Delaware (State or Other Jurisdiction of Incorporation) |
1-5805 (Commission File Number) |
13-2624428 (IRS Employer Identification No.) |
||
270 Park Avenue, New York, NY (Address of Principal Executive Offices) |
10017 (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit Number | Description of Exhibit | |
12.1
|
JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges | |
12.2
|
JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividend Requirements | |
99.1
|
JPMorgan Chase & Co. Earnings Release Fourth Quarter 2007 Results | |
99.2
|
JPMorgan Chase & Co. Earnings Release Financial Supplement Fourth Quarter 2007 |
2
JPMORGAN CHASE & CO. | ||||||
(Registrant) |
||||||
By: | /s/ Louis Rauchenberger | |||||
Louis Rauchenberger | ||||||
Managing Director and Controller | ||||||
[Principal Accounting Officer] |
3
Exhibit Number | Description of Exhibit | |
12.1
|
JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges | |
12.2
|
JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividend Requirements | |
99.1
|
JPMorgan Chase & Co. Earnings Release Fourth Quarter 2007 Results | |
99.2
|
JPMorgan Chase & Co. Earnings Release Financial Supplement Fourth Quarter 2007 |
4
Year ended December 31, (in millions, except ratios) | 2007 | |||
Excluding
Interest on Deposits |
||||
Income from continuing operations before income taxes |
$ | 22,805 | ||
Fixed charges: |
||||
Interest expense |
23,328 | |||
One-third of rents, net of income from subleases (a) |
400 | |||
Total fixed charges |
23,728 | |||
Less: Equity in undistributed income of affiliates |
(159 | ) | ||
Income from continuing operations before income taxes and fixed charges,
excluding capitalized interest |
$ | 46,374 | ||
Fixed charges, as above |
$ | 23,728 | ||
Ratio of earnings to fixed charges |
1.95 | |||
Including
Interest on Deposits |
||||
Fixed charges, as above |
$ | 23,728 | ||
Add: Interest on deposits |
21,653 | |||
Total fixed charges and interest on deposits |
$ | 45,381 | ||
Income from continuing operations before income taxes and fixed charges,
excluding capitalized interest, as above |
$ | 46,374 | ||
Add: Interest on deposits |
21,653 | |||
Total income from continuing operations before income taxes,
fixed charges and interest on deposits |
$ | 68,027 | ||
Ratio of earnings to fixed charges |
1.50 | |||
(a)
|
The proportion deemed representative of the interest factor. |
Year ended December 31, (in millions, except ratios) | 2007 | |||
Excluding
Interest on Deposits |
||||
Income from continuing operations before income taxes |
$ | 22,805 | ||
Fixed charges: |
||||
Interest expense |
23,328 | |||
One-third of rents, net of income from subleases (a) |
400 | |||
Total fixed charges |
23,728 | |||
Less: Equity in undistributed income of affiliates |
(159 | ) | ||
Income from continuing operations before income taxes and fixed charges,
excluding capitalized interest |
$ | 46,374 | ||
Fixed charges, as above |
$ | 23,728 | ||
Preferred stock dividends (pre-tax) |
- | |||
Fixed charges including preferred stock dividends |
$ | 23,728 | ||
Ratio of earnings to fixed charges and
preferred stock dividend requirements |
1.95 | |||
Including
Interest on Deposits |
||||
Fixed charges including preferred stock dividends, as above |
$ | 23,728 | ||
Add: Interest on deposits |
21,653 | |||
Total fixed charges including preferred stock
dividends and interest on deposits |
$ | 45,381 | ||
Income from continuing operations before income taxes and fixed charges,
excluding capitalized interest, as above |
$ | 46,374 | ||
Add: Interest on deposits |
21,653 | |||
Total income from continuing operations before income taxes, fixed charges
and interest on deposits |
$ | 68,027 | ||
Ratio of earnings to fixed charges
and preferred stock dividend requirements |
1.50 | |||
(a)
|
The proportion deemed representative of the interest factor. |
www.jpmorganchase.com
|
||
JPMORGAN CHASE REPORTS RECORD FULL-YEAR 2007 NET INCOME OF $15.4 BILLION ON RECORD
REVENUE OF $71.4 BILLION; |
|||
RECORD EARNINGS PER SHARE OF $4.38 |
|||
COMPANY REPORTS FOURTH-QUARTER 2007 NET INCOME OF
$3.0 BILLION AND EARNINGS PER SHARE OF $0.86 |
|||
FULL-YEAR 2007 EPS FROM CONTINUING OPERATIONS UP 15%; FOURTH-QUARTER EPS FROM CONTINUING
OPERATIONS DOWN 21% |
|||
CAPITAL REMAINED STRONG WITH TIER 1 CAPITAL OF $88.7 BILLION, OR 8.4% (estimated); CREDIT
RESERVES FURTHER STRENGTHENED |
|||
| Investment Bank fourth-quarter results declined significantly. Results included: |
- | Markdowns of $1.3 billion (net of hedges) on subprime positions, including
subprime CDOs |
||
- | Weaker trading performance |
||
- | Strong fourth-quarter investment banking fees, record full-year fees |
| Asset Management and Treasury & Securities Services generated record earnings and revenue
for the fourth quarter and full year |
||
| Commercial Banking produced double-digit earnings growth on record revenue and Private
Equity posted strong results in the fourth quarter |
Investor Contact: Julia Bates (212) 270-7318
|
Media Contact: Joe Evangelisti (212) 270-7438 |
Results for IB | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $O/(U) | O/(U) % | $O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue |
$ | 3,172 | $ | 2,946 | $ | 4,860 | $ | 226 | 8 | % | ($1,688 | ) | (35 | )% | |||||||||||||||||||||||
Provision for Credit Losses |
200 | 227 | 63 | (27 | ) | (12 | ) | 137 | 217 | ||||||||||||||||||||||||||||
Noninterest Expense |
3,011 | 2,378 | 3,205 | 633 | 27 | (194 | ) | (6 | ) | ||||||||||||||||||||||||||||
Net Income |
$ | 124 | $ | 296 | $ | 1,009 | ($172 | ) | (58 | )% | ($885 | ) | (88 | )% | |||||||||||||||||||||||
2
n |
Ranked #2 in Global Equity and Equity-Related; #1 in Global Syndicated
Loans; #4 in Global Announced M&A; #2 in Global Debt, Equity and
Equity-Related; and #2 in Global Long-Term Debt, based upon volume, according
to Thomson Financial for the year ended December 31, 2007. |
||
n |
Return on equity was 2% and 15% on $21.0 billion of allocated capital for
the fourth quarter and full year 2007, respectively. |
Results for RFS | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $O/(U) | O/(U) % | $O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue |
$ | 4,815 | $ | 4,201 | $ | 3,728 | $ | 614 | 15 | % | $ | 1,087 | 29 | % | |||||||||||||||||||||||
Provision for Credit Losses |
1,051 | 680 | 262 | 371 | 55 | 789 | 301 | ||||||||||||||||||||||||||||||
Noninterest Expense |
2,540 | 2,469 | 2,291 | 71 | 3 | 249 | 11 | ||||||||||||||||||||||||||||||
Net Income |
$ | 752 | $ | 639 | $ | 718 | $ | 113 | 18 | % | $ | 34 | 5 | % | |||||||||||||||||||||||
3
n |
Checking accounts totaled
10.8 million, up 844,000, or 8%, from the
prior year. |
||
n |
Average total deposits
increased to $208.5 billion, up $7.8 billion, or 4%,
from the prior year. |
||
n |
Average home equity loans of $94.0 billion increased from $84.2 billion in
the prior year. |
||
n |
Business Banking loan originations were $1.7 billion, up 10% from the prior
year. Average business banking loans were $15.1 billion, up 8% from the prior
year. |
||
n |
Number of branches increased to 3,152, up 73 from the prior year. |
||
n |
Branch sales of credit cards increased 34% from the prior year. |
||
n |
Branch sales of investment products were flat compared with the prior year. |
||
n |
Overhead ratio (excluding amortization of core deposit intangibles)
decreased to 51% from 55% in the prior year. |
4
n |
Mortgage loan originations were $40.0 billion, up 34% from the prior year
and 2% from the prior quarter. |
||
n |
Total third-party mortgage loans serviced were $614.7 billion, an increase
of $88.0 billion, or 17%, from the prior year. |
n |
Auto loan originations were $5.6 billion, up 12% from the prior year. |
||
n |
Average loan receivables were $41.1 billion, up 6% from the prior year. |
5
Results for CS | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $O/(U) | O/(U) % | $O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue |
$ | 3,971 | $ | 3,867 | $ | 3,750 | $ | 104 | 3 | % | $ | 221 | 6 | % | |||||||||||||||||||||||
Provision for Credit Losses |
1,788 | 1,363 | 1,281 | 425 | 31 | 507 | 40 | ||||||||||||||||||||||||||||||
Noninterest Expense |
1,223 | 1,262 | 1,341 | (39 | ) | (3 | ) | (118 | ) | (9 | ) | ||||||||||||||||||||||||||
Net Income |
$ | 609 | $ | 786 | $ | 719 | ($177 | ) | (23 | )% | ($110 | ) | (15 | )% | |||||||||||||||||||||||
6
n |
Return on equity was 17%, down from 20% in the prior year. |
||
n |
Pretax income to average managed loans (ROO) was 2.51%, down from 3.04% in
the prior year and 3.31% in the prior quarter. |
||
n |
Net interest income as a percentage of average managed loans was 8.20%, up
from 7.92% in the prior year, but down from 8.29% in the prior quarter. |
||
n |
Net accounts of 5.3 million were opened during the quarter. |
||
n |
Charge volume was $95.5 billion, an increase of $2.1 billion, or 2%, from
the prior year, driven by sales volume growth of 8%. |
||
n |
Merchant processing volume was $194.4 billion, an increase of $16.5 billion,
or 9%, and total transactions were 5.4 billion, an increase of 438 million, or
9%, from the prior year. |
Results for CB | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $O/(U) | O/(U) % | $O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue |
$ | 1,084 | $ | 1,009 | $ | 1,018 | $ | 75 | 7 | % | $ | 66 | 6 | % | |||||||||||||||||||||||
Provision for Credit Losses |
105 | 112 | 111 | (7 | ) | (6 | ) | (6 | ) | (5 | ) | ||||||||||||||||||||||||||
Noninterest Expense |
504 | 473 | 485 | 31 | 7 | 19 | 4 | ||||||||||||||||||||||||||||||
Net Income |
$ | 288 | $ | 258 | $ | 256 | $ | 30 | 12 | % | $ | 32 | 13 | % | |||||||||||||||||||||||
7
n |
Overhead ratio was 46%, an improvement from 48% in the prior year. |
||
n |
Average loan balances were $65.5 billion, up $7.9 billion, or 14%, from the
prior year and up $4.3 billion, or 7%, from the prior quarter. |
||
n |
Average liability balances were $96.7 billion, up $17.7 billion, or 22%,
from the prior year and up $8.6 billion, or 10%, from the prior quarter. |
Results for TSS | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $O/(U) | O/(U) % | $O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue |
$ | 1,930 | $ | 1,748 | $ | 1,537 | $ | 182 | 10 | % | $ | 393 | 26 | % | |||||||||||||||||||||||
Provision for Credit Losses |
4 | 9 | (2 | ) | (5 | ) | (56 | ) | 6 | NM | |||||||||||||||||||||||||||
Noninterest Expense |
1,222 | 1,134 | 1,104 | 88 | 8 | 118 | 11 | ||||||||||||||||||||||||||||||
Net Income |
$ | 422 | $ | 360 | $ | 256 | $ | 62 | 17 | % | $ | 166 | 65 | % | |||||||||||||||||||||||
n |
TSS pretax margin(2) was 35%, up from 33% in the prior quarter
and 26% in the prior year. |
||
n |
Average liability balances were $250.6 billion, up 30% from the prior year. |
||
n |
Assets under custody increased to $15.9 trillion, up 15% from the prior
year. |
8
n |
New product launches and client relationships included: |
- | Launched JPMorgan CustodyConnect, which enables financial
institutions to expand their custody offering in local and regional
markets, and named OJSC Swedbank as its first client; |
||
- | Selected by the State of Michigan Department of Treasury Bureau of
Investments to perform portfolio administration and performance
reporting for their alternative private equity investments; |
||
- | Named depositary receipt bank for several large global programs,
including Sanofi-Aventis, the largest ADR program in France; and Grupo
Clarín, Argentinas largest media company; and |
||
- | Selected by Computershare to assist in a major acquisition by Rio
Tinto, by providing cash management and access to JPMorgans short-term
investment and industry-leading U.S. dollar clearing capabilities. |
Results for AM | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $O/(U) | O/(U) % | $O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue |
$ | 2,389 | $ | 2,205 | $ | 1,947 | $ | 184 | 8 | % | $ | 442 | 23 | % | |||||||||||||||||||||||
Provision for Credit Losses |
(1 | ) | 3 | 14 | (4 | ) | NM | (15 | ) | NM | |||||||||||||||||||||||||||
Noninterest Expense |
1,559 | 1,366 | 1,284 | 193 | 14 | 275 | 21 | ||||||||||||||||||||||||||||||
Net Income |
$ | 527 | $ | 521 | $ | 407 | $ | 6 | 1 | % | $ | 120 | 29 | % | |||||||||||||||||||||||
9
n |
Pretax margin(2) was 35%, up from 33% in the prior year. |
||
n |
Assets under management were $1.2 trillion, up 18%, or $180 billion, from
the prior year, including growth of 21%, or $21 billion, in alternative assets. |
||
n |
Assets under management net inflows were $33 billion for the fourth quarter
of 2007, and $115 billion for the past 12-month period. |
||
n |
Assets under management that ranked in the top two quartiles for investment
performance were 76% over five years, 75% over three years and 57% over one
year. |
||
n |
Customer assets in 4 and 5 Star rated funds were 55%. |
||
n |
Average loans of $32.6 billion were up $3.7 billion, or 13%, from the prior
year. |
||
n |
Average deposits of $64.6 billion were up $13.3 billion, or 26%, from the
prior year. |
Results for Corporate | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $ O/(U) | O/(U) % | $ O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue |
$ | 914 | $ | 1,001 | $ | 194 | ($87 | ) | (9 | )% | $ | 720 | 371 | % | |||||||||||||||||||||||
Provision for Credit Losses |
14 | (31 | ) | (2 | ) | 45 | NM | 16 | NM | ||||||||||||||||||||||||||||
Noninterest Expense |
661 | 245 | 175 | 416 | 170 | 486 | 278 | ||||||||||||||||||||||||||||||
Income from Continuing
Operations |
249 | 513 | 541 | (264 | ) | (51 | ) | (292 | ) | (54 | ) | ||||||||||||||||||||||||||
Income from Discontinued
Operations
(after-tax)(a) |
| | 620 | | | (620 | ) | NM | |||||||||||||||||||||||||||||
Net Income |
$ | 249 | $ | 513 | $ | 1,161 | ($264 | ) | (51 | )% | ($912 | ) | (79 | )% | |||||||||||||||||||||||
10
n |
Private Equity portfolio was $7.2 billion, up from $6.1 billion in the prior
year and $6.6 billion in the prior quarter. The portfolio represented 9.2% of
stockholders equity less goodwill, up from 8.6% in the prior year and 8.8% in
the prior quarter. |
RESULTS FOR JPM | 3Q07 | 4Q06 | |||||||||||||||||||||||||||||||||||
($ millions) | 4Q07 | 3Q07 | 4Q06 | $ O/(U) | O/(U) % | $ O/(U) | O/(U) % | ||||||||||||||||||||||||||||||
Net Revenue(a) |
$ | 18,275 | $ | 16,977 | $ | 17,034 | $ | 1,298 | 8 | % | $ | 1,241 | 7 | % | |||||||||||||||||||||||
Provision for Credit Losses(a) |
3,161 | 2,363 | 1,727 | 798 | 34 | 1,434 | 83 | ||||||||||||||||||||||||||||||
Noninterest Expense |
10,720 | 9,327 | 9,885 | 1,393 | 15 | 835 | 8 | ||||||||||||||||||||||||||||||
Income from Continuing Operations |
2,971 | 3,373 | 3,906 | (402 | ) | (12 | ) | (935 | ) | (24 | ) | ||||||||||||||||||||||||||
Income from Discontinued Operations
(after-tax)(b) |
| | 620 | | | (620 | ) | NM | |||||||||||||||||||||||||||||
Net Income |
$ | 2,971 | $ | 3,373 | $ | 4,526 | ($402 | ) | (12 | )% | ($1,555 | ) | (34 | )% | |||||||||||||||||||||||
11
n |
Tier 1 capital ratio was 8.4% at December 31, 2007 (estimated), 8.4% at
September 30, 2007, and 8.7% at December 31, 2006. |
||
n |
During the quarter, $163 million of common stock was repurchased,
reflecting 3.6 million shares purchased at an average price of $45.29 per
share. |
||
n |
Headcount of 180,667 increased by 6,307 since December 31, 2006. |
12
| Merger savings and cost: For the quarter ended December 31, 2007, approximately
$750 million of merger savings have been realized, an annualized rate of $3.0 billion.
Merger costs of $22 million were expensed during the fourth quarter of 2007 and the total
amount of merger costs incurred were $3.6 billion (including costs associated with the Bank
of New York transaction and capitalized costs) since the beginning of 2004. |
13
14
JPMORGAN CHASE & CO. |
||
CONSOLIDATED FINANCIAL HIGHLIGHTS |
||
(in millions, except per share, ratio and headcount data) |
QUARTERLY TRENDS | FULL YEAR | ||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | ||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | ||||||||||||||||||||||||||
SELECTED INCOME STATEMENT DATA |
|||||||||||||||||||||||||||||||||
Total Net Revenue (a) |
$ | 17,384 | $ | 16,112 | $ | 16,193 | 8 | % | 7 | % | $ | 71,372 | $ | 61,999 | 15 | % | |||||||||||||||||
Provision for Credit Losses |
2,542 | 1,785 | 1,134 | 42 | 124 | 6,864 | 3,270 | 110 | |||||||||||||||||||||||||
Total Noninterest Expense |
10,720 | 9,327 | 9,885 | 15 | 8 | 41,703 | 38,843 | 7 | |||||||||||||||||||||||||
Income from Continuing Operations (after-tax) |
2,971 | 3,373 | 3,906 | (12 | ) | (24 | ) | 15,365 | 13,649 | 13 | |||||||||||||||||||||||
Income from Discontinued Operations (b) |
| | 620 | | NM | | 795 | NM | |||||||||||||||||||||||||
Net Income |
2,971 | 3,373 | 4,526 | (12 | ) | (34 | ) | 15,365 | 14,444 | 6 | |||||||||||||||||||||||
PER COMMON SHARE: |
|||||||||||||||||||||||||||||||||
Basic Earnings |
|||||||||||||||||||||||||||||||||
Income from Continuing Operations |
$ | 0.88 | $ | 1.00 | $ | 1.13 | (12 | ) | (22 | ) | $ | 4.51 | $ | 3.93 | 15 | ||||||||||||||||||
Net Income |
0.88 | 1.00 | 1.31 | (12 | ) | (33 | ) | 4.51 | 4.16 | 8 | |||||||||||||||||||||||
Diluted Earnings |
|||||||||||||||||||||||||||||||||
Income from Continuing Operations |
$ | 0.86 | $ | 0.97 | $ | 1.09 | (11 | ) | (21 | ) | $ | 4.38 | $ | 3.82 | 15 | ||||||||||||||||||
Net Income |
0.86 | 0.97 | 1.26 | (11 | ) | (32 | ) | 4.38 | 4.04 | 8 | |||||||||||||||||||||||
Cash Dividends Declared |
0.38 | 0.38 | 0.34 | | 12 | 1.48 | 1.36 | 9 | |||||||||||||||||||||||||
Book Value |
36.59 | 35.72 | 33.45 | 2 | 9 | 36.59 | 33.45 | 9 | |||||||||||||||||||||||||
Closing Share Price |
43.65 | 45.82 | 48.30 | (5 | ) | (10 | ) | 43.65 | 48.30 | (10 | ) | ||||||||||||||||||||||
Market Capitalization |
146,986 | 153,901 | 167,199 | (4 | ) | (12 | ) | 146,986 | 167,199 | (12 | ) | ||||||||||||||||||||||
COMMON SHARES OUTSTANDING: |
|||||||||||||||||||||||||||||||||
Weighted-Average Diluted Shares Outstanding |
3,471.8 | # | 3,477.7 | # | 3,578.6 | # | | (3 | ) | 3,507.6 | # | 3,573.9 | # | (2 | ) | ||||||||||||||||||
Common Shares Outstanding at Period-end |
3,367.4 | 3,358.8 | 3,461.7 | | (3 | ) | 3,367.4 | 3,461.7 | (3 | ) | |||||||||||||||||||||||
FINANCIAL RATIOS: (c) |
|||||||||||||||||||||||||||||||||
Income from Continuing Operations: |
|||||||||||||||||||||||||||||||||
Return on Common Equity (ROE) |
10 | % | 11 | % | 14 | % | 13 | % | 12 | % | |||||||||||||||||||||||
Return on Equity-Goodwill (ROE-GW) (d) |
15 | 18 | 22 | 21 | 20 | ||||||||||||||||||||||||||||
Return on Assets (ROA) (e) |
0.77 | 0.91 | 1.14 | 1.06 | 1.04 | ||||||||||||||||||||||||||||
Net Income: |
|||||||||||||||||||||||||||||||||
ROE |
10 | 11 | 16 | 13 | 13 | ||||||||||||||||||||||||||||
ROE-GW (d) |
15 | 18 | 26 | 21 | 22 | ||||||||||||||||||||||||||||
ROA |
0.77 | 0.91 | 1.32 | 1.06 | 1.10 | ||||||||||||||||||||||||||||
CAPITAL RATIOS: |
|||||||||||||||||||||||||||||||||
Tier 1 Capital Ratio |
8.4 | (g) | 8.4 | 8.7 | |||||||||||||||||||||||||||||
Total Capital Ratio |
12.6 | (g) | 12.5 | 12.3 | |||||||||||||||||||||||||||||
SELECTED BALANCE SHEET DATA (Period-end) |
|||||||||||||||||||||||||||||||||
Total Assets |
$ | 1,562,147 | $ | 1,479,575 | $ | 1,351,520 | 6 | 16 | $ | 1,562,147 | $ | 1,351,520 | 16 | ||||||||||||||||||||
Wholesale Loans |
213,076 | 197,728 | 183,742 | 8 | 16 | 213,076 | 183,742 | 16 | |||||||||||||||||||||||||
Consumer Loans |
306,298 | 288,592 | 299,385 | 6 | 2 | 306,298 | 299,385 | 2 | |||||||||||||||||||||||||
Deposits |
740,728 | 678,091 | 638,788 | 9 | 16 | 740,728 | 638,788 | 16 | |||||||||||||||||||||||||
Common Stockholders Equity |
123,221 | 119,978 | 115,790 | 3 | 6 | 123,221 | 115,790 | 6 | |||||||||||||||||||||||||
Headcount |
180,667 | # | 179,847 | # | 174,360 | # | | 4 | 180,667 | # | 174,360 | # | 4 | ||||||||||||||||||||
LINE OF BUSINESS NET INCOME |
|||||||||||||||||||||||||||||||||
Investment Bank |
$ | 124 | $ | 296 | $ | 1,009 | (58 | ) | (88 | ) | $ | 3,139 | $ | 3,674 | (15 | ) | |||||||||||||||||
Retail Financial Services |
752 | 639 | 718 | 18 | 5 | 3,035 | 3,213 | (6 | ) | ||||||||||||||||||||||||
Card Services |
609 | 786 | 719 | (23 | ) | (15 | ) | 2,919 | 3,206 | (9 | ) | ||||||||||||||||||||||
Commercial Banking |
288 | 258 | 256 | 12 | 13 | 1,134 | 1,010 | 12 | |||||||||||||||||||||||||
Treasury & Securities Services |
422 | 360 | 256 | 17 | 65 | 1,397 | 1,090 | 28 | |||||||||||||||||||||||||
Asset Management |
527 | 521 | 407 | 1 | 29 | 1,966 | 1,409 | 40 | |||||||||||||||||||||||||
Corporate (f) |
249 | 513 | 1,161 | (51 | ) | (79 | ) | 1,775 | 842 | 111 | |||||||||||||||||||||||
Net Income |
$ | 2,971 | $ | 3,373 | $ | 4,526 | (12 | ) | (34 | ) | $ | 15,365 | $ | 14,444 | 6 | ||||||||||||||||||
(a) | The Firm adopted SFAS 157 in the first quarter of 2007. For additional information, see Note 3 of the Firms September 30, 2007, Form 10-Q. | |
(b) | On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses are reported as discontinued operations for each 2006 period. | |
(c) | Quarterly ratios are based upon annualized amounts. | |
(d) | Income from continuing operations and Net income applicable to common stock divided by total average common equity (net of goodwill). The Firm uses return on equity less goodwill, a non-GAAP financial measure, to evaluate the operating performance of the Firm. The Firm also utilizes this measure to facilitate comparisons to competitors. | |
(e) | Income from continuing operations divided by Total average assets less average assets of discontinued operations held-for-sale. | |
(f) | Included the after-tax impact of discontinued operations, material litigation actions, tax audit benefits and merger costs. | |
(g) | Estimated. |
15
JPMORGAN CHASE & CO. |
||
TABLE OF CONTENTS |
Page | ||||
Consolidated Results |
||||
Consolidated Financial Highlights |
2 | |||
Statements of Income |
3 | |||
Consolidated Balance Sheets |
4 | |||
Condensed Average Balance Sheets and Annualized Yields |
5 | |||
Reconciliation from Reported to Managed Summary |
6 | |||
Business Detail |
||||
Line of Business Financial Highlights Managed Basis |
7 | |||
Investment Bank |
8 | |||
Retail Financial Services |
10 | |||
Card Services Managed Basis |
14 | |||
Commercial Banking |
17 | |||
Treasury & Securities Services |
