JP Morgan asset & wealth management (AWM) arm has embarked on the road to recovery in Q1 2021, reporting an 86% surge in net income and a 20% increase in net revenue.
The wealth result is in keeping with the overall performance of the group, which posted a growth in quarterly profit as it released $5.2bn in funds it had placed aside as loan loss reserves.
Key AWM metrics
The unit’s net income for three-month period ending March 2021 stood at $1.24bn, versus $669m a year ago.
Total net revenue was $4.08bn, of which asset management contributed $2.18bn and global private bank contributing $1.89bn.
In Q1 2020, the division’s total net revenue was $3.39bn.
Total noninterest expense rose 6% to $2.57bn from $2.43bn over the period. This was due to higher volume- and revenue-related expense, which outweighed lower structural expense, noted the bank.
As of 31 March 2021, AUM reached $2.8trn while client assets totalled $3.8trn. The figures were up 28% and 32% respectively, from the previous year. This was the result of inflows into long-term and liquidity products.
JP Morgan chairman and CEO Jamie Dimon said: “In Asset & Wealth Management, continued strong investment performance, growth in new products and adviser hiring led to net inflows of $48 billion into long-term products.
“Also, AWM has seen strong and steady loan demand primarily to support business growth and mortgages.”
Corporate & Investment Bank (CIB)
This unit too reported a strong performance, with a 189% jump in net income.
CIB’s net income for the quarter ending 31 March 2021 was $5.74bn, versus $1.98bn in the prior year.
Revenue soared to $14.6bn from $10bn. Total Markets revenue of $9.1bn were up 25%, led by fixed income markets and equity markets.
The group’s net income in Q1 2021 was $14.3bn, or $4.50 per share, surpassing estimates. This compares to $2.86bn, or 78 cents per share, in Q1 2020.
Revenue increased 14% to $33.12bn from $29bn.
The group’s CET1 capital ratio, a key measure of strength, was 13.1% at the end of March 2021. The ratio was 11.5% a year ago.