For the quarterly period ended | Commission file |
March 31, 2019 | number 1-5805 |
Delaware | 13-2624428 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification no.) |
383 Madison Avenue, New York, New York | 10179 |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer x | Accelerated filer | o |
Non-accelerated filer o | Smaller reporting company | o |
Emerging growth company | o | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common stock | JPM | The New York Stock Exchange |
Depositary Shares, each representing a one-four hundredth interest in a share of 5.45% Non-Cumulative Preferred Stock, Series P | JPM PR A | The New York Stock Exchange |
Depositary Shares, each representing a one-four hundredth interest in a share of 6.30% Non-Cumulative Preferred Stock, Series W | JPM PR E | The New York Stock Exchange |
Depositary Shares, each representing a one-four hundredth interest in a share of 6.125% Non-Cumulative Preferred Stock, Series Y | JPM PR F | The New York Stock Exchange |
Depositary Shares, each representing a one-four hundredth interest in a share of 6.10% Non-Cumulative Preferred Stock, Series AA | JPM PR G | The New York Stock Exchange |
Depositary Shares, each representing a one-four hundredth interest in a share of 6.15% Non-Cumulative Preferred Stock, Series BB | JPM PR H | The New York Stock Exchange |
Depositary Shares, each representing a one-four hundredth interest in a share of 5.75% Non-Cumulative Preferred Stock, Series DD | JPM PR D | The New York Stock Exchange |
Depositary Shares, each representing a one-four hundredth interest in a share of 6.00% Non-Cumulative Preferred Stock, Series EE | JPM PR C | The New York Stock Exchange |
Alerian MLP Index ETNs due May 24, 2024 | AMJ | NYSE Arca, Inc. |
Guarantee of Callable Step-Up Fixed Rate Notes due April 26, 2028 of JPMorgan Chase Financial Company LLC | JPM/28 | The New York Stock Exchange |
Guarantee of Cushing 30 MLP Index ETNs due June 15, 2037 of JPMorgan Chase Financial Company LLC | PPLN | NYSE Arca, Inc. |
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As of or for the period ended, (in millions, except per share, ratio, headcount data and where otherwise noted) | |||||||||||||||||
1Q19 | 4Q18 | 3Q18 | 2Q18 | 1Q18 | |||||||||||||
Selected income statement data | |||||||||||||||||
Total net revenue | $ | 29,123 | $ | 26,109 | $ | 27,260 | $ | 27,753 | $ | 27,907 | |||||||
Total noninterest expense | 16,395 | 15,720 | 15,623 | 15,971 | 16,080 | ||||||||||||
Pre-provision profit | 12,728 | 10,389 | 11,637 | 11,782 | 11,827 | ||||||||||||
Provision for credit losses | 1,495 | 1,548 | 948 | 1,210 | 1,165 | ||||||||||||
Income before income tax expense | 11,233 | 8,841 | 10,689 | 10,572 | 10,662 | ||||||||||||
Income tax expense | 2,054 | 1,775 | 2,309 | 2,256 | 1,950 | ||||||||||||
Net income | $ | 9,179 | $ | 7,066 | $ | 8,380 | $ | 8,316 | $ | 8,712 | |||||||
Earnings per share data | |||||||||||||||||
Net income: Basic | $ | 2.65 | $ | 1.99 | $ | 2.35 | $ | 2.31 | $ | 2.38 | |||||||
Diluted | 2.65 | 1.98 | 2.34 | 2.29 | 2.37 | ||||||||||||
Average shares: Basic | 3,298.0 | 3,335.8 | 3,376.1 | 3,415.2 | 3,458.3 | ||||||||||||
Diluted | 3,308.2 | 3,347.3 | 3,394.3 | 3,434.7 | 3,479.5 | ||||||||||||
Market and per common share data | |||||||||||||||||
Market capitalization | 328,387 | 319,780 | 375,239 | 350,204 | 374,423 | ||||||||||||
Common shares at period-end | 3,244.0 | 3,275.8 | 3,325.4 | 3,360.9 | 3,404.8 | ||||||||||||
Book value per share | 71.78 | 70.35 | 69.52 | 68.85 | 67.59 | ||||||||||||
Tangible book value per share (“TBVPS”)(a) | 57.62 | 56.33 | 55.68 | 55.14 | 54.05 | ||||||||||||
