By Manya Saini and Saeed Azhar
April 14 (Reuters) – JPMorgan Chase posted a bigger-than-expected 13% jump in first-quarter profit on Tuesday as volatile markets lifted trading revenue to a record high and dealmaking increased, even as CEO Jamie Dimon warned of mounting global economic risks.
Worries about the impact of artificial intelligence on software companies and the uncertain outcome of the Iran war rattled global financial markets in the first quarter, triggering selloffs that kept trading desks busy.
Volatility typically lifts trading businesses at large banks as it spurs clients to rebalance portfolios, trade more actively and hedge risks.
“There is an increasingly complex set of risks – such as geopolitical tensions and wars … While we cannot predict how these risks and uncertainties will ultimately play out, they are significant and they reinforce why we prepare the Firm for a wide range of environments,” Dimon said in a statement.
MARKETS REVENUE UP 20%
JPMorgan’s markets revenue rose 20% to $11.6 billion in the first quarter and was a key driver of the bank’s results, just like at Wall Street rival Goldman Sachs, which beat expectations on Monday.
The largest U.S. lender’s revenue from fixed income markets climbed 21% to $7.1 billion, while equity markets surged 17% to $4.5 billion.
JPMorgan reported a profit of $5.94 per share for the three months ended March 31. Analysts on average had expected a profit of $5.45 per share, according to estimates compiled by LSEG.
Net revenue climbed 10% to $50.5 billion, comfortably surpassing Wall Street expectations of $49.2 billion.
The earnings beat was driven by strong net interest income and non-interest income, and a lower-than-expected provision for credit losses, said Gerard Cassidy, a banking analyst at RBC Capital Markets, in a note.
The consumer and small businesses remain healthy despite higher gas prices and volatile markets, Chief Financial Officer Jeremy Barnum said on a call with analysts.
The bank’s shares were down 0.3% in morning trading.
SPOTLIGHT ON DEALMAKING
U.S. investment banks expect a strong year as they eye mega listings of big AI and space companies, as well as a revival in dealmaking on hopes that President Donald Trump’s administration would ease regulations.
Though volatile market conditions have led to cautious M&A forecasts, bank executives say companies are showing a healthy appetite for deals.
JPMorgan’s investment banking fees rose 28% in the first quarter versus a year earlier, the highest among global banks during the period, according to Dealogic data. The total value of mergers and acquisitions crossed $1 trillion.
JPMorgan was the bookrunner on Amazon’s $37 billion bond offering and served as lead adviser to AES on its announced $33.4 billion take-private transaction.
PRIVATE CREDIT
JPMorgan said it had $50 billion in exposure to private credit in the first quarter, which was part of its core exposure to non-bank financial institutions.
The bank had disclosed $160 billion in NBFI exposure for fourth-quarter earnings ending December 2025, but has not provided an updated figure.
The private credit sector has been hurt by concerns that software portfolios are vulnerable to AI disruption and that loans to small, middle-market companies could come under pressure.
“There’s been some weakening in underwriting, and that’s not just by private credit,” Dimon said on the analysts call.
INTEREST INCOME CLIMBS
Loan demand has picked up in recent months as a resilient labor market supports wage growth and draws more borrowers into credit markets. While interest rates remain elevated, they have eased from recent highs, helping lift demand for loans.
Net interest income – the difference between what a bank earns as payments on loans and pays on deposits – rose 9% in the first quarter to $25.5 billion. Excluding markets, it climbed 3%.
Consumer spending has largely held up despite economic pressures, keeping bad debt stable and giving banks confidence to keep credit flowing.
Large lenders, including JPMorgan Chase and Bank of America, offer a window into the U.S. economy, reflecting trends in consumer spending, borrowing and business activity.
Rival Wells Fargo’s profit also climbed in the first quarter, aided by higher income from interest payments and increased trading gains from volatile markets.
(Reporting by Manya Saini in Bengaluru and Saeed Azhar in New York; Editing by Anil D’Silva, Rod Nickel)