19 | |||
Asset Management |
21 | |||
Corporate |
24 | |||
Credit-Related Information |
26 | |||
Supplemental Detail |
||||
Capital |
31 | |||
Glossary of Terms |
32 |
Page 1
JPMORGAN CHASE & CO. |
||
CONSOLIDATED FINANCIAL HIGHLIGHTS |
||
(in millions, except per share, ratio and headcount data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
SELECTED INCOME STATEMENT DATA |
||||||||||||||||||||||||||||||||||||||||
Total Net Revenue (a) |
$ | 17,384 | $ | 16,112 | $ | 18,908 | $ | 18,968 | $ | 16,193 | 8 | % | 7 | % | $ | 71,372 | $ | 61,999 | 15 | % | ||||||||||||||||||||
Provision for Credit Losses |
2,542 | 1,785 | 1,529 | 1,008 | 1,134 | 42 | 124 | 6,864 | 3,270 | 110 | ||||||||||||||||||||||||||||||
Total Noninterest Expense |
10,720 | 9,327 | 11,028 | 10,628 | 9,885 | 15 | 8 | 41,703 | 38,843 | 7 | ||||||||||||||||||||||||||||||
Income from Continuing Operations (after-tax) |
2,971 | 3,373 | 4,234 | 4,787 | 3,906 | (12 | ) | (24 | ) | 15,365 | 13,649 | 13 | ||||||||||||||||||||||||||||
Income from Discontinued Operations (b) |
| | | | 620 | | NM | | 795 | NM | ||||||||||||||||||||||||||||||
Net Income |
2,971 | 3,373 | 4,234 | 4,787 | 4,526 | (12 | ) | (34 | ) | 15,365 | 14,444 | 6 | ||||||||||||||||||||||||||||
PER COMMON SHARE: |
||||||||||||||||||||||||||||||||||||||||
Basic Earnings |
||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
$ | 0.88 | $ | 1.00 | $ | 1.24 | $ | 1.38 | $ | 1.13 | (12 | ) | (22 | ) | $ | 4.51 | $ | 3.93 | 15 | |||||||||||||||||||||
Net Income |
0.88 | 1.00 | 1.24 | 1.38 | 1.31 | (12 | ) | (33 | ) | 4.51 | 4.16 | 8 | ||||||||||||||||||||||||||||
Diluted Earnings |
||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
$ | 0.86 | $ | 0.97 | $ | 1.20 | $ | 1.34 | $ | 1.09 | (11 | ) | (21 | ) | $ | 4.38 | $ | 3.82 | 15 | |||||||||||||||||||||
Net Income |
0.86 | 0.97 | 1.20 | 1.34 | 1.26 | (11 | ) | (32 | ) | 4.38 | 4.04 | 8 | ||||||||||||||||||||||||||||
Cash Dividends Declared |
0.38 | 0.38 | 0.38 | 0.34 | 0.34 | | 12 | 1.48 | 1.36 | 9 | ||||||||||||||||||||||||||||||
Book Value |
36.59 | 35.72 | 35.08 | 34.45 | 33.45 | 2 | 9 | 36.59 | 33.45 | 9 | ||||||||||||||||||||||||||||||
Closing Share Price |
43.65 | 45.82 | 48.45 | 48.38 | 48.30 | (5 | ) | (10 | ) | 43.65 | 48.30 | (10 | ) | |||||||||||||||||||||||||||
Market Capitalization |
146,986 | 153,901 | 164,659 | 165,280 | 167,199 | (4 | ) | (12 | ) | 146,986 | 167,199 | (12 | ) | |||||||||||||||||||||||||||
COMMON SHARES OUTSTANDING: |
||||||||||||||||||||||||||||||||||||||||
Weighted-Average Diluted Shares Outstanding |
3,471.8 | # | 3,477.7 | # | 3,521.6 | # | 3,559.5 | # | 3,578.6 | # | | (3 | ) | 3,507.6 | # | 3,573.9 | # | (2 | ) | |||||||||||||||||||||
Common Shares Outstanding at Period-end |
3,367.4 | 3,358.8 | 3,398.5 | 3,416.3 | 3,461.7 | | (3 | ) | 3,367.4 | 3,461.7 | (3 | ) | ||||||||||||||||||||||||||||
FINANCIAL RATIOS: (c) |
||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations: |
||||||||||||||||||||||||||||||||||||||||
Return on Common Equity (ROE) |
10 | % | 11 | % | 14 | % | 17 | % | 14 | % | 13 | % | 12 | % | ||||||||||||||||||||||||||
Return on Equity-Goodwill (ROE-GW) (d) |
15 | 18 | 23 | 27 | 22 | 21 | 20 | |||||||||||||||||||||||||||||||||
Return on Assets (ROA) (e) |
0.77 | 0.91 | 1.19 | 1.41 | 1.14 | 1.06 | 1.04 | |||||||||||||||||||||||||||||||||
Net Income: |
||||||||||||||||||||||||||||||||||||||||
ROE |
10 | 11 | 14 | 17 | 16 | 13 | 13 | |||||||||||||||||||||||||||||||||
ROE-GW (d) |
15 | 18 | 23 | 27 | 26 | 21 | 22 | |||||||||||||||||||||||||||||||||
ROA |
0.77 | 0.91 | 1.19 | 1.41 | 1.32 | 1.06 | 1.10 | |||||||||||||||||||||||||||||||||
CAPITAL RATIOS: |
||||||||||||||||||||||||||||||||||||||||
Tier 1 Capital Ratio |
8.4 | (g) | 8.4 | 8.4 | 8.5 | 8.7 | ||||||||||||||||||||||||||||||||||
Total Capital Ratio |
12.6 | (g) | 12.5 | 12.0 | 11.8 | 12.3 | ||||||||||||||||||||||||||||||||||
SELECTED BALANCE SHEET DATA (Period-end) |
||||||||||||||||||||||||||||||||||||||||
Total Assets |
$ | 1,562,147 | $ | 1,479,575 | $ | 1,458,042 | $ | 1,408,918 | $ | 1,351,520 | 6 | 16 | $ | 1,562,147 | $ | 1,351,520 | 16 | |||||||||||||||||||||||
Wholesale Loans |
213,076 | 197,728 | 181,968 | 168,194 | 183,742 | 8 | 16 | 213,076 | 183,742 | 16 | ||||||||||||||||||||||||||||||
Consumer Loans |
306,298 | 288,592 | 283,069 | 281,571 | 299,385 | 6 | 2 | 306,298 | 299,385 | 2 | ||||||||||||||||||||||||||||||
Deposits |
740,728 | 678,091 | 651,370 | 626,428 | 638,788 | 9 | 16 | 740,728 | 638,788 | 16 | ||||||||||||||||||||||||||||||
Common Stockholders Equity |
123,221 | 119,978 | 119,211 | 117,704 | 115,790 | 3 | 6 | 123,221 | 115,790 | 6 | ||||||||||||||||||||||||||||||
Headcount |
180,667 | # | 179,847 | # | 179,664 | # | 176,314 | # | 174,360 | # | | 4 | 180,667 | # | 174,360 | # | 4 | |||||||||||||||||||||||
LINE OF BUSINESS NET INCOME |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | 124 | $ | 296 | $ | 1,179 | $ | 1,540 | $ | 1,009 | (58 | ) | (88 | ) | $ | 3,139 | $ | 3,674 | (15 | ) | ||||||||||||||||||||
Retail Financial Services |
752 | 639 | 785 | 859 | 718 | 18 | 5 | 3,035 | 3,213 | (6 | ) | |||||||||||||||||||||||||||||
Card Services |
609 | 786 | 759 | 765 | 719 | (23 | ) | (15 | ) | 2,919 | 3,206 | (9 | ) | |||||||||||||||||||||||||||
Commercial Banking |
288 | 258 | 284 | 304 | 256 | 12 | 13 | 1,134 | 1,010 | 12 | ||||||||||||||||||||||||||||||
Treasury & Securities Services |
422 | 360 | 352 | 263 | 256 | 17 | 65 | 1,397 | 1,090 | 28 | ||||||||||||||||||||||||||||||
Asset Management |
527 | 521 | 493 | 425 | 407 | 1 | 29 | 1,966 | 1,409 | 40 | ||||||||||||||||||||||||||||||
Corporate (f) |
249 | 513 | 382 | 631 | 1,161 | (51 | ) | (79 | ) | 1,775 | 842 | 111 | ||||||||||||||||||||||||||||
Net Income |
$ | 2,971 | $ | 3,373 | $ | 4,234 | $ | 4,787 | $ | 4,526 | (12 | ) | (34 | ) | $ | 15,365 | $ | 14,444 | 6 | |||||||||||||||||||||
(a) | The Firm adopted SFAS 157 in the first quarter of 2007. For additional information, see Note 3 of the Firms September 30, 2007, Form 10-Q. | |
(b) | On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses are reported as discontinued operations for each 2006 period. | |
(c) | Quarterly ratios are based upon annualized amounts. | |
(d) | Income from continuing operations and Net income applicable to common stock divided by total average common equity (net of goodwill). The Firm uses return on equity less goodwill, a non-GAAP financial measure, to evaluate the operating performance of the Firm. The Firm also utilizes this measure to facilitate comparisons to competitors. | |
(e) | Income from continuing operations divided by Total average assets less average assets of discontinued operations held-for-sale. | |
(f) | Included the after-tax impact of discontinued operations, material litigation actions, tax audit benefits and merger costs. See Corporate Financial Highlights for additional details. | |
(g) | Estimated. |
Page 2
JPMORGAN CHASE & CO. |
||
STATEMENTS OF INCOME |
||
(in millions, except per share and ratio data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Investment Banking Fees |
$ | 1,662 | $ | 1,336 | $ | 1,898 | $ | 1,739 | $ | 1,565 | 24 | % | 6 | % | $ | 6,635 | $ | 5,520 | 20 | % | ||||||||||||||||||||
Principal Transactions (a) (b) |
165 | 650 | 3,713 | 4,487 | 2,591 | (75 | ) | (94 | ) | 9,015 | 10,778 | (16 | ) | |||||||||||||||||||||||||||
Lending & Deposit Related Fees |
1,066 | 1,026 | 951 | 895 | 895 | 4 | 19 | 3,938 | 3,468 | 14 | ||||||||||||||||||||||||||||||
Asset Management, Administration and Commissions |
3,896 | 3,663 | 3,611 | 3,186 | 3,173 | 6 | 23 | 14,356 | 11,855 | 21 | ||||||||||||||||||||||||||||||
Securities Gains (Losses) |
148 | 237 | (223 | ) | 2 | 35 | (38 | ) | 323 | 164 | (543 | ) | NM | |||||||||||||||||||||||||||
Mortgage
Fees and Related Income (c) |
898 | 221 | 523 | 476 | 75 | 306 | NM | 2,118 | 591 | 258 | ||||||||||||||||||||||||||||||
Credit Card Income |
1,857 | 1,777 | 1,714 | 1,563 | 1,645 | 5 | 13 | 6,911 | 6,913 | | ||||||||||||||||||||||||||||||
Other Income |
469 | 289 | 553 | 518 | 522 | 62 | (10 | ) | 1,829 | 2,175 | (16 | ) | ||||||||||||||||||||||||||||
Noninterest Revenue |
10,161 | 9,199 | 12,740 | 12,866 | 10,501 | 10 | (3 | ) | 44,966 | 40,757 | 10 | |||||||||||||||||||||||||||||
Interest Income (b) |
18,619 | 18,806 | 17,342 | 16,620 | 16,097 | (1 | ) | 16 | 71,387 | 59,107 | 21 | |||||||||||||||||||||||||||||
Interest Expense |
11,396 | 11,893 | 11,174 | 10,518 | 10,405 | (4 | ) | 10 | 44,981 | 37,865 | 19 | |||||||||||||||||||||||||||||
Net Interest Income |
7,223 | 6,913 | 6,168 | 6,102 | 5,692 | 4 | 27 | 26,406 | 21,242 | 24 | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
17,384 | 16,112 | 18,908 | 18,968 | 16,193 | 8 | 7 | 71,372 | 61,999 | 15 | ||||||||||||||||||||||||||||||
Provision for Credit Losses |
2,542 | 1,785 | 1,529 | 1,008 | 1,134 | 42 | 124 | 6,864 | 3,270 | 110 | ||||||||||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense |
5,469 | 4,677 | 6,309 | 6,234 | 4,985 | 17 | 10 | 22,689 | 21,191 | 7 | ||||||||||||||||||||||||||||||
Occupancy Expense |
659 | 657 | 652 | 640 | 625 | | 5 | 2,608 | 2,335 | 12 | ||||||||||||||||||||||||||||||
Technology, Communications and Equipment Expense |
986 | 950 | 921 | 922 | 997 | 4 | (1 | ) | 3,779 | 3,653 | 3 | |||||||||||||||||||||||||||||
Professional & Outside Services |
1,421 | 1,260 | 1,259 | 1,200 | 1,246 | 13 | 14 | 5,140 | 4,450 | 16 | ||||||||||||||||||||||||||||||
Marketing |
570 | 561 | 457 | 482 | 614 | 2 | (7 | ) | 2,070 | 2,209 | (6 | ) | ||||||||||||||||||||||||||||
Other Expense (d) |
1,254 | 812 | 1,013 | 735 | 948 | 54 | 32 | 3,814 | 3,272 | 17 | ||||||||||||||||||||||||||||||
Amortization of Intangibles |
339 | 349 | 353 | 353 | 370 | (3 | ) | (8 | ) | 1,394 | 1,428 | (2 | ) | |||||||||||||||||||||||||||
Merger Costs |
22 | 61 | 64 | 62 | 100 | (64 | ) | (78 | ) | 209 | 305 | (31 | ) | |||||||||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
10,720 | 9,327 | 11,028 | 10,628 | 9,885 | 15 | 8 | 41,703 | 38,843 | 7 | ||||||||||||||||||||||||||||||
Income from Continuing Operations before Income Tax Expense |
4,122 | 5,000 | 6,351 | 7,332 | 5,174 | (18 | ) | (20 | ) | 22,805 | 19,886 | 15 | ||||||||||||||||||||||||||||
Income Tax Expense |
1,151 | 1,627 | 2,117 | 2,545 | 1,268 | (29 | ) | (9 | ) | 7,440 | 6,237 | 19 | ||||||||||||||||||||||||||||
Income from Continuing Operations (after-tax) |
2,971 | 3,373 | 4,234 | 4,787 | 3,906 | (12 | ) | (24 | ) | 15,365 | 13,649 | 13 | ||||||||||||||||||||||||||||
Income from Discontinued Operations (e) |
| | | | 620 | | NM | | 795 | NM | ||||||||||||||||||||||||||||||
NET INCOME |
$ | 2,971 | $ | 3,373 | $ | 4,234 | $ | 4,787 | $ | 4,526 | (12 | ) | (34 | ) | $ | 15,365 | $ | 14,444 | 6 | |||||||||||||||||||||
DILUTED EARNINGS PER SHARE |
||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations (after-tax) |
$ | 0.86 | $ | 0.97 | $ | 1.20 | $ | 1.34 | $ | 1.09 | (11 | ) | (21 | ) | $ | 4.38 | $ | 3.82 | 15 | |||||||||||||||||||||
Income from Discontinued Operations (e) |
| | | | 0.17 | | NM | | 0.22 | NM | ||||||||||||||||||||||||||||||
Net Income |
$ | 0.86 | $ | 0.97 | $ | 1.20 | $ | 1.34 | $ | 1.26 | (11 | ) | (32 | ) | $ | 4.38 | $ | 4.04 | 8 | |||||||||||||||||||||
FINANCIAL RATIOS |
||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations: |
||||||||||||||||||||||||||||||||||||||||
ROE |
10 | % | 11 | % | 14 | % | 17 | % | 14 | % | 13 | % | 12 | % | ||||||||||||||||||||||||||
ROE-GW |
15 | 18 | 23 | 27 | 22 | 21 | 20 | |||||||||||||||||||||||||||||||||
ROA |
0.77 | 0.91 | 1.19 | 1.41 | 1.14 | 1.06 | 1.04 | |||||||||||||||||||||||||||||||||
Net Income: |
||||||||||||||||||||||||||||||||||||||||
ROE |
10 | 11 | 14 | 17 | 16 | 13 | 13 | |||||||||||||||||||||||||||||||||
ROE-GW |
15 | 18 | 23 | 27 | 26 | 21 | 22 | |||||||||||||||||||||||||||||||||
ROA |
0.77 | 0.91 | 1.19 | 1.41 | 1.32 | 1.06 | 1.10 | |||||||||||||||||||||||||||||||||
Effective Income Tax Rate (f) |
28 | 33 | 33 | 35 | 25 | 33 | 31 | |||||||||||||||||||||||||||||||||
Overhead Ratio |
62 | 58 | 58 | 56 | 61 | 58 | 63 | |||||||||||||||||||||||||||||||||
EXCLUDING IMPACT OF MERGER COSTS (g) |
||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
$ | 2,971 | $ | 3,373 | $ | 4,234 | $ | 4,787 | $ | 3,906 | (12 | ) | (24 | ) | $ | 15,365 | $ | 13,649 | 13 | |||||||||||||||||||||
Less Merger Costs (after-tax) |
14 | 38 | 40 | 38 | 62 | (63 | ) | (77 | ) | 130 | 189 | (31 | ) | |||||||||||||||||||||||||||
Income from Continuing Operations Excluding Merger Costs |
$ | 2,985 | $ | 3,411 | $ | 4,274 | $ | 4,825 | $ | 3,968 | (12 | ) | (25 | ) | $ | 15,495 | $ | 13,838 | 12 | |||||||||||||||||||||
Diluted Per Share: |
||||||||||||||||||||||||||||||||||||||||
Income from Continuing Operations |
$ | 0.86 | $ | 0.97 | $ | 1.20 | $ | 1.34 | $ | 1.09 | (11 | ) | (21 | ) | $ | 4.38 | $ | 3.82 | 15 | |||||||||||||||||||||
Less Merger Costs (after-tax) |
| 0.01 | 0.01 | 0.01 | 0.02 | NM | NM | 0.04 | 0.05 | (20 | ) | |||||||||||||||||||||||||||||
Income from Continuing Operations Excluding Merger Costs |
$ | 0.86 | $ | 0.98 | $ | 1.21 | $ | 1.35 | $ | 1.11 | (12 | ) | (23 | ) | $ | 4.42 | $ | 3.87 | 14 | |||||||||||||||||||||
(a) | The Firm adopted SFAS 157 in the first quarter of 2007. For additional information, see Note 3 of the Firms September 30, 2007, Form 10-Q. | |
(b) | For certain trading-related positions, amounts have been revised between Principal transactions revenue and Interest income; there is no impact to Net revenue as a result of these reclassifications. | |
(c) | The Firm adopted SFAS 159 in the first quarter of 2007. As a result, certain loan origination costs have been classified as expense (previously netted against revenue) for the current-year quarters and full year 2007. | |
(d) | Insurance recoveries related to settlement of the Enron and WorldCom class action litigations and for certain other material legal proceedings were $137 million for the three months ended December 31, 2006. Insurance recoveries were $512 million for full year 2006. | |
(e) | On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses were reported as discontinued operations for each 2006 period. | |
(f) | Based on Income from continuing operations. | |
(g) | Income from continuing operations excluding merger costs, a non-GAAP financial measure, is used by the Firm to facilitate comparison of results against the Firms ongoing operations and with other companies U.S. GAAP financial statements. |
Page 3
JPMORGAN CHASE & CO. |
||
CONSOLIDATED BALANCE SHEETS |
||
(in millions) |
Dec 31, 2007 | ||||||||||||||||||||||||||||
Change | ||||||||||||||||||||||||||||
Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Dec 31 | ||||||||||||||||||||||
2007 | 2007 | 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||||||
Cash and Due from Banks |
$ | 40,144 | $ | 32,766 | $ | 35,449 | $ | 31,836 | $ | 40,412 | 23 | % | (1 | )% | ||||||||||||||
Deposits with Banks |
11,466 | 26,714 | 41,736 | 30,973 | 13,547 | (57 | ) | (15 | ) | |||||||||||||||||||
Federal Funds Sold and Securities Purchased under Resale Agreements |
170,897 | 135,589 | 125,930 | 144,306 | 140,524 | 26 | 22 | |||||||||||||||||||||
Securities Borrowed |
84,184 | 84,697 | 88,360 | 84,800 | 73,688 | (1 | ) | 14 | ||||||||||||||||||||
Trading Assets: |
||||||||||||||||||||||||||||
Debt and Equity Instruments |
414,273 | 389,119 | 391,508 | 373,684 | 310,137 | 6 | 34 | |||||||||||||||||||||
Derivative Receivables |
77,136 | 64,592 | 59,038 | 49,647 | 55,601 | 19 | 39 | |||||||||||||||||||||
Securities |
85,450 | 97,706 | 95,984 | 97,029 | 91,975 | (13 | ) | (7 | ) | |||||||||||||||||||
Loans (Net of Allowance for Loan Losses) |
510,140 | 478,207 | 457,404 | 442,465 | 475,848 | 7 | 7 | |||||||||||||||||||||
Accrued Interest and Accounts Receivable |
24,823 | 26,401 | 26,716 | 23,663 | 22,891 | (6 | ) | 8 | ||||||||||||||||||||
Premises and Equipment |
9,319 | 8,892 | 9,044 | 8,728 | 8,735 | 5 | 7 | |||||||||||||||||||||
Goodwill |
45,270 | 45,335 | 45,254 | 45,063 | 45,186 | | | |||||||||||||||||||||
Other Intangible Assets: |
||||||||||||||||||||||||||||
Mortgage Servicing Rights |
8,632 | 9,114 | 9,499 | 7,937 | 7,546 | (5 | ) | 14 | ||||||||||||||||||||
Purchased Credit Card Relationships |
2,303 | 2,427 | 2,591 | 2,758 | 2,935 | (5 | ) | (22 | ) | |||||||||||||||||||
All Other Intangibles |
3,796 | 3,959 | 4,103 | 4,205 | 4,371 | (4 | ) | (13 | ) | |||||||||||||||||||
Other Assets |
74,314 | 74,057 | 65,426 | 61,824 | 58,124 | | 28 | |||||||||||||||||||||
TOTAL ASSETS |
$ | 1,562,147 | $ | 1,479,575 | $ | 1,458,042 | $ | 1,408,918 | $ | 1,351,520 | 6 | 16 | ||||||||||||||||
LIABILITIES |
||||||||||||||||||||||||||||
Deposits: |
||||||||||||||||||||||||||||
U.S. Offices: |
||||||||||||||||||||||||||||
Noninterest-Bearing |
$ | 129,406 | $ | 115,036 | $ | 120,470 | $ | 123,942 | $ | 132,781 | 12 | (3 | ) | |||||||||||||||
Interest-Bearing |
376,194 | 354,459 | 342,079 | 342,368 | 337,812 | 6 | 11 | |||||||||||||||||||||
Non-U.S. Offices: |
||||||||||||||||||||||||||||
Noninterest-Bearing |
6,342 | 6,559 | 5,919 | 8,104 | 7,662 | (3 | ) | (17 | ) | |||||||||||||||||||
Interest-Bearing |
228,786 | 202,037 | 182,902 | 152,014 | 160,533 | 13 | 43 | |||||||||||||||||||||
Total Deposits |
740,728 | 678,091 | 651,370 | 626,428 | 638,788 | 9 | 16 | |||||||||||||||||||||
Federal Funds Purchased and Securities Sold under Repurchase Agreements |
154,398 | 178,767 | 205,961 | 218,917 | 162,173 | (14 | ) | (5 | ) | |||||||||||||||||||
Commercial Paper |
49,596 | 33,978 | 25,116 | 25,354 | 18,849 | 46 | 163 | |||||||||||||||||||||
Other Borrowed Funds |
28,835 | 31,154 | 29,263 | 19,871 | 18,053 | (7 | ) | 60 | ||||||||||||||||||||
Trading Liabilities: |
||||||||||||||||||||||||||||
Debt and Equity Instruments |
89,162 | 80,748 | 93,969 | 94,309 | 90,488 | 10 | (1 | ) | ||||||||||||||||||||
Derivative Payables |
68,705 | 68,426 | 61,396 | 50,316 | 57,469 | | 20 | |||||||||||||||||||||
Accounts Payable, Accrued Expenses and Other Liabilities
(including the Allowance for Lending-Related Commitments) |
94,476 | 86,524 | 84,785 | 87,603 | 88,096 | 9 | 7 | |||||||||||||||||||||
Beneficial Interests Issued by Consolidated VIEs |
14,016 | 13,283 | 14,808 | 13,109 | 16,184 | 6 | (13 | ) | ||||||||||||||||||||
Long-Term Debt |
183,862 | 173,696 | 159,493 | 143,274 | 133,421 | 6 | 38 | |||||||||||||||||||||
Junior Subordinated Deferrable Interest Debentures Held by Trusts that Issued
Guaranteed Capital Debt Securities |
15,148 | 14,930 | 12,670 | 12,033 | 12,209 | 1 | 24 | |||||||||||||||||||||
TOTAL LIABILITIES |
1,438,926 | 1,359,597 | 1,338,831 | 1,291,214 | 1,235,730 | 6 | 16 | |||||||||||||||||||||
STOCKHOLDERS EQUITY |
||||||||||||||||||||||||||||
Common Stock |
3,658 | 3,658 | 3,658 | 3,658 | 3,658 | | | |||||||||||||||||||||
Capital Surplus |
78,597 | 78,295 | 78,020 | 77,760 | 77,807 | | 1 | |||||||||||||||||||||
Retained Earnings (a) |
54,715 | 53,064 | 51,011 | 48,105 | 43,600 | 3 | 25 | |||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) |
(917 | ) | (1,830 | ) | (2,080 | ) | (1,482 | ) | (1,557 | ) | 50 | 41 | ||||||||||||||||
Treasury Stock, at Cost |
(12,832 | ) | (13,209 | ) | (11,398 | ) | (10,337 | ) | (7,718 | ) | 3 | (66 | ) | |||||||||||||||
TOTAL STOCKHOLDERS EQUITY |
123,221 | 119,978 | 119,211 | 117,704 | 115,790 | 3 | 6 | |||||||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY |
$ | 1,562,147 | $ | 1,479,575 | $ | 1,458,042 | $ | 1,408,918 | $ | 1,351,520 | 6 | 16 | ||||||||||||||||
(a) | The cumulative effect of changes in accounting principles increased retained earnings as a result of implementing SFAS 157, SFAS 159 and FIN 48 in the first quarter of 2007. For additional information see the Firms September 30, 2007, Form 10-Q. |
Page 4
JPMORGAN CHASE & CO. |
||
CONDENSED AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS |
||
(in millions, except rates) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
AVERAGE BALANCES |
||||||||||||||||||||||||||||||||||||||||
ASSETS |
||||||||||||||||||||||||||||||||||||||||
Deposits with Banks |
$ | 41,363 | $ | 39,906 | $ | 18,153 | $ | 16,224 | $ | 19,736 | 4 | % | 110 | % | $ | 29,010 | $ | 27,730 | 5 | % | ||||||||||||||||||||
Federal Funds Sold and Securities Purchased
under Resale Agreements |
140,622 | 133,780 | 132,768 | 135,499 | 144,744 | 5 | (3 | ) | 135,677 | 132,118 | 3 | |||||||||||||||||||||||||||||
Securities Borrowed |
86,649 | 87,955 | 90,810 | 78,768 | 82,184 | (1 | ) | 5 | 86,072 | 83,831 | 3 | |||||||||||||||||||||||||||||
Trading Assets Debt Instruments |
308,175 | 310,445 | 294,931 | 257,079 | 218,188 | (1 | ) | 41 | 292,846 | 205,506 | 42 | |||||||||||||||||||||||||||||
Securities |
93,236 | 95,694 | 96,921 | 95,326 | 89,962 | (3 | ) | 4 | 95,290 | 77,845 | 22 | |||||||||||||||||||||||||||||
Interests in Purchased Receivables (a) |
| | | | | | | | 13,941 | NM | ||||||||||||||||||||||||||||||
Loans |
508,172 | 476,912 | 465,763 | 467,453 | 484,140 | 7 | 5 | 479,679 | 454,535 | 6 | ||||||||||||||||||||||||||||||
Total Interest-Earning Assets |
1,178,217 | 1,144,692 | 1,099,346 | 1,050,349 | 1,038,954 | 3 | 13 | 1,118,574 | 995,506 | 12 | ||||||||||||||||||||||||||||||
Trading Assets Equity Instruments |
93,453 | 86,177 | 85,830 | 88,791 | 81,985 | 8 | 14 | 88,569 | 74,573 | 19 | ||||||||||||||||||||||||||||||
Goodwill |
45,321 | 45,276 | 45,181 | 45,125 | 45,163 | | | 45,226 | 43,872 | 3 | ||||||||||||||||||||||||||||||
Other Intangible Assets: |
||||||||||||||||||||||||||||||||||||||||
Mortgage Servicing Rights |
8,795 | 9,290 | 8,371 | 7,784 | 7,295 | (5 | ) | 21 | 8,565 | 7,484 | 14 | |||||||||||||||||||||||||||||
All Other Intangible Assets |
6,220 | 6,532 | 6,854 | 7,139 | 7,478 | (5 | ) | (17 | ) | 6,684 | 7,420 | (10 | ) | |||||||||||||||||||||||||||
All Other Noninterest-Earning Assets |
198,031 | 185,367 | 186,404 | 179,727 | 181,732 | 7 | 9 | 187,426 | 168,442 | 11 | ||||||||||||||||||||||||||||||
Assets of Discontinued Operations Held-for-Sale (b) |
| | | | | | | | 16,497 | NM | ||||||||||||||||||||||||||||||
TOTAL ASSETS |
$ | 1,530,037 | $ | 1,477,334 | $ | 1,431,986 | $ | 1,378,915 | $ | 1,362,607 | 4 | 12 | $ | 1,455,044 | $ | 1,313,794 | 11 | |||||||||||||||||||||||
LIABILITIES |
||||||||||||||||||||||||||||||||||||||||
Interest-Bearing Deposits |