Cash dividends declared per share | 0.80 | 0.80 | 0.80 | 0.56 | 0.56 | ||||||||||||
Selected ratios and metrics | |||||||||||||||||
Return on common equity (“ROE”)(b) | 16 | % | 12 | % | 14 | % | 14 | % | 15 | % | |||||||
Return on tangible common equity (“ROTCE”)(a)(b) | 19 | 14 | 17 | 17 | 19 | ||||||||||||
Return on assets(b) | 1.39 | 1.06 | 1.28 | 1.28 | 1.37 | ||||||||||||
Overhead ratio | 56 | 60 | 57 | 58 | 58 | ||||||||||||
Loans-to-deposits ratio | 64 | 67 | 65 | 65 | 63 | ||||||||||||
Liquidity coverage ratio (“LCR”) (average) | 111 | 113 | 115 | 115 | 115 | ||||||||||||
Common equity Tier 1 (“CET1”) capital ratio(c) | 12.1 | 12.0 | 12.0 | 12.0 | 11.8 | ||||||||||||
Tier 1 capital ratio(c) | 13.8 | 13.7 | 13.6 | 13.6 | 13.5 | ||||||||||||
Total capital ratio(c) | 15.7 | 15.5 | 15.4 | 15.5 | 15.3 | ||||||||||||
Tier 1 leverage ratio(c) | 8.1 | 8.1 | 8.2 | 8.2 | 8.2 | ||||||||||||
Supplementary leverage ratio (“SLR”) | 6.4 | 6.4 | 6.5 | 6.5 | 6.5 | ||||||||||||
Selected balance sheet data (period-end) | |||||||||||||||||
Trading assets | $ | 533,402 | $ | 413,714 | $ | 419,827 | $ | 418,799 | $ | 412,282 | |||||||
Investment securities | 267,365 | 261,828 | 231,398 | 233,015 | 238,188 | ||||||||||||
Loans | 956,245 | 984,554 | 954,318 | 948,414 | 934,424 | ||||||||||||
Core loans | 905,943 | 931,856 | 899,006 | 889,433 | 870,536 | ||||||||||||
Average core loans | 916,567 | 907,271 | 894,279 | 877,640 | 861,089 | ||||||||||||
Total assets | 2,737,188 | 2,622,532 | 2,615,183 | 2,590,050 | 2,609,785 | ||||||||||||
Deposits | 1,493,441 | 1,470,666 | 1,458,762 | 1,452,122 | 1,486,961 | ||||||||||||
Long-term debt | 290,893 | 282,031 | 270,124 | 273,114 | 274,449 | ||||||||||||
Common stockholders’ equity | 232,844 | 230,447 | 231,192 | 231,390 | 230,133 | ||||||||||||
Total stockholders’ equity | 259,837 | 256,515 | 258,956 | 257,458 | 256,201 | ||||||||||||
Headcount | 255,998 | 256,105 | 255,313 | 252,942 | 253,707 | ||||||||||||
Credit quality metrics | |||||||||||||||||
Allowance for credit losses | $ | 14,591 | $ | 14,500 | $ | 14,225 | $ | 14,367 | $ | 14,482 | |||||||
Allowance for loan losses to total retained loans | 1.43 | % | 1.39 | % | 1.39 | % | 1.41 | % | 1.44 | % | |||||||
Allowance for loan losses to retained loans excluding purchased credit-impaired loans(d) | 1.28 | 1.23 | 1.23 | 1.22 | 1.25 | ||||||||||||
Nonperforming assets | $ | 5,616 | $ | 5,190 | $ | 5,034 | $ | 5,767 | $ | 6,364 | |||||||
Net charge-offs | 1,361 | 1,236 | 1,033 | 1,252 | 1,335 | ||||||||||||
Net charge-off rate | 0.58 | % | 0.52 | % | 0.43 | % | 0.54 | % | 0.59 | % |
(a) | TBVPS and ROTCE are non-GAAP financial measures. For a further discussion of these measures, refer to Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures on pages 15–16. |
(b) | Quarterly ratios are based upon annualized amounts. |
(c) | Effective January 1, 2019, the capital adequacy of the Firm is now evaluated against the fully phased-in measures under Basel III and represents the lower of the Standardized or Advanced approaches. During 2018, the required capital measures were subject to the transitional rules and as of December 31, 2018 and September 30, 2018, were the same on a fully phased-in and on a transitional basis. Refer to Capital Risk Management on pages 32–36 for additional information on Basel III. |
(d) | Excludes the impact of residential real estate purchased credit-impaired (“PCI”) loans, a non-GAAP financial measure. For a further discussion of these measures, refer to Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures on pages 15–16, and the Allowance for credit losses on pages 55–56. |
INTRODUCTION |
EXECUTIVE OVERVIEW |
