANCIAL RESULTS 16
Slide 18: Consumer credit — delinquency trends
Consumer credit — delinquency trends (Excl purchased credit-impaired loans and WaMu and Commercial Card portfolios) (Excl. Home Equity delinquency trend ($ in millions) Prime Mortgage delinquency trend ($ in millions) $4,000 $ , 30 – 150 day delinquencies $4,500 $ , 30 – 150 day delinquencies 150+ d
Slide 19: Coverage ratios remain strong
Coverage ratios remain strong $ in millions Loan Loss Reserve/Total Loans1 Loan Loss Reserve Nonaccrual Loans Loan Loss Reserve/NALs1 6.00% 500% 5.00% 400% 35,836 34,161 38,186 32,266 4 00% 4.00% 30 633 30,633 31 602 31,602 300% 29,750 28,520 29,072 3.00% 200% 2.00% 100% 14 785 14,785 17,767 17,564
Slide 20: IB League Tables
IB League Tables League table results For YTD June 30, 2011, JPM ranked: YTD J June ne 2011 FY 2010 #1 in Global IB fees Rank Share Rank Share #1 in Global Debt, Equity & Equity-related Based on fees: #3 in Global Equity & Equity-related Global IB fees¹ 1 8.8% 1 7.6% #2 in Global Long-term
Slide 21: Notes on non-GAAP & other financial measures
Notes on non non-GAAP GAAP & other financial measures Notes on non-GAAP financial measures 1. In addition to analyzing the Firm’s results on a reported basis, management reviews the Firm’s results and the results of the lines of business on a “managed” basis, which is a non-GAAP financial measure. T
Slide 22: Forward looking statements
Forward looking statements Forward-looking This presentation contains forward-looking statements within the meaning of the Private Securities Litigation g Reform Act of 1995. Such statements are based upon p the current beliefs and expectations of JPMorgan Chase & Co.’s management and are subject to