$ | 587,297 | $ | 540,937 | $ | 513,451 | $ | 498,717 | $ | 487,368 | 9 | 21 | $ | 535,359 | $ | 452,323 | 18 | |||||||||||||||||||||||
Federal Funds Purchased and Securities Sold
under Repurchase Agreements |
171,450 | 206,174 | 209,323 | 199,252 | 198,166 | (17 | ) | (13 | ) | 196,500 | 183,783 | 7 | ||||||||||||||||||||||||||||
Commercial Paper |
48,821 | 26,511 | 25,282 | 22,339 | 18,787 | 84 | 160 | 30,799 | 17,710 | 74 | ||||||||||||||||||||||||||||||
Other Borrowings (c) |
99,259 | 104,995 | 100,715 | 95,664 | 96,499 | (5 | ) | 3 | 100,181 | 102,147 | (2 | ) | ||||||||||||||||||||||||||||
Beneficial Interests Issued by Consolidated VIEs |
14,183 | 14,454 | 13,641 | 15,993 | 15,769 | (2 | ) | (10 | ) | 14,563 | 28,652 | (49 | ) | |||||||||||||||||||||||||||
Long-Term Debt |
191,797 | 177,851 | 162,465 | 148,146 | 140,515 | 8 | 36 | 170,206 | 129,667 | 31 | ||||||||||||||||||||||||||||||
Total Interest-Bearing Liabilities |
1,112,807 | 1,070,922 | 1,024,877 | 980,111 | 957,104 | 4 | 16 | 1,047,608 | 914,282 | 15 | ||||||||||||||||||||||||||||||
Noninterest-Bearing Liabilities |
295,670 | 287,436 | 289,058 | 282,559 | 290,741 | 3 | 2 | 288,713 | 272,994 | 6 | ||||||||||||||||||||||||||||||
Liabilities of Discontinued Operations Held-for-Sale (b) |
| | | | | | | | 15,787 | NM | ||||||||||||||||||||||||||||||
TOTAL LIABILITIES |
1,408,477 | 1,358,358 | 1,313,935 | 1,262,670 | 1,247,845 | 4 | 13 | 1,336,321 | 1,203,063 | 11 | ||||||||||||||||||||||||||||||
Preferred Stock |
| | | | | | | | 34 | NM | ||||||||||||||||||||||||||||||
Common Stockholders Equity |
121,560 | 118,976 | 118,051 | 116,245 | 114,762 | 2 | 6 | 118,723 | 110,697 | 7 | ||||||||||||||||||||||||||||||
TOTAL STOCKHOLDERS EQUITY |
121,560 | 118,976 | 118,051 | 116,245 | 114,762 | 2 | 6 | 118,723 | 110,731 | 7 | ||||||||||||||||||||||||||||||
TOTAL LIABILITIES, PREFERRED STOCK
AND STOCKHOLDERS EQUITY |
$ | 1,530,037 | $ | 1,477,334 | $ | 1,431,986 | $ | 1,378,915 | $ | 1,362,607 | 4 | 12 | $ | 1,455,044 | $ | 1,313,794 | 11 | |||||||||||||||||||||||
AVERAGE RATES |
||||||||||||||||||||||||||||||||||||||||
INTEREST-EARNING ASSETS |
||||||||||||||||||||||||||||||||||||||||
Deposits with Banks |
4.95 | % | 5.06 | % | 4.56 | % | 4.65 | % | 5.18 | % | 4.89 | % | 4.56 | % | ||||||||||||||||||||||||||
Federal Funds Sold and Securities Purchased
under Resale Agreements |
4.41 | 4.83 | 4.99 | 4.95 | 4.71 | 4.79 | 4.22 | |||||||||||||||||||||||||||||||||
Securities Borrowed |
4.77 | 5.60 | 5.31 | 5.42 | 4.56 | 5.27 | 4.06 | |||||||||||||||||||||||||||||||||
Trading Assets Debt Instruments (d) |
5.84 | 6.09 | 5.65 | 5.96 | 5.45 | 5.89 | 5.41 | |||||||||||||||||||||||||||||||||
Securities |
5.58 | 5.69 | 5.68 | 5.68 | 5.57 | 5.65 | 5.53 | |||||||||||||||||||||||||||||||||
Interests in Purchased Receivables |
| | | | | | 4.68 | |||||||||||||||||||||||||||||||||
Loans |
7.60 | 7.80 | 7.65 | 7.53 | 7.35 | 7.65 | 7.26 | |||||||||||||||||||||||||||||||||
Total Interest-Earning Assets |
6.30 | 6.55 | 6.37 | 6.44 | 6.17 | 6.42 | 5.96 | |||||||||||||||||||||||||||||||||
INTEREST-BEARING LIABILITIES |
||||||||||||||||||||||||||||||||||||||||
Interest-Bearing Deposits |
3.84 | 4.13 | 4.17 | 4.06 | 3.99 | 4.04 | 3.77 | |||||||||||||||||||||||||||||||||
Federal Funds Purchased and Securities Sold
under Repurchase Agreements |
4.35 | 5.18 | 5.19 | 5.09 | 4.86 | 4.98 | 4.45 | |||||||||||||||||||||||||||||||||
Commercial Paper |
4.40 | 4.68 | 4.92 | 4.89 | 4.76 | 4.65 | 4.49 | |||||||||||||||||||||||||||||||||
Other Borrowings (c) |
5.02 | 4.90 | 4.69 | 5.07 | 4.75 | 4.91 | 5.00 | |||||||||||||||||||||||||||||||||
Beneficial Interests Issued by Consolidated VIEs |
4.36 | 4.52 | 3.22 | 3.82 | 3.96 | 3.98 | 4.31 | |||||||||||||||||||||||||||||||||
Long-Term Debt |
3.90 | 3.99 | 3.77 | 3.85 | 4.34 | 3.88 | 4.24 | |||||||||||||||||||||||||||||||||
Total Interest-Bearing Liabilities |
4.06 | 4.41 | 4.37 | 4.35 | 4.31 | 4.29 | 4.14 | |||||||||||||||||||||||||||||||||
INTEREST RATE SPREAD |
2.24 | % | 2.14 | % | 2.00 | % | 2.09 | % | 1.86 | % | 2.13 | % | 1.82 | % | ||||||||||||||||||||||||||
NET YIELD ON INTEREST-EARNING ASSETS |
2.46 | % | 2.43 | % | 2.30 | % | 2.38 | % | 2.19 | % | 2.39 | % | 2.16 | % | ||||||||||||||||||||||||||
NET YIELD ON INTEREST-EARNING ASSETS
ADJUSTED FOR SECURITIZATIONS |
2.80 | % | 2.75 | % | 2.63 | % | 2.73 | % | 2.54 | % | 2.73 | % | 2.56 | % | ||||||||||||||||||||||||||
(a) | As a result of restructuring certain multi-seller conduits the Firm administers, during the second quarter of 2006, JPMorgan Chase deconsolidated $29 billion of Interests in Purchased Receivables, $3 billion of Loans and $1 billion of Securities, and recorded $33 billion of Lending-Related Commitments. | |
(b) | On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses for the consumer, business banking and middle-market banking businesses of The Bank of New York. As a result of this transaction, for purposes of the consolidated average balance sheet for assets and liabilities transferred to discontinued operations, JPMorgan Chase used Federal funds sold interest income as a reasonable estimate of the earnings on corporate trust deposits for the periods prior to the close of the transaction; therefore, JPMorgan Chase transferred to assets of discontinued operations held-for-sale average Federal funds sold, along with the related interest income earned, and transferred to liabilities of discontinued operations held-for-sale average corporate trust deposits. | |
(c) | Includes securities sold but not yet purchased. | |
(d) | For certain trading-related positions, amounts have been revised between Principal transactions revenue and Interest income on Trading assets debt instruments; there is no impact to Net revenue as a result of these reclassifications. |
Page 5
JPMORGAN CHASE & CO. |
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RECONCILIATION FROM REPORTED TO MANAGED SUMMARY |
||
(in millions) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
CREDIT CARD INCOME |
||||||||||||||||||||||||||||||||||||||||
Credit Card Income Reported |
$ | 1,857 | $ | 1,777 | $ | 1,714 | $ | 1,563 | $ | 1,645 | 5 | % | 13 | % | $ | 6,911 | $ | 6,913 | | % | ||||||||||||||||||||
Impact of: |
||||||||||||||||||||||||||||||||||||||||
Credit Card Securitizations |
(885 | ) | (836 | ) | (788 | ) | (746 | ) | (726 | ) | (6 | ) | (22 | ) | (3,255 | ) | (3,509 | ) | 7 | |||||||||||||||||||||
Credit Card Income Managed |
$ | 972 | $ | 941 | $ | 926 | $ | 817 | $ | 919 | 3 | 6 | $ | 3,656 | $ | 3,404 | 7 | |||||||||||||||||||||||
OTHER INCOME |
||||||||||||||||||||||||||||||||||||||||
Other Income Reported |
$ | 469 | $ | 289 | $ | 553 | $ | 518 | $ | 522 | 62 | (10 | ) | $ | 1,829 | $ | 2,175 | (16 | ) | |||||||||||||||||||||
Impact of: |
||||||||||||||||||||||||||||||||||||||||
Tax-Equivalent Adjustments |
182 | 192 | 199 | 110 | 195 | (5 | ) | (7 | ) | 683 | 676 | 1 | ||||||||||||||||||||||||||||
Other Income Managed |
$ | 651 | $ | 481 | $ | 752 | $ | 628 | $ | 717 | 35 | (9 | ) | $ | 2,512 | $ | 2,851 | (12 | ) | |||||||||||||||||||||
TOTAL NONINTEREST REVENUE |
||||||||||||||||||||||||||||||||||||||||
Total Noninterest Revenue Reported |
$ | 10,161 | $ | 9,199 | $ | 12,740 | $ | 12,866 | $ | 10,501 | 10 | (3 | ) | $ | 44,966 | $ | 40,757 | 10 | ||||||||||||||||||||||
Impact of: |
||||||||||||||||||||||||||||||||||||||||
Credit Card Securitizations |
(885 | ) | (836 | ) | (788 | ) | (746 | ) | (726 | ) | (6 | ) | (22 | ) | (3,255 | ) | (3,509 | ) | 7 | |||||||||||||||||||||
Tax-Equivalent Adjustments |
182 | 192 | 199 | 110 | 195 | (5 | ) | (7 | ) | 683 | 676 | 1 | ||||||||||||||||||||||||||||
Total Noninterest Revenue Managed |
$ | 9,458 | $ | 8,555 | $ | 12,151 | $ | 12,230 | $ | 9,970 | 11 | (5 | ) | $ | 42,394 | $ | 37,924 | 12 | ||||||||||||||||||||||
NET INTEREST INCOME |
||||||||||||||||||||||||||||||||||||||||
Net Interest Income Reported |
$ | 7,223 | $ | 6,913 | $ | 6,168 | $ | 6,102 | $ | 5,692 | 4 | 27 | $ | 26,406 | $ | 21,242 | 24 | |||||||||||||||||||||||
Impact of: |
||||||||||||||||||||||||||||||||||||||||
Credit Card Securitizations |
1,504 | 1,414 | 1,378 | 1,339 | 1,319 | 6 | 14 | 5,635 | 5,719 | (1 | ) | |||||||||||||||||||||||||||||
Tax-Equivalent Adjustments |
90 | 95 | 122 | 70 | 53 | (5 | ) | 70 | 377 | 228 | 65 | |||||||||||||||||||||||||||||
Net Interest Income Managed |
$ | 8,817 | $ | 8,422 | $ | 7,668 | $ | 7,511 | $ | 7,064 | 5 | 25 | $ | 32,418 | $ | 27,189 | 19 | |||||||||||||||||||||||
TOTAL NET REVENUE |
||||||||||||||||||||||||||||||||||||||||
Total Net Revenue Reported |
$ | 17,384 | $ | 16,112 | $ | 18,908 | $ | 18,968 | $ | 16,193 | 8 | 7 | $ | 71,372 | $ | 61,999 | 15 | |||||||||||||||||||||||
Impact of: |
||||||||||||||||||||||||||||||||||||||||
Credit Card Securitizations |
619 | 578 | 590 | 593 | 593 | 7 | 4 | 2,380 | 2,210 | 8 | ||||||||||||||||||||||||||||||
Tax-Equivalent Adjustments |
272 | 287 | 321 | 180 | 248 | (5 | ) | 10 | 1,060 | 904 | 17 | |||||||||||||||||||||||||||||
Total Net Revenue Managed |
$ | 18,275 | $ | 16,977 | $ | 19,819 | $ | 19,741 | $ | 17,034 | 8 | 7 | $ | 74,812 | $ | 65,113 | 15 | |||||||||||||||||||||||
PROVISION FOR CREDIT LOSSES |
||||||||||||||||||||||||||||||||||||||||
Provision for Credit Losses Reported |
$ | 2,542 | $ | 1,785 | $ | 1,529 | $ | 1,008 | $ | 1,134 | 42 | 124 | $ | 6,864 | $ | 3,270 | 110 | |||||||||||||||||||||||
Impact of: |
||||||||||||||||||||||||||||||||||||||||
Credit Card Securitizations |
619 | 578 | 590 | 593 | 593 | 7 | 4 | 2,380 | 2,210 | 8 | ||||||||||||||||||||||||||||||
Provision for Credit Losses Managed |
$ | 3,161 | $ | 2,363 | $ | 2,119 | $ | 1,601 | $ | 1,727 | 34 | 83 | $ | 9,244 | $ | 5,480 | 69 | |||||||||||||||||||||||
INCOME TAX EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Income Tax Expense Reported |
$ | 1,151 | $ | 1,627 | $ | 2,117 | $ | 2,545 | $ | 1,268 | (29 | ) | (9 | ) | $ | 7,440 | $ | 6,237 | 19 | |||||||||||||||||||||
Impact of: |
||||||||||||||||||||||||||||||||||||||||
Tax-Equivalent Adjustments |
272 | 287 | 321 | 180 | 248 | (5 | ) | 10 | 1,060 | 904 | 17 | |||||||||||||||||||||||||||||
Income Tax Expense Managed |
$ | 1,423 | $ | 1,914 | $ | 2,438 | $ | 2,725 | $ | 1,516 | (26 | ) | (6 | ) | $ | 8,500 | $ | 7,141 | 19 | |||||||||||||||||||||
Page 6
JPMORGAN CHASE & CO. |
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LINE OF BUSINESS FINANCIAL HIGHLIGHTS MANAGED BASIS |
||
(in millions, except ratio data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
TOTAL NET REVENUE (FTE) |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | 3,172 | $ | 2,946 | $ | 5,798 | $ | 6,254 | $ | 4,860 | 8 | % | (35 | )% | $ | 18,170 | $ | 18,833 | (4 | )% | ||||||||||||||||||||
Retail Financial Services |
4,815 | 4,201 | 4,357 | 4,106 | 3,728 | 15 | 29 | 17,479 | 14,825 | 18 | ||||||||||||||||||||||||||||||
Card Services |
3,971 | 3,867 | 3,717 | 3,680 | 3,750 | 3 | 6 | 15,235 | 14,745 | 3 | ||||||||||||||||||||||||||||||
Commercial Banking |
1,084 | 1,009 | 1,007 | 1,003 | 1,018 | 7 | 6 | 4,103 | 3,800 | 8 | ||||||||||||||||||||||||||||||
Treasury & Securities Services |
1,930 | 1,748 | 1,741 | 1,526 | 1,537 | 10 | 26 | 6,945 | 6,109 | 14 | ||||||||||||||||||||||||||||||
Asset Management |
2,389 | 2,205 | 2,137 | 1,904 | 1,947 | 8 | 23 | 8,635 | 6,787 | 27 | ||||||||||||||||||||||||||||||
Corporate |
914 | 1,001 | 1,062 | 1,268 | 194 | (9 | ) | 371 | 4,245 | 14 | NM | |||||||||||||||||||||||||||||
TOTAL NET REVENUE |
$ | 18,275 | $ | 16,977 | $ | 19,819 | $ | 19,741 | $ | 17,034 | 8 | 7 | $ | 74,812 | $ | 65,113 | 15 | |||||||||||||||||||||||
NET INCOME |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | 124 | $ | 296 | $ | 1,179 | $ | 1,540 | $ | 1,009 | (58 | ) | (88 | ) | $ | 3,139 | $ | 3,674 | (15 | ) | ||||||||||||||||||||
Retail Financial Services |
752 | 639 | 785 | 859 | 718 | 18 | 5 | 3,035 | 3,213 | (6 | ) | |||||||||||||||||||||||||||||
Card Services |
609 | 786 | 759 | 765 | 719 | (23 | ) | (15 | ) | 2,919 | 3,206 | (9 | ) | |||||||||||||||||||||||||||
Commercial Banking |
288 | 258 | 284 | 304 | 256 | 12 | 13 | 1,134 | 1,010 | 12 | ||||||||||||||||||||||||||||||
Treasury & Securities Services |
422 | 360 | 352 | 263 | 256 | 17 | 65 | 1,397 | 1,090 | 28 | ||||||||||||||||||||||||||||||
Asset Management |
527 | 521 | 493 | 425 | 407 | 1 | 29 | 1,966 | 1,409 | 40 | ||||||||||||||||||||||||||||||
Corporate (a) |
249 | 513 | 382 | 631 | 1,161 | (51 | ) | (79 | ) | 1,775 | 842 | 111 | ||||||||||||||||||||||||||||
TOTAL NET INCOME (b) |
$ | 2,971 | $ | 3,373 | $ | 4,234 | $ | 4,787 | $ | 4,526 | (12 | ) | (34 | ) | $ | 15,365 | $ | 14,444 | 6 | |||||||||||||||||||||
AVERAGE EQUITY (c) |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | 21,000 | $ | 21,000 | $ | 21,000 | $ | 21,000 | $ | 21,000 | | | $ | 21,000 | $ | 20,753 | 1 | |||||||||||||||||||||||
Retail Financial Services |
16,000 | 16,000 | 16,000 | 16,000 | 16,000 | | | 16,000 | 14,629 | 9 | ||||||||||||||||||||||||||||||
Card Services |
14,100 | 14,100 | 14,100 | 14,100 | 14,100 | | | 14,100 | 14,100 | | ||||||||||||||||||||||||||||||
Commercial Banking |
6,700 | 6,700 | 6,300 | 6,300 | 6,300 | | 6 | 6,502 | 5,702 | 14 | ||||||||||||||||||||||||||||||
Treasury & Securities Services |
3,000 | 3,000 | 3,000 | 3,000 | 2,200 | | 36 | 3,000 | 2,285 | 31 | ||||||||||||||||||||||||||||||
Asset Management |
4,000 | 4,000 | 3,750 | 3,750 | 3,500 | | 14 | 3,876 | 3,500 | 11 | ||||||||||||||||||||||||||||||
Corporate |
56,760 | 54,176 | 53,901 | 52,095 | 51,662 | 5 | 10 | 54,245 | 49,728 | 9 | ||||||||||||||||||||||||||||||
TOTAL AVERAGE EQUITY |
$ | 121,560 | $ | 118,976 | $ | 118,051 | $ | 116,245 | $ | 114,762 | 2 | 6 | $ | 118,723 | $ | 110,697 | 7 | |||||||||||||||||||||||
RETURN ON EQUITY (c) |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
2 | % | 6 | % | 23 | % | 30 | % | 19 | % | 15 | % | 18 | % | ||||||||||||||||||||||||||
Retail Financial Services |
19 | 16 | 20 | 22 | 18 | 19 | 22 | |||||||||||||||||||||||||||||||||
Card Services |
17 | 22 | 22 | 22 | 20 | 21 | 23 | |||||||||||||||||||||||||||||||||
Commercial Banking |
17 | 15 | 18 | 20 | 16 | 17 | 18 | |||||||||||||||||||||||||||||||||
Treasury & Securities Services |
56 | 48 | 47 | 36 | 46 | 47 | 48 | |||||||||||||||||||||||||||||||||
Asset Management |
52 | 52 | 53 | 46 | 46 | 51 | 40 |
(a) | Included the after-tax impact of discontinued operations, material litigation actions, tax audit benefits and merger costs. See Corporate Financial Highlights for additional details. | |
(b) | Net income included Income from discontinued operations (after-tax) of $620 million for the quarter ended December 31, 2006, and $795 million for full year 2006. There was no income from discontinued operations in 2007. | |
(c) | Each business segment is allocated capital by taking into consideration stand-alone peer comparisons, economic risk measures and regulatory capital requirements. The amount of capital assigned to each business is referred to as equity. |
Page 7
JPMORGAN CHASE & CO. |
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INVESTMENT BANK |
||
FINANCIAL HIGHLIGHTS |
||
(in millions, except ratio data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT |
||||||||||||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Investment Banking Fees |
$ | 1,657 | $ | 1,330 | $ | 1,900 | $ | 1,729 | $ | 1,580 | 25 | % | 5 | % | $ | 6,616 | $ | 5,537 | 19 | % | ||||||||||||||||||||
Principal Transactions (a) (b) |
(623 | ) | (435 | ) | 2,325 | 3,142 | 2,327 | (43 | ) | NM | 4,409 | 9,512 | (54 | ) | ||||||||||||||||||||||||||
Lending & Deposit Related Fees |
142 | 118 | 93 | 93 | 119 | 20 | 19 | 446 | 517 | (14 | ) | |||||||||||||||||||||||||||||
Asset Management, Administration and Commissions |
705 | 712 | 643 | 641 | 569 | (1 | ) | 24 | 2,701 | 2,240 | 21 | |||||||||||||||||||||||||||||
All Other Income |
(166 | ) | (76 | ) | 122 | 42 | 91 | (118 | ) | NM | (78 | ) | 528 | NM | ||||||||||||||||||||||||||
Noninterest Revenue |
1,715 | 1,649 | 5,083 | 5,647 | 4,686 | 4 | (63 | ) | 14,094 | 18,334 | (23 | ) | ||||||||||||||||||||||||||||
Net Interest Income (a) (b) |
1,457 | 1,297 | 715 | 607 | 174 | 12 | NM | 4,076 | 499 | NM | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE (c) |
3,172 | 2,946 | 5,798 | 6,254 | 4,860 | 8 | (35 | ) | 18,170 | 18,833 | (4 | ) | ||||||||||||||||||||||||||||
Provision for Credit Losses |
200 | 227 | 164 | 63 | 63 | (12 | ) | 217 | 654 | 191 | 242 | |||||||||||||||||||||||||||||
Credit Reimbursement from TSS (d) |
30 | 31 | 30 | 30 | 31 | (3 | ) | (3 | ) | 121 | 121 | | ||||||||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense |
1,561 | 1,178 | 2,589 | 2,637 | 1,880 | 33 | (17 | ) | 7,965 | 8,190 | (3 | ) | ||||||||||||||||||||||||||||
Noncompensation Expense |
1,450 | 1,200 | 1,265 | 1,194 | 1,325 | 21 | 9 | 5,109 | 4,670 | 9 | ||||||||||||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
3,011 | 2,378 | 3,854 | 3,831 | 3,205 | 27 | (6 | ) | 13,074 | 12,860 | 2 | |||||||||||||||||||||||||||||
Income Before Income Tax Expense |
(9 | ) | 372 | 1,810 | 2,390 | 1,623 | NM | NM | 4,563 | 5,903 | (23 | ) | ||||||||||||||||||||||||||||
Income Tax Expense |
(133 | ) | 76 | 631 | 850 | 614 | NM | NM | 1,424 | 2,229 | (36 | ) | ||||||||||||||||||||||||||||
NET INCOME |
$ | 124 | $ | 296 | $ | 1,179 | $ | 1,540 | $ | 1,009 | (58 | ) | (88 | ) | $ | 3,139 | $ | 3,674 | (15 | ) | ||||||||||||||||||||
FINANCIAL RATIOS |
||||||||||||||||||||||||||||||||||||||||
ROE |
2 | % | 6 | % | 23 | % | 30 | % | 19 | % | 15 | % | 18 | % | ||||||||||||||||||||||||||
ROA |
0.07 | 0.17 | 0.68 | 0.95 | 0.62 | 0.45 | 0.57 | |||||||||||||||||||||||||||||||||
Overhead Ratio |
95 | 81 | 66 | 61 | 66 | 72 | 68 | |||||||||||||||||||||||||||||||||
Compensation Expense as a % of Total Net Revenue (e) |
49 | 40 | 45 | 42 | 38 | 44 | 41 | |||||||||||||||||||||||||||||||||
REVENUE BY BUSINESS |
||||||||||||||||||||||||||||||||||||||||
Investment Banking Fees: |
||||||||||||||||||||||||||||||||||||||||
Advisory |
$ | 646 | $ | 595 | $ | 560 | $ | 472 | $ | 482 | 9 | 34 | $ | 2,273 | $ | 1,659 | 37 | |||||||||||||||||||||||
Equity Underwriting |
544 | 267 | 509 | 393 | 327 | 104 | 66 | 1,713 | 1,178 | 45 | ||||||||||||||||||||||||||||||
Debt Underwriting |
467 | 468 | 831 | 864 | 771 | | (39 | ) | 2,630 | 2,700 | (3 | ) | ||||||||||||||||||||||||||||
Total Investment Banking Fees |
1,657 | 1,330 | 1,900 | 1,729 | 1,580 | 25 | 5 | 6,616 | 5,537 | 19 | ||||||||||||||||||||||||||||||
Fixed Income Markets |
615 | 687 | 2,445 | 2,592 | 2,061 | (10 | ) | (70 | ) | 6,339 | 8,736 | (27 | ) | |||||||||||||||||||||||||||
Equity Markets |
578 | 537 | 1,249 | 1,539 | 958 | 8 | (40 | ) | 3,903 | 3,458 | 13 | |||||||||||||||||||||||||||||
Credit Portfolio |
322 | 392 | 204 | 394 | 261 | (18 | ) | 23 | 1,312 | 1,102 | 19 | |||||||||||||||||||||||||||||
Total Net Revenue |
$ | 3,172 | $ | 2,946 | $ | 5,798 | $ | 6,254 | $ | 4,860 | 8 | (35 | ) | $ | 18,170 | $ | 18,833 | (4 | ) | |||||||||||||||||||||
REVENUE BY REGION |
||||||||||||||||||||||||||||||||||||||||
Americas |
$ | 1,128 | $ | 1,016 | $ | 2,655 | $ | 3,366 | $ | 2,535 | 11 | (56 | ) | $ | 8,165 | $ | 9,601 | (15 | ) | |||||||||||||||||||||
Europe/Middle East/Africa |
1,334 | 1,389 | 2,327 | 2,251 | 1,886 | (4 | ) | (29 | ) | 7,301 | 7,421 | (2 | ) | |||||||||||||||||||||||||||
Asia/Pacific |
710 | 541 | 816 | 637 | 439 | 31 | 62 | 2,704 | 1,811 | 49 | ||||||||||||||||||||||||||||||
Total Net Revenue |
$ | 3,172 | $ | 2,946 | $ | 5,798 | $ | 6,254 | $ | 4,860 | 8 | (35 | ) | $ | 18,170 | $ | 18,833 | (4 | ) | |||||||||||||||||||||
(a) | The Firm adopted SFAS 157 and SFAS 159 in the first quarter of 2007; for additional information related to the impact to the Investment Bank (IB), see IB business segment results in the Firms September 30, 2007, Form 10-Q. | |
(b) | For certain trading-related positions, amounts have been revised between Principal transactions revenue and Net interest income; there is no impact to Net revenue as a result of these reclassifications. | |
(c) | Total net revenue included tax-equivalent adjustments, primarily due to tax-exempt income from municipal bond investments and income tax credits related to affordable housing investments, of $230 million, $255 million, $290 million, $152 million, and $218 million for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively, and $927 million and $802 million for full year 2007 and 2006, respectively. | |
(d) | Treasury & Securities Services (TSS) was charged a credit reimbursement related to certain exposures managed within the Investment Bank credit portfolio on behalf of clients shared with TSS. | |
(e) | For 2006, the compensation expense to Total net revenue ratio was adjusted to present this ratio as if SFAS 123R had always been in effect. IB management believes that adjusting the Compensation expense to Total net revenue ratio for the incremental impact of adopting SFAS 123R provides a more meaningful measure of IBs Compensation expense to Total net revenue ratio for 2006. |
Page 8
JPMORGAN CHASE & CO. |
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INVESTMENT BANK |
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FINANCIAL HIGHLIGHTS, CONTINUED |
||
(in millions, except headcount, ratio and rankings data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
SELECTED BALANCE SHEETS DATA (Average) |
||||||||||||||||||||||||||||||||||||||||
Total Assets |
$ | 735,685 | $ | 710,665 | $ | 696,230 | $ | 658,724 | $ | 645,993 | 4 | % | 14 | % | $ | 700,565 | $ | 647,569 | 8 | % | ||||||||||||||||||||
Trading Assets Debt and Equity Instruments (a) |
371,842 | 372,212 | 359,387 | 335,118 | 295,317 | | 26 | 359,775 | 275,077 | 31 | ||||||||||||||||||||||||||||||
Trading Assets Derivative Receivables |
74,659 | 63,017 | 58,520 | 56,398 | 59,802 | 18 | 25 | 63,198 | 54,541 | 16 | ||||||||||||||||||||||||||||||
Loans: |
||||||||||||||||||||||||||||||||||||||||
Loans Retained (b) |
68,928 | 61,919 | 59,065 | 58,973 | 60,947 | 11 | 13 | 62,247 | 58,846 | 6 | ||||||||||||||||||||||||||||||
Loans Held-for-Sale & Loans at Fair Value (a) |
24,977 | 17,315 | 14,794 | 13,684 | 23,743 | 44 | 5 | 17,723 | 21,745 | (18 | ) | |||||||||||||||||||||||||||||
Total Loans |
93,905 | 79,234 | 73,859 | 72,657 | 84,690 | 19 | 11 | 79,970 | 80,591 | (1 | ) | |||||||||||||||||||||||||||||
