US bank earnings hint towards economic recovery
JP Morgan, the largest bank in the US by assets, reported a $5.7 billion profit in the third quarter today, an increase of 34% compared to a year ago. The CEO Jamie Dimon suggested the nation’s housing market had “turned a corner”, and that the bank would be reducing the amount it sets aside to cover mortgage losses. The bank also appeared to be recovering from trading losses created by a former employee who has become known as the “London Whale”. Whilst the synthetic credit derivative losses generated in London have so far cost the bank $5.8 billion, only modest losses were anticipated going forward as the positions were unwound, although the bank is currently investigations by US authorities. Wells Fargo’s also reported earnings, the biggest mortgage lender in the US announcing that net income has increased 22% over the same period, to $4.9 billion. The group highlighted strength in its mortgage and deposit businesses, with a surge in refinances occurring in the quarter as homeowners refinances to take advantage of the Federal Reserve’s low interest rate policy. Equities were generally lower; London’s blue-chip index struggled as miners posted some significant losses. Hargreaves Lansdown was the biggest gainer closing up 3.5% after following a well received interim management statement in which revenue, customer numbers and assets under administration were all ahead of expectations as the provider of investment management products and services continued to gain market share. The FTSE 100 finished down 0.62% at 5793 in line with other European indices.
This was posted in Bdaily's Members' News section by James .