JPMorgan surges most in almost 11 months on higher NII outlook

BLOOMBERG 

JPMorgan Chase & Co surged the most in almost 11 months after boosting its guidance for net interest income (NII) and reporting an unexpected increase in deposits.
NII soared 49% in the first quarter, a bigger jump than analysts expected, and the bank said it now expects the figure to clock in at about $81 billion for this year. That compares with a January forecast of $73 billion. Deposits climbed 2% from the end of last year.
JPMorgan and other big lenders are benefiting from the Federal Reserve’s aggressive interest-rate hikes, which are aimed at taming inflation but also fuel banks’ revenue from lending businesses. Wells Fargo & Co said that its NII surged 45% in the quarter.
“The US economy continues to be on generally healthy footings — consumers are still spending and have strong balance sheets, and businesses are in good shape,” JPMorgan Chief Executive Officer Jamie Dimon said in a statement. NII was $20.7 billion in the quarter, above analysts’ expectations. But JPMorgan said there are still “significant sources of uncertainty” in its full-year outlook. On a conference call with analysts, Chief Financial Officer Jeremy Barnum said the company’s forecast for the gauge assumes modest deposit outflows in coming quarters. Dimon said on a call with journalists that net interest income will come down significantly next year.
Deposits at the New York-based bank jumped to $2.38 trillion at the end of March, compared with $2.34 trillion three months earlier.