WASHINGTON (AP) — JPMorgan’s net income soared 50% to more than $14 billion in the fourth quarter as the bank’s profit and revenue easily beat Wall Street forecasts, and other major banks reported banner earnings for the year as businesses and consumers continued to spend despite elevated interest rates.
JPMorgan’s earnings per share rose to $4.81 from $3.04 a year ago. The result beat Wall Street profit projections of $4.09 a share, according to the data firm FactSet. Total managed revenue hit $43.7 billion, up 10%, from $39.9 billion a year ago. Wall Street was expecting revenue of $41.9 billion.
JPMorgan posted a record $54 billion profit for the year, or $18.22 per share, adjusted for one-time expenses.
JPMorgan shares rose just less than 1% in morning trading.
Citigroup, Wells Fargo and Goldman Sachs also issued strong results on Wednesday.
The country’s biggest banks have benefitted from higher interest rates for the last two years, when the Federal Reserve jacked up rates to combat the inflation that took root in the wake of the COVID-19 pandemic.
The government’s latest consumer prices report, also issued Wednesday, showed that prices for many essentials rose, pushing the consumer price index to 2.9% in December, the highest it has been since July. But underlying inflation trends — watched closely by the Fed — slowed to 3.2% in December, better than analysts expected and a good sign for consumers and the broader economy.
That, combined with the strong bank earnings, boosted markets, with the S&P 500 and Dow Jones Industrials each climbing 1.7% and the technology-heavy Nasdaq gaining 2.2%.
As great as 2024 was for markets, bank stocks did even better, despite the Federal Reserve trimming its benchmark interest rate three times between September and December.
When it issued its last cut in December, the Fed also trimmed its forecast for 2025 rate cuts to two from four as inflation remained stubbornly above the Fed’s 2% target. That sent markets into a mini-slump, but not enough to dampen what was a spectacular 2024 run. The S&P gained 23% last year, the Nasdaq climbed more than 28% and the Dow finished up nearly 13%.
As for the banks, Goldman Sachs shares finished 2024 48% higher, while JPMorgan enjoyed a 41% gain and Wells Fargo shares climbed 43%.
JPMorgan reported Wednesday that its interest income fell 3% to $23.5 billion, thanks to a downtick in interest rates.
CEO Jamie Dimon said the bank got a boost from investment banking business, where fees rose 49% and markets revenue jumped 21%. The bank’s consumer banking business also thrived, with clients opening nearly 2 million checking accounts.
