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July 18, 2011

Chase announces Q2 2011 results

JP Morgan Chase has revealed improved net income results for the cards services division in its Q2 2011 report. Lower provision of credit losses, offset partially by lower net revenue resulted in net income of $911 million, an increase of $568 from the same point in 2010.

By Verdict Staff

JP Morgan Chase has revealed improved net income results for the cards services division in its Q2 2011 report.

Lower provision of credit losses, offset partially by lower net revenue, resulted in net income of $911m, an increase of $568m from the same point in 2010.

The bank’s card services’ net revenue stood at $3.9bn for the quarter, a 7% decrease from the prior year. Lower average loan balances, legislative changes and decreased level of fees led to a 13% decrease in net interest income to the current $2.9bn.

The provision for credit losses decreased from $2.2bn in the prior year to the present $810m. The firm also reported lower estimated losses which led to lower net charge-offs and a $1bn reduction to loan losses allowance.

“We are pleased to report that our results for the quarter reflected continued improvement in credit trends across our consumer and wholesale portfolios,” said Jamie Dimon, chairman and CEO of JP Morgan Chase.

“With respect to our credit card portfolio, delinquencies and net charge-offs improved, and we reduced loan loss reserves by $1bn as estimated losses declined. We expect credit card net charge-offs to continue to improve next quarter as we approach a more normalised credit environment.”

2m new accounts were opened during Q2 2011 and merchant processing volume grew by 17% to $137.3bn on 5.9 bn transactions processed.

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