Financial performance of JPMorgan Chase | ||||||||||
(unaudited) As of or for the period ended, (in millions, except per share data and ratios) | Three months ended March 31, | |||||||||
2019 | 2018 | Change | ||||||||
Selected income statement data | ||||||||||
Total net revenue | $ | 29,123 | $ | 27,907 | 4 | % | ||||
Total noninterest expense | 16,395 | 16,080 | 2 | |||||||
Pre-provision profit | 12,728 | 11,827 | 8 | |||||||
Provision for credit losses | 1,495 | 1,165 | 28 | |||||||
Net income | 9,179 | 8,712 | 5 | |||||||
Diluted earnings per share | $ | 2.65 | $ | 2.37 | 12 | |||||
Selected ratios and metrics | ||||||||||
Return on common equity | 16 | % | 15 | % | ||||||
Return on tangible common equity | 19 | 19 | ||||||||
Book value per share | $ | 71.78 | $ | 67.59 | 6 | |||||
Tangible book value per share | 57.62 | 54.05 | 7 | |||||||
Capital ratios(a) | ||||||||||
CET1 | 12.1 | % | 11.8 | % | ||||||
Tier 1 capital | 13.8 | 13.5 | ||||||||
Total capital | 15.7 | 15.3 |
(a) | Effective January 1, 2019, the capital adequacy of the Firm is now evaluated against the fully phased-in measures under Basel III and represents the lower of the Standardized or Advanced approaches. During 2018, the required capital measures were subject to the transitional rules. Refer to Capital Risk Management on pages 32–36 for additional information on Basel III. |
• | The Firm had record net income of $9.2 billion, up 5%, driven by strong revenue growth, partially offset by increases in the provision for credit losses and noninterest expense. |
• | Total net revenue increased 4%. Net interest income was $14.5 billion, up 9%, predominantly driven by the impact of higher rates, as well as balance sheet growth and change in mix. Noninterest revenue was $14.7 billion, up 1%. The prior year included $505 million of fair value gains related to the adoption of the recognition and measurement accounting guidance. Excluding these gains, noninterest revenue was up 4%, driven by higher auto lease income and investment banking fees, as well as the absence of net losses on investment securities and certain legacy private equity investments in the prior year, with lower Markets revenue more than offset by lower funding spreads on derivatives. |
• | Noninterest expense was $16.4 billion, up 2%, driven by investments in the business, including technology, marketing, real estate and front office hires, as well as higher auto lease depreciation, partially offset by the absence of the prior-year FDIC surcharge and lower performance-based compensation. |
• | The provision for credit losses was $1.5 billion, an increase of $330 million. The increase was driven by the wholesale portfolio, reflecting a net addition to the allowance for credit losses of $135 million on select Commercial and Industrial client downgrades. This compares to a net reduction in the allowance for credit losses of $170 million in the prior year driven by a single name in the Oil & Gas Portfolio. |
• | The total allowance for credit losses was $14.6 billion at March 31, 2019, and the Firm had a loan loss coverage ratio, excluding the PCI portfolio, of 1.28%, compared with 1.25% in the prior year. The Firm’s nonperforming assets totaled $5.6 billion at March 31, 2019, a decrease from $6.4 billion in the prior year, reflecting improved credit performance in the consumer portfolio. |
• | Firmwide average core loans increased 6%, and excluding CIB, core loans increased 5%. |
• | The Firm’s CET1 capital was $186 billion, and the Standardized and Advanced CET1 ratios were 12.1% and 13.0%, respectively. |
• | The Firm’s supplementary leverage ratio (“SLR”) was 6.4% at March 31, 2019. |
