Shares of JPMorgan Chase (JPM 0.31%), the largest bank by assets in the U.S., traded more than 3% higher as of 11:44 a.m. ET on Friday after the bank reported earnings results for the third quarter.
JPMorgan reported $3.12 earnings per share on managed revenue of $33.5 billion, easily beating analyst estimates.
Excluding markets revenue, net interest income (NII), the profit banks make on loans and securities after funding those assets, came in at $16.9 billion, up $3.2 billion from the prior quarter, as banks benefit from the rising interest rate environment.
Management now expects NII to come in at $66 billion for the full year of 2022, a big revision upward from last quarter due to the trajectory of the Federal Reserve's benchmark overnight lending rate.
As expected, JPMorgan's investment banking business continued to struggle like much of the industry, with investment banking revenue down 43% year over year after a very strong year in 2021.
Credit quality remains strong at the bank, with net charge-offs, debt unlikely to be collected and an indicator of actual loan losses, flat from the second quarter at roughly $700 million. JPMorgan built a provision for credit losses in the quarter of $800 million. It also expects a credit card net charge-off rate of only 1.5% for the full year, which is extremely low.
There didn't seem to be any big surprises in JPMorgan's earnings report. Loan and bond revenues came in strong due to the high-rate environment, investment banking was weak because of market volatility, and credit remains benign for now. All in all, it was a solid quarter for the bank.