JPMorgan misses analysts’ 4Q estimates, but still better than Citigroup

Source: Exec Digital USA

Date :1/16/2008 11:50:25 AM

JPMorgan’s fourth quarter earnings have sunk 21 percent following its $1.3 billion subprime-related writedown as the subprime crisis trundles on.

Despite being significantly less than rival Citigroup, the damage was still enough to send earnings down to $3 billion, or 86 cents per share, from $3.9 billion, or $1.09 per share.

Citigroup on Tuesday posted a loss of $9.83 billion, after writing down $18.1 billion due to huge losses on collateralized debt obligations- a form of mortgage-backed bond products.

Positives

Comparatively, it would seem, JPMorgan have got off lightly. Commercial banking profit rose 13 percent to $288 million, Treasury and Security Services profit rose 65 percent to a record $422 million and Asset Management profit rose 29 percent to a record $527 million.

Jamie Dimon, JPMorgan chief executive, was upbeat on the results:

"I am pleased with our company's record results for the year, despite our mixed performance in the fourth quarter,” he said.

“Our lower quarterly results were affected by the investment bank's markdowns in subprime-related positions and weaker trading. In addition, our consumer home equity and subprime loan portfolios performed worse than we expected."

January 16, 2008