JP Morgan and Merrill post second quarter results

by Gill Montia

Story link: JP Morgan and Merrill post second quarter results

US investment bank JP Morgan Chase has recorded second-quarter profits above market expectations.

The firm wrote down $1.1 billion during the quarter and net profit fell year-on-year by 53%, to $2 billion.

However, $540 million of the write down was in connection with the firm’s acquisition of Bear Stearns, in May.

The news was well received by Wall Street, although JP Morgan’s chief executive, Jamie Dimon, warned that markets conditions will deteriorate and that capital markets will remain under stress.

Mr Dimon added that he expects these factors to affect the business for the remainder of the year or longer.

The news from JP Morgan was followed by Merrill Lynch announcing a $4.65 billion loss during its second quarter.

The bank has now posted a loss for four consecutive quarters and says it plans to raise fresh capital by selling about $8 billion of assets.

This week, it announced the sale of its 20% stake in Bloomberg for $4.43 billion and confirmed plans to sell a controlling interest in its Financial Data Services unit.