Adjusted Assets (c) |
644,573 | 625,619 | 603,839 | 572,017 | 548,628 | 3 | 17 | 611,749 | 527,753 | 16 | ||||||||||||||||||||||||||||||
Equity |
21,000 | 21,000 | 21,000 | 21,000 | 21,000 | | | 21,000 | 20,753 | 1 | ||||||||||||||||||||||||||||||
Headcount |
25,543 | # | 25,691 | # | 25,356 | # | 23,892 | # | 23,729 | # | (1 | ) | 8 | 25,543 | # | 23,729 | # | 8 | ||||||||||||||||||||||
CREDIT DATA AND QUALITY STATISTICS |
||||||||||||||||||||||||||||||||||||||||
Net Charge-offs (Recoveries) |
$ | (9 | ) | $ | 67 | $ | (16 | ) | $ | (6 | ) | $ | 10 | NM | NM | $ | 36 | $ | (31 | ) | NM | |||||||||||||||||||
Nonperforming Assets: |
||||||||||||||||||||||||||||||||||||||||
Nonperforming Loans (d) |
353 | 265 | 72 | 92 | 231 | 33 | 53 | 353 | 231 | 53 | ||||||||||||||||||||||||||||||
Other Nonperforming Assets |
100 | 60 | 47 | 36 | 38 | 67 | 163 | 100 | 38 | 163 | ||||||||||||||||||||||||||||||
Allowance for Credit Losses: |
||||||||||||||||||||||||||||||||||||||||
Allowance for Loan Losses |
1,329 | 1,112 | 1,037 | 1,037 | 1,052 | 20 | 26 | 1,329 | 1,052 | 26 | ||||||||||||||||||||||||||||||
Allowance for Lending-Related Commitments |
560 | 568 | 487 | 310 | 305 | (1 | ) | 84 | 560 | 305 | 84 | |||||||||||||||||||||||||||||
Total Allowance for Credit Losses |
1,889 | 1,680 | 1,524 | 1,347 | 1,357 | 12 | 39 | 1,889 | 1,357 | 39 | ||||||||||||||||||||||||||||||
Net Charge-off (Recovery) Rate (a) (b) |
(0.05 | )% | 0.43 | % | (0.11 | )% | (0.04 | )% | 0.07 | % | 0.06 | % | (0.05 | )% | ||||||||||||||||||||||||||
Allowance for Loan Losses to Average Loans (a) (b) |
1.93 | 1.80 | 1.76 | 1.76 | 1.73 | 2.14 | 1.79 | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses to Nonperforming Loans (d) |
431 | 585 | 2,206 | 1,178 | 461 | 431 | 461 | |||||||||||||||||||||||||||||||||
Nonperforming Loans to Average Loans |
0.38 | 0.33 | 0.10 | 0.13 | 0.27 | 0.44 | 0.29 | |||||||||||||||||||||||||||||||||
MARKET RISK AVERAGE TRADING
AND CREDIT PORTFOLIO VAR |
||||||||||||||||||||||||||||||||||||||||
Trading Activities: |
||||||||||||||||||||||||||||||||||||||||
Fixed Income |
$ | 103 | $ | 98 | $ | 74 | $ | 45 | $ | 51 | 5 | 102 | $ | 80 | $ | 56 | 43 | |||||||||||||||||||||||
Foreign Exchange |
31 | 23 | 20 | 19 | 20 | 35 | 55 | 23 | 22 | 5 | ||||||||||||||||||||||||||||||
Equities |
63 | 35 | 51 | 42 | 35 | 80 | 80 | 48 | 31 | 55 | ||||||||||||||||||||||||||||||
Commodities and Other |
29 | 28 | 40 | 34 | 35 | 4 | (17 | ) | 33 | 45 | (27 | ) | ||||||||||||||||||||||||||||
Diversification (e) |
(102 | ) | (72 | ) | (73 | ) | (58 | ) | (58 | ) | (42 | ) | (76 | ) | (77 | ) | (70 | ) | (10 | ) | ||||||||||||||||||||
Total Trading VAR (f) |
124 | 112 | 112 | 82 | 83 | 11 | 49 | 107 | 84 | 27 | ||||||||||||||||||||||||||||||
Credit Portfolio VAR (g) |
26 | 17 | 12 | 13 | 15 | 53 | 73 | 17 | 15 | 13 | ||||||||||||||||||||||||||||||
Diversification (e) |
(27 | ) | (22 | ) | (14 | ) | (12 | ) | (11 | ) | (23 | ) | (145 | ) | (18 | ) | (11 | ) | (64 | ) | ||||||||||||||||||||
Total Trading and Credit Portfolio VAR |
$ | 123 | $ | 107 | $ | 110 | $ | 83 | $ | 87 | 15 | 41 | $ | 106 | $ | 88 | 20 | |||||||||||||||||||||||
Full Year 2007 | Full Year 2006 | |||||||||||||||||||||||||||||||||||||||
Market | Market | |||||||||||||||||||||||||||||||||||||||
MARKET SHARES AND RANKINGS (h) | Share | Rankings | Share | Rankings | ||||||||||||||||||||||||||||||||||||
Global Debt, Equity and Equity-Related |
7 | % | # 2 | 7 | % | # 2 | ||||||||||||||||||||||||||||||||||
Global Syndicated Loans |
13 | % | # 1 | 14 | % | # 1 | ||||||||||||||||||||||||||||||||||
Global Long-Term Debt |
7 | % | # 2 | 6 | % | # 3 | ||||||||||||||||||||||||||||||||||
Global Equity and Equity-Related |
9 | % | # 2 | 7 | % | # 6 | ||||||||||||||||||||||||||||||||||
Global Announced M&A |
24 | % | # 4 | 26 | % | # 4 | ||||||||||||||||||||||||||||||||||
U.S. Debt, Equity and Equity-Related |
10 | % | # 2 | 9 | % | # 2 | ||||||||||||||||||||||||||||||||||
U.S. Syndicated Loans |
24 | % | # 1 | 26 | % | # 1 | ||||||||||||||||||||||||||||||||||
U.S. Long-Term Debt |
12 | % | # 2 | 12 | % | # 2 | ||||||||||||||||||||||||||||||||||
U.S. Equity and Equity-Related (i) |
11 | % | # 5 | 8 | % | # 6 | ||||||||||||||||||||||||||||||||||
U.S. Announced M&A |
25 | % | # 4 | 29 | % | # 3 |
(a) | As a result of the adoption of SFAS 159 in the first quarter of 2007, $11.7 billion of loans were reclassified to trading assets. Loans held-for-sale & loans at fair value were excluded when calculating the allowance coverage ratio and Net charge-off rate. | |
(b) | Loans retained included Credit Portfolio loans, leveraged leases and other accrual loans, and excluded loans at fair value. | |
(c) | Adjusted assets, a non-GAAP financial measure, equals total assets minus (1) Securities purchased under resale agreements and Securities borrowed less Securities sold, not yet purchased; (2) assets of variable interest entities (VIEs) consolidated under FIN 46R; (3) cash and securities segregated and on deposit for regulatory and other purposes; and (4) goodwill and intangibles. The amount of adjusted assets is presented to assist the reader in comparing the IBs asset and capital levels to other investment banks in the securities industry. Asset-to-equity leverage ratios are commonly used as one measure to assess a companys capital adequacy. The IB believed an adjusted asset amount that excluded the assets discussed above, which were considered to have a low risk profile, provided a more meaningful measure of balance sheet leverage in the securities industry. | |
(d) | Nonperforming loans included loans held-for-sale of $45 million, $75 million, $25 million, $4 million, and $3 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively, which were excluded from the allowance coverage ratios. Nonperforming loans excluded distressed loans held-for-sale purchased as part of IBs proprietary activities and assets classified as trading assets. Loans elected under the fair value option and classified within trading assets are also excluded from nonperforming loans. | |
(e) | Average VARs were less than the sum of the VARs of their market risk components, which was due to risk offsets resulting from portfolio diversification. The diversification effect reflected the fact that the risks were not perfectly correlated. The risk of a portfolio of positions is usually less than the sum of the risks of the positions themselves. | |
(f) | Trading VAR includes substantially all trading activities in IB. Trading VAR does not include VAR related to the debit valuation adjustments (DVA) taken on derivative and structured liabilities to reflect the credit quality of the Firm. | |
(g) | Includes VAR on derivative credit valuation adjustments, hedges of the credit valuation adjustment and mark-to-market hedges of the retained loan portfolio, which were all reported in Principal Transactions revenue. The VAR did not include the retained loan portfolio. | |
(h) | Source: Thomson Financial Securities data. Global announced M&A was based on rank value; all other rankings were based upon proceeds, with full credit to each book manager/equal if joint. Because of joint assignments, market share of all participants will add up to more than 100%; Global and U.S. announced M&A market share and ranking for 2006 include transactions withdrawn since December 31, 2006. | |
(i) | References U.S. domiciled equity and equity-related transactions, per Thomson Financial Securities. |
Page 9
JPMORGAN CHASE & CO. |
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RETAIL FINANCIAL SERVICES |
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FINANCIAL HIGHLIGHTS |
||
(in millions, except ratio and headcount data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT |
||||||||||||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Lending & Deposit Related Fees |
$ | 496 | $ | 492 | $ | 470 | $ | 423 | $ | 430 | 1 | % | 15 | % | $ | 1,881 | $ | 1,597 | 18 | % | ||||||||||||||||||||
Asset Management, Administration and Commissions |
332 | 336 | 344 | 263 | 293 | (1 | ) | 13 | 1,275 | 1,422 | (10 | ) | ||||||||||||||||||||||||||||
Securities Gains (Losses) |
1 | | | | (5 | ) | NM | NM | 1 | (57 | ) | NM | ||||||||||||||||||||||||||||
Mortgage Fees and Related Income (a) |
888 | 229 | 495 | 482 | 111 | 288 | NM | 2,094 | 618 | 239 | ||||||||||||||||||||||||||||||
Credit Card Income |
174 | 167 | 163 | 142 | 143 | 4 | 22 | 646 | 523 | 24 | ||||||||||||||||||||||||||||||
All Other Income |
219 | 296 | 212 | 179 | 176 | (26 | ) | 24 | 906 | 557 | 63 | |||||||||||||||||||||||||||||
Noninterest Revenue |
2,110 | 1,520 | 1,684 | 1,489 | 1,148 | 39 | 84 | 6,803 | 4,660 | 46 | ||||||||||||||||||||||||||||||
Net Interest Income |
2,705 | 2,681 | 2,673 | 2,617 | 2,580 | 1 | 5 | 10,676 | 10,165 | 5 | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
4,815 | 4,201 | 4,357 | 4,106 | 3,728 | 15 | 29 | 17,479 | 14,825 | 18 | ||||||||||||||||||||||||||||||
Provision for Credit Losses |
1,051 | 680 | 587 | 292 | 262 | 55 | 301 | 2,610 | 561 | 365 | ||||||||||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense (a) |
1,113 | 1,087 | 1,104 | 1,065 | 950 | 2 | 17 | 4,369 | 3,657 | 19 | ||||||||||||||||||||||||||||||
Noncompensation Expense (a) |
1,313 | 1,265 | 1,264 | 1,224 | 1,211 | 4 | 8 | 5,066 | 4,806 | 5 | ||||||||||||||||||||||||||||||
Amortization of Intangibles |
114 | 117 | 116 | 118 | 130 | (3 | ) | (12 | ) | 465 | 464 | | ||||||||||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
2,540 | 2,469 | 2,484 | 2,407 | 2,291 | 3 | 11 | 9,900 | 8,927 | 11 | ||||||||||||||||||||||||||||||
Income Before Income Tax Expense |
1,224 | 1,052 | 1,286 | 1,407 | 1,175 | 16 | 4 | 4,969 | 5,337 | (7 | ) | |||||||||||||||||||||||||||||
Income Tax Expense |
472 | 413 | 501 | 548 | 457 | 14 | 3 | 1,934 | 2,124 | (9 | ) | |||||||||||||||||||||||||||||
NET INCOME |
$ | 752 | $ | 639 | $ | 785 | $ | 859 | $ | 718 | 18 | 5 | $ | 3,035 | $ | 3,213 | (6 | ) | ||||||||||||||||||||||
FINANCIAL RATIOS |
||||||||||||||||||||||||||||||||||||||||
ROE |
19 | % | 16 | % | 20 | % | 22 | % | 18 | % | 19 | % | 22 | % | ||||||||||||||||||||||||||
Overhead Ratio (a) |
53 | 59 | 57 | 59 | 61 | 57 | 60 | |||||||||||||||||||||||||||||||||
Overhead Ratio Excluding Core Deposit Intangibles (a)
(b) |
50 | 56 | 54 | 56 | 58 | 54 | 57 | |||||||||||||||||||||||||||||||||
SELECTED BALANCE SHEETS (Ending) |
||||||||||||||||||||||||||||||||||||||||
Assets |
$ | 225,908 | $ | 216,754 | $ | 217,421 | $ | 212,997 | $ | 237,887 | 4 | (5 | ) | $ | 225,908 | $ | 237,887 | (5 | ) | |||||||||||||||||||||
Loans: |
||||||||||||||||||||||||||||||||||||||||
Loans Retained |
181,016 | 172,498 | 166,992 | 163,462 | 180,760 | 5 | | 181,016 | 180,760 | | ||||||||||||||||||||||||||||||
Loans Held-for-Sale & Loans at Fair Value (c) |
16,541 | 18,274 | 23,501 | 25,006 | 32,744 | (9 | ) | (49 | ) | 16,541 | 32,744 | (49 | ) | |||||||||||||||||||||||||||
Total Loans |
197,557 | 190,772 | 190,493 | 188,468 | 213,504 | 4 | (7 | ) | 197,557 | 213,504 | (7 | ) | ||||||||||||||||||||||||||||
Deposits |
221,129 | 216,135 | 217,689 | 221,840 | 214,081 | 2 | 3 | 221,129 | 214,081 | 3 | ||||||||||||||||||||||||||||||
SELECTED BALANCE SHEETS (Average) |
||||||||||||||||||||||||||||||||||||||||
Assets |
$ | 221,557 | $ | 214,852 | $ | 216,692 | $ | 217,135 | $ | 235,301 | 3 | (6 | ) | $ | 217,564 | $ | 231,566 | (6 | ) | |||||||||||||||||||||
Loans: |
||||||||||||||||||||||||||||||||||||||||
Loans Retained |
176,140 | 168,495 | 165,136 | 162,744 | 190,426 | 5 | (8 | ) | 168,166 | 187,753 | (10 | ) | ||||||||||||||||||||||||||||
Loans Held-for-Sale & Loans at Fair Value (c) |
17,538 | 19,560 | 25,166 | 28,235 | 21,228 | (10 | ) | (17 | ) | 22,587 | 16,129 | 40 | ||||||||||||||||||||||||||||
Total Loans |
193,678 | 188,055 | 190,302 | 190,979 | 211,654 | 3 | (8 | ) | 190,753 | 203,882 | (6 | ) | ||||||||||||||||||||||||||||
Deposits |
219,226 | 216,904 | 219,171 | 216,933 | 211,915 | 1 | 3 | 218,062 | 201,127 | 8 | ||||||||||||||||||||||||||||||
Equity |
16,000 | 16,000 | 16,000 | 16,000 | 16,000 | | | 16,000 | 14,629 | 9 | ||||||||||||||||||||||||||||||
Headcount |
69,465 | # | 68,528 | # | 68,254 | # | 67,247 | # | 65,570 | # | 1 | 6 | 69,465 | # | 65,570 | # | 6 | |||||||||||||||||||||||
CREDIT DATA AND QUALITY STATISTICS |
||||||||||||||||||||||||||||||||||||||||
Net Charge-offs |
$ | 522 | $ | 350 | $ | 270 | $ | 185 | $ | 214 | 49 | 144 | $ | 1,327 | $ | 576 | 130 | |||||||||||||||||||||||
Nonperforming Loans (d) (e) |
2,704 | 1,991 | 1,760 | 1,655 | 1,677 | 36 | 61 | 2,704 | 1,677 | 61 | ||||||||||||||||||||||||||||||
Nonperforming Assets (d) (e) |
3,190 | 2,404 | 2,099 | 1,910 | 1,902 | 33 | 68 | 3,190 | 1,902 | 68 | ||||||||||||||||||||||||||||||
Allowance for Loan Losses |
2,634 | 2,105 | 1,772 | 1,453 | 1,392 | 25 | 89 | 2,634 | 1,392 | 89 | ||||||||||||||||||||||||||||||
Net Charge-off Rate (f) |
1.18 | % | 0.82 | % | 0.66 | % | 0.46 | % | 0.45 | % | 0.79 | % | 0.31 | % | ||||||||||||||||||||||||||
Allowance for Loan Losses to Ending Loans (f) |
1.46 | 1.22 | 1.06 | 0.89 | 0.77 | 1.46 | 0.77 | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses to Nonperforming Loans (f) |
100 | 107 | 115 | 94 | 89 | 100 | 89 | |||||||||||||||||||||||||||||||||
Nonperforming Loans to Total Loans |
1.37 | 1.04 | 0.92 | 0.88 | 0.79 | 1.37 | 0.79 |
(a) | The Firm adopted SFAS 159 in the first quarter of 2007. As a result, certain loan origination costs have been classified as expense (previously netted against revenue) for the current-year quarters and twelve months ended December 31, 2007. | |
(b) | Retail Financial Services uses the overhead ratio excluding the amortization of core deposit intangibles (CDI), a non-GAAP financial measure, to evaluate the underlying expense trends of the business. Including CDI amortization expense in the overhead ratio calculation results in a higher overhead ratio in the earlier years and a lower overhead ratio in later years; this method would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio excluded Regional Bankings core deposit intangible amortization expense related to The Bank of New York transaction and the Bank One merger of $113 million, $116 million, $115 million, $116 million, and $130 million for the quarters ending December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively, and $460 million and $458 million for full year 2007 and 2006, respectively. | |
(c) | Loans included prime mortgage loans originated with the intent to sell, which, for new originations on or after January 1, 2007, were accounted for at fair value under SFAS 159. These loans, classified as Trading assets on the Consolidated balance sheets, totaled $12.6 billion, $14.4 billion, $15.2 billion, and $11.6 billion at December 31, 2007, September 30, 2007, June 30, 2007 and March 31, 2007, respectively. Average loans included prime mortgage loans, classified as Trading assets on the Consolidated balance sheets, of $13.5 billion, $14.1 billion, $13.5 billion and $6.5 billion for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007 and March 31, 2007, respectively, and $11.9 billion for the full year 2007. | |
(d) | Nonperforming loans included Loans held-for-sale and Loans accounted for at fair value under SFAS 159 of $69 million, $17 million, $217 million, $112 million, and $116 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. Certain of these loans are classified as Trading assets on the Consolidated balance sheet. | |
(e) | Nonperforming loans and assets excluded (1) loans eligible for repurchase as well as loans repurchased from Governmental National Mortgage Association (GNMA) pools that are insured by U.S. government agencies of $1.5 billion, $1.3 billion, $1.2 billion, $1.3 billion, and $1.2 billion at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007 and December 31, 2006, respectively, and (2) education loans that are 90 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $279 million, $241 million, $200 million, $178 million and $219 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007 and December 31, 2006, respectively. These amounts for GNMA and education loans are excluded, as reimbursement is proceeding normally. | |
(f) | Loans held-for-sale and loans accounted for at fair value under SFAS 159 were excluded when calculating the allowance coverage ratio and the Net charge-off rate. |
Page 10
JPMORGAN CHASE & CO. |
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RETAIL FINANCIAL SERVICES |
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FINANCIAL HIGHLIGHTS, CONTINUED |
||
(in millions, except ratio data and where otherwise noted) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
REGIONAL BANKING |
||||||||||||||||||||||||||||||||||||||||
Noninterest Revenue |
$ | 940 | $ | 1,013 | $ | 977 | $ | 793 | $ | 678 | (7 | )% | 39 | % | $ | 3,723 | $ | 3,204 | 16 | % | ||||||||||||||||||||
Net Interest Income |
2,363 | 2,325 | 2,296 | 2,299 | 2,229 | 2 | 6 | 9,283 | 8,768 | 6 | ||||||||||||||||||||||||||||||
Total Net Revenue |
3,303 | 3,338 | 3,273 | 3,092 | 2,907 | (1 | ) | 14 | 13,006 | 11,972 | 9 | |||||||||||||||||||||||||||||
Provision for Credit Losses |
915 | 574 | 494 | 233 | 165 | 59 | 455 | 2,216 | 354 | NM | ||||||||||||||||||||||||||||||
Noninterest Expense |
1,785 | 1,760 | 1,749 | 1,729 | 1,730 | 1 | 3 | 7,023 | 6,825 | 3 | ||||||||||||||||||||||||||||||
Income Before Income Tax Expense |
603 | 1,004 | 1,030 | 1,130 | 1,012 | (40 | ) | (40 | ) | 3,767 | 4,793 | (21 | ) | |||||||||||||||||||||||||||
Net Income |
371 | 611 | 629 | 690 | 619 | (39 | ) | (40 | ) | 2,301 | 2,884 | (20 | ) | |||||||||||||||||||||||||||
ROE |
12 | % | 21 | % | 21 | % | 24 | % | 21 | % | 20 | % | 27 | % | ||||||||||||||||||||||||||
Overhead Ratio |
54 | 53 | 53 | 56 | 60 | 54 | 57 | |||||||||||||||||||||||||||||||||
Overhead Ratio Excluding Core Deposit Intangibles (a) |
51 | 49 | 50 | 52 | 55 | 50 | 53 | |||||||||||||||||||||||||||||||||
BUSINESS METRICS (in billions) |
||||||||||||||||||||||||||||||||||||||||
Home Equity Origination Volume |
$ | 9.8 | $ | 11.2 | $ | 14.6 | $ | 12.7 | $ | 12.9 | (13 | ) | (24 | ) | $ | 48.3 | $ | 51.9 | (7 | ) | ||||||||||||||||||||
End of Period Loans Owned: |
||||||||||||||||||||||||||||||||||||||||
Home Equity |
$ | 94.8 | $ | 93.0 | $ | 91.0 | $ | 87.7 | $ | 85.7 | 2 | 11 | $ | 94.8 | $ | 85.7 | 11 | |||||||||||||||||||||||
Mortgage (b) |
15.7 | 12.3 | 8.8 | 9.2 | 30.1 | 28 | (48 | ) | 15.7 | 30.1 | (48 | ) | ||||||||||||||||||||||||||||
Business Banking |
15.4 | 14.9 | 14.6 | 14.3 | 14.1 | 3 | 9 | 15.4 | 14.1 | 9 | ||||||||||||||||||||||||||||||
Education |
11.0 | 10.2 | 10.2 | 11.1 | 10.3 | 8 | 7 | 11.0 | 10.3 | 7 | ||||||||||||||||||||||||||||||
Other Loans (c) |
2.3 | 2.4 | 2.5 | 2.7 | 2.7 | (4 | ) | (15 | ) | 2.3 | 2.7 | (15 | ) | |||||||||||||||||||||||||||
Total End of Period Loans |
139.2 | 132.8 | 127.1 | 125.0 | 142.9 | 5 | (3 | ) | 139.2 | 142.9 | (3 | ) | ||||||||||||||||||||||||||||
End of Period Deposits: |
||||||||||||||||||||||||||||||||||||||||
Checking |
$ | 67.0 | $ | 64.5 | $ | 67.3 | $ | 69.3 | $ | 68.7 | 4 | (2 | ) | $ | 67.0 | $ | 68.7 | (2 | ) | |||||||||||||||||||||
Savings |
96.0 | 95.7 | 97.7 | 100.1 | 92.4 | | 4 | 96.0 | 92.4 | 4 | ||||||||||||||||||||||||||||||
Time and Other |
48.7 | 46.5 | 41.9 | 42.2 | 43.3 | 5 | 12 | 48.7 | 43.3 | 12 | ||||||||||||||||||||||||||||||
Total End of Period Deposits |
211.7 | 206.7 | 206.9 | 211.6 | 204.4 | 2 | 4 | 211.7 | 204.4 | 4 | ||||||||||||||||||||||||||||||
Average Loans Owned: |
||||||||||||||||||||||||||||||||||||||||
Home Equity |
$ | 94.0 | $ | 91.8 | $ | 89.2 | $ | 86.3 | $ | 84.2 | 2 | 12 | $ | 90.4 | $ | 78.3 | 15 | |||||||||||||||||||||||
Mortgage Loans (b) |
13.7 | 9.9 | 8.8 | 8.9 | 40.8 | 38 | (66 | ) | 10.3 | 45.1 | (77 | ) | ||||||||||||||||||||||||||||
Business Banking |
15.1 | 14.8 | 14.5 | 14.3 | 14.0 | 2 | 8 | 14.7 | 13.2 | 11 | ||||||||||||||||||||||||||||||
Education |
10.6 | 9.8 | 10.5 | 11.0 | 9.9 | 8 | 7 | 10.5 | 8.3 | 27 | ||||||||||||||||||||||||||||||
Other Loans (c) |
2.3 | 2.4 | 2.4 | 3.0 | 2.7 | (4 | ) | (15 | ) | 2.5 | 2.6 | (4 | ) | |||||||||||||||||||||||||||
Total Average Loans (d) |
135.7 | 128.7 | 125.4 | 123.5 | 151.6 | 5 | (10 | ) | 128.4 | 147.5 | (13 | ) | ||||||||||||||||||||||||||||
Average Deposits: |
||||||||||||||||||||||||||||||||||||||||
Checking |
$ | 64.5 | $ | 64.9 | $ | 67.2 | $ | 67.3 | $ | 65.5 | (1 | ) | (2 | ) | $ | 66.0 | $ | 62.8 | 5 | |||||||||||||||||||||
Savings |
96.3 | 97.1 | 98.4 | 96.7 | 92.2 | (1 | ) | 4 | 97.1 | 89.9 | 8 | |||||||||||||||||||||||||||||
Time and Other |
47.7 | 43.3 | 41.7 | 42.5 | 43.0 | 10 | 11 | 43.8 | 37.5 | 17 | ||||||||||||||||||||||||||||||
Total Average Deposits |
208.5 | 205.3 | 207.3 | 206.5 | 200.7 | 2 | 4 | 206.9 | 190.2 | 9 | ||||||||||||||||||||||||||||||
Average Assets |
147.1 | 140.6 | 137.7 | 135.9 | 162.5 | 5 | (9 | ) | 140.4 | 160.8 | (13 | ) | ||||||||||||||||||||||||||||
Average Equity |
11.8 | 11.8 | 11.8 | 11.8 | 11.9 | | (1 | ) | 11.8 | 10.5 | 12 |
Page 11
JPMORGAN CHASE & CO. |
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RETAIL FINANCIAL SERVICES |
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FINANCIAL HIGHLIGHTS, CONTINUED |
||
(in millions, except ratio data and where otherwise noted) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
REGIONAL BANKING (continued) |
||||||||||||||||||||||||||||||||||||||||
CREDIT DATA AND QUALITY STATISTICS |
||||||||||||||||||||||||||||||||||||||||
30+ Day Delinquency Rate (e) (f) |
3.03 | % | 2.39 | % | 1.88 | % | 1.84 | % | 2.02 | % | 3.03 | % | 2.02 | % | ||||||||||||||||||||||||||
Net Charge-offs |
||||||||||||||||||||||||||||||||||||||||
Home Equity |
$ | 248 | $ | 150 | $ | 98 | $ | 68 | $ | 51 | 65 | % | 386 | % | $ | 564 | $ | 143 | 294 | % | ||||||||||||||||||||
Mortgage |
73 | 40 | 26 | 20 | 21 | 83 | 248 | 159 | 56 | 184 | ||||||||||||||||||||||||||||||
Business Banking |
38 | 33 | 30 | 25 | 38 | 15 | | 126 | 91 | 38 | ||||||||||||||||||||||||||||||
Other Loans |
28 | 23 | 52 | 13 | 27 | 22 | 4 | 116 | 48 | 142 | ||||||||||||||||||||||||||||||
Total Net Charge-offs |
387 | 246 | 206 | 126 | 137 | 57 | 182 | 965 | 338 | 186 | ||||||||||||||||||||||||||||||
Net Charge-off
Rate | ||||||||||||||||||||||||||||||||||||||||
