JPMorgan raises net interest income forecast on robust Q3 performance
JPMorgan Chase on Tuesday raised its full-year forecast for net interest income following a strong third-quarter performance.
The bank exceeded profit expectations, boosted by robust results in its trading and investment banking divisions, News.Az reports, citing Reuters.
Economic resilience despite tariff war risks and hopes of U.S. interest rate cuts have prompted companies to strike big deals and consider stock offerings, lifting investment banking business across Wall Street, with dealmakers expecting an even stronger 2026.
"While there have been some signs of a softening, particularly in job growth, the U.S. economy generally remained resilient," CEO Jamie Dimon said in a statement.
"However, there continues to be a heightened degree of uncertainty stemming from complex geopolitical conditions, tariffs and trade uncertainty, elevated asset prices and the risk of sticky inflation," he added.
The bank's traders capitalized on portfolio repositioning by their clients as equity markets hit record levels during the quarter.
Revenue from the markets division, which includes both equities and fixed-income trading, rose 25% to $8.9 billion to a third-quarter record, far surpassing an earlier estimate.
Large banks such as JPMorgan Chase and Bank of America can help feel the pulse of the U.S. economy by offering insights into consumer spending, borrowing and business activity.
Net interest income, or the difference between what banks earn on loans and pay out on deposits, continues to prop up industry earnings.
JPMorgan revised its interest income forecast for the year. It now expects NII of roughly $95.8 billion for 2025, compared with an earlier estimate of $95.5 billion. It had raised its forecast in July as well.
Analysts, on average, had expected $95.4 billion, according to estimates compiled by LSEG.
Industry executives have said consumers remain in good financial shape, helped by a strong labor market and rising wages. That has also meant regular debt payments and steady demand for new loans.
At JPMorgan, NII rose 2% in the third quarter to $24.1 billion. Meanwhile, for the fourth quarter, it expects its interest income to be $23.5 billion, excluding markets.
It expects interest income, excluding markets, of $95 billion in 2026, driven by balance sheet growth and partially offset by the impact of lower rates.
It reported a profit of $5.07 per share for the latest quarter, comfortably beating analysts' estimates of $4.84 per share.
Rival Wells Fargo also beat Wall Street estimates for third-quarter profit on Tuesday.
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