The giant US bank reported $9.4 billion in profits, up four percent from the year-ago period as revenues were down slightly at $29.9 billion.
Like other large banks, JPMorgan had set aside billions of dollars in bad loans the last two quarters due to the coronavirus.
But after nearly $20 billion in credit costs in the first half of 2020, the bank reported just $611 million in credit costs in the third quarter. That figure included a boost from $569 in reserve releases.
JPMorgan Chief Executive Jamie Dimon said the results show JPMorgan’s committment to “an inclusive economic recovery” in spite of “significant uncertainty.”
As in the second quarter, when volatility boosted trading activity, JPMorgan again scored higher revenue from its markets division.
On the downside, the bank reported a decline in net interest income in the wake of Federal Reserve actions to keep rates low to boost the economy.
The much lower credit costs are an indicator of how the US economy has stabilized after the upheaval earlier in the year following broad lockdowns to contain the coronavirus. The set-asides taken earlier in the year were in preparation for possibly significant loan defaults.
A key factor has been hefty US fiscal relief spending earlier in the year that provided a cushion to many households and avoided devastating non-payments seen in other recessions, bank executives said.
However, bank executives have cautioned that much uncertainty remains ahead given the coronavirus and the failure so far of policy makers to enact fresh stimulus.
Shares of JPMorgan rose 1.5 percent to $104.00 in pre-market trading. | Agence France-Presse