Home Equity |
1.05 | % | 0.65 | % | 0.44 | % | 0.32 | % | 0.24 | % | 0.62 | % | 0.18 | % | ||||||||||||||||||||||||||
Mortgage (g) |
2.06 | 1.60 | 1.19 | 0.91 | 0.20 | 1.52 | 0.12 | |||||||||||||||||||||||||||||||||
Business Banking |
1.00 | 0.88 | 0.83 | 0.71 | 1.08 | 0.86 | 0.69 | |||||||||||||||||||||||||||||||||
Other Loans |
1.21 | 1.01 | 2.32 | 0.55 | 1.15 | 1.26 | 0.59 | |||||||||||||||||||||||||||||||||
Total Net
Charge-off Rate (d)(g) |
1.16 | 0.78 | 0.68 | 0.43 | 0.37 | 0.77 | 0.23 | |||||||||||||||||||||||||||||||||
Nonperforming Assets (h) |
$ | 2,879 | $ | 2,206 | $ | 1,751 | $ | 1,688 | $ | 1,714 | 31 | 68 | $ | 2,879 | $ | 1,714 | 68 | |||||||||||||||||||||||
RETAIL BRANCH BUSINESS METRICS |
||||||||||||||||||||||||||||||||||||||||
Investment Sales Volume |
$ | 4,114 | $ | 4,346 | $ | 5,117 | $ | 4,783 | $ | 4,101 | (5 | ) | | $ | 18,360 | $ | 14,882 | 23 | ||||||||||||||||||||||
Number of: |
||||||||||||||||||||||||||||||||||||||||
Branches |
3,152 | # | 3,096 | # | 3,089 | # | 3,071 | # | 3,079 | # | 56 | # | 73 | # | 3,152 | # | 3,079 | # | 73 | # | ||||||||||||||||||||
ATMs |
9,186 | 8,943 | 8,649 | 8,560 | 8,506 | 243 | 680 | 9,186 | 8,506 | 680 | ||||||||||||||||||||||||||||||
Personal
Bankers (i) |
9,650 | 9,503 | 9,025 | 7,846 | 7,573 | 147 | 2,077 | 9,650 | 7,573 | 2,077 | ||||||||||||||||||||||||||||||
Sales
Specialists (i) |
4,105 | 4,025 | 3,915 | 3,712 | 3,614 | 80 | 491 | 4,105 | 3,614 | 491 | ||||||||||||||||||||||||||||||
Active
Online Customers (in thousands) (j) |
5,918 | 5,706 | 5,448 | 5,295 | 4,909 | 212 | 1,009 | 5,918 | 4,909 | 1,009 | ||||||||||||||||||||||||||||||
Checking Accounts (in thousands) |
10,839 | 10,644 | 10,356 | 10,158 | 9,995 | 195 | 844 | 10,839 | 9,995 | 844 | ||||||||||||||||||||||||||||||
MORTGAGE BANKING |
||||||||||||||||||||||||||||||||||||||||
Production
Revenue (k) |
$ | 321 | $ | 176 | $ | 463 | $ | 400 | $ | 215 | 82 | % | 49 | % | $ | 1,360 | $ | 833 | 63 | % | ||||||||||||||||||||
Net Mortgage Servicing Revenue: |
||||||||||||||||||||||||||||||||||||||||
Loan Servicing Revenue |
665 | 629 | 615 | 601 | 598 | 6 | 11 | 2,510 | 2,300 | 9 | ||||||||||||||||||||||||||||||
Changes in MSR Asset Fair Value: |
||||||||||||||||||||||||||||||||||||||||
Due to Inputs or Assumptions in Model |
(766 | ) | (810 | ) | 952 | 108 | 38 | 5 | NM | (516 | ) | 165 | NM | |||||||||||||||||||||||||||
Other Changes in Fair Value |
(393 | ) | (377 | ) | (383 | ) | (378 | ) | (372 | ) | (4 | ) | (6 | ) | (1,531 | ) | (1,440 | ) | (6 | ) | ||||||||||||||||||||
Total Changes in MSR Asset Fair Value |
(1,159 | ) | (1,187 | ) | 569 | (270 | ) | (334 | ) | 2 | (247 | ) | (2,047 | ) | (1,275 | ) | (61 | ) | ||||||||||||||||||||||
Derivative Valuation Adjustments and Other |
1,232 | 788 | (1,014 | ) | (127 | ) | (69 | ) | 56 | NM | 879 | (544 | ) | NM | ||||||||||||||||||||||||||
Total Net Mortgage Servicing Revenue |
738 | 230 | 170 | 204 | 195 | 221 | 278 | 1,342 | 481 | 179 | ||||||||||||||||||||||||||||||
Total Net Revenue |
1,059 | 406 | 633 | 604 | 410 | 161 | 158 | 2,702 | 1,314 | 106 | ||||||||||||||||||||||||||||||
Noninterest
Expense (k) |
518 | 485 | 516 | 468 | 354 | 7 | 46 | 1,987 | 1,341 | 48 | ||||||||||||||||||||||||||||||
Income (Loss) Before Income Tax Expense |
541 | (79 | ) | 117 | 136 | 56 | NM | NM | 715 | (27 | ) | NM | ||||||||||||||||||||||||||||
Net Income (Loss) |
332 | (48 | ) | 71 | 84 | 34 | NM | NM | 439 | (17 | ) | NM | ||||||||||||||||||||||||||||
ROE |
66 | % | NM | 14 | % | 17 | % | 8 | % | 22 | % | NM | ||||||||||||||||||||||||||||
Business Metrics (in billions) |
||||||||||||||||||||||||||||||||||||||||
Third Party Mortgage Loans Serviced (Ending) |
$ | 614.7 | $ | 600.0 | $ | 572.4 | $ | 546.1 | $ | 526.7 | 2 | 17 | $ | 614.7 | $ | 526.7 | 17 | |||||||||||||||||||||||
MSR Net Carrying Value (Ending) |
8.6 | 9.1 | 9.5 | 7.9 | 7.5 | (5 | ) | 15 | 8.6 | 7.5 | 15 | |||||||||||||||||||||||||||||
Avg Mortgage Loans Held-for-Sale & Loans at Fair
Value (l) |
13.8 | 16.4 | 21.3 | 23.8 | 17.9 | (16 | ) | (23 | ) | 18.8 | 12.8 | 47 | ||||||||||||||||||||||||||||
Average Assets |
30.6 | 31.4 | 35.6 | 38.0 | 29.8 | (3 | ) | 3 | 33.9 | 25.8 | 31 | |||||||||||||||||||||||||||||
Average Equity |
2.0 | 2.0 | 2.0 | 2.0 | 1.7 | | 18 | 2.0 | 1.7 | 18 | ||||||||||||||||||||||||||||||
Mortgage Origination Volume by Channel (in billions) |
||||||||||||||||||||||||||||||||||||||||
Retail |
$ | 9.9 | $ | 11.1 | $ | 13.6 | $ | 10.9 | $ | 10.5 | (11 | ) | (6 | ) | $ | 45.5 | $ | 40.5 | 12 | |||||||||||||||||||||
Wholesale |
10.2 | 9.8 | 12.8 | 9.9 | 9.0 | 4 | 13 | 42.7 | 32.8 | 30 | ||||||||||||||||||||||||||||||
Correspondent |
9.5 | 7.2 | 6.4 | 4.8 | 3.5 | 32 | 171 | 27.9 | 13.3 | 110 | ||||||||||||||||||||||||||||||
CNT (Including Negotiated Transactions) |
10.4 | 11.1 | 11.3 | 10.5 | 6.8 | (6 | ) | 53 | 43.3 | 32.6 | 33 | |||||||||||||||||||||||||||||
Total (m) |
40.0 | 39.2 | 44.1 | 36.1 | 29.8 | 2 | 34 | 159.4 | 119.2 | 34 | ||||||||||||||||||||||||||||||
AUTO FINANCE |
||||||||||||||||||||||||||||||||||||||||
Noninterest Revenue |
$ | 142 | $ | 140 | $ | 138 | $ | 131 | $ | 124 | 1 | 15 | $ | 551 | $ | 368 | 50 | |||||||||||||||||||||||
Net Interest Income |
308 | 307 | 312 | 279 | 287 | | 7 | 1,206 | 1,171 | 3 | ||||||||||||||||||||||||||||||
Total Net Revenue |
450 | 447 | 450 | 410 | 411 | 1 | 9 | 1,757 | 1,539 | 14 | ||||||||||||||||||||||||||||||
Provision for Credit Losses |
133 | 96 | 92 | 59 | 97 | 39 | 37 | 380 | 207 | 84 | ||||||||||||||||||||||||||||||
Noninterest Expense |
237 | 224 | 219 | 210 | 207 | 6 | 14 | 890 | 761 | 17 | ||||||||||||||||||||||||||||||
Income Before Income Tax Expense |
80 | 127 | 139 | 141 | 107 | (37 | ) | (25 | ) | 487 | 571 | (15 | ) | |||||||||||||||||||||||||||
Net Income |
49 | 76 | 85 | 85 | 65 | (36 | ) | (25 | ) | 295 | 346 | (15 | ) | |||||||||||||||||||||||||||
ROE |
9 | % | 14 | % | 15 | % | 16 | % | 11 | % | 13 | % | 14 | % | ||||||||||||||||||||||||||
ROA |
0.44 | 0.70 | 0.79 | 0.80 | 0.60 | 0.68 | 0.77 |
Page 12
JPMORGAN CHASE & CO. |
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RETAIL FINANCIAL SERVICES |
||
FINANCIAL HIGHLIGHTS, CONTINUED |
||
(in millions, except ratio data and where otherwise noted) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
AUTO FINANCE (continued) |
||||||||||||||||||||||||||||||||||||||||
Business Metrics (in billions) |
||||||||||||||||||||||||||||||||||||||||
Auto Origination Volume |
$ | 5.6 | $ | 5.2 | $ | 5.3 | $ | 5.2 | $ | 5.0 | 8 | % | 12 | % | $ | 21.3 | $ | 19.3 | 10 | % | ||||||||||||||||||||
End-of-Period Loans and Lease Related Assets |
||||||||||||||||||||||||||||||||||||||||
Loans Outstanding |
$ | 42.0 | $ | 40.3 | $ | 40.4 | $ | 39.7 | $ | 39.3 | 4 | 7 | $ | 42.0 | $ | 39.3 | 7 | |||||||||||||||||||||||
Lease Financing Receivables |
0.3 | 0.6 | 0.8 | 1.2 | 1.7 | (50 | ) | (82 | ) | 0.3 | 1.7 | (82 | ) | |||||||||||||||||||||||||||
Operating Lease Assets |
1.9 | 1.8 | 1.8 | 1.7 | 1.6 | 6 | 19 | 1.9 | 1.6 | 19 | ||||||||||||||||||||||||||||||
Total End-of-Period Loans and Lease Related Assets |
44.2 | 42.7 | 43.0 | 42.6 | 42.6 | 4 | 4 | 44.2 | 42.6 | 4 | ||||||||||||||||||||||||||||||
Average Loans and Lease Related Assets |
||||||||||||||||||||||||||||||||||||||||
Loans Outstanding (n) |
$ | 41.1 | $ | 39.9 | $ | 40.1 | $ | 39.4 | $ | 38.7 | 3 | 6 | $ | 40.2 | $ | 39.8 | 1 | |||||||||||||||||||||||
Lease Financing Receivables |
0.5 | 0.7 | 1.0 | 1.5 | 1.9 | (29 | ) | (74 | ) | 0.9 | 2.9 | (69 | ) | |||||||||||||||||||||||||||
Operating Lease Assets |
1.9 | 1.8 | 1.7 | 1.6 | 1.5 | 6 | 27 | 1.7 | 1.3 | 31 | ||||||||||||||||||||||||||||||
Total Average Loans and Lease Related Assets |
43.5 | 42.4 | 42.8 | 42.5 | 42.1 | 3 | 3 | 42.8 | 44.0 | (3 | ) | |||||||||||||||||||||||||||||
Average Assets |
43.8 | 42.9 | 43.4 | 43.2 | 43.1 | 2 | 2 | 43.3 | 44.9 | (4 | ) | |||||||||||||||||||||||||||||
Average Equity |
2.2 | 2.2 | 2.2 | 2.2 | 2.4 | | (8 | ) | 2.2 | 2.4 | (8 | ) | ||||||||||||||||||||||||||||
Credit Quality Statistics |
||||||||||||||||||||||||||||||||||||||||
30+ Day Delinquency Rate |
1.85 | % | 1.65 | % | 1.43 | % | 1.33 | % | 1.72 | % | 1.85 | % | 1.72 | % | ||||||||||||||||||||||||||
Net Charge-offs |
||||||||||||||||||||||||||||||||||||||||
Loans |
$ | 132 | $ | 98 | $ | 62 | $ | 58 | $ | 76 | 35 | 74 | $ | 350 | $ | 231 | 52 | |||||||||||||||||||||||
Lease Receivables |
1 | 1 | 1 | 1 | 1 | | | 4 | 7 | (43 | ) | |||||||||||||||||||||||||||||
Total Net Charge-offs |
133 | 99 | 63 | 59 | 77 | 34 | 73 | 354 | 238 | 49 | ||||||||||||||||||||||||||||||
Net Charge-off Rate |
||||||||||||||||||||||||||||||||||||||||
Loans (n) |
1.27 | % | 0.97 | % | 0.62 | % | 0.60 | % | 0.78 | % | 0.87 | % | 0.59 | % | ||||||||||||||||||||||||||
Lease Receivables |
0.79 | 0.57 | 0.40 | 0.27 | 0.21 | 0.44 | 0.24 | |||||||||||||||||||||||||||||||||
Total Net Charge-off Rate (n) |
1.27 | 0.97 | 0.61 | 0.59 | 0.75 | 0.86 | 0.56 | |||||||||||||||||||||||||||||||||
Nonperforming Assets |
$ | 188 | $ | 156 | $ | 131 | $ | 140 | $ | 177 | 21 | 6 | $ | 188 | $ | 177 | 6 |
(a) | Regional Banking uses the overhead ratio excluding the amortization of core deposit intangibles (CDI), a non-GAAP financial measure, to evaluate the underlying expense trends of the business. Including CDI amortization expense in the overhead ratio calculation results in a higher overhead ratio in the earlier years and a lower overhead ratio in later years; this inclusion would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio excluded Regional Bankings core deposit intangible amortization expense related to The Bank of New York transaction and the Bank One merger of $113 million, $116 million, $115 million, $116 million, and $130 million for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, and $460 million and $458 million for full year 2007 and 2006, respectively. | |
(b) | As of January 1, 2007, $19.4 billion of held-for-investment prime mortgage loans were transferred from Retail Financial Services (RFS) to Treasury within the Corporate segment for risk management and reporting purposes. The transfer had no impact on the financial results of Regional Banking. Balances reported for current-year quarter ends primarily reflected subprime mortgage loans owned. | |
(c) | Included commercial loans derived from community development activities and, prior to July 1, 2006, insurance policy loans. | |
(d) | Average loans included loans held-for-sale of $3.7 billion, $3.2 billion, $3.9 billion, $4.4 billion, and $3.3 billion for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively, and $3.8 billion and $2.8 billion for full year 2007 and 2006, respectively. These amounts were excluded when calculating the Net charge-off rate. | |
(e) | Excluded loans eligible for repurchase as well as loans repurchased from GNMA pools that are insured by U.S. government agencies of $1.2 billion, $979 million, $879 million, $975 million, and $960 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. These amounts are excluded as reimbursement is proceeding normally. | |
(f) | Excluded loans that are 30 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $663 million, $590 million, $523 million, $519 million, and $464 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. These amounts are excluded as reimbursement is proceeding normally. | |
(g) | The mortgage and total net charge-off rate for the fourth quarter and full year 2007 excluded $2 million of charge-offs related to prime mortgage loans held by Treasury in the Corporate Sector. | |
(h) | Excluded nonperforming assets related to education loans that are 90 days past due and still accruing, which were insured by U.S. government agencies under the Federal Family Education Loan Program of $279 million, $241 million, $200 million, $178 million, and $219 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. These amounts are excluded as reimbursement is proceeding normally. | |
(i) | Employees acquired as part of The Bank of New York transaction are included beginning June 30, 2007. | |
(j) | During the quarter ended June 30, 2007, RFS changed the methodology for determining active online customers to include all individual RFS customers with one or more online accounts that have been active within 90 days of period end, including customers who also have online accounts with Card Services. Prior periods have been restated to conform to this new methodology. | |
(k) | The Firm adopted SFAS 159 in the first quarter of 2007. As a result, certain loan origination costs have been classified as expense (previously netted against revenue) for the 2007 quarters and full year period. | |
(l) | Included $13.5 billion, $14.1 billion, $13.5 billion and $6.5 billion of prime mortgage loans at fair value for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007, and March 31, 2007, respectively, and $11.9 billion for full year 2007. These loans are classified as trading assets on the Consolidated balance sheets for 2007. | |
(m) | During the second quarter of 2007, RFS changed its definition of mortgage originations to include all newly originated mortgage loans sourced through RFS channels, and to exclude all mortgage loan originations sourced through IB channels. Prior periods have been restated to conform to this new definition. | |
(n) | Average Loans held-for-sale for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, and full year 2007 were insignificant. The full year average Loans held-for-sale were $530 million for 2006. These amounts are excluded when calculating the Net charge-off rate. |
Page 13
JPMORGAN CHASE & CO. |
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CARD SERVICES MANAGED BASIS |
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FINANCIAL HIGHLIGHTS |
||
(in millions, except ratio data and where otherwise noted) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT |
||||||||||||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Credit Card Income |
$ | 712 | $ | 692 | $ | 682 | $ | 599 | $ | 697 | 3 | % | 2 | % | $ | 2,685 | $ | 2,587 | 4 | % | ||||||||||||||||||||
All Other Income |
122 | 67 | 80 | 92 | 111 | 82 | 10 | 361 | 357 | 1 | ||||||||||||||||||||||||||||||
Noninterest Revenue |
834 | 759 | 762 | 691 | 808 | 10 | 3 | 3,046 | 2,944 | 3 | ||||||||||||||||||||||||||||||
Net Interest Income |
3,137 | 3,108 | 2,955 | 2,989 | 2,942 | 1 | 7 | 12,189 | 11,801 | 3 | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
3,971 | 3,867 | 3,717 | 3,680 | 3,750 | 3 | 6 | 15,235 | 14,745 | 3 | ||||||||||||||||||||||||||||||
Provision for Credit Losses |
1,788 | 1,363 | 1,331 | 1,229 | 1,281 | 31 | 40 | 5,711 | 4,598 | 24 | ||||||||||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense |
260 | 256 | 251 | 254 | 242 | 2 | 7 | 1,021 | 1,003 | 2 | ||||||||||||||||||||||||||||||
Noncompensation Expense |
790 | 827 | 753 | 803 | 915 | (4 | ) | (14 | ) | 3,173 | 3,344 | (5 | ) | |||||||||||||||||||||||||||
Amortization of Intangibles |
173 | 179 | 184 | 184 | 184 | (3 | ) | (6 | ) | 720 | 739 | (3 | ) | |||||||||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
1,223 | 1,262 | 1,188 | 1,241 | 1,341 | (3 | ) | (9 | ) | 4,914 | 5,086 | (3 | ) | |||||||||||||||||||||||||||
Income Before Income Tax Expense |
960 | 1,242 | 1,198 | 1,210 | 1,128 | (23 | ) | (15 | ) | 4,610 | 5,061 | (9 | ) | |||||||||||||||||||||||||||
Income Tax Expense |
351 | 456 | 439 | 445 | 409 | (23 | ) | (14 | ) | 1,691 | 1,855 | (9 | ) | |||||||||||||||||||||||||||
NET INCOME |
$ | 609 | $ | 786 | $ | 759 | $ | 765 | $ | 719 | (23 | ) | (15 | ) | $ | 2,919 | $ | 3,206 | (9 | ) | ||||||||||||||||||||
Memo: Net Securitization Gains (Amortization) |
$ | 28 | $ | | $ | 16 | $ | 23 | $ | 32 | NM | (13 | ) | $ | 67 | $ | 82 | (18 | ) | |||||||||||||||||||||
FINANCIAL METRICS |
||||||||||||||||||||||||||||||||||||||||
ROE |
17 | % | 22 | % | 22 | % | 22 | % | 20 | % | 21 | % | 23 | % | ||||||||||||||||||||||||||
Overhead Ratio |
31 | 33 | 32 | 34 | 36 | 32 | 34 | |||||||||||||||||||||||||||||||||
% of Average Managed Outstandings: |
||||||||||||||||||||||||||||||||||||||||
Net Interest Income |
8.20 | 8.29 | 8.04 | 8.11 | 7.92 | 8.16 | 8.36 | |||||||||||||||||||||||||||||||||
Provision for Credit Losses |
4.67 | 3.64 | 3.62 | 3.34 | 3.45 | 3.82 | 3.26 | |||||||||||||||||||||||||||||||||
Noninterest Revenue |
2.18 | 2.03 | 2.07 | 1.88 | 2.17 | 2.04 | 2.09 | |||||||||||||||||||||||||||||||||
Risk Adjusted Margin (a) |
5.71 | 6.68 | 6.49 | 6.65 | 6.65 | 6.38 | 7.19 | |||||||||||||||||||||||||||||||||
Noninterest Expense |
3.20 | 3.37 | 3.23 | 3.37 | 3.61 | 3.29 | 3.60 | |||||||||||||||||||||||||||||||||
Pretax Income (ROO) |
2.51 | 3.31 | 3.26 | 3.28 | 3.04 | 3.09 | 3.59 | |||||||||||||||||||||||||||||||||
Net Income |
1.59 | 2.10 | 2.06 | 2.08 | 1.94 | 1.95 | 2.27 | |||||||||||||||||||||||||||||||||
BUSINESS METRICS |
||||||||||||||||||||||||||||||||||||||||
Charge Volume (in billions) |
$ | 95.5 | $ | 89.8 | $ | 88.0 | $ | 81.3 | $ | 93.4 | 6 | 2 | $ | 354.6 | $ | 339.6 | 4 | |||||||||||||||||||||||
Net Accounts Opened (in thousands) (b) |
5,250 | # | 3,957 | # | 3,706 | # | 3,439 | # | 14,392 | # | 33 | (64 | ) | 16,352 | # | 45,869 | # | (64 | ) | |||||||||||||||||||||
Credit Cards Issued (in thousands) |
155,000 | 153,637 | 150,883 | 152,097 | 154,424 | 1 | | 155,000 | 154,424 | | ||||||||||||||||||||||||||||||
Number of Registered Internet Customers (in millions) |
28.3 | 26.4 | 24.6 | 24.3 | 22.5 | 7 | 26 | 28.3 | 22.5 | 26 | ||||||||||||||||||||||||||||||
Merchant Acquiring Business (c) |
||||||||||||||||||||||||||||||||||||||||
Bank Card Volume (in billions) |
$ | 194.4 | $ | 181.4 | $ | 179.7 | $ | 163.6 | $ | 177.9 | 7 | 9 | $ | 719.1 | $ | 660.6 | 9 | |||||||||||||||||||||||
Total Transactions (in millions) |
5,406 | # | 4,990 | # | 4,811 | # | 4,465 | # | 4,968 | # | 8 | 9 | 19,672 | # | 18,171 | # | 8 |
(a) | Represents Total Net Revenue less Provision for Credit Losses. | |
(b) | Fourth quarter of 2006 included approximately 9 million accounts from the acquisition of the BP and Pier 1 Imports, Inc. private label portfolios. In addition, full year 2006 included approximately 21 million accounts from the acquisition of the Kohls private label portfolio in the second quarter of 2006. | |
(c) | Represents 100% of the merchant acquiring business. |
Page 14
JPMORGAN CHASE & CO. |
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CARD SERVICES MANAGED BASIS |
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FINANCIAL HIGHLIGHTS, CONTINUED |
||
(in millions, except headcount and ratio data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
SELECTED ENDING BALANCES |
||||||||||||||||||||||||||||||||||||||||
Loans: |
||||||||||||||||||||||||||||||||||||||||
Loans on Balance Sheets |
$ | 84,352 | $ | 79,409 | $ | 80,495 | $ | 78,173 | $ | 85,881 | 6 | % | (2 | )% | $ | 84,352 | $ | 85,881 | (2 | )% | ||||||||||||||||||||
Securitized Loans |
72,701 | 69,643 | 67,506 | 68,403 | 66,950 | 4 | 9 | 72,701 | 66,950 | 9 | ||||||||||||||||||||||||||||||
Managed Loans |
$ | 157,053 | $ | 149,052 | $ | 148,001 | $ | 146,576 | $ | 152,831 | 5 | 3 | $ | 157,053 | $ | 152,831 | 3 | |||||||||||||||||||||||
SELECTED AVERAGE BALANCES |
||||||||||||||||||||||||||||||||||||||||
Managed Assets |
$ | 158,183 | $ | 154,956 | $ | 154,406 | $ | 156,271 | $ | 153,973 | 2 | 3 | $ | 155,957 | $ | 148,153 | 5 | |||||||||||||||||||||||
Loans: |
||||||||||||||||||||||||||||||||||||||||
Loans on Balance Sheets |
$ | 79,028 | $ | 79,993 | $ | 79,000 | $ | 81,932 | $ | 81,489 | (1 | ) | (3 | ) | $ | 79,980 | $ | 73,740 | 8 | |||||||||||||||||||||
Securitized Loans |
72,715 | 68,673 | 68,428 | 67,485 | 65,898 | 6 | 10 | 69,338 | 67,367 | 3 | ||||||||||||||||||||||||||||||
Managed Loans |
$ | 151,743 | $ | 148,666 | $ | 147,428 | $ | 149,417 | $ | 147,387 | 2 | 3 | $ | 149,318 | $ | 141,107 | 6 | |||||||||||||||||||||||
Equity |
$ | 14,100 | $ | 14,100 | $ | 14,100 | $ | 14,100 | $ | 14,100 | | | $ | 14,100 | $ | 14,100 | | |||||||||||||||||||||||
Headcount |
18,554 | # | 18,887 | # | 18,913 | # | 18,749 | # | 18,639 | # | (2 | ) | | 18,554 | # | 18,639 | # | | ||||||||||||||||||||||
MANAGED CREDIT QUALITY STATISTICS |
||||||||||||||||||||||||||||||||||||||||
Net Charge-offs |
$ | 1,488 | $ | 1,363 | $ | 1,331 | $ | 1,314 | $ | 1,281 | 9 | 16 | $ | 5,496 | $ | 4,698 | 17 | |||||||||||||||||||||||
Net Charge-off Rate |
3.89 | % | 3.64 | % | 3.62 | % | 3.57 | % | 3.45 | % | 3.68 | % | 3.33 | % | ||||||||||||||||||||||||||
Managed delinquency ratios |
||||||||||||||||||||||||||||||||||||||||
30+ days |
3.48 | % | 3.25 | % | 3.00 | % | 3.07 | % | 3.13 | % | 3.48 | % | 3.13 | % | ||||||||||||||||||||||||||
90+ days |
1.65 | 1.50 | 1.42 | 1.52 | 1.50 | 1.65 | 1.50 | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses |
$ | 3,407 | $ | 3,107 | $ | 3,096 | $ | 3,092 | $ | 3,176 | 10 | 7 | $ | 3,407 | $ | 3,176 | 7 | |||||||||||||||||||||||
Allowance for Loan Losses to Period-end Loans |
4.04 | % | 3.91 | % | 3.85 | % | 3.96 | % | 3.70 | % | 4.04 | % | 3.70 | % |
Page 15
JPMORGAN CHASE & CO. |
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CARD RECONCILIATION OF REPORTED AND MANAGED DATA |
||
(in millions) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT DATA (a) |
||||||||||||||||||||||||||||||||||||||||
Credit Card Income |
||||||||||||||||||||||||||||||||||||||||
Reported Basis for the Period |
$ | 1,597 | $ | 1,528 | $ | 1,470 | $ | 1,345 | $ | 1,423 | 5 | % | 12 | % | $ | 5,940 | $ | 6,096 | (3 | )% | ||||||||||||||||||||
Securitization Adjustments |
(885 | ) | (836 | ) | (788 | ) | (746 | ) | (726 | ) | (6 | ) | (22 | ) | (3,255 | ) | (3,509 | ) | 7 | |||||||||||||||||||||
Managed Credit Card Income |
$ | 712 | $ | 692 | $ | 682 | $ | 599 | $ | 697 | 3 | 2 | $ | 2,685 | $ | 2,587 | 4 | |||||||||||||||||||||||
Net Interest Income |
||||||||||||||||||||||||||||||||||||||||
Reported Basis for the Period |
$ | 1,633 | $ | 1,694 | $ | 1,577 | $ | 1,650 | $ | 1,623 | (4 | ) | 1 | $ | 6,554 | $ | 6,082 | 8 | ||||||||||||||||||||||
Securitization Adjustments |
1,504 | 1,414 | 1,378 | 1,339 | 1,319 | 6 | 14 | 5,635 | 5,719 | (1 | ) | |||||||||||||||||||||||||||||
Managed Net Interest Income |
$ | 3,137 | $ | 3,108 | $ | 2,955 | $ | 2,989 | $ | 2,942 | 1 | 7 | $ | 12,189 | $ | 11,801 | 3 | |||||||||||||||||||||||
