JPMorgan Chase (NYSE:JPM), America's largest bank, blew past analysts' earnings expectations for the third quarter in what is a promising start to bank earnings season.

The bank today reported net income of roughly $9.4 billion, or $2.92 diluted earnings per share, up 4% year over year and doubling second-quarter profits. Although total revenue of $29.1 billion dropped from the second quarter, it also beat expectations and fell just a hair short of total revenue in the year-ago quarter.

The big difference from the first two quarters of the year is that the bank set aside just $611 million to cover future potential loan losses, after setting aside close to $19 billion for that purpose in the first two quarters of the year.

JPMorgan Chase

Image source: JPMorgan Chase

JPMorgan's corporate and investment bank continued to perform well, turning a profit of $4.3 billion on net revenue of $11.5 billion, down from the division's huge second quarter, but still up 52% year over year.

Total deposits came up more than $70 billion in the last three months ending September, and are now up 31% year over year. According to CEO Jamie Dimon, the bank now holds the most U.S. retail deposits for the first time ever.

Total reserves stashed away for future potential losses were $33.6 billion at the end of the third quarter, or roughly 3.26% of the bank's total loan book.

Net charge-offs (debt unlikely to be collected) in the third quarter were down 24% from the linked quarter and 14% year over year.

But total non-accrual loans, those that are likely 90 days past due, reached close to $11 billion, up 18% from the linked quarter and 96% from the third quarter of 2019. This suggests that borrowers are seeing pain from current economic conditions.

The bank has also seen great improvement in consumer loans (residential mortgage, auto, and credit cards) still under deferral plans. Only 3.4% of total consumer loans are still in deferral plans, down from 6.4% at the end of the second quarter.

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