Dividends andJPMorgan Chase beats profit forecasts

In contrast to Wells Fargo, JPMorgan Chase posted a better than expected quarterly profit. In an article by Elizabeth Dilts and David Henry of Reuters, the largest bank in the US by assets showed strength across its business lines powered by solid US economic growth, moderate inflation, and strong consumer and business confidence.

Loans in the consumer division rose 4% from a year ago. Overall revenue rose 4.7% to $29.85 billion beating the analysts expectation of $28.44 billion.

The bank’s net interest margin edged up 0.02% from the 4th quarter. The bank expects the number to be constant for the next few quarters.

Unlike Wells Fargo which is expecting the net interest income to decline, JPMorgan Chase expects an increase of 4% over 2018.

Although the bank added $90 million provision for credit losses, Chief Financial Officer Marianne Lake did see the provisions as signs of credit deterioration.

The bank’s net income rose to $9.18 billion or $2.65 a share, up from $8.71 billion or $2.37 a share. Analysts had expected $2.35 a share.

Linking to dividend paying stocks, it is hard not to own a bank in a dividend stock portfolio because unless the entire economy collapses and from the Hearings on the House Banking Committee, the banks are well capitalized and very profitable. They can weather 99% of any downturn in the economy and still make money.

There are more questions than answers, till the next time – to raising questions.

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