• | The Firm continued to grow tangible book value per share (“TBVPS”), ending the first quarter of 2019 at $57.62, up 7%. |
CCB ROE 30% | • Average core loans up 4%; average deposits up 3% • Client investment assets of $312 billion, up 13%• Credit card sales volume up 10% and merchant processing volume up 13% | |
CIB ROE 16% | • Maintained #1 ranking for Global Investment Banking fees with 9.6% wallet share in the first quarter of 2019• Debt underwriting revenue of $935 million, up 21%; Advisory revenue of $644 million, up 12%• Total Markets revenue of $5.5 billion, down 17%, or 10% adjusted(a) | |
CB ROE 19% | • Record gross Investment Banking revenue of $818 million, up 44%• Strong credit performance with net charge-offs of 2 bps | |
AWM ROE 25% | • Average loan balances up 10%• Record assets under management (“AUM”) of $2.1 trillion, up 4% |
(a) | Adjusted Markets revenue excludes approximately $500 million of fair value gains related to the adoption of the recognition and measurement accounting guidance in the first quarter of 2018. |
$529 billion | Total credit provided and capital raised | |
$55 billion | Credit for consumers | |
$7 billion | Credit for U.S. small businesses | |
$196 billion | Credit for corporations | |
$256 billion | Capital raised for corporate clients and non-U.S. government entities | |
$15 billion | Credit and capital raised for U.S. government and nonprofit entities(a) |
(a) | Includes states, municipalities, hospitals and universities. |
CONSOLIDATED RESULTS OF OPERATIONS |
Revenue | ||||||||||
Three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Investment banking fees | $ | 1,840 | $ | 1,736 | 6 | % | ||||
Principal transactions | 4,076 | 3,952 | 3 | |||||||
Lending- and deposit-related fees | 1,482 | 1,477 | — | |||||||
Asset management, administration and commissions | 4,114 | 4,309 | (5 | ) | ||||||
Investment securities gains/(losses) | 13 | (245 | ) | NM | ||||||
Mortgage fees and related income | 396 | 465 | (15 | ) | ||||||
Card income | 1,274 | 1,275 | — | |||||||
Other income(a) | 1,475 | 1,626 | (9 | ) | ||||||
Noninterest revenue | 14,670 | 14,595 | 1 | |||||||
Net interest income | 14,453 | 13,312 | 9 | |||||||
Total net revenue | $ | 29,123 | $ | 27,907 | 4 | % |
(a) | Included operating lease income of $1.3 billion and $1.0 billion for the three months ended March 31, 2019 and 2018, |
• | higher debt underwriting fees driven by large acquisition financing deals |
• | higher advisory fees compared to a strong prior year, driven by a higher number of large completed transactions |
• | lower equity underwriting fees driven by declines in industry-wide fee levels. |
• | a gain from lower funding spreads on derivatives in Credit Adjustments & Other, predominantly offset by |
• | lower Fixed Income Markets revenue primarily driven by lower client activity in Currencies & Emerging Markets, and |
• | lower Equity Markets revenue driven by lower client activity in derivatives compared to a strong prior year. |
• | lower revenue related to hedges on certain investments in AWM, which was more than offset by higher investment valuation gains in other income, and |
• | losses on cash deployment transactions in Treasury and Chief Investment Office (“CIO”), which were more than offset by the net interest income earned on those transactions. |
• | lower asset management fees in AWM driven by lower average market levels |
• | lower brokerage commissions in CIB and AWM on lower activity. |
• | lower net mortgage servicing revenue reflecting a lower level of third-party loans serviced and lower MSR risk management results |
