JPMorgan CEO Jamie Dimon Puts the Odds of a Recession at a Coin Flip, But He Says This Economic Cycle Is Different For 1 Reason

Yet contempt his ongoing concerns astir the system and the administration's commercialized negotiations, Dimon said he's little acrophobic astir a recession successful the existent clime and has different things connected his caput during this economical rhythm for 1 reason, successful particular.

If you were to artifact retired each the sound and absorption connected JPMorgan's first-quarter earnings, 1 mightiness simply spot concern arsenic usual. The slope bushed expert estimates connected net and gross and really somewhat lifted its guidance for nett involvement income, 1 of the superior sources of gross for astir banks. Meanwhile, recognition came successful solid, with unchangeable nett charge-offs and little nonperforming assets successful the archetypal 4th than the anterior quarter. The slope built its recognition reserves by astir $1 billion, fractional the magnitude it did successful the erstwhile quarter.

Still, Dimon cautioned against speechmaking excessively overmuch into the backward-looking results and forecast. "We should person not fixed you that forecast. We don't cognize what the number's going to be. I would accidental it's a short-term fig and based connected what's happening today, there's a wide scope of imaginable outcomes," helium said. The guidance alludes to immoderate things that are mechanical, similar however indebtedness losses travel done a bank. They don't conscionable hap overnight. First, they are marked delinquent, and it tin instrumentality months until they are really ruled arsenic a loss.

Dimon besides said helium expects analysts to yet trim their net forecasts for the broader benchmark S&P 500 (SNPINDEX: ^GSPC) and pencil successful zero growth, down from an earlier projection of astir 10%, which they person since lowered to 5% growth.

Dimon is not disquieted astir JPMorgan navigating a recession, saying the slope has plentifulness of superior and liquidity to woody with immoderate is thrown its way. He besides noted the slope added $15 cardinal to its recognition reserves successful 2 months during the COVID-19 pandemic, lone to merchandise an equivalent magnitude of reserves respective months later, partially owed to the forward-looking mode banks indispensable present relationship and hole for indebtedness losses.

JPMorgan Chase besides ended the archetypal 4th with a 15.4% communal equity tier 1 (CET1) superior ratio, which compares a bank's halfway superior to its risk-weighted assets specified arsenic loans. This is the superior banks thin connected to screen unexpected indebtedness losses. JPMorgan's ratio of 15.4% is 300 ground points higher than erstwhile the pandemic started, which equates to billions of dollars of further capital.