JPMorgan Earnings Easily Beat Street

(Updated share prices throughout.)

JPMorgan Chase's ( JPM) shares were falling early Thursday, despite easily beating top- and bottom-line estimates that were tempered by the company's repayment of federal bailout funds and a special assessment to its regulator.

JPMorgan posted a profit of 28 cents a share in the second quarter, down from 53 cents a year earlier, but far better than the 4 cents a share predicted by analysts.

Shares of the bank were down 2% to $35.52 in recent trading. The stock closed Wednesday at $36.26.

The results were weighed by a charge of $1.1 billion, or 27 cents a share, related to the company's repayment last month of the federal government's $25 preferred equity investment made through the Troubled Asset Relief Program. JPMorgan also was hit with a special assessment of 10 cents a share by the Federal Deposit Insurance Corp.

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The company said its $27.7 billion in revenue for the quarter was its best ever, easily surpassing the $25.89 billion expected by analysts. The company recorded $2 billion in revenue in the year-ago quarter. Results were driven by record investment banking fees and fixed income markets revenue, much like rival Goldman Sachs ( GS) reported on Tuesday.

Commercial banking, asset management, Treasury and securities services and retail banking also were strong, offset by credit costs that remain high in consumer lending and card services. Chairman and CEO Jamie Dimon said in a statement said the company expects credit costs to "remain elevated for the foreseeable future."

Still, the company has continued to lend, Dimon said. JPMorgan has extended $150 billion in new credit to consumers, corporations, small businesses, municipalities and non-profits and has approved 138,000 trial mortgage modifications in the quarter, bringing total foreclosures prevented since 2007 to 565,000.

"Throughout this crisis, we have remained committed to doing our part to help bring stability to the communities in which we operate and to the financial system overall," Dimon said.

Dimon also noted JPMorgan has increased credit reserves by $2 billion to $30 billion, leaving it with a Tier 1 capital ratio of 9.7% and a Tier 1 common ratio of 7.7%.
Gannon joined TheStreet.com in March 2007, after spending more than six years as a reporter and editor for The Journal News in Westchester County, N.Y., most recently as an assistant metro editor. He earlier covered several political and government beats as a reporter, including the city of Yonkers. Earlier in his career, he covered venture capital, private equity and the IPO market for Thomson Financial?s Venture Capital Journal and advertising for Sales-Fax, a small, independent trade weekly. He earned a B.A. in history from the College of the Holy Cross and an M.S. in journalism from Northwestern University?s Medill School.

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