• | higher net mortgage production revenue reflecting higher mortgage production margins, as well as the impact of a loan sale. |
• | higher operating lease income from growth in auto operating lease volume in CCB, and |
• | higher investment valuation gains in AWM, which were largely offset by the impact of the related hedges in principal transactions revenue |
• | the absence of the $505 million of fair value gains related to the adoption of the recognition and measurement accounting guidance in the first quarter of 2018. |
Provision for credit losses | ||||||||||
Three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Consumer, excluding credit card | $ | 114 | $ | 146 | (22 | )% | ||||
Credit card | 1,202 | 1,170 | 3 | |||||||
Total consumer | 1,316 | 1,316 | — | |||||||
Wholesale | 179 | (151 | ) | NM | ||||||
Total provision for credit losses | $ | 1,495 | $ | 1,165 | 28 | % |
Noninterest expense | ||||||||||
Three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Compensation expense | $ | 8,937 | $ | 8,862 | 1 | % | ||||
Noncompensation expense: | ||||||||||
Occupancy | 1,068 | 888 | 20 | |||||||
Technology, communications and equipment | 2,364 | 2,054 | 15 | |||||||
Professional and outside services | 2,039 | 2,121 | (4 | ) | ||||||
Marketing | 879 | 800 | 10 | |||||||
Other expense(a)(b) | 1,108 | 1,355 | (18 | ) | ||||||
Total noncompensation expense | 7,458 | 7,218 | 3 | |||||||
Total noninterest expense | $ | 16,395 | $ | 16,080 | 2 | % |
(a) | Included Firmwide legal expense/(benefit) of $(81) million and $70 million for the three months ended March 31, 2019 and 2018, respectively. |
(b) | Included FDIC-related expense of $143 million and $383 million for the three months ended March 31, 2019 and 2018, respectively. |
• | higher investments in the businesses, including real estate, technology, and marketing |
• | higher depreciation expense from growth in auto operating lease volume in CCB |
• | a contribution to the Firm’s Foundation |
• | lower FDIC-related expense as a result of the elimination of the surcharge at the end of the third quarter of 2018, and |
• | a net legal benefit compared with an expense in the prior year. |
Income tax expense | ||||||||||
Three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Income before income tax expense | $ | 11,233 | $ | 10,662 | 5 | % | ||||
Income tax expense | 2,054 | 1,950 | 5 | |||||||
Effective tax rate | 18.3 | % | 18.3 | % |
CONSOLIDATED BALANCE SHEETS AND CASH FLOWS ANALYSIS |
Selected Consolidated balance sheets data | |||||||||
(in millions) | Mar 31, 2019 | Dec 31, 2018 | Change | ||||||
Assets | |||||||||
Cash and due from banks | $ | 21,946 | $ | 22,324 | (2 | )% | |||
Deposits with banks | 280,658 | 256,469 | 9 | ||||||
Federal funds sold and securities purchased under resale agreements | 299,140 | 321,588 | (7 | ) | |||||
Securities borrowed | 123,186 | 111,995 | 10 | ||||||
Trading assets | 533,402 | 413,714 | 29 | ||||||
Investment securities | 267,365 | 261,828 | 2 | ||||||
Loans | 956,245 | 984,554 | (3 | ) | |||||
Allowance for loan losses | (13,533 | ) | (13,445 | ) | 1 | ||||
Loans, net of allowance for loan losses | 942,712 | 971,109 | (3 | ) | |||||
Accrued interest and accounts receivable | 72,240 | 73,200 | (1 | ) | |||||
Premises and equipment | 24,160 | 14,934 | 62 | ||||||
Goodwill, MSRs and other intangible assets | 54,168 | 54,349 | — | ||||||
Other assets | 118,211 | 121,022 | (2 | ) | |||||
Total assets | $ | 2,737,188 | $ | 2,622,532 | 4 | % |
• | lower consumer loans due to a decline in the residential real estate portfolio, predominantly driven by a loan sale, and a seasonal decline in credit card balances and |
