On Thursday, the largest bank in the United States, JPMorgan Chase, revealed a decrease in its profits for the second quarter that was 28 percent lower than the previous year.
The bank reported quarterly earnings of $2.76 per share, which fell short of the estimates of industry analysts by $0.13 per share. Because of this, it is clear that JPMorgan is concerned about the future of the economy, as seen by the fact that the bank has set aside $428 million to cover bad loans and frozen stock buybacks, as reported by the Wall Street Journal.
According to The Wall Street Journal, the primary cause of the bank's decrease in revenue of 1 percent and profit decrease of 45 percent was the cash that was set aside for loans that turned out to be bad. According to the report of the company's results, the corporate and investment bank had a reduction in revenues of 10 percent while also seeing a drop in profit of 26 percent.
According to the Wall Street Journal (WSJ), the slowdown in corporate dealmaking and stock sales caused trading fees on Wall Street to increase by 15 percent while investment banking fees decreased by 54 percent.
On the other hand, the profitability of loans increased while also growing by 6% over this time period.
The Federal Reserve increased interest rates in May by 0.5 percentage points, and then again in June by 0.75 percentage points. Another price hike might be on the horizon for this month, as reported by CNBC.
According to CNBC, the banking industry is keeping a close eye on JPMorgan's quarterly results to see how the bank will fare in the face of mounting concerns that the United States is headed for recession. The purpose of this monitoring is to determine how the bank will fare in the face of these concerns. According to CNBC, JPMorgan's share price experienced a decline of more than 5 percent during trading on Thursday.
The Daily Caller News Foundation attempted to get a statement from JPMorgan, but the bank did not immediately respond to their inquiry.
The preceding is a summary of an article that originally appeared on DailyCaller.