Total Net Revenue |
||||||||||||||||||||||||||||||||||||||||
Reported Basis for the Period |
$ | 3,352 | $ | 3,289 | $ | 3,127 | $ | 3,087 | $ | 3,157 | 2 | 6 | $ | 12,855 | $ | 12,535 | 3 | |||||||||||||||||||||||
Securitization Adjustments |
619 | 578 | 590 | 593 | 593 | 7 | 4 | 2,380 | 2,210 | 8 | ||||||||||||||||||||||||||||||
Managed Total Net Revenue |
$ | 3,971 | $ | 3,867 | $ | 3,717 | $ | 3,680 | $ | 3,750 | 3 | 6 | $ | 15,235 | $ | 14,745 | 3 | |||||||||||||||||||||||
Provision for Credit Losses |
||||||||||||||||||||||||||||||||||||||||
Reported Basis for the Period |
$ | 1,169 | $ | 785 | $ | 741 | $ | 636 | $ | 688 | 49 | 70 | $ | 3,331 | $ | 2,388 | 39 | |||||||||||||||||||||||
Securitization Adjustments |
619 | 578 | 590 | 593 | 593 | 7 | 4 | 2,380 | 2,210 | 8 | ||||||||||||||||||||||||||||||
Managed Provision for Credit Losses |
$ | 1,788 | $ | 1,363 | $ | 1,331 | $ | 1,229 | $ | 1,281 | 31 | 40 | $ | 5,711 | $ | 4,598 | 24 | |||||||||||||||||||||||
BALANCE SHEETS AVERAGE BALANCES (a) |
||||||||||||||||||||||||||||||||||||||||
Total Average Assets |
||||||||||||||||||||||||||||||||||||||||
Reported Basis for the Period |
$ | 88,244 | $ | 88,856 | $ | 88,486 | $ | 91,157 | $ | 90,283 | (1 | ) | (2 | ) | $ | 89,177 | $ | 82,887 | 8 | |||||||||||||||||||||
Securitization Adjustments |
69,939 | 66,100 | 65,920 | 65,114 | 63,690 | 6 | 10 | 66,780 | 65,266 | 2 | ||||||||||||||||||||||||||||||
Managed Average Assets |
$ | 158,183 | $ | 154,956 | $ | 154,406 | $ | 156,271 | $ | 153,973 | 2 | 3 | $ | 155,957 | $ | 148,153 | 5 | |||||||||||||||||||||||
CREDIT QUALITY STATISTICS (a) |
||||||||||||||||||||||||||||||||||||||||
Net Charge-offs |
||||||||||||||||||||||||||||||||||||||||
Reported Net Charge-offs Data for the Period |
$ | 869 | $ | 785 | $ | 741 | $ | 721 | $ | 688 | 11 | 26 | $ | 3,116 | $ | 2,488 | 25 | |||||||||||||||||||||||
Securitization Adjustments |
619 | 578 | 590 | 593 | 593 | 7 | 4 | 2,380 | 2,210 | 8 | ||||||||||||||||||||||||||||||
Managed Net Charge-offs |
$ | 1,488 | $ | 1,363 | $ | 1,331 | $ | 1,314 | $ | 1,281 | 9 | 16 | $ | 5,496 | $ | 4,698 | 17 | |||||||||||||||||||||||
(a) | JPMorgan Chase uses the concept of managed receivables to evaluate the credit performance and overall performance of the underlying credit card loans, both sold and not sold; as the same borrower is continuing to use the credit card for ongoing charges, a borrowers credit performance will affect both the receivables sold under SFAS 140 and those not sold. Thus, in its disclosures regarding managed receivables, JPMorgan Chase treats the sold receivables as if they were still on the balance sheet in order to disclose the credit performance (such as net charge-off rates) of the entire managed credit card portfolio. Managed results exclude the impact of credit card securitizations on Total Net Revenue, the Provision for Credit Losses, Net Charge-offs and Loan Receivables. Securitization does not change reported Net income versus managed earnings; however, it does affect the classification of items on the Consolidated statements of income and Consolidated balance sheets. |
Page 16
JPMORGAN CHASE & CO. |
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COMMERCIAL BANKING |
||
FINANCIAL HIGHLIGHTS |
||
(in millions, except ratio data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT |
||||||||||||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Lending & Deposit Related Fees |
$ | 172 | $ | 159 | $ | 158 | $ | 158 | $ | 155 | 8 | % | 11 | % | $ | 647 | $ | 589 | 10 | % | ||||||||||||||||||||
Asset Management, Administration and Commissions |
24 | 24 | 21 | 23 | 20 | | 20 | 92 | 67 | 37 | ||||||||||||||||||||||||||||||
All Other Income (a) |
130 | 107 | 133 | 154 | 135 | 21 | (4 | ) | 524 | 417 | 26 | |||||||||||||||||||||||||||||
Noninterest Revenue |
326 | 290 | 312 | 335 | 310 | 12 | 5 | 1,263 | 1,073 | 18 | ||||||||||||||||||||||||||||||
Net Interest Income |
758 | 719 | 695 | 668 | 708 | 5 | 7 | 2,840 | 2,727 | 4 | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
1,084 | 1,009 | 1,007 | 1,003 | 1,018 | 7 | 6 | 4,103 | 3,800 | 8 | ||||||||||||||||||||||||||||||
Provision for Credit Losses |
105 | 112 | 45 | 17 | 111 | (6 | ) | (5 | ) | 279 | 160 | 74 | ||||||||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense |
184 | 160 | 182 | 180 | 174 | 15 | 6 | 706 | 740 | (5 | ) | |||||||||||||||||||||||||||||
Noncompensation Expense |
307 | 300 | 300 | 290 | 296 | 2 | 4 | 1,197 | 1,179 | 2 | ||||||||||||||||||||||||||||||
Amortization of Intangibles |
13 | 13 | 14 | 15 | 15 | | (13 | ) | 55 | 60 | (8 | ) | ||||||||||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
504 | 473 | 496 | 485 | 485 | 7 | 4 | 1,958 | 1,979 | (1 | ) | |||||||||||||||||||||||||||||
Income Before Income Tax Expense |
475 | 424 | 466 | 501 | 422 | 12 | 13 | 1,866 | 1,661 | 12 | ||||||||||||||||||||||||||||||
Income Tax Expense |
187 | 166 | 182 | 197 | 166 | 13 | 13 | 732 | 651 | 12 | ||||||||||||||||||||||||||||||
NET INCOME |
$ | 288 | $ | 258 | $ | 284 | $ | 304 | $ | 256 | 12 | 13 | $ | 1,134 | $ | 1,010 | 12 | |||||||||||||||||||||||
MEMO: |
||||||||||||||||||||||||||||||||||||||||
Revenue by Product: |
||||||||||||||||||||||||||||||||||||||||
Lending |
$ | 380 | $ | 343 | $ | 348 | $ | 348 | $ | 359 | 11 | 6 | $ | 1,419 | $ | 1,344 | 6 | |||||||||||||||||||||||
Treasury Services |
631 | 594 | 569 | 556 | 576 | 6 | 10 | 2,350 | 2,243 | 5 | ||||||||||||||||||||||||||||||
Investment Banking |
70 | 64 | 82 | 76 | 87 | 9 | (20 | ) | 292 | 253 | 15 | |||||||||||||||||||||||||||||
Other |
3 | 8 | 8 | 23 | (4 | ) | (63 | ) | NM | 42 | (40 | ) | NM | |||||||||||||||||||||||||||
Total Commercial Banking Revenue |
$ | 1,084 | $ | 1,009 | $ | 1,007 | $ | 1,003 | $ | 1,018 | 7 | 6 | $ | 4,103 | $ | 3,800 | 8 | |||||||||||||||||||||||
IB Revenues, Gross (b) |
$ | 227 | $ | 194 | $ | 236 | $ | 231 | $ | 246 | 17 | (8 | ) | $ | 888 | $ | 716 | 24 | ||||||||||||||||||||||
Revenue by Business: |
||||||||||||||||||||||||||||||||||||||||
Middle Market Banking |
$ | 695 | $ | 680 | $ | 653 | $ | 661 | $ | 661 | 2 | 5 | $ | 2,689 | $ | 2,535 | 6 | |||||||||||||||||||||||
Mid-Corporate Banking |
239 | 167 | 197 | 212 | 198 | 43 | 21 | 815 | 656 | 24 | ||||||||||||||||||||||||||||||
Real Estate Banking |
102 | 108 | 109 | 102 | 120 | (6 | ) | (15 | ) | 421 | 458 | (8 | ) | |||||||||||||||||||||||||||
Other |
48 | 54 | 48 | 28 | 39 | (11 | ) | 23 | 178 | 151 | 18 | |||||||||||||||||||||||||||||
Total Commercial Banking Revenue |
$ | 1,084 | $ | 1,009 | $ | 1,007 | $ | 1,003 | $ | 1,018 | 7 | 6 | $ | 4,103 | $ | 3,800 | 8 | |||||||||||||||||||||||
FINANCIAL RATIOS |
||||||||||||||||||||||||||||||||||||||||
ROE |
17 | % | 15 | % | 18 | % | 20 | % | 16 | % | 17 | % | 18 | % | ||||||||||||||||||||||||||
Overhead Ratio |
46 | 47 | 49 | 48 | 48 | 48 | 52 |
(a) | IB-related and commercial card revenues are included in All Other Income. | |
(b) | Represents the total revenue related to investment banking products sold to Commercial Banking (CB) clients. |
Page 17
JPMORGAN CHASE & CO. |
||
COMMERCIAL BANKING |
||
FINANCIAL HIGHLIGHTS, CONTINUED |
||
(in millions, except ratio and headcount data) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
SELECTED BALANCE SHEETS DATA (Average) |
||||||||||||||||||||||||||||||||||||||||
Total Assets |
$ | 94,550 | $ | 86,652 | $ | 84,687 | $ | 82,545 | $ | 62,227 | 9 | % | 52 | % | $ | 87,140 | $ | 57,754 | 51 | % | ||||||||||||||||||||
Loans: |
||||||||||||||||||||||||||||||||||||||||
Loans Retained |
63,749 | 60,839 | 59,071 | 57,185 | 56,853 | 5 | 12 | 60,231 | 53,154 | 13 | ||||||||||||||||||||||||||||||
Loans Held-for-Sale & Loans at Fair Value |
1,795 | 433 | 741 | 475 | 804 | 315 | 123 | 863 | 442 | 95 | ||||||||||||||||||||||||||||||
Total Loans (a) |
65,544 | 61,272 | 59,812 | 57,660 | 57,657 | 7 | 14 | 61,094 | 53,596 | 14 | ||||||||||||||||||||||||||||||
Liability Balances (b) |
96,716 | 88,081 | 84,187 | 81,752 | 79,050 | 10 | 22 | 87,726 | 73,613 | 19 | ||||||||||||||||||||||||||||||
Equity |
6,700 | 6,700 | 6,300 | 6,300 | 6,300 | | 6 | 6,502 | 5,702 | 14 | ||||||||||||||||||||||||||||||
MEMO: |
||||||||||||||||||||||||||||||||||||||||
Loans by Business: |
||||||||||||||||||||||||||||||||||||||||
Middle Market Banking |
$ | 38,275 | $ | 37,617 | $ | 37,099 | $ | 36,317 | $ | 35,618 | 2 | 7 | $ | 37,333 | $ | 33,225 | 12 | |||||||||||||||||||||||
Mid-Corporate Banking |
15,440 | 12,076 | 11,692 | 10,669 | 9,898 | 28 | 56 | 12,481 | 8,632 | 45 | ||||||||||||||||||||||||||||||
Real Estate Banking |
7,347 | 7,144 | 6,894 | 7,074 | 7,745 | 3 | (5 | ) | 7,116 | 7,566 | (6 | ) | ||||||||||||||||||||||||||||
Other |
4,482 | 4,435 | 4,127 | 3,600 | 4,396 | 1 | 2 | 4,164 | 4,173 | | ||||||||||||||||||||||||||||||
Total Commercial Banking Loans |
$ | 65,544 | $ | 61,272 | $ | 59,812 | $ | 57,660 | $ | 57,657 | 7 | 14 | $ | 61,094 | $ | 53,596 | 14 | |||||||||||||||||||||||
Headcount |
4,125 | # | 4,158 | # | 4,295 | # | 4,281 | # | 4,459 | # | (1 | ) | (7 | ) | 4,125 | # | 4,459 | # | (7 | ) | ||||||||||||||||||||
CREDIT DATA AND QUALITY STATISTICS |
||||||||||||||||||||||||||||||||||||||||
Net Charge-offs (Recoveries) |
$ | 33 | $ | 20 | $ | (8 | ) | $ | (1 | ) | $ | 16 | 65 | 106 | $ | 44 | $ | 27 | 63 | |||||||||||||||||||||
Nonperforming Loans |
146 | 134 | 135 | 141 | 121 | 9 | 21 | 146 | 121 | 21 | ||||||||||||||||||||||||||||||
Allowance for Credit Losses: |
||||||||||||||||||||||||||||||||||||||||
Allowance for Loan Losses |
1,695 | 1,623 | 1,551 | 1,531 | 1,519 | 4 | 12 | 1,695 | 1,519 | 12 | ||||||||||||||||||||||||||||||
Allowance for Lending-Related Commitments |
236 | 236 | 222 | 187 | 187 | | 26 | 236 | 187 | 26 | ||||||||||||||||||||||||||||||
Total Allowance for Credit Losses |
1,931 | 1,859 | 1,773 | 1,718 | 1,706 | 4 | 13 | 1,931 | 1,706 | 13 | ||||||||||||||||||||||||||||||
Net Charge-off (Recovery) Rate (a) |
0.21 | % | 0.13 | % | (0.05 | )% | (0.01 | )% | 0.11 | % | 0.07 | % | 0.05 | % | ||||||||||||||||||||||||||
Allowance for Loan Losses to Average Loans (a) |
2.66 | 2.67 | 2.63 | 2.68 | 2.67 | 2.81 | 2.86 | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses to Nonperforming Loans |
1,161 | 1,211 | 1,149 | 1,086 | 1,255 | 1,161 | 1,255 | |||||||||||||||||||||||||||||||||
Nonperforming Loans to Average Loans |
0.22 | 0.22 | 0.23 | 0.24 | 0.21 | 0.24 | 0.23 |
(a) | Loans held-for-sale and Loans accounted for at fair value under SFAS 159 were excluded when calculating the allowance coverage ratio and the Net charge-off rate. | |
(b) | Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, Federal funds purchased, and repurchase agreements. |
Page 18
JPMORGAN CHASE & CO. |
||
TREASURY & SECURITIES SERVICES |
||
FINANCIAL HIGHLIGHTS |
||
(in millions, except ratio data and where otherwise noted) |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT |
||||||||||||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Lending & Deposit Related Fees |
$ | 247 | $ | 244 | $ | 219 | $ | 213 | $ | 186 | 1 | % | 33 | % | $ | 923 | $ | 735 | 26 | % | ||||||||||||||||||||
Asset Management, Administration and Commissions |
806 | 730 | 828 | 686 | 717 | 10 | 12 | 3,050 | 2,692 | 13 | ||||||||||||||||||||||||||||||
All Other Income |
228 | 171 | 184 | 125 | 133 | 33 | 71 | 708 | 612 | 16 | ||||||||||||||||||||||||||||||
Noninterest Revenue |
1,281 | 1,145 | 1,231 | 1,024 | 1,036 | 12 | 24 | 4,681 | 4,039 | 16 | ||||||||||||||||||||||||||||||
Net Interest Income |
649 | 603 | 510 | 502 | 501 | 8 | 30 | 2,264 | 2,070 | 9 | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
1,930 | 1,748 | 1,741 | 1,526 | 1,537 | 10 | 26 | 6,945 | 6,109 | 14 | ||||||||||||||||||||||||||||||
Provision for Credit Losses |
4 | 9 | | 6 | (2 | ) | (56 | ) | NM | 19 | (1 | ) | NM | |||||||||||||||||||||||||||
Credit Reimbursement to IB (a) |
(30 | ) | (31 | ) | (30 | ) | (30 | ) | (31 | ) | 3 | 3 | (121 | ) | (121 | ) | | |||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense |
607 | 579 | 609 | 558 | 555 | 5 | 9 | 2,353 | 2,198 | 7 | ||||||||||||||||||||||||||||||
Noncompensation Expense |
598 | 538 | 523 | 502 | 533 | 11 | 12 | 2,161 | 1,995 | 8 | ||||||||||||||||||||||||||||||
Amortization of Intangibles |
17 | 17 | 17 | 15 | 16 | | 6 | 66 | 73 | (10 | ) | |||||||||||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
1,222 | 1,134 | 1,149 | 1,075 | 1,104 | 8 | 11 | 4,580 | 4,266 | 7 | ||||||||||||||||||||||||||||||
Income before Income Tax Expense |
674 | 574 | 562 | 415 | 404 | 17 | 67 | 2,225 | 1,723 | 29 | ||||||||||||||||||||||||||||||
Income Tax Expense |
252 | 214 | 210 | 152 | 148 | 18 | 70 | 828 | 633 | 31 | ||||||||||||||||||||||||||||||
NET INCOME |
$ | 422 | $ | 360 | $ | 352 | $ | 263 | $ | 256 | 17 | 65 | $ | 1,397 | $ | 1,090 | 28 | |||||||||||||||||||||||
REVENUE BY BUSINESS |
||||||||||||||||||||||||||||||||||||||||
Treasury Services |
$ | 824 | $ | 780 | $ | 720 | $ | 689 | 700 | 6 | 18 | $ | 3,013 | $ | 2,792 | 8 | ||||||||||||||||||||||||
Worldwide Securities Services |
1,106 | 968 | 1,021 | 837 | 837 | 14 | 32 | 3,932 | 3,317 | 19 | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
$ | 1,930 | $ | 1,748 | $ | 1,741 | $ | 1,526 | $ | 1,537 | 10 | 26 | $ | 6,945 | $ | 6,109 | 14 | |||||||||||||||||||||||
FINANCIAL RATIOS |
||||||||||||||||||||||||||||||||||||||||
ROE |
56 | % | 48 | % | 47 | % | 36 | % | 46 | % | 47 | % | 48 | % | ||||||||||||||||||||||||||
Overhead Ratio |
63 | 65 | 66 | 70 | 72 | 66 | 70 | |||||||||||||||||||||||||||||||||
Pretax Margin Ratio (b) |
35 | 33 | 32 | 27 | 26 | 32 | 28 | |||||||||||||||||||||||||||||||||
FIRMWIDE BUSINESS METRICS |
||||||||||||||||||||||||||||||||||||||||
Assets under Custody (in billions) |
$ | 15,946 | $ | 15,614 | $ | 15,203 | $ | 14,661 | $ | 13,903 | 2 | 15 | $ | 15,946 | $ | 13,903 | 15 | |||||||||||||||||||||||
Number of: |
||||||||||||||||||||||||||||||||||||||||
US$ ACH transactions originated (in millions) |
984 | # | 943 | # | 972 | # | 971 | # | 931 | # | 4 | 6 | 3,870 | # | 3,503 | # | 10 | |||||||||||||||||||||||
Total US$ Clearing Volume (in thousands) |
28,386 | 28,031 | 27,779 | 26,840 | 26,906 | 1 | 6 | 111,036 | 104,846 | 6 | ||||||||||||||||||||||||||||||
International Electronic Funds Transfer Volume (in
thousands) (c) |
42,723 | 41,415 | 42,068 | 42,399 | 41,007 | 3 | 4 | 168,605 | 145,325 | 16 | ||||||||||||||||||||||||||||||
Wholesale Check Volume (in millions) |
656 | 731 | 767 | 771 | 793 | (10 | ) | (17 | ) | 2,925 | 3,409 | (14 | ) | |||||||||||||||||||||||||||
Wholesale Cards Issued (in thousands) (d) |
18,722 | 18,108 | 17,535 | 17,146 | 17,228 | 3 | 9 | 18,722 | 17,228 | 9 |
Page 19
JPMORGAN CHASE & CO. TREASURY & SECURITIES SERVICES FINANCIAL HIGHLIGHTS, CONTINUED |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
SELECTED BALANCE SHEETS (Average) |
||||||||||||||||||||||||||||||||||||||||
Total Assets |
$ | 60,830 | $ | 55,688 | $ | 50,687 | $ | 46,005 | $ | 35,422 | 9 | % | 72 | % | $ | 53,350 | $ | 31,760 | 68 | % | ||||||||||||||||||||
Loans |
23,489 | 20,602 | 20,195 | 18,948 | 19,030 | 14 | 23 | 20,821 | 15,564 | 34 | ||||||||||||||||||||||||||||||
Liability Balances (e) |
250,645 | 236,381 | 217,514 | 210,639 | 193,129 | 6 | 30 | 228,925 | 189,540 | 21 | ||||||||||||||||||||||||||||||
Equity |
3,000 | 3,000 | 3,000 | 3,000 | 2,200 | | 36 | 3,000 | 2,285 | 31 | ||||||||||||||||||||||||||||||
Headcount |
25,669 | # | 25,209 | # | 25,206 | # | 24,875 | # | 25,423 | # | 2 | 1 | 25,669 | # | 25,423 | # | 1 | |||||||||||||||||||||||
TSS FIRMWIDE METRICS |
||||||||||||||||||||||||||||||||||||||||
Treasury Services Firmwide Revenue (f) |
$ | 1,530 | $ | 1,444 | $ | 1,354 | $ | 1,305 | $ | 1,333 | 6 | 15 | $ | 5,633 | $ | 5,242 | 7 | |||||||||||||||||||||||
Treasury & Securities Services Firmwide Revenue (f) |
2,636 | 2,412 | 2,375 | 2,142 | 2,170 | 9 | 21 | 9,565 | 8,559 | 12 | ||||||||||||||||||||||||||||||
Treasury Services Firmwide Overhead Ratio (g) |
53 | % | 54 | % | 59 | % | 59 | % | 56 | % | 56 | % | 56 | % | ||||||||||||||||||||||||||
Treasury & Securities Services Firmwide Overhead Ratio (g) |
57 | 59 | 60 | 63 | 63 | 60 | 62 | |||||||||||||||||||||||||||||||||
Treasury Services Firmwide Liability Balances (Average) (h) |
$ | 218,416 | $ | 201,671 | $ | 189,214 | $ | 186,631 | $ | 168,321 | 8 | 30 | $ | 199,077 | $ | 162,020 | 23 | |||||||||||||||||||||||
Treasury & Securities Services Firmwide Liability Balances (Average) (h) |
347,361 | 324,462 | 301,701 | 292,391 | 272,178 | 7 | 28 | 316,651 | 262,678 | 21 |
(a) | TSS was charged a credit reimbursement related to certain exposures managed within the IB credit portfolio on behalf of clients shared with TSS. | |
(b) | Pretax margin represents Income before income tax expense divided by Total net revenue, which is a measure of pretax performance and another basis by which management evaluates its performance and that of its competitors. | |
(c) | International electronic funds transfer includes non-US$ ACH and clearing volume. | |
(d) | Wholesale cards issued include domestic commercial card, stored value card, prepaid card, and government electronic benefit card products. | |
(e) | Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, Federal funds purchased, and repurchase agreements. |
(f) | Firmwide revenue includes TS revenue recorded in the CB, Regional Banking and Asset Management (AM) lines of business (see below) and excludes FX revenues recorded in the IB for TSS-related FX activity. |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
TS Revenue Reported in CB |
$ | 631 | $ | 594 | $ | 569 | $ | 556 | $ | 576 | 6 | % | 10 | % | $ | 2,350 | $ | 2,243 | 5 | % | ||||||||||||||||||||
TS Revenue Reported in Other Lines of Business |
75 | 70 | 65 | 60 | 57 | 7 | 32 | 270 | 207 | 30 |
(g) | Overhead ratios have been calculated based upon firmwide revenues and TSS and TS expenses, respectively, including those allocated to certain other lines of business. FX revenues and expenses recorded in the IB for TSS-related FX activity are not included in this ratio. | |
(h) | Firmwide liability balances include TS liability balances recorded in certain other lines of business. Liability balances associated with TS customers who are also customers of the CB line of business are not included in TS liability balances. |
Page 20
JPMORGAN CHASE & CO. ASSET MANAGEMENT FINANCIAL HIGHLIGHTS |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT |
||||||||||||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Asset Management, Administration and Commissions |
$ | 1,901 | $ | 1,760 | $ | 1,671 | $ | 1,489 | $ | 1,509 | 8 | % | 26 | % | $ | 6,821 | $ | 5,295 | 29 | % | ||||||||||||||||||||
All Other Income |
159 | 152 | 173 | 170 | 192 | 5 | (17 | ) | 654 | 521 | 26 | |||||||||||||||||||||||||||||
Noninterest Revenue |
2,060 | 1,912 | 1,844 | 1,659 | 1,701 | 8 | 21 | 7,475 | 5,816 | 29 | ||||||||||||||||||||||||||||||
Net Interest Income |
329 | 293 | 293 | 245 | 246 | 12 | 34 | 1,160 | 971 | 19 | ||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
2,389 | 2,205 | 2,137 | 1,904 | 1,947 | 8 | 23 | 8,635 | 6,787 | 27 | ||||||||||||||||||||||||||||||
Provision for Credit Losses |
(1 | ) | 3 | (11 | ) | (9 | ) | 14 | NM | NM | (18 | ) | (28 | ) | 36 | |||||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense |
1,030 | 848 | 879 | 764 | 750 | 21 | 37 | 3,521 | 2,777 | 27 | ||||||||||||||||||||||||||||||
Noncompensation Expense |
510 | 498 | 456 | 451 | 512 | 2 | | 1,915 | 1,713 | 12 | ||||||||||||||||||||||||||||||
Amortization of Intangibles |
19 | 20 | 20 | 20 | 22 | (5 | ) | (14 | ) | 79 | 88 | (10 | ) | |||||||||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
1,559 | 1,366 | 1,355 | 1,235 | 1,284 | 14 | 21 | 5,515 | 4,578 | 20 | ||||||||||||||||||||||||||||||
Income Before Income Tax Expense |
831 | 836 | 793 | 678 | 649 | (1 | ) | 28 | 3,138 | 2,237 | 40 | |||||||||||||||||||||||||||||
Income Tax Expense |
304 | 315 | 300 | 253 | 242 | (3 | ) | 26 | 1,172 | 828 | 42 | |||||||||||||||||||||||||||||
NET INCOME |
$ | 527 | $ | 521 | $ | 493 | $ | 425 | $ | 407 | 1 | 29 | $ | 1,966 | $ | 1,409 | 40 | |||||||||||||||||||||||
REVENUE BY CLIENT SEGMENT |
||||||||||||||||||||||||||||||||||||||||
Institutional |
$ | 754 | $ | 603 | $ | 617 | $ | 551 | $ | 624 | 25 | 21 | $ | 2,525 | $ | 1,972 | 28 | |||||||||||||||||||||||
Private Bank |
713 | 686 | 646 | 560 | 528 | 4 | 35 | 2,605 | 1,907 | 37 | ||||||||||||||||||||||||||||||
Retail |
640 | 639 | 602 | 527 | 541 | | 18 | 2,408 | 1,885 | 28 | ||||||||||||||||||||||||||||||
Private Client Services |
282 | 277 | 272 | 266 | 254 | 2 | 11 | 1,097 | 1,023 | 7 | ||||||||||||||||||||||||||||||
Total Net Revenue |
$ | 2,389 | $ | 2,205 | $ | 2,137 | $ | 1,904 | $ | 1,947 | 8 | 23 | $ | 8,635 | $ | 6,787 | 27 | |||||||||||||||||||||||
FINANCIAL RATIOS |
||||||||||||||||||||||||||||||||||||||||
ROE |
52 | % | 52 | % | 53 | % | 46 | % | 46 | % | 51 | % | 40 | % | ||||||||||||||||||||||||||
Overhead Ratio |
65 | 62 | 63 | 65 | 66 | 64 | 67 | |||||||||||||||||||||||||||||||||
Pretax Margin Ratio (a) |
35 | 38 | 37 | 36 | 33 | 36 | 33 | |||||||||||||||||||||||||||||||||
BUSINESS METRICS |
||||||||||||||||||||||||||||||||||||||||
Number of: |
||||||||||||||||||||||||||||||||||||||||
Client Advisors |
1,729 | # | 1,680 | # | 1,582 | # | 1,533 | # | 1,506 | # | 3 | 15 | 1,729 | # | 1,506 | # | 15 | |||||||||||||||||||||||
Retirement Planning Services Participants |
1,501,000 | 1,495,000 | 1,477,000 | 1,423,000 | 1,362,000 | | 10 | 1,501,000 | 1,362,000 | 10 | ||||||||||||||||||||||||||||||
% of Customer Assets in 4 & 5 Star Funds (b) |
55 | % | 55 | % | 65 | % | 61 | % | 58 | % | | (5 | ) | 55 | % | 58 | % | (5 | ) | |||||||||||||||||||||
% of AUM in 1st and 2nd Quartiles: (c) |
||||||||||||||||||||||||||||||||||||||||
1 Year |
57 | % | 47 | % | 65 | % | 76 | % | 83 | % | 21 | (31 | ) | 57 | % | 83 | % | (31 | ) | |||||||||||||||||||||
3 Years |
75 | % | 73 | % | 77 | % | 76 | % | 77 | % | 3 | (3 | ) | 75 | % | 77 | % | (3 | ) | |||||||||||||||||||||
5 Years |
76 | % | 76 | % | 76 | % | 81 | % | 79 | % | | (4 | ) | 76 | % | 79 | % | (4 | ) | |||||||||||||||||||||
SELECTED BALANCE SHEETS DATA (Average) |
||||||||||||||||||||||||||||||||||||||||
Total Assets |
$ | 55,989 | $ | 53,879 | $ | 51,710 | $ | 45,816 | $ | 46,716 | 4 | 20 | $ | 51,882 | $ | 43,635 | 19 | |||||||||||||||||||||||
