NEW YORK ( TheStreet) -- Financial sector ETFs were in the red Wednesday, after JPMorgan Chase ( JPM)
reported better-than-expected results but its lackluster loan growth failed to impress. The second largest bank by assets reported a 67% growth in profits, but revenue was on the lighter side. Analysts had been hoping for a pickup in loan growth, but except for the commercial banking segment, which saw a 7% increase in loans over the corresponding previous quarter, all other segments saw lower loan balances. The dim revenue outlook and continuing problems associated with its mortgage businesses -- the bank reported a $1.1 billion provision for credit losses arising from its real estate portfolios and a loss of $1.1 billion for the impact of increased servicing costs on the fair value of the firm's mortgage servicing rights asset, among other charges -- dampened expectation for solid earnings reports from Bank of America ( BAC), due to report on April 15, and Citigroup ( C) and Wells Fargo ( WFC), which report next week. In addition, JPMorgan CEO Jamie Dimon said that investors should not expect dividend increases for some time. Shares of JPMorgan were losing 0.9%. Shares of Citigroup and Wells Fargo were down by 1.5% each, while Bank of America saw its shares slip by 1.1%. Regional Bank HOLDRs ( RKH) was shedding 1.5%. JPMorgan accounts for about 23% of its portfolio, while Wells Fargo takes up another 20%. Broader banking sector ETFs such as iShares Dow Jones US Financial Services ETF ( IYG) and SPDR Financial ETF ( XLF) were losing about 0.8% each. Regional banks were also under pressure, with the SPDR KBW Regional Banking ETF ( KRE) down by 1.2%. Banking stocks have not participated in the rally in recent months, weighed by concerns about impact of new regulations, as well as a tepid revenue outlook. Some analysts have argued that bank stocks need to rally for the stock market to move higher. --Written by Shanthi Bharatwaj in New York >To contact the writer of this article, click here: Shanthi Bharatwaj. >To follow the writer on Twitter, go to http://twitter.com/shavenk. >To submit a news tip, send an email to: email@example.com.