JPMorgan Chase reported a remarkable 50% increase in net income, exceeding $14 billion in the fourth quarter. The bank’s revenue and profits surpassed Wall Street expectations, demonstrating resilience as both businesses and consumers maintained spending levels in the face of high interest rates. The earnings per share surged to $4.81 compared to $3.04 the previous year, which outperformed analysts’ predictions of $4.09 according to data from FactSet. Overall managed revenue reached $43.7 billion, reflecting a 10% rise from the $39.9 billion reported a year prior, significantly exceeding Wall Street’s forecast of $41.9 billion.
For the entire year, JPMorgan achieved a record-high profit of $54 billion, translating to $18.22 per share after adjusting for one-time expenses. Following this news, the bank’s shares saw a modest increase of nearly 1% in early trading. Other major banks, including Citigroup, Wells Fargo, and Goldman Sachs, also released impressive earnings results recently.
Over the last two years, the largest banks have benefited from higher interest rates implemented by the Federal Reserve to combat inflation that escalated after the COVID-19 pandemic. The most recent report from the government indicated that essential prices rose, pushing the consumer price index to 2.9% in December—the highest mark since July. However, key underlying inflation metrics, closely monitored by the Fed, showed a slowdown to 3.2% in December, slightly better than analysts had anticipated, which is encouraging for consumers and the broader economy.
This positive performance by banks, coupled with strong market data, contributed to market gains, with the S&P 500 and Dow Jones Industrial Average both climbing 1.7%, while the tech-oriented Nasdaq rose 2.2%. While 2024 was a booming year for the markets, bank stocks outperformed even that, despite the Federal Reserve cutting its benchmark interest rate three times between September and December. Although the Fed reduced its 2025 rate cut forecasts from four to two, triggered by persistent inflation above its 2% target, this did not alter the significant gains made in 2024, which saw the S&P up 23%, the Nasdaq rising over 28%, and the Dow increasing nearly 13%.
In terms of individual bank performance, Goldman Sachs saw a 48% increase in shares by the end of 2024, while JPMorgan’s shares rose by 41% and Wells Fargo’s stock climbed by 43%. In its report, JPMorgan noted a slight drop in interest income, which fell by 3% to $23.5 billion, influenced by a decrease in interest rates. CEO Jamie Dimon highlighted a surge in investment banking revenues, with fees increasing by 49%, and market revenues up by 21%. The consumer banking sector also saw strong growth, with nearly 2 million new checking accounts opened by clients.
JPMorgan set aside $2.6 billion to account for potential loan defaults, a figure that is down marginally from the previous year’s comparable period. Dimon remarked on the robustness of the U.S. economy, citing low unemployment rates and vigorous consumer spending as positive indicators. He noted a growing optimism among businesses regarding economic prospects, mentioning expectations of a pro-growth agenda and enhanced collaboration between the government and the business community, in reference to the incoming administration.
Dimon emphasized the necessity for regulations that balance growth with the safety of the banking system. He clarified that this viewpoint is focused on establishing transparent, fair, and well-researched regulations rather than weakening existing rules, which would enable banks to fulfill their essential roles in the economy and markets. However, he cautioned that geopolitical issues remain complex and challenging, labeling the current landscape as “the most dangerous and complicated since World War II,” indicating that JPMorgan is preparing for various potential scenarios.
In other personnel updates, it was announced that Dimon’s top deputy, Daniel Pinto, will retire from his role as president and chief operating officer by the end of June, remaining with the bank until the conclusion of 2026. Jennifer Piepszak, co-CEO of the commercial and investment bank division, is set to assume the COO position under Pinto’s mentorship. Following Dimon’s earlier statement about his expected retirement in five years, there was speculation that Pinto might take over as CEO, though a representative disclosed that Piepszak currently has no interest in the role, possibly allowing for other internal candidates to emerge when it eventually becomes available.
Wells Fargo also surpassed earnings predictions with a net income increase of nearly 50%, reaching $5.1 billion in the fourth quarter, or $1.43 per share, with revenue slightly lower than expected at $20.4 billion. A year earlier, Wells Fargo reported a net income of $3.4 billion at 86 cents per share on $20.5 billion in revenue. Earlier in September, Wells Fargo entered into an agreement with U.S. regulators to enhance its financial crimes risk management practices, following a series of scandals, including the creation of unauthorized accounts.
Wells Fargo’s stock rose by 5.3% during early trading, while Citigroup shares increased by 5.7% and Goldman Sachs stocks gained 5.4% after both companies exceeded Wall Street’s profit expectations. Goldman Sachs noted a significant boost from its global banking and markets operations, generating nearly $35 billion in revenue, particularly driven by strong performances in equities trading and investment banking, and claimed leadership in global mergers and acquisitions throughout 2024.
