JP Morgan Update as it enters the Protected Support Zone after its good 1st Quarter earnings of $1.59 on Friday 12/04/2013

Supported Consumers, Businesses and Communities

JPMorgan Chase & Co. (JPM):

-- Strong performance across all businesses(2) -- Consumer & Community Banking deposits were up 10%; mortgage originations were up 37% to $52.7 billion; Credit Card sales volume(1) was up 9%

-- Corporate & Investment Bank reported strong performance across products and maintained its #1 ranking for Global Investment Banking fees; assets under custody were up 8% to $19.3 trillion

-- Asset Management achieved its sixteenth consecutive quarter of positive net long-term client flows, a record of $31 billion for the first quarter; assets under supervision were a record $2.2 trillion; loan balances were up 27% to a record $81.4 billion

-- The Board intends to increase the second-quarter common stock dividend to $0.38 per share(3) from the current $0.30 per share; the Firm repurchased $2.6 billion of common equity in the first quarter and is authorized to repurchase an additional $6 billion of common equity through the first quarter of 2014

-- Fortress balance sheet strengthened -- Basel I Tier 1 common(1) of $143 billion, or 10.2%

-- Estimated Basel III Tier 1 common(1) of 8.9%(4), up from 8.7% in the prior quarter

-- High Quality Liquid Assets(5) of $413 billion

-- First-quarter results included the following significant items -- $650 million pretax benefit ($0.10 per share after-tax increase in earnings) from reduced mortgage loan loss reserves in Real Estate Portfolios

-- $500 million pretax benefit ($0.08 per share after-tax increase in earnings) from reduced credit card loan loss reserves in Card Services

-- JPMorgan Chase supported consumers, businesses and our communities -- $480 billion of credit(1) provided and capital raised in the first quarter -- $78 billion of credit(1) provided for consumers; originated more than 260,000 mortgages

-- Nearly $4 billion of credit(1) provided for U.S. small businesses

-- $123 billion of credit(1) provided for corporations

-- More than $255 billion of capital raised for clients

-- More than $17 billion of credit(1) provided and capital raised for nonprofit and government entities, including states, municipalities, hospitals and universities

-- Hired nearly 5,300 U.S. veterans and service members since the beginning of 2011

JPMorgan Chase & Co. (JPM) today reported record net income of $6.5 billion for the first quarter of 2013, compared with net income of $4.9 billion in the first quarter of 2012. Earnings per share were a record $1.59, compared with $1.19 in the first quarter of 2012. Revenue(1) for the quarter was $25.8 billion, compared with $26.8 billion in the prior year. The Firm’s return on tangible common equity(1) for the first quarter of 2013 was 17%, compared with 15% in the prior year.

As previously announced, the Board of Directors intends to increase the second-quarter common stock dividend to $0.38 per share(3) from the current $0.30 per share, returning the dividend to its highest level. The Board has also authorized the Firm to repurchase $6 billion of common equity commencing with the second quarter of this year through the end of the first quarter of 2014. During the first quarter of 2013, the Firm repurchased $2.6 billion of common equity. The Federal Reserve asked the Firm to submit by the end of the third quarter an additional capital plan addressing the weaknesses it identified in the Firm’s capital planning processes. The Firm is dramatically increasing the resources deployed and intends to fully address their requirements. Following their review, the Federal Reserve may require the Firm to modify its capital distributions.

Jamie Dimon, Chairman and Chief Executive Officer, commented on the financial results: "JPMorgan Chase had a very good start to the year. All our businesses had strong performance, and our client franchises did exceptionally well. The Corporate & Investment Bank was #1 in fees, global debt and equity, syndicated loans, and announced M&A. Those leadership positions reflect the volume of business we do with clients and it is a great result. Consumer & Community Banking deposits were up 10% compared with the prior year, client investment assets were up 15%, and mortgage loan originations were up 37%. Asset Management also had strong performance with loan balances up 27% compared with the prior year. Assets under supervision were up 8% to $2.2 trillion. This business achieved a record $31 billion of net long-term client flows for the first quarter."

Dimon continued: "We are seeing positive signs that the economy is healthy and getting stronger. Housing prices continued to improve and new home purchases are also starting to come back. We also saw strong performance in our credit card portfolio, with net charge-offs remaining near historic lows, another sign that consumers are healthier and more confident. As a result, we reduced the allowance for loan losses in Consumer & Community Banking in the first quarter by a total of $1.2 billion and are likely to see further releases. Credit conditions were also favorable across the wholesale loan portfolios."

Dimon added: "The exception is that loan growth across the industry has been softer this quarter, although year-on-year growth remained strong. Small businesses remain cautious about the recovery and fiscal uncertainty, and are not investing their capital. However, companies’ balance sheets are much stronger than they were before the financial crisis and small businesses remain well positioned to invest in growth once they decide to. With approximately 2 million small business customers, Chase remains the nation’s #1 Small Business Administration lender and we plan to serve more customers when loan demand comes back."

Commenting on the balance sheet, Dimon said: "We strengthened our fortress balance sheet, ending the first quarter with Basel I Tier 1 common capital of $143 billion and a resulting ratio(1) of 10.2%; this includes the impact of the Basel 2.5 rules that became effective at the beginning of this year. We estimate that our Basel III Tier 1 common ratio(1) was approximately 8.9%(4)at the end of the first quarter, up from 8.7% in the fourth quarter."

Dimon continued: "We are pleased that our capital strength and earnings power will allow the Firm to return excess capital to our shareholders. We are also doing our part to support the economic recovery, providing credit(1) and raising capital totaling $480 billion for our clients in the first quarter. As I said in my letter to shareholders distributed this week in the 2012 annual report, we have work to do to strengthen our controls and carry out our compliance mission. To do so, we have reprioritized our business agenda to focus on this critical effort - it is the top priority for our company. There is no room for compromise in meeting our obligations to comply with the new regulatory requirements and ensure that our systems, practices, controls, technology and, above all, culture meet the highest standards. And we will continue to work with our regulators on our common interest - to build and sustain a strong and safe financial system."

Dimon concluded: "We are very pleased with our first-quarter results, are proud of our accomplishments and remain optimistic about the future."