US banks report solid earnings

NEW YORK: Credit cards were a strength and trading revenues a weakness in the solid US bank earnings released Friday, as JPMorgan Chase chief executive Jamie political gridlock in Washington.

JPMorgan Chase, Wells Fargo and Citigroup all reported betterthan-expected earnings, and bank executives described US economic growth as solid, if unspectacular, as moves by the US Federal Reserve to lift interest rates have enabled banks to charge more for loans.

Yet Friday’s deluge of results, quarter corporate earnings period, drew a lackluster reaction from Wall Street, with shares of all three banks falling after the reports.

At JPMorgan, the biggest US bank by assets, second-quarter net income rose 13.4 percent to $7.0 billion. Net revenues climbed 4.7 percent to $26.4 billion.

Key factors behind the earnings jump included higher net interest income due to the rising interest rate environment, as well as higher overall loans, often seen as a proxy households.

But JPMorgan’s trading divisions suffered compared with the year-ago period, with the bank citing “sustained low volatility.”

Analysts also were disappointed by a $500 million cut to JPMorgan’s 2017 projection for growth of net interest income to $4 billion, implying it sees weaker loan growth in the second half of 2017, due in part to the Fed’s policy of only raising interest rates gradually.

“We’re looking at a slower rise in interest rates in general and that speaks to Fed funds rate policy,” said CFRA analyst Ken Leon.

“I believe you’re not going to interest income from rising rates until 2018 and 2019.”

Dimon blasts Washington

JPMorgan chief executive Jamie colorful tirade against Washington gridlock that he blames for blocking progress on tax reform and other growth measures needed to boost the economy.

- ness advisory council, warned the US will have trouble accelerating growth from its current 1.5 to 2.0 percent trend if it fails to come together in favor of pro-business policies.

“It’s almost an embarrassment to be an American citizen traveling around the world and listening to the stupid shit we have to deal analysts on a conference call,

“It’s not a Republican issue, doesn’t matter who the pilot is.”

lagging progress on President - da, with the outlook highly uncertain for a Republican health care law that has been seen as important to tax reform.

John Gerspach expressed cautious optimism about the outlook for pro-growth measures from Washington.

“The hope is still there,” Gerspach said in a conference call with reporters. “Obviously it’s taken a little bit longer than anybody would want.”

Citigroup’s net income came in at $3.9 billion, down 3.2 percent from the year- ago period, but better than analysts expected. Revenues rose 2 percent to $17.9 billion, with revenues from Citibranded credit cards jumping 10 percent following a venture with Costco Wholesale.

Citigroup cited higher cost of credit and operating expenses as

It also said its trading revenues were dented by an unfavorable comparison with the year-ago period, when Brexit-related trading boosted volumes.

Wells Fargo’s net income rose 4.5 percent from the year- ago period to $5.8 billion. Revenues of $22.2 billion were essentially period.

Net interest income rose, but overall loans were essentially unchanged compared with the year-ago period. One factor was a decline in auto loans due to tighter underwriting standards.