April 12, 2013
The bank broadly beat estimates, with a 33% jump in profit to $6.53 billion for the first three months of the year. But the boosts didn’t come from the lending that echoes the health of the broader consumer.
Total loans on the bank’s balance sheet rose only 1% from last year to $728.9 billion.
In the consumer and community bank, which would include small businesses, loans dropped 4% from the prior year as of the end of the period.
Loan originations to small businesses dropped 20% from the prior year.
Dimon didn’t shy from raising a red flag about the small business number.
“The exception is that loan growth across the industry has been softer this quarter, although year-on-year growth remained strong,” Dimon said in a release. “Small businesses remain cautious about the recovery and fiscal uncertainty, and are not investing their capital. However, companies’ balance sheets are much stronger than they were before the financial crisis and small businesses remain well positioned to invest in growth once they decide to.”
Credit card and student loan volumes dropped 3% and 14%, respectively thought auto loans rose 5%.
Mortgage originations did rise 37% from the prior year but the revenue from mortgages slid due to changes in the valuation it ascribes to mortgage servicing rights.
Loan growth to the larger companies was stronger, however. In the commercial bank, which would house middle market clients, loans rose 13% from last year, though again revenue and profit only ticked slightly higher for the commercial bank.
Loans to J.P. Morgan’s largest clients in the corporate and investment bank rose 2%.