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JPMorgan Kicks Off Big Bank Earnings: What You Need To Know

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JPMorgan Chase & Co. (NYSE: JPM) is scheduled to report its second quarter results on Tuesday before market open.

Estimize, the crowd sourced earnings and economic estimates platform is estimating the bank will earn $1.48 per share in the quarter (based on 58 estimates) on revenue of $24.675 billion. This compares to the Wall Street consensus estimate calling for an earnings per share of $1.45 on revenue of $24.425 billion.

JPMorgan last reported its first quarter earnings on April 14. At that time, the company earned $1.58 per share, beating the consensus of $1.39. Revenue of $24.82 billion was also higher than the $24.46 billion analysts were looking for. Net income rose $645 million, or 12 percent to $5.9 billion from the same quarter a year ago.

Q2, Full Year Outlook

JPMorgan issued the following outlook and commentary for its second quarter and full year fiscal 2015 results. Investors will be paying attention to any commentary the bank releases in its second quarter print to compare expectations.

Firmwide:

  • Expect FY2015 core loan growth of 10 percent+/-
  • Expect FY2015 NCOs to remain low at $4B+
  • Expect FY2015 adjusted expense of $57B+/-
  • Expect Basel III Fully Phased-in CET1 ratio of 11 percent+/- by year-end 2015.

Consumer And Community Banking:

  • Expect Mortgage Banking noninterest revenue for FY2015 to be down ~$1B Year over year on lower servicing revenue as well as lower repurchase benefits
  • Expect Card Services revenue rate in 2015 to remain at the low end of the target range of 12-12.5 percent
  • Expect Card Services FY2015 NCO rate to be slightly less than 2.5 percent

Corporate & Investment Bank:

  • For 2Q15, expect business simplification to generate Year over year negative variance in Markets revenue of ~$300mm, or 6 percent, with an associated ~$300mm reduction in expense
  • Expect Securities Services revenue to be $950mm – $1B in each of the remaining quarters of 2015, depending on seasonality

Commercial Banking:

  • Expect expense to be relatively stable as compared to 1Q15 run-rate, as the build-out of the control environment is completed

Asset Management:

  • Expect FY2015 pretax margin and ROE to be at the low end of TTC targets

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