/The war in Ukraine ruined the profits of one of the world's largest banks
The war in Ukraine ruined the profits of one of the world's largest banks

The war in Ukraine ruined the profits of one of the world's largest banks

JPMorgan Chase said on Wednesday that its first-quarter profit had fallen sharply from a year earlier, driven by rising spending on bad loans and market turmoil caused by the war in Ukraine. According to her report, earnings fell 42 percent year-over-year to $ 8.28 billion, or $ 2.63 a share. Revenue fell more modestly, by 5% to $ 31.59 billion, beating analysts’ forecast for the quarter.

Shares of the New York-based bank fell 3.2% in early trading

JPMorgan’s quarterly results illustrate how quickly events have changed the outlook for the industry. A year ago, the bank’s chief executive, Jamie Dimon, predicted long-term economic expansion and positive results after billions of dollars in loan loss reserves were released. Now, amid rampant inflation and Europe’s worst post-World War II conflict, he has drawn attention to the opposite – the possibility of a recession.

JPMorgan said it had amassed $ 902 million to build credit reserves for expected loan losses, up from $ 5.2 billion last year. The bank also reported losses of $ 524 million due to cuts and widening spreads following Russia’s invasion of its neighbor.

Dimon said he had amassed credit reserves because of the “greater likelihood of a downturn” in the US economy, in particular the impact of high inflation and the conflict in Ukraine.

We remain optimistic about the economy, at least in the short term – consumer and business balances and consumer spending remain stable – but we see significant geopolitical and economic challenges ahead due to high inflation, supply chain problems and the war in Ukraine, “said Dimon.

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