JPMorgan Chase kicked off first-quarter 2011 earnings season on Wednesday by reporting a 67% rise in profits, with earnings at $5.56 billion, or $1.28 per share, versus $3.3 billion, or EPS of $0.74, a year ago at this time. The earnings performance beat analysts' expectations for EPS of $1.15.
The bank's strong performance comes as it continues to work out provisions for bad mortgages and credit card loans. JPMorgan set aside $1.17 billion in the first quarter compared with $7.01 billion a year ago, but its retail division reported a net loss of $208 million, compared with a net loss of $131 million in the prior year, according to the company's Q1 2011 earnings release.
The retail bank's performance "was more than offset by the extraordinarily high losses we still are bearing on mortgage-related issues," said Chairman and CEO Jamie Dimon in a statement. "Unfortunately, these losses will continue for a while. Rest assured, we are fully engaged in fixing our problems and addressing our mistakes from the past, and we will strive to build the best mortgage business going forward."
However, he said, JPMorgan's strong balance sheet allowed the bank to increase its annual dividend to $1.00 per share and to re-establish a significant share-repurchase program.
The bank increased its quarterly common stock dividend to $0.25 per share and authorized a new $15 billion multi-year common stock repurchase program, of which up to $8.0 billion of common stock repurchases is approved for 2011.
In JPMorgan's asset management division, net income was $466 million, an increase of $74 million, or 19%, from the prior year. The results reflected higher net revenue and a lower provision for credit losses, largely offset by higher noninterest expense.