Loans (d) |
32,627 | 30,928 | 28,695 | 25,640 | 28,917 | 5 | 13 | 29,496 | 26,507 | 11 | ||||||||||||||||||||||||||||||
Deposits |
64,630 | 59,907 | 55,981 | 54,816 | 51,341 | 8 | 26 | 58,863 | 50,607 | 16 | ||||||||||||||||||||||||||||||
Equity |
4,000 | 4,000 | 3,750 | 3,750 | 3,500 | | 14 | 3,876 | 3,500 | 11 | ||||||||||||||||||||||||||||||
Headcount |
14,799 | # | 14,510 | # | 14,108 | # | 13,568 | # | 13,298 | # | 2 | 11 | 14,799 | # | 13,298 | # | 11 | |||||||||||||||||||||||
CREDIT DATA AND QUALITY STATISTICS |
||||||||||||||||||||||||||||||||||||||||
Net Charge-offs (Recoveries) |
$ | 2 | $ | (5 | ) | $ | (5 | ) | $ | | $ | 2 | NM | | $ | (8 | ) | $ | (19 | ) | 58 | |||||||||||||||||||
Nonperforming Loans |
12 | 28 | 21 | 34 | 39 | (57 | ) | (69 | ) | 12 | 39 | (69 | ) | |||||||||||||||||||||||||||
Allowance for Loan Losses |
112 | 115 | 105 | 114 | 121 | (3 | ) | (7 | ) | 112 | 121 | (7 | ) | |||||||||||||||||||||||||||
Allowance for Lending Related Commitments |
7 | 6 | 7 | 5 | 6 | 17 | 17 | 7 | 6 | 17 | ||||||||||||||||||||||||||||||
Net Charge-off (Recovery) Rate |
0.02 | % | (0.06 | )% | (0.07 | )% | | % | 0.03 | % | (0.03 | )% | (0.07 | )% | ||||||||||||||||||||||||||
Allowance for Loan Losses to Average Loans |
0.34 | 0.37 | 0.37 | 0.44 | 0.42 | 0.38 | 0.46 | |||||||||||||||||||||||||||||||||
Allowance for Loan Losses to Nonperforming Loans |
933 | 411 | 500 | 335 | 310 | 933 | 310 | |||||||||||||||||||||||||||||||||
Nonperforming Loans to Average Loans |
0.04 | 0.09 | 0.07 | 0.13 | 0.13 | 0.04 | 0.15 |
(a) | Pretax margin represents income before income tax expense divided by Total net revenue, which is a measure of pretax performance and another basis by which management evaluates its performance and that of its competitors. | |
(b) | Derived from Morningstar for the United States; Micropal for the United Kingdom, Luxembourg, Hong Kong and Taiwan; and Nomura for Japan. | |
(c) | Quartile rankings sourced from Lipper for the United States and Taiwan; Micropal for the United Kingdom, Luxembourg and Hong Kong; and Nomura for Japan. | |
(d) | Held-for-investment prime mortgage loans that were transferred from AM to Treasury within the Corporate segment during the third and first quarters of 2007 totaled $1.2 billion and $5.3 billion, respectively. There were no transfers during the fourth or second quarters of 2007 or the full year 2006. The transfer had no material impact on the financial results of AM. |
Page 21
JPMORGAN CHASE & CO. ASSET MANAGEMENT FINANCIAL HIGHLIGHTS, CONTINUED |
Dec 31, 2007 | ||||||||||||||||||||||||||||
Change | ||||||||||||||||||||||||||||
Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Dec 31 | ||||||||||||||||||||||
2007 | 2007 | 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||||||||
Assets by Asset Class |
||||||||||||||||||||||||||||
Liquidity |
$ | 400 | $ | 368 | $ | 333 | $ | 318 | $ | 311 | 9 | % | 29 | % | ||||||||||||||
Fixed Income |
200 | 195 | 190 | 180 | 175 | 3 | 14 | |||||||||||||||||||||
Equities & Balanced |
472 | 481 | 467 | 446 | 427 | (2 | ) | 11 | ||||||||||||||||||||
Alternatives |
121 | 119 | 119 | 109 | 100 | 2 | 21 | |||||||||||||||||||||
TOTAL ASSETS UNDER MANAGEMENT |
1,193 | 1,163 | 1,109 | 1,053 | 1,013 | 3 | 18 | |||||||||||||||||||||
Custody / Brokerage / Administration / Deposits |
379 | 376 | 363 | 342 | 334 | 1 | 13 | |||||||||||||||||||||
TOTAL ASSETS UNDER SUPERVISION |
$ | 1,572 | $ | 1,539 | $ | 1,472 | $ | 1,395 | $ | 1,347 | 2 | 17 | ||||||||||||||||
Assets by Client Segment |
||||||||||||||||||||||||||||
Institutional |
$ | 632 | $ | 603 | $ | 565 | $ | 550 | $ | 538 | 5 | 17 | ||||||||||||||||
Private Bank |
201 | 196 | 185 | 170 | 159 | 3 | 26 | |||||||||||||||||||||
Retail |
300 | 304 | 300 | 274 | 259 | (1 | ) | 16 | ||||||||||||||||||||
Private Client Services |
60 | 60 | 59 | 59 | 57 | | 5 | |||||||||||||||||||||
TOTAL ASSETS UNDER MANAGEMENT |
$ | 1,193 | $ | 1,163 | $ | 1,109 | $ | 1,053 | $ | 1,013 | 3 | 18 | ||||||||||||||||
Institutional |
$ | 633 | $ | 604 | $ | 566 | $ | 551 | $ | 539 | 5 | 17 | ||||||||||||||||
Private Bank |
433 | 423 | 402 | 374 | 357 | 2 | 21 | |||||||||||||||||||||
Retail |
394 | 399 | 393 | 361 | 343 | (1 | ) | 15 | ||||||||||||||||||||
Private Client Services |
112 | 113 | 111 | 109 | 108 | (1 | ) | 4 | ||||||||||||||||||||
TOTAL ASSETS UNDER SUPERVISION |
$ | 1,572 | $ | 1,539 | $ | 1,472 | $ | 1,395 | $ | 1,347 | 2 | 17 | ||||||||||||||||
Assets by Geographic Region |
||||||||||||||||||||||||||||
U.S. / Canada |
$ | 760 | $ | 745 | $ | 700 | $ | 664 | $ | 630 | 2 | 21 | ||||||||||||||||
International |
433 | 418 | 409 | 389 | 383 | 4 | 13 | |||||||||||||||||||||
TOTAL ASSETS UNDER MANAGEMENT |
$ | 1,193 | $ | 1,163 | $ | 1,109 | $ | 1,053 | $ | 1,013 | 3 | 18 | ||||||||||||||||
U.S. / Canada |
$ | 1,032 | $ | 1,022 | $ | 971 | $ | 929 | $ | 889 | 1 | 16 | ||||||||||||||||
International |
540 | 517 | 501 | 466 | 458 | 4 | 18 | |||||||||||||||||||||
TOTAL ASSETS UNDER SUPERVISION |
$ | 1,572 | $ | 1,539 | $ | 1,472 | $ | 1,395 | $ | 1,347 | 2 | 17 | ||||||||||||||||
Mutual Funds Assets by Asset Class |
||||||||||||||||||||||||||||
Liquidity |
$ | 339 | $ | 308 | $ | 268 | $ | 257 | $ | 255 | 10 | 33 | ||||||||||||||||
Fixed Income |
46 | 46 | 49 | 48 | 46 | | | |||||||||||||||||||||
Equity |
224 | 235 | 235 | 219 | 206 | (5 | ) | 9 | ||||||||||||||||||||
TOTAL MUTUAL FUND ASSETS |
$ | 609 | $ | 589 | $ | 552 | $ | 524 | $ | 507 | 3 | 20 | ||||||||||||||||
Page 22
JPMORGAN CHASE & CO. ASSET MANAGEMENT FINANCIAL HIGHLIGHTS, CONTINUED |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 2007 | 2006 | ||||||||||||||||||||||
ASSETS UNDER SUPERVISION (continued) |
||||||||||||||||||||||||||||
Assets Under Management Rollforward |
||||||||||||||||||||||||||||
Beginning Balance |
$ | 1,163 | $ | 1,109 | $ | 1,053 | $ | 1,013 | $ | 935 | $ | 1,013 | $ | 847 | ||||||||||||||
Flows: |
||||||||||||||||||||||||||||
Liquidity |
26 | 33 | 12 | 7 | 24 | 78 | 44 | |||||||||||||||||||||
Fixed Income |
3 | (2 | ) | 6 | 2 | 1 | 9 | 11 | ||||||||||||||||||||
Equities, Balanced & Alternatives |
4 | 2 | 12 | 10 | 5 | 28 | 34 | |||||||||||||||||||||
Market / Performance / Other Impacts |
(3 | ) | 21 | 26 | 21 | 48 | 65 | 77 | ||||||||||||||||||||
TOTAL ASSETS UNDER MANAGEMENT |
$ | 1,193 | $ | 1,163 | $ | 1,109 | $ | 1,053 | $ | 1,013 | $ | 1,193 | $ | 1,013 | ||||||||||||||
Assets Under Supervision Rollforward |
||||||||||||||||||||||||||||
Beginning Balance |
$ | 1,539 | $ | 1,472 | $ | 1,395 | $ | 1,347 | $ | 1,265 | $ | 1,347 | $ | 1,149 | ||||||||||||||
Net Asset Flows |
37 | 41 | 38 | 27 | 31 | 143 | 102 | |||||||||||||||||||||
Market / Performance / Other Impacts |
(4 | ) | 26 | 39 | 21 | 51 | 82 | 96 | ||||||||||||||||||||
TOTAL ASSETS UNDER SUPERVISION |
$ | 1,572 | $ | 1,539 | $ | 1,472 | $ | 1,395 | $ | 1,347 | $ | 1,572 | $ | 1,347 | ||||||||||||||
Page 23
JPMORGAN CHASE & CO. CORPORATE FINANCIAL HIGHLIGHTS |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
INCOME STATEMENT |
||||||||||||||||||||||||||||||||||||||||
REVENUE |
||||||||||||||||||||||||||||||||||||||||
Principal Transactions (a) (b) |
$ | 773 | $ | 1,082 | $ | 1,372 | $ | 1,325 | $ | 236 | (29 | )% | 228 | % | $ | 4,552 | $ | 1,181 | 285 | % | ||||||||||||||||||||
Securities Gains (Losses) |
146 | 128 | (227 | ) | (8 | ) | 18 | 14 | NM | 39 | (608 | ) | NM | |||||||||||||||||||||||||||
All Other Income |
213 | 70 | 90 | 68 | 27 | 204 | NM | 441 | 485 | (9 | ) | |||||||||||||||||||||||||||||
Noninterest Revenue |
1,132 | 1,280 | 1,235 | 1,385 | 281 | (12 | ) | 303 | 5,032 | 1,058 | 376 | |||||||||||||||||||||||||||||
Net Interest Income (Expense) |
(218 | ) | (279 | ) | (173 | ) | (117 | ) | (87 | ) | 22 | (151 | ) | (787 | ) | (1,044 | ) | 25 | ||||||||||||||||||||||
TOTAL NET REVENUE |
914 | 1,001 | 1,062 | 1,268 | 194 | (9 | ) | 371 | 4,245 | 14 | NM | |||||||||||||||||||||||||||||
Provision for Credit Losses |
14 | (31 | ) | 3 | 3 | (2 | ) | NM | NM | (11 | ) | (1 | ) | NM | ||||||||||||||||||||||||||
NONINTEREST EXPENSE |
||||||||||||||||||||||||||||||||||||||||
Compensation Expense (b) |
714 | 569 | 695 | 776 | 434 | 25 | 65 | 2,754 | 2,626 | 5 | ||||||||||||||||||||||||||||||
Noncompensation
Expense (c) |
982 | 674 | 818 | 556 | 678 | 46 | 45 | 3,030 | 2,357 | 29 | ||||||||||||||||||||||||||||||
Merger Costs |
22 | 61 | 64 | 62 | 100 | (64 | ) | (78 | ) | 209 | 305 | (31 | ) | |||||||||||||||||||||||||||
Subtotal |
1,718 | 1,304 | 1,577 | 1,394 | 1,212 | 32 | 42 | 5,993 | 5,288 | 13 | ||||||||||||||||||||||||||||||
Net Expenses Allocated to Other Businesses |
(1,057 | ) | (1,059 | ) | (1,075 | ) | (1,040 | ) | (1,037 | ) | | (2 | ) | (4,231 | ) | (4,141 | ) | (2 | ) | |||||||||||||||||||||
TOTAL NONINTEREST EXPENSE |
661 | 245 | 502 | 354 | 175 | 170 | 278 | 1,762 | 1,147 | 54 | ||||||||||||||||||||||||||||||
Income (Loss) from Continuing Operations before Income Tax Expense |
239 | 787 | 557 | 911 | 21 | (70 | ) | NM | 2,494 | (1,132 | ) | NM | ||||||||||||||||||||||||||||
Income Tax
Expense (Benefit) (d) |
(10 | ) | 274 | 175 | 280 | (520 | ) | NM | 98 | 719 | (1,179 | ) | NM | |||||||||||||||||||||||||||
Income (Loss) from Continuing Operations |
249 | 513 | 382 | 631 | 541 | (51 | ) | (54 | ) | 1,775 | 47 | NM | ||||||||||||||||||||||||||||
Income
from Discontinued Operations (e) |
| | | | 620 | | NM | | 795 | NM | ||||||||||||||||||||||||||||||
NET INCOME (LOSS) |
$ | 249 | $ | 513 | $ | 382 | $ | 631 | $ | 1,161 | (51 | ) | (79 | ) | $ | 1,775 | $ | 842 | 111 | |||||||||||||||||||||
MEMO: |
||||||||||||||||||||||||||||||||||||||||
TOTAL NET REVENUE |
||||||||||||||||||||||||||||||||||||||||
Private Equity (a) (b) |
$ | 688 | $ | 733 | $ | 1,293 | $ | 1,253 | $ | 250 | (6 | ) | 175 | $ | 3,967 | $ | 1,142 | 247 | ||||||||||||||||||||||
Treasury and Other Corporate |
226 | 268 | (231 | ) | 15 | (56 | ) | (16 | ) | NM | 278 | (1,128 | ) | NM | ||||||||||||||||||||||||||
TOTAL NET REVENUE |
$ | 914 | $ | 1,001 | $ | 1,062 | $ | 1,268 | $ | 194 | (9 | ) | 371 | $ | 4,245 | $ | 14 | NM | ||||||||||||||||||||||
NET INCOME (LOSS) |
||||||||||||||||||||||||||||||||||||||||
Private Equity (a) |
$ | 356 | $ | 409 | $ | 702 | $ | 698 | $ | 136 | (13 | ) | 162 | $ | 2,165 | $ | 627 | 245 | ||||||||||||||||||||||
Treasury and
Other Corporate (c) (d) |
(93 | ) | 142 | (280 | ) | (29 | ) | 467 | NM | NM | (260 | ) | (391 | ) | 34 | |||||||||||||||||||||||||
Merger Costs |
(14 | ) | (38 | ) | (40 | ) | (38 | ) | (62 | ) | 63 | 77 | (130 | ) | (189 | ) | 31 | |||||||||||||||||||||||
Income (Loss) from Continuing Operations |
249 | 513 | 382 | 631 | 541 | (51 | ) | (54 | ) | 1,775 | 47 | NM | ||||||||||||||||||||||||||||
Income from Discontinued Operations |
| | | | 620 | | NM | | 795 | NM | ||||||||||||||||||||||||||||||
TOTAL NET INCOME (LOSS) |
$ | 249 | $ | 513 | $ | 382 | $ | 631 | $ | 1,161 | (51 | ) | (79 | ) | $ | 1,775 | $ | 842 | 111 | |||||||||||||||||||||
Headcount |
22,512 | # | 22,864 | # | 23,532 | # | 23,702 | # | 23,242 | # | (2 | ) | (3 | ) | 22,512 | # | 23,242 | # | (3 | ) |
(a) | The Firm adopted SFAS 157 in the first quarter of 2007. For additional information, see the Firms September 30, 2007, Form 10-Q. | |
(b) | The 2007 quarters and full year included the reclassification of certain private equity carried interest from net revenue to compensation expense. | |
(c) | Included insurance recoveries related to settlement of the Enron and WorldCom class action litigations and for certain other material proceedings of $137 million for the quarter ended December 31, 2006. Insurance recoveries were $512 million for full year 2006. | |
(d) | Included a tax benefit of $359 million related to audit resolutions in the fourth quarter of 2006. | |
(e) | On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses were reported as discontinued operations for 2006. Included $622 million gain on sale in the fourth quarter of 2006. |
Page 24
JPMORGAN CHASE & CO. CORPORATE FINANCIAL HIGHLIGHTS, CONTINUED |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
SUPPLEMENTAL |
||||||||||||||||||||||||||||||||||||||||
TREASURY |
||||||||||||||||||||||||||||||||||||||||
Securities Gains (Losses) (a) |
$ | 146 | $ | 126 | $ | (227 | ) | $ | (8 | ) | $ | 7 | 16 | % | NM | % | $ | 37 | $ | (619 | ) | NM | % | |||||||||||||||||
Investment Securities Portfolio (Average) |
82,445 | 85,470 | 87,760 | 86,436 | 80,616 | (4 | ) | 2 | 85,517 | 63,361 | 35 | |||||||||||||||||||||||||||||
Investment Securities Portfolio (Ending) |
76,200 | 86,495 | 86,821 | 88,681 | 82,091 | (12 | ) | (7 | ) | 76,200 | 82,091 | (7 | ) | |||||||||||||||||||||||||||
Mortgage Loans (Average) (b) |
34,436 | 29,854 | 26,830 | 25,244 | | 15 | NM | 29,118 | | NM | ||||||||||||||||||||||||||||||
Mortgage Loans (Ending) (b) |
36,942 | 32,804 | 27,299 | 26,499 | | 13 | NM | 36,942 | | NM | ||||||||||||||||||||||||||||||
PRIVATE EQUITY |
||||||||||||||||||||||||||||||||||||||||
Private Equity Gains (Losses) |
||||||||||||||||||||||||||||||||||||||||
Direct
Investments |
||||||||||||||||||||||||||||||||||||||||
Realized Gains |
$ | 100 | $ | 504 | $ | 985 | $ | 723 | $ | 254 | (80 | ) | (61 | ) | $ | 2,312 | $ | 1,223 | 89 | |||||||||||||||||||||
Write-ups / (Write-downs) (c) |
577 | 222 | 209 | 648 | 12 | 160 | NM | 1,656 | (73 | ) | NM | |||||||||||||||||||||||||||||
Mark-to-Market Gains (Losses) |
(8 | ) | 5 | 81 | (127 | ) | (6 | ) | NM | (33 | ) | (49 | ) | 72 | NM | |||||||||||||||||||||||||
Total Direct Investments |
669 | 731 | 1,275 | 1,244 | 260 | (8 | ) | 157 | 3,919 | 1,222 | 221 | |||||||||||||||||||||||||||||
Third-Party Fund Investments |
43 | 35 | 53 | 34 | 27 | 23 | 59 | 165 | 77 | 114 | ||||||||||||||||||||||||||||||
Total Private Equity Gains (d) |
$ | 712 | $ | 766 | $ | 1,328 | $ | 1,278 | $ | 287 | (7 | ) | 148 | $ | 4,084 | $ | 1,299 | 214 | ||||||||||||||||||||||
Private Equity Portfolio Information |
||||||||||||||||||||||||||||||||||||||||
Direct Investments |
||||||||||||||||||||||||||||||||||||||||
Publicly-Held Securities |
||||||||||||||||||||||||||||||||||||||||
Carrying Value |
$ | 390 | $ | 409 | $ | 465 | $ | 389 | $ | 587 | (5 | ) | (34 | ) | ||||||||||||||||||||||||||
Cost |
288 | 291 | 367 | 366 | 451 | (1 | ) | (36 | ) | |||||||||||||||||||||||||||||||
Quoted Public Value |
536 | 560 | 600 | 493 | 831 | (4 | ) | (35 | ) | |||||||||||||||||||||||||||||||
Privately-Held Direct Securities |
||||||||||||||||||||||||||||||||||||||||
Carrying Value |
5,914 | 5,336 | 5,247 | 5,294 | 4,692 | 11 | 26 | |||||||||||||||||||||||||||||||||
Cost |
4,867 | 5,003 | 5,228 | 5,574 | 5,795 | (3 | ) | (16 | ) | |||||||||||||||||||||||||||||||
Third-Party Fund Investments |
||||||||||||||||||||||||||||||||||||||||
Carrying Value |
849 | 839 | 812 | 744 | 802 | 1 | 6 | |||||||||||||||||||||||||||||||||
Cost |
1,076 | 1,078 | 1,067 | 1,026 | 1,080 | | | |||||||||||||||||||||||||||||||||
Total Private Equity Portfolio Carrying Value |
$ | 7,153 | $ | 6,584 | $ | 6,524 | $ | 6,427 | $ | 6,081 | 9 | 18 | ||||||||||||||||||||||||||||
Total Private Equity Portfolio Cost |
$ | 6,231 | $ | 6,372 | $ | 6,662 | $ | 6,966 | $ | 7,326 | (2 | ) | (15 | ) | ||||||||||||||||||||||||||
(a) | Losses reflected repositioning of the Treasury investment securities portfolio. Excludes gains/losses on securities used to manage risk associated with MSRs. | |
(b) | Held-for-investment prime mortgage loans were transferred from RFS and AM to the Corporate segment for risk management and reporting purposes. The transfers had no material impact on the financial results of Corporate. | |
(c) | The Firm adopted SFAS 157 in the first quarter of 2007. For additional information, see the Firms September 30, 2007, Form 10-Q. The 2007 quarters and full year included the reclassification of certain private equity carried interest from Total net revenue to Compensation expense. | |
(d) | Included in Principal Transactions revenue in the Consolidated statements of income. |
Page 25
JPMORGAN CHASE & CO. CREDIT-RELATED INFORMATION |
Dec 31, 2007 | ||||||||||||||||||||||||||||
Change | ||||||||||||||||||||||||||||
Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Dec 31 | ||||||||||||||||||||||
2007 | 2007 | 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||||||||
CREDIT EXPOSURE |
||||||||||||||||||||||||||||
WHOLESALE (a) |
||||||||||||||||||||||||||||
Loans U.S. |
$ | 133,253 | $ | 126,343 | $ | 111,082 | $ | 108,627 | $ | 118,686 | 5 | % | 12 | % | ||||||||||||||
Loans Non-U.S. |
79,823 | 71,385 | 70,886 | 59,567 | 65,056 | 12 | 23 | |||||||||||||||||||||
TOTAL WHOLESALE LOANS REPORTED (b) |
213,076 | 197,728 | 181,968 | 168,194 | 183,742 | 8 | 16 | |||||||||||||||||||||
CONSUMER (c) |
||||||||||||||||||||||||||||
Home Equity |
94,832 | 93,026 | 90,989 | 87,741 | 85,730 | 2 | 11 | |||||||||||||||||||||
Mortgage (includes RFS and Corporate) |
56,031 | 47,730 | 43,114 | 46,574 | 59,668 | 17 | (6 | ) | ||||||||||||||||||||
Auto Loans and Leases |
42,350 | 40,871 | 41,231 | 40,937 | 41,009 | 4 | 3 | |||||||||||||||||||||
Credit Card Reported |
84,352 | 79,409 | 80,495 | 78,173 | 85,881 | 6 | (2 | ) | ||||||||||||||||||||
Other Loans |
28,733 | 27,556 | 27,240 | 28,146 | 27,097 | 4 | 6 | |||||||||||||||||||||
TOTAL CONSUMER LOANS REPORTED (d) |
306,298 | 288,592 | 283,069 | 281,571 | 299,385 | 6 | 2 | |||||||||||||||||||||
TOTAL LOANS REPORTED |
519,374 | 486,320 | 465,037 | 449,765 | 483,127 | 7 | 8 | |||||||||||||||||||||
Credit Card Securitizations |
72,701 | 69,643 | 67,506 | 68,403 | 66,950 | 4 | 9 | |||||||||||||||||||||
TOTAL LOANS MANAGED |
592,075 | 555,963 | 532,543 | 518,168 | 550,077 | 6 | 8 | |||||||||||||||||||||
Derivative Receivables |
77,136 | 64,592 | 59,038 | 49,647 | 55,601 | 19 | 39 | |||||||||||||||||||||
TOTAL CREDIT-RELATED ASSETS |
669,211 | 620,555 | 591,581 | 567,815 | 605,678 | 8 | 10 | |||||||||||||||||||||
Wholesale Lending-Related Commitments |
446,652 | 468,145 | 435,718 | 412,382 | 391,424 | (5 | ) | 14 | ||||||||||||||||||||
TOTAL |
$ | 1,115,863 | $ | 1,088,700 | $ | 1,027,299 | $ | 980,197 | $ | 997,102 | 2 | 12 | ||||||||||||||||
Memo: Total by Category |
||||||||||||||||||||||||||||
Total Wholesale Exposure (e) |
$ | 736,864 | $ | 730,465 | $ | 676,724 | $ | 630,223 | $ | 630,767 | 1 | 17 | ||||||||||||||||
Total Consumer Managed Loans (f) |
378,999 | 358,235 | 350,575 | 349,974 | 366,335 | 6 | 3 | |||||||||||||||||||||
Total |
$ | 1,115,863 | $ | 1,088,700 | $ | 1,027,299 | $ | 980,197 | $ | 997,102 | 2 | 12 | ||||||||||||||||
Risk Profile of Wholesale Credit Exposure: |
||||||||||||||||||||||||||||
Investment-Grade (g) |
$ | 571,394 | $ | 548,663 | $ | 532,134 | $ | 487,309 | $ | 490,185 | 4 | 17 | ||||||||||||||||
Noninvestment-Grade: (g) |
||||||||||||||||||||||||||||
Noncriticized |
134,983 | 155,172 | 127,818 | 121,981 | 113,049 | (13 | ) | 19 | ||||||||||||||||||||
Criticized Performing |
6,267 | 5,605 | 4,964 | 5,090 | 4,599 | 12 | 36 | |||||||||||||||||||||
Criticized Nonperforming |
571 | 414 | 252 | 263 | 427 | 38 | 34 | |||||||||||||||||||||
Total Noninvestment-Grade |
141,821 | 161,191 | 133,034 | 127,334 | 118,075 | (12 | ) | 20 | ||||||||||||||||||||
Loans Held-for-Sale & Loans at Fair Value |
23,649 | 20,611 | 11,556 | 15,580 | 22,256 | 15 | 6 | |||||||||||||||||||||
Purchased Nonperforming Wholesale Loans (h) |
| | | | 251 | | NM | |||||||||||||||||||||
Total Wholesale Exposure |
$ | 736,864 | $ | 730,465 | $ | 676,724 | $ | 630,223 | $ | 630,767 | 1 | 17 | ||||||||||||||||
(a) | Includes Investment Bank, Commercial Banking, Treasury & Securities Services and Asset Management. | |
(b) | Includes Loans held-for-sale & loans at fair value. As a result of the adoption of SFAS 159 in the first quarter of 2007, $11.7 billion of IB loans were reclassified to Trading assets and excluded from wholesale loans reported. | |
(c) | Includes Retail Financial Services, Card Services and residential mortgage loans reported in the Corporate segment to be risk managed by the Chief Investment Office. | |
(d) | As a result of the adoption of SFAS 159, certain IB loans are accounted for at fair value and reported in Trading assets and therefore, are no longer included in Loans beginning January 1, 2007. | |
(e) | Represents Total Wholesale Loans, Derivative Receivables and Wholesale Lending-Related Commitments. | |
(f) | Represents Total Consumer Loans plus Credit Card Securitizations, and excludes consumer lending-related commitments. | |
(g) | Excludes Loans held-for-sale & loans at fair value. | |
(h) | Represents distressed held-for-sale wholesale loans purchased as part of IBs proprietary activities, which were excluded from nonperforming assets. During the first quarter of 2007, the Firm elected the fair value option of accounting for this portfolio of nonperforming loans. These loans were classified as trading assets for quarters ending on or after March 31, 2007. |
Note: | The risk profile is based on JPMorgan Chases internal risk ratings, which
generally correspond to the following ratings as defined by Standard & Poors /
Moodys: Investment-Grade: AAA / Aaa to BBB- / Baa3 Noninvestment-Grade: BB+ / Ba1 and below |
Page 26
JPMORGAN CHASE & CO. CREDIT-RELATED INFORMATION, CONTINUED |
Dec 31, 2007 | ||||||||||||||||||||||||||||
Change | ||||||||||||||||||||||||||||
Dec 31 | Sep 30 | Jun 30 | Mar 31 | Dec 31 | Sep 30 | Dec 31 | ||||||||||||||||||||||
2007 | 2007 | 2007 | 2007 | 2006 | 2007 | 2006 | ||||||||||||||||||||||
NONPERFORMING ASSETS AND RATIOS |
||||||||||||||||||||||||||||
WHOLESALE LOANS (a) |
||||||||||||||||||||||||||||
Loans U.S. |
$ | 490 | $ | 401 | $ | 190 | $ | 205 | $ | 309 | 22 | % | 59 | % | ||||||||||||||
Loans Non-U.S. |
24 | 26 | 38 | 62 | 82 | (8 | ) | (71 | ) | |||||||||||||||||||
TOTAL WHOLESALE LOANS-REPORTED |
514 | 427 | 228 | 267 | 391 | 20 | 31 | |||||||||||||||||||||
CONSUMER LOANS (b) |
||||||||||||||||||||||||||||
Home Equity |
810 | 576 | 483 | 459 | 454 | 41 | 78 | |||||||||||||||||||||
Mortgage (includes RFS and Corporate) |
1,798 | 1,224 | 1,034 | 960 | 769 | 47 | 134 | |||||||||||||||||||||
Auto Loans and Leases |
116 | 92 | 81 | 95 | 132 | 26 | (12 | ) | ||||||||||||||||||||
Credit Card Reported |
7 | 7 | 8 | 9 | 9 | | (22 | ) | ||||||||||||||||||||
Other Loans |
