Jp Morgan Chase & Co. · NYSE:JPM
Jp Morgan Chase & — Q4 2003 Earnings Presentation
16 slides from Jp Morgan Chase &'s earnings presentation, Jan 21, 2004
Slide 1: Fourth Quarter and Full Year 2003 Financial Results
FOURTH QUARTER AND FULL YEAR 2003 J A N U A R Y 2 1, 2 0 0 4 Financial results
Slide 2: Significant earnings rebound; delivering on performance and execution
Significant earnings rebound driven by: Revenue growth across all businesses -- record earnings at CFS and IB Much lower commercial credit costs Lowered risk concentrations, increased capital levels FY03: Delivering on performance and execution
Slide 3: Operating results
$ in billions Operating results 1 Actual ROE for all periods, not over/under. $ per share
Slide 4: 2003 revenue growth
2003 revenue growth Growth comparisons versus FY 2002 on an operating basis $ in billions 1 Includes Support units & Corporate sector
Slide 5: Commercial credit
Commercial Credit ($ in millions) Critized 12/31/2002 16.6 Q103 14.6 Q203 12.8 9/30/2003 11.3 12/31/2003 8.9 Criticized Exposure ($ in billions) NPA2 $4.1 $3.0 $2.4 1 Includes commercial & residual 2 Commercial Nonperforming Assets Commercial credit
Slide 6: Commercial credit portfolio trends
12/31/2001 12/31/2002 12/31/2003 Commercial Credit Risk Exposure (1) 75 65 50 CDS Hedges (2) 19 24 35.2 Commercial Credit Risk Capital (3) 12 12 7 Lowered risk exposures 1 Includes notional spot balances of lending-related commitments, loans, other assets and MTM-derivative receivables (net of colla
Slide 7: Balance sheet and capital
$ in billions Dividend payout ratio of 43% in 03 compared to 83% in 02 on operating basis Growth in risk weighted assets and portfolio acquisitions Balance sheet and capital
Slide 8: Investment Bank revenue
Portfolio management revenues relate to both market-making and proprietary risk-taking activities. Other includes fees and commissions, credit portfolio and other revenues. Investment Bank revenue $ in billions
Slide 9: Investment banking fees and market share
Note: Y-Axix is set to 16.5. Update scale when updating data 2000 0.029 2001 0.035 2002 0.044 2003 0.085 Investment banking fees and market share $ in millions Global Equity & Equity Related Very strong quarter; increase for full year Doubled market share in equity and increased share in M&A1 Mainta
Slide 10: Chase Financial Services
$ in billions Chase Financial Services 1Actual ROE for all periods, not over/under. Revenue breakdown by business ($ in millions)
Slide 11: Investment Management & Private Banking
Operating Earnings ($ in millions) Investment Management & Private Banking Pre-tax margin 2% 17% 18% ROTE1 4% 23% 31% 1Return on tangible equity
Slide 12: Treasury & Securities Services
Treasury & Securities Services Revenue ($ in millions) Earnings $128 $116 $114 $143 $147 ROE 19% 17% 16% 22% 21% Record revenues in Q4 include gain on sale of non-strategic business Investor Services trending better in 2H03, driving revenue and income rebound in Q4 Full year ROE of 19%, earnings dow
Slide 13: JPMorgan Partners
JPMorgan Partners $ in millions Direct portfolio: Over $900MM swing in 03; higher realized gains; writedowns trending favorably Significant reductions in 3rd party funds, moderating losses In 2004, looking for improvement but still low returns; lower book value as "harvesting" exceeds new investment
Slide 14: Summary of 2003, outlook for 2004
Summary of 2003, outlook for 2004 Record earnings since merger Lower risk concentrations and increased capital 2004 outlook - different mix of earnings IB: Higher client revenue but lower securities gains and NII Lower mortgage offsets growth in other CFS businesses Improved equity markets and merge
Slide 15: 2004 outlook
2004 outlook JPMC -- stand alone Headwinds from impact of rising rates on mortgage and global treasury. Tailwinds from gains in market share and rise in equity values and market activity. Combined with Bank One Short-term cautious: Cost savings in '04 more than offset by estimate of amortization Spo
Slide 16: Regulation MA Disclosure
Regulation MA Disclosure This investor presentation contains forward-looking statements 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