JPMorgan profit drops 76 pct to $702 million

Bloomberg

Fourth-quarter net income was $702 million, or 7 cents a share, compared with $2.97 billion, or 86 cents, a year earlier, the New York-based bank said yesterday in a statement.

JPMorgan’s $20.5 billion of writedowns, losses and credit provisions through the third quarter were less than a third of those at Citigroup, which was forced to sell control of its Smith Barney brokerage to Morgan Stanley for $2.7 billion. Chief Executive Officer Jamie Dimon has used JPMorgan’s relative strength to acquire troubled rivals, including Bear Stearns in March and Washington Mutual in September.

"JPM is better positioned against deteriorating loan portfolios than many of its peers given its strong loan-loss reserves," KBW analyst David Konrad wrote in a Jan. 14 research note.

JPMorgan, which moved up its earnings announcement by six days, is the first of the largest U.S. banks to disclose fourth-quarter figures. New York-based Citigroup reports today, and Bank of America, which bought Merrill Lynch two weeks ago, is scheduled to release results on Jan. 20. San Francisco-based Wells Fargo will follow on Jan. 28 as it JPMorgan lost 34 percent of market value in the past year. Citigroup tumbled 83 percent in the past 12 months, Bank of America dropped 73 percent and Morgan Stanley declined 64 percent.JPMorgan has issued $17.9 billion of debt backed by the Federal Deposit Insurance Corp. under the Temporary Liquidity Guarantee Program, which insures bank debt issued through June.