341 | 336 | 335 | 326 | 322 | 1 | 6 | |||||||||||||||||||||
TOTAL CONSUMER LOANS-REPORTED (c) |
3,072 | 2,235 | 1,941 | 1,849 | 1,686 | 37 | 82 | |||||||||||||||||||||
TOTAL LOANS REPORTED |
3,586 | 2,662 | 2,169 | 2,116 | 2,077 | 35 | 73 | |||||||||||||||||||||
Derivative Receivables |
29 | 34 | 30 | 36 | 36 | (15 | ) | (19 | ) | |||||||||||||||||||
Assets Acquired in Loan Satisfactions |
622 | 485 | 387 | 269 | 228 | 28 | 173 | |||||||||||||||||||||
TOTAL NONPERFORMING ASSETS |
$ | 4,237 | $ | 3,181 | $ | 2,586 | $ | 2,421 | $ | 2,341 | 33 | 81 | ||||||||||||||||
TOTAL NONPERFORMING LOANS TO TOTAL LOANS |
0.69 | % | 0.55 | % | 0.47 | % | 0.47 | % | 0.43 | % | ||||||||||||||||||
NONPERFORMING ASSETS BY LOB |
||||||||||||||||||||||||||||
Investment Bank |
$ | 453 | $ | 325 | $ | 119 | $ | 128 | $ | 269 | 39 | 68 | ||||||||||||||||
Retail Financial Services |
3,121 | 2,387 | 2,097 | 1,910 | 1,902 | 31 | 64 | |||||||||||||||||||||
Card Services |
7 | 7 | 8 | 9 | 9 | | (22 | ) | ||||||||||||||||||||
Commercial Banking |
148 | 136 | 137 | 142 | 122 | 9 | 21 | |||||||||||||||||||||
Treasury & Securities Services |
| | | | | | ||||||||||||||||||||||
Asset Management |
12 | 28 | 21 | 35 | 39 | (57 | ) | (69 | ) | |||||||||||||||||||
Corporate (d) |
496 | 298 | 204 | 197 | | 66 | NM | |||||||||||||||||||||
TOTAL |
$ | 4,237 | $ | 3,181 | $ | 2,586 | $ | 2,421 | $ | 2,341 | 33 | 81 | ||||||||||||||||
(a) | Included nonperforming loans held-for-sale of $45 million, $75 million, $25 million, $4 million, and $4 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. Excluded purchased held-for-sale wholesale loans. | |
(b) | There were no nonperforming loans held-for-sale at December 31, 2007 and September 30, 2007, while there were $215 million, $112 million, and $116 million at June 30, 2007, March 31, 2007, and December 31, 2006, respectively. | |
(c) | Nonperforming loans and assets excluded (1) loans eligible for repurchase as well as loans repurchased from GNMA pools that are insured by U.S. government agencies of $1.5 billion, $1.3 billion, $1.2 billion, $1.3 billion, and $1.2 billion at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively, and (2) education loans that are 90 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $279 million, $241 million, $200 million, $178 million, and $219 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. These amounts for GNMA and education loans are excluded, as reimbursement is proceeding normally. | |
(d) | Primarily relates to held-for-investment prime mortgage loans transferred from RFS and AM to the Corporate segment. |
Page 27
JPMORGAN CHASE & CO. CREDIT-RELATED INFORMATION, CONTINUED |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
GROSS CHARGE-OFFS |
||||||||||||||||||||||||||||||||||||||||
Wholesale Loans |
$ | 54 | $ | 101 | $ | 13 | $ | 17 | $ | 76 | (47 | )% | (29 | )% | $ | 185 | $ | 186 | (1 | )% | ||||||||||||||||||||
Consumer (includes RFS and Corporate) |
582 | 403 | 321 | 241 | 266 | 44 | 119 | 1,547 | 802 | 93 | ||||||||||||||||||||||||||||||
Credit Card Reported |
1,000 | 911 | 877 | 847 | 801 | 10 | 25 | 3,635 | 2,896 | 26 | ||||||||||||||||||||||||||||||
Total Loans Reported |
1,636 | 1,415 | 1,211 | 1,105 | 1,143 | 16 | 43 | 5,367 | 3,884 | 38 | ||||||||||||||||||||||||||||||
Credit Card Securitizations |
716 | 679 | 704 | 702 | 694 | 5 | 3 | 2,801 | 2,579 | 9 | ||||||||||||||||||||||||||||||
Total Loans Managed |
2,352 | 2,094 | 1,915 | 1,807 | 1,837 | 12 | 28 | 8,168 | 6,463 | 26 | ||||||||||||||||||||||||||||||
RECOVERIES |
||||||||||||||||||||||||||||||||||||||||
Wholesale Loans |
29 | 19 | 42 | 23 | 48 | 53 | (40 | ) | 113 | 208 | (46 | ) | ||||||||||||||||||||||||||||
Consumer (includes RFS and Corporate) |
47 | 49 | 48 | 53 | 52 | (4 | ) | (10 | ) | 197 | 226 | (13 | ) | |||||||||||||||||||||||||||
Credit Card Reported |
131 | 126 | 136 | 126 | 113 | 4 | 16 | 519 | 408 | 27 | ||||||||||||||||||||||||||||||
Total Loans Reported |
207 | 194 | 226 | 202 | 213 | 7 | (3 | ) | 829 | 842 | (2 | ) | ||||||||||||||||||||||||||||
Credit Card Securitizations |
97 | 101 | 114 | 109 | 101 | (4 | ) | (4 | ) | 421 | 369 | 14 | ||||||||||||||||||||||||||||
Total Loans Managed |
304 | 295 | 340 | 311 | 314 | 3 | (3 | ) | 1,250 | 1,211 | 3 | |||||||||||||||||||||||||||||
NET CHARGE-OFFS |
||||||||||||||||||||||||||||||||||||||||
Wholesale Loans |
25 | 82 | (29 | ) | (6 | ) | 28 | (70 | ) | (11 | ) | 72 | (22 | ) | NM | |||||||||||||||||||||||||
Consumer (includes RFS and Corporate) |
535 | 354 | 273 | 188 | 214 | 51 | 150 | 1,350 | 576 | 134 | ||||||||||||||||||||||||||||||
Credit Card Reported |
869 | 785 | 741 | 721 | 688 | 11 | 26 | 3,116 | 2,488 | 25 | ||||||||||||||||||||||||||||||
Total Loans Reported |
1,429 | 1,221 | 985 | 903 | 930 | 17 | 54 | 4,538 | 3,042 | 49 | ||||||||||||||||||||||||||||||
Credit Card Securitizations |
619 | 578 | 590 | 593 | 593 | 7 | 4 | 2,380 | 2,210 | 8 | ||||||||||||||||||||||||||||||
Total Loans Managed |
$ | 2,048 | $ | 1,799 | $ | 1,575 | $ | 1,496 | $ | 1,523 | 14 | 34 | $ | 6,918 | $ | 5,252 | 32 | |||||||||||||||||||||||
NET CHARGE-OFF RATES ANNUALIZED |
||||||||||||||||||||||||||||||||||||||||
Wholesale Loans (a) |
0.05 | % | 0.19 | % | (0.07 | )% | (0.02 | )% | 0.07 | % | 0.04 | % | (0.01 | )% | ||||||||||||||||||||||||||
Consumer (includes RFS and Corporate) (b) |
1.01 | 0.70 | 0.57 | 0.47 | 0.45 | 0.69 | 0.31 | |||||||||||||||||||||||||||||||||
Credit Card Reported |
4.36 | 3.89 | 3.76 | 3.57 | 3.35 | 3.90 | 3.37 | |||||||||||||||||||||||||||||||||
Total Loans Reported (a) (b) |
1.19 | 1.07 | 0.90 | 0.85 | 0.84 | 1.00 | 0.73 | |||||||||||||||||||||||||||||||||
Credit Card Securitizations |
3.38 | 3.34 | 3.46 | 3.56 | 3.57 | 3.43 | 3.28 | |||||||||||||||||||||||||||||||||
Total Loans Managed (a) (b) |
1.48 | 1.37 | 1.25 | 1.22 | 1.20 | 1.33 | 1.09 | |||||||||||||||||||||||||||||||||
Memo: Credit Card Managed |
3.89 | 3.64 | 3.62 | 3.57 | 3.45 | 3.68 | 3.33 |
(a) | Average wholesale Loans held-for-sale & loans at fair value were $26.8 billion, $17.8 billion, $15.5 billion, $14.2 billion, and $24.5 billion for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively, and $18.6 billion and $22.2 billion for full year 2007 and 2006, respectively. These amounts were excluded when calculating the net charge-off rates. | |
(b) | Average consumer (excluding card) Loans held-for-sale & loans at fair value were $4.0 billion, $5.4 billion, $11.7 billion, $21.7 billion, and $21.2 billion for the quarters ended December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively, and $10.6 billion and $16.1 billion for full year 2007 and 2006, respectively. These amounts were excluded when calculating the net charge-off rates. |
Page 28
JPMORGAN CHASE & CO. CREDIT-RELATED INFORMATION, CONTINUED |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
SUMMARY OF CHANGES IN THE ALLOWANCE FOR LOAN LOSSES |
||||||||||||||||||||||||||||||||||||||||
Beginning Balance |
$ | 8,113 | $ | 7,633 | $ | 7,300 | $ | 7,279 | $ | 7,056 | 6 | % | 15 | % | $ | 7,279 | $ | 7,090 | 3 | % | ||||||||||||||||||||
Net Charge-Offs |
(1,429 | ) | (1,221 | ) | (985 | ) | (903 | ) | (930 | ) | (17 | ) | (54 | ) | (4,538 | ) | (3,042 | ) | (49 | ) | ||||||||||||||||||||
Provision for Loan Losses |
2,550 | 1,693 | 1,316 | 979 | 1,085 | 51 | 135 | 6,538 | 3,153 | 107 | ||||||||||||||||||||||||||||||
Other (a) (b) |
| 8 | 2 | (55 | ) | 68 | NM | NM | (45 | ) | 78 | NM | ||||||||||||||||||||||||||||
Ending Balance |
$ | 9,234 | $ | 8,113 | $ | 7,633 | $ | 7,300 | $ | 7,279 | 14 | 27 | $ | 9,234 | $ | 7,279 | 27 | |||||||||||||||||||||||
SUMMARY OF CHANGES IN THE ALLOWANCE FOR
LENDING-RELATED COMMITMENTS |
||||||||||||||||||||||||||||||||||||||||
Beginning Balance |
$ | 858 | $ | 766 | $ | 553 | $ | 524 | $ | 468 | 12 | 83 | $ | 524 | $ | 400 | 31 | |||||||||||||||||||||||
Provision for Lending-Related Commitments |
(8 | ) | 92 | 213 | 29 | 49 | NM | NM | 326 | 117 | 179 | |||||||||||||||||||||||||||||
Other (b) |
| | | | 7 | | NM | | 7 | NM | ||||||||||||||||||||||||||||||
Ending Balance |
$ | 850 | $ | 858 | $ | 766 | $ | 553 | $ | 524 | (1 | ) | 62 | $ | 850 | $ | 524 | 62 | ||||||||||||||||||||||
ALLOWANCE COMPONENTS AND RATIOS |
||||||||||||||||||||||||||||||||||||||||
ALLOWANCE FOR LOAN LOSSES |
||||||||||||||||||||||||||||||||||||||||
Wholesale |
||||||||||||||||||||||||||||||||||||||||
Asset Specific |
$ | 108 | $ | 53 | $ | 52 | $ | 54 | $ | 51 | 104 | 112 | ||||||||||||||||||||||||||||
Formula Based |
3,046 | 2,810 | 2,650 | 2,639 | 2,660 | 8 | 15 | |||||||||||||||||||||||||||||||||
Total Wholesale |
3,154 | 2,863 | 2,702 | 2,693 | 2,711 | 10 | 16 | |||||||||||||||||||||||||||||||||
Consumer |
||||||||||||||||||||||||||||||||||||||||
Asset Specific |
$ | 80 | $ | 70 | $ | 81 | $ | 70 | $ | 67 | 14 | 19 | ||||||||||||||||||||||||||||
Formula Based |
6,000 | 5,180 | 4,850 | 4,537 | 4,501 | 16 | 33 | |||||||||||||||||||||||||||||||||
Total Consumer (c) |
6,080 | 5,250 | 4,931 | 4,607 | 4,568 | 16 | 33 | |||||||||||||||||||||||||||||||||
Total Allowance for Loan Losses |
9,234 | 8,113 | 7,633 | 7,300 | 7,279 | 14 | 27 | |||||||||||||||||||||||||||||||||
Allowance for Lending-Related Commitments |
850 | 858 | 766 | 553 | 524 | (1 | ) | 62 | ||||||||||||||||||||||||||||||||
Total Allowance for Credit Losses |
$ | 10,084 | $ | 8,971 | $ | 8,399 | $ | 7,853 | $ | 7,803 | 12 | 29 | ||||||||||||||||||||||||||||
Wholesale Allowance for Loan Losses to Total Wholesale Loans (d) |
1.67 | % | 1.62 | % | 1.59 | % | 1.76 | % | 1.68 | % | ||||||||||||||||||||||||||||||
Consumer Allowance for Loan Losses to Total Consumer Loans (e) |
2.01 | 1.84 | 1.79 | 1.72 | 1.71 | |||||||||||||||||||||||||||||||||||
Allowance for Loan Losses to Total Loans (d) (e) |
1.88 | 1.76 | 1.71 | 1.74 | 1.70 | |||||||||||||||||||||||||||||||||||
Allowance for Loan Losses to Total Nonperforming Loans (f) |
261 | 314 | 396 | 365 | 372 | |||||||||||||||||||||||||||||||||||
ALLOWANCE FOR LOAN LOSSES BY LOB |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | 1,329 | $ | 1,112 | $ | 1,037 | $ | 1,037 | $ | 1,052 | 20 | 26 | ||||||||||||||||||||||||||||
Retail Financial Services |
2,634 | 2,105 | 1,772 | 1,453 | 1,392 | 25 | 89 | |||||||||||||||||||||||||||||||||
Card Services |
3,407 | 3,107 | 3,096 | 3,092 | 3,176 | 10 | 7 | |||||||||||||||||||||||||||||||||
Commercial Banking |
1,695 | 1,623 | 1,551 | 1,531 | 1,519 | 4 | 12 | |||||||||||||||||||||||||||||||||
Treasury & Securities Services |
18 | 13 | 9 | 11 | 7 | 38 | 157 | |||||||||||||||||||||||||||||||||
Asset Management |
112 | 115 | 105 | 114 | 121 | (3 | ) | (7 | ) | |||||||||||||||||||||||||||||||
Corporate (g) |
39 | 38 | 63 | 62 | 12 | 3 | 225 | |||||||||||||||||||||||||||||||||
Total |
$ | 9,234 | $ | 8,113 | $ | 7,633 | $ | 7,300 | $ | 7,279 | 14 | 27 | ||||||||||||||||||||||||||||
(a) | First quarter of 2007 primarily relates to the Firms adoption of SFAS 159, effective January 1, 2007. | |
(b) | Fourth quarter and full year 2006 primarily reflect The Bank of New York transaction. | |
(c) | Includes RFS, Card Services and Corporate. | |
(d) | Wholesale Loans held-for-sale & loans at fair value were $23.6 billion, $20.6 billion, $11.6 billion, $15.6 billion, and $22.5 billion at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. These amounts were excluded when calculating the allowance coverage ratios. | |
(e) | Consumer Loans held-for-sale were $4.0 billion, $3.9 billion, $8.3 billion, $13.4 billion, and $32.7 billion at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. These amounts were excluded when calculating the allowance coverage ratios. | |
(f) | Nonperforming Loans held-for-sale were $45 million, $75 million, $240 million, $116 million, and $120 million at December 31, 2007, September 30, 2007, June 30, 2007, March 31, 2007, and December 31, 2006, respectively. These amounts were excluded when calculating the allowance coverage ratios. | |
(g) | March 31, 2007 included $50 million associated with mortgages originated by RFS and AM and transferred to Corporate to be risk managed by the Chief Investment Office. |
Page 29
JPMORGAN CHASE & CO. CREDIT-RELATED INFORMATION, CONTINUED |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
PROVISION FOR CREDIT LOSSES |
||||||||||||||||||||||||||||||||||||||||
LOANS |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | 208 | $ | 146 | $ | (13 | ) | $ | 35 | $ | 50 | 42 | % | 316 | % | $ | 376 | $ | 112 | 236 | % | |||||||||||||||||||
Commercial Banking |
105 | 98 | 10 | 17 | 86 | 7 | 22 | 230 | 133 | 73 | ||||||||||||||||||||||||||||||
Treasury & Securities Services |
5 | 3 | (1 | ) | 4 | (2 | ) | 67 | NM | 11 | (1 | ) | NM | |||||||||||||||||||||||||||
Asset Management |
(2 | ) | 4 | (13 | ) | (8 | ) | 12 | NM | NM | (19 | ) | (30 | ) | 37 | |||||||||||||||||||||||||
Corporate |
| | | | (2 | ) | | NM | | (1 | ) | NM | ||||||||||||||||||||||||||||
Total Wholesale |
316 | 251 | (17 | ) | 48 | 144 | 26 | 119 | 598 | 213 | 181 | |||||||||||||||||||||||||||||
Retail Financial Services |
1,051 | 688 | 589 | 292 | 253 | 53 | 315 | 2,620 | 552 | 375 | ||||||||||||||||||||||||||||||
Card Services |
1,169 | 785 | 741 | 636 | 688 | 49 | 70 | 3,331 | 2,388 | 39 | ||||||||||||||||||||||||||||||
Corporate (a) |
14 | (31 | ) | 3 | 3 | | NM | NM | (11 | ) | | NM | ||||||||||||||||||||||||||||
Total Consumer |
2,234 | 1,442 | 1,333 | 931 | 941 | 55 | 137 | 5,940 | 2,940 | 102 | ||||||||||||||||||||||||||||||
Total Provision for Loan Losses |
$ | 2,550 | $ | 1,693 | $ | 1,316 | $ | 979 | $ | 1,085 | 51 | 135 | $ | 6,538 | $ | 3,153 | 107 | |||||||||||||||||||||||
LENDING-RELATED COMMITMENTS |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | (8 | ) | $ | 81 | $ | 177 | $ | 28 | $ | 13 | NM | NM | $ | 278 | $ | 79 | 252 | ||||||||||||||||||||||
Commercial Banking |
| 14 | 35 | | 25 | NM | NM | 49 | 27 | 81 | ||||||||||||||||||||||||||||||
Treasury & Securities Services |
(1 | ) | 6 | 1 | 2 | | NM | NM | 8 | | NM | |||||||||||||||||||||||||||||
Asset Management |
1 | (1 | ) | 2 | (1 | ) | 2 | NM | (50 | ) | 1 | 2 | (50 | ) | ||||||||||||||||||||||||||
Total Wholesale |
(8 | ) | 100 | 215 | 29 | 40 | NM | NM | 336 | 108 | 211 | |||||||||||||||||||||||||||||
Retail Financial Services |
| (8 | ) | (2 | ) | | 9 | NM | NM | (10 | ) | 9 | NM | |||||||||||||||||||||||||||
Card Services |
| | | | | | | | | | ||||||||||||||||||||||||||||||
Total Consumer |
| (8 | ) | (2 | ) | | 9 | NM | NM | (10 | ) | 9 | NM | |||||||||||||||||||||||||||
Total Provision for Lending-Related Commitments |
$ | (8 | ) | $ | 92 | $ | 213 | $ | 29 | $ | 49 | NM | NM | $ | 326 | $ | 117 | 179 | ||||||||||||||||||||||
TOTAL PROVISION FOR CREDIT LOSSES |
||||||||||||||||||||||||||||||||||||||||
Investment Bank |
$ | 200 | $ | 227 | $ | 164 | $ | 63 | $ | 63 | (12 | ) | 217 | $ | 654 | $ | 191 | 242 | ||||||||||||||||||||||
Commercial Banking |
105 | 112 | 45 | 17 | 111 | (6 | ) | (5 | ) | 279 | 160 | 74 | ||||||||||||||||||||||||||||
Treasury & Securities Services |
4 | 9 | | 6 | (2 | ) | (56 | ) | NM | 19 | (1 | ) | NM | |||||||||||||||||||||||||||
Asset Management |
(1 | ) | 3 | (11 | ) | (9 | ) | 14 | NM | NM | (18 | ) | (28 | ) | 36 | |||||||||||||||||||||||||
Corporate |
| | | | (2 | ) | | NM | | (1 | ) | NM | ||||||||||||||||||||||||||||
Total Wholesale |
308 | 351 | 198 | 77 | 184 | (12 | ) | 67 | 934 | 321 | 191 | |||||||||||||||||||||||||||||
Retail Financial Services |
1,051 | 680 | 587 | 292 | 262 | 55 | 301 | 2,610 | 561 | 365 | ||||||||||||||||||||||||||||||
Card Services |
1,169 | 785 | 741 | 636 | 688 | 49 | 70 | 3,331 | 2,388 | 39 | ||||||||||||||||||||||||||||||
Corporate (a) |
14 | (31 | ) | 3 | 3 | | NM | NM | (11 | ) | | NM | ||||||||||||||||||||||||||||
Total Consumer |
2,234 | 1,434 | 1,331 | 931 | 950 | 56 | 135 | 5,930 | 2,949 | 101 | ||||||||||||||||||||||||||||||
Total Provision for Credit Losses |
2,542 | 1,785 | 1,529 | 1,008 | 1,134 | 42 | 124 | 6,864 | 3,270 | 110 | ||||||||||||||||||||||||||||||
Securitized Credit Losses |
619 | 578 | 590 | 593 | 593 | 7 | 4 | 2,380 | 2,210 | 8 | ||||||||||||||||||||||||||||||
Managed Provision for Credit Losses |
$ | 3,161 | $ | 2,363 | $ | 2,119 | $ | 1,601 | $ | 1,727 | 34 | 83 | $ | 9,244 | $ | 5,480 | 69 | |||||||||||||||||||||||
(a) | Includes amounts related to held-for-investment prime mortgages transferred from RFS and AM to the Corporate segment during 2007. |
Page 30
JPMORGAN CHASE & CO. CAPITAL |
QUARTERLY TRENDS | FULL YEAR | |||||||||||||||||||||||||||||||||||||||
4Q07 Change | 2007 Change | |||||||||||||||||||||||||||||||||||||||
4Q07 | 3Q07 | 2Q07 | 1Q07 | 4Q06 | 3Q07 | 4Q06 | 2007 | 2006 | 2006 | |||||||||||||||||||||||||||||||
COMMON SHARES OUTSTANDING |
||||||||||||||||||||||||||||||||||||||||
Weighted-Average Basic Shares Outstanding |
3,367.1 | # | 3,375.9 | # | 3,415.1 | # | 3,456.4 | # | 3,465.3 | # | | % | (3 | )% | 3,403.6 | # | 3,470.1 | # | (2 | )% | ||||||||||||||||||||
Weighted-Average Diluted Shares Outstanding |
3,471.8 | 3,477.7 | 3,521.6 | 3,559.5 | 3,578.6 | | (3 | ) | 3,507.6 | 3,573.9 | (2 | ) | ||||||||||||||||||||||||||||
Common Shares Outstanding at Period End |
3,367.4 | 3,358.8 | 3,398.5 | 3,416.3 | 3,461.7 | | (3 | ) | 3,367.4 | 3,461.7 | (3 | ) | ||||||||||||||||||||||||||||
Cash Dividends Declared per Share |
$ | 0.38 | $ | 0.38 | $ | 0.38 | $ | 0.34 | $ | 0.34 | | 12 | $ | 1.48 | $ | 1.36 | 9 | |||||||||||||||||||||||
Book Value per Share |
36.59 | 35.72 | 35.08 | 34.45 | 33.45 | 2 | 9 | 36.59 | 33.45 | 9 | ||||||||||||||||||||||||||||||
Dividend Payout (a) |
44 | % | 39 | % | 31 | % | 25 | % | 27 | % | 34 | % | 34 | % | ||||||||||||||||||||||||||
NET INCOME |
$ | 2,971 | $ | 3,373 | $ | 4,234 | $ | 4,787 | $ | 4,526 | (12 | ) | (34 | ) | $ | 15,365 | $ | 14,444 | 6 | |||||||||||||||||||||
Preferred Dividends |
| | | | | | 4 | |||||||||||||||||||||||||||||||||
Net Income Applicable to Common Stock |
$ | 2,971 | $ | 3,373 | $ | 4,234 | $ | 4,787 | $ | 4,526 | (12 | ) | (34 | ) | $ | 15,365 | $ | 14,440 | 6 | |||||||||||||||||||||
INCOME PER SHARE |
||||||||||||||||||||||||||||||||||||||||
Basic Earnings per Share |
||||||||||||||||||||||||||||||||||||||||
Income from continuing operations |
$ | 0.88 | $ | 1.00 | $ | 1.24 | $ | 1.38 | $ | 1.13 | (12 | ) | (22 | ) | $ | 4.51 | $ | 3.93 | 15 | |||||||||||||||||||||
Net Income |
0.88 | 1.00 | 1.24 | 1.38 | 1.31 | (12 | ) | (33 | ) | 4.51 | 4.16 | 8 | ||||||||||||||||||||||||||||
Diluted Earnings per Share |
||||||||||||||||||||||||||||||||||||||||
Income from continuing operations |
$ | 0.86 | $ | 0.97 | $ | 1.20 | $ | 1.34 | $ | 1.09 | (11 | ) | (21 | ) | $ | 4.38 | $ | 3.82 | 15 | |||||||||||||||||||||
Net Income |
0.86 | 0.97 | 1.20 | 1.34 | 1.26 | (11 | ) | (32 | ) | 4.38 | 4.04 | 8 | ||||||||||||||||||||||||||||
SHARE PRICE |
||||||||||||||||||||||||||||||||||||||||
High |
$ | 48.02 | $ | 50.48 | $ | 53.25 | $ | 51.95 | $ | 49.00 | (5 | ) | (2 | ) | $ | 53.25 | $ | 49.00 | 9 | |||||||||||||||||||||
Low |
40.15 | 42.16 | 47.70 | 45.91 | 45.51 | (5 | ) | (12 | ) | 40.15 | 37.88 | 6 | ||||||||||||||||||||||||||||
Close |
43.65 | 45.82 | 48.45 | 48.38 | 48.30 | (5 | ) | (10 | ) | 43.65 | 48.30 | (10 | ) | |||||||||||||||||||||||||||
Market Capitalization |
146,986 | 153,901 | 164,659 | 165,280 | 167,199 | (4 | ) | (12 | ) | 146,986 | 167,199 | (12 | ) | |||||||||||||||||||||||||||
STOCK REPURCHASE PROGRAM (b) |
||||||||||||||||||||||||||||||||||||||||
Aggregate Repurchases |
$ | 163.3 | $ | 2,135.4 | $ | 1,875.3 | $ | 4,000.9 | $ | 1,000.3 | (92 | ) | (84 | ) | $ | 8,174.9 | $ | 3,936.1 | 108 | |||||||||||||||||||||
Common Shares Repurchased |
3.6 | # | 47.0 | # | 36.7 | # | 80.9 | # | 21.1 | # | (92 | ) | (83 | ) | 168.2 | # | 90.7 | # | 85 | |||||||||||||||||||||
Average Purchase Price |
$ | 45.29 | $ | 45.42 | $ | 51.13 | $ | 49.45 | $ | 47.33 | | (4 | ) | $ | 48.60 | $ | 43.41 | 12 | ||||||||||||||||||||||
CAPITAL RATIOS |
||||||||||||||||||||||||||||||||||||||||
Tier 1 Capital |
$ | 88,703 | (c) | $ | 86,096 | $ | 85,096 | $ | 82,538 | $ | 81,055 | 3 | 9 | |||||||||||||||||||||||||||
Total Capital |
132,242 | (c) | 128,543 | 122,276 | 115,142 | 115,265 | 3 | 15 | ||||||||||||||||||||||||||||||||
Risk-Weighted Assets |
1,050,112 | (c) | 1,028,551 | 1,016,031 | 972,813 | 935,909 | 2 | 12 | ||||||||||||||||||||||||||||||||
Adjusted Average Assets |
1,473,541 | (c) | 1,423,171 | 1,376,727 | 1,324,145 | 1,308,699 | 4 | 13 | ||||||||||||||||||||||||||||||||
Tier 1 Capital Ratio |
8.4 | %(c) | 8.4 | % | 8.4 | % | 8.5 | % | 8.7 | % | ||||||||||||||||||||||||||||||
Total Capital Ratio |
12.6 | (c) | 12.5 | 12.0 | 11.8 | 12.3 | ||||||||||||||||||||||||||||||||||
Tier 1 Leverage Ratio |
6.0 | (c) | 6.0 | 6.2 | 6.2 | 6.2 | ||||||||||||||||||||||||||||||||||
INTANGIBLE ASSETS (PERIOD-END) |
||||||||||||||||||||||||||||||||||||||||
Goodwill |
$ | 45,270 | $ | 45,335 | $ | 45,254 | $ | 45,063 | $ | 45,186 | | | ||||||||||||||||||||||||||||
Mortgage Servicing Rights |
8,632 | 9,114 | 9,499 | 7,937 | 7,546 | (5 | ) | 14 | ||||||||||||||||||||||||||||||||
Purchased Credit Card Relationships |
2,303 | 2,427 | 2,591 | 2,758 | 2,935 | (5 | ) | (22 | ) | |||||||||||||||||||||||||||||||
All Other Intangibles |
3,796 | 3,959 | 4,103 | 4,205 | 4,371 | (4 | ) | (13 | ) | |||||||||||||||||||||||||||||||
Total Intangibles |
$ | 60,001 | $ | 60,835 | $ | 61,447 | $ | 59,963 | $ | 60,038 | (1 | ) | | |||||||||||||||||||||||||||
(a) | Based on Net income amounts. | |
(b) | Excludes commission costs. | |
(c) | Estimated. |
Page 31
JPMORGAN CHASE & CO. Glossary of Terms |
Page 32
JPMORGAN CHASE & CO. Line of Business Metrics |
a) | Servicing revenue represents all gross income earned from servicing third-party mortgage loans including stated service fees, excess service fees, late fees, and other ancillary fees. | ||
b) | Changes in MSR asset fair value due to: |
| market-based inputs such as interest rates and volatility, as well as updates to assumptions used in the MSR valuation model. | ||
| modeled servicing portfolio runoff (or time decay) |
c) | Derivative valuation adjustments and other, which represents changes in the fair value of derivative instruments used to offset the impact of changes in the market-based inputs to the MSR valuation model. |
Page 33
JPMORGAN CHASE & CO. Line of Business Metrics (continued) |
Page 34