JP Morgan, Goldman Sachs, Wells Fargo Report Strong Q1’21 Earnings

Source: Freedomz, Shutterstock

Summary

  • JP Morgan posted 399 percent year over year growth in its first quarter net income
  • Wells Fargo’s net income during the quarter jumped to US$4.74 billion.
  • Goldman Sachs saw its net income soar 464 percent in the three months period.

Three major US-based banks – JPMorgan Chase & Co. (NYSE: JPM), Wells Fargo & Company (NYSE: WFC) and The Goldman Sachs Group, Inc. (NYSE: GS) – posted robust financial results for the first quarter of 2021.

Share of Wells Fargo and Goldman Sachs rose 5.53 percent and 2.34 percent on Wednesday, while JP Morgan’s shares lost 1.87 percent.

Here, we explore the earnings and revenues for the three companies:

Source: Pixabay

 

JP Morgan

 

The New York-based bank’s net income for the first quarter skyrocketed 399 percent year over year to US$14.30 billion. Net income per share came in at U$4.50, up from 78 cents in the year ago period. The earnings included a US$5.2 billion benefit from credit reserve releases.

Net revenue rose 14 percent to US$33.12 billion. Noninterest revenue increased 39 percent to US$20.1 billion following higher CIB Markets. However, the net interest income was $13.0 billion, down 11 percent year over year.

In the consumer and community banking segment, JP Morgan’s net revenue declined 6 percent to US$12.52 billion. Net revenue jumped 46 percent year over year to US$14.60 billion in corporate and investment bank unit while in commercial banking segment it rose 11 percent to US$2.39 billion.

Shares of JP Morgan grew 18.6 percent year to date.

 

Wells Fargo

 

The California-based company’s net income during the first quarter jumped to US$4.74 billion from US$653 million in the year ago period.

The earnings include a US1.6 billion reduction in the allowance for credit losses, against the US$3.1 billion growth in the allowance during the first quarter of 2020.

Net interest income dropped 22 percent over lower interest rates, while noninterest income increased 45 percent.

Wells Fargo’s revenue during the period rose 2 percent to US$18.06 billion. Revenue in the consumer banking and lending division remained flat at US$8.65 billion while the commercial banking unit’s revenue declined 12 percent to US$2.21 billion.

Corporate and investment banking segment recorded 7 percent growth to US$ 3.62 billion and the wealth and investment management division saw its revenue rise 8 percent to US$3.54 billion.

Wells Fargo shares rose 38.5 percent year to date.

Source: Refinitiv, JP Morgan, Wells Fargo and Goldman Sachs performance on NYSE year to date

 

Goldman Sachs

 

The New York-based financial service company posted a 464 percent year-over-year growth in its first quarter net earnings to US$6.84 billion. Diluted EPS came increased to US$18.60 from US$3.11 in the first quarter of 2020.

Net revenues during the three months period soared 102 percent year over year to US$17.70 billion in the first quarter.

Revenues from its investment banking unit jumped 73 percent to US$3.77 billion. Global Markets segment revenue grew 47 percent year over year to US$7.58 billion

The asset management segment’s net revenues came in at US$4.61 billion compared to net revenue loss of US$96 million in the year ago period. Net revenues in consumer and wealth management totaled US$1.74 billion, up 16 percent.

Goldman Sachs’ share price grew 25.5 percent in the year to date.


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