• | lower loans across the wholesale businesses, primarily driven by a loan syndication in CIB, and seasonality and paydowns in AWM. |
Selected Consolidated balance sheets data (continued) | |||||||||
(in millions) | Mar 31, 2019 | Dec 31, 2018 | Change | ||||||
Liabilities | |||||||||
Deposits | $ | 1,493,441 | $ | 1,470,666 | 2 | % | |||
Federal funds purchased and securities loaned or sold under repurchase agreements | 222,677 | 182,320 | 22 | ||||||
Short-term borrowings | 71,305 | 69,276 | 3 | ||||||
Trading liabilities | 156,907 | 144,773 | 8 | ||||||
Accounts payable and other liabilities | 216,173 | 196,710 | 10 | ||||||
Beneficial interests issued by consolidated variable interest entities (“VIEs”) | 25,955 | 20,241 | 28 | ||||||
Long-term debt | 290,893 | 282,031 | 3 | ||||||
Total liabilities | 2,477,351 | 2,366,017 | 5 | ||||||
Stockholders’ equity | 259,837 | 256,515 | 1 | ||||||
Total liabilities and stockholders’ equity | $ | 2,737,188 | $ | 2,622,532 | 4 | % |
• | higher client payables related to client-driven market-making activities in CIB, |
• | the impact of the adoption of the new lease accounting guidance, and |
• | higher payables in CCB related to the timing of payment activities in Card Services, due to the end of the quarter falling on a weekend. |
(in millions) | Three months ended March 31, | |||||||
2019 | 2018 | |||||||
Net cash provided by/(used in) | ||||||||
Operating activities | $ | (80,880 | ) | $ | (35,109 | ) | ||
Investing activities | 36,301 | (45,021 | ) | |||||
Financing activities | 69,435 | 60,589 | ||||||
Effect of exchange rate changes on cash | (1,045 | ) | 3,049 | |||||
Net increase/(decrease) in cash and due from banks and deposits with banks | $ | 23,811 | $ | (16,492 | ) |
• | In 2019, cash used primarily reflected an increase in trading assets-debt and equity instruments and higher securities borrowed, partially offset by increased trading liabilities and accounts payable and other liabilities, and net proceeds from loans held-for-sale. |
• | In 2018, cash used primarily reflected increases in trading assets-debt and equity instruments, and securities borrowed. |
• | In 2019, cash provided reflected a decrease in securities purchased under resale agreements, and net proceeds from sales of loans held-for-investment. |
• | In 2018, cash used reflected an increase in securities purchased under resale agreements, partially offset by lower investment securities. |
• | In 2019, cash provided reflected higher securities loaned or sold under repurchase agreements and higher deposits. |
• | In 2018, cash provided reflected higher deposits, and securities loaned or sold under repurchase agreements, partially offset by a decrease in long-term borrowings. |
• | For both periods, cash was used for repurchases of common stock and cash dividends on common and preferred stock. |
OFF-BALANCE SHEET ARRANGEMENTS |
Type of off-balance sheet arrangement | Location of disclosure | Page references |
Special-purpose entities: variable interests and other obligations, including contingent obligations, arising from variable interests in nonconsolidated VIEs | Refer to Note 13 | 123-128 |
Off-balance sheet lending-related financial instruments, guarantees, and other commitments | Refer to Note 22 | 140-143 |
EXPLANATION AND RECONCILIATION OF THE FIRM’S USE OF NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE MEASURES |
• | Firmwide “managed” basis results, including the overhead ratio, which include certain reclassifications to present total net revenue from investments that receive tax credits and tax-exempt securities on a basis comparable to taxable investments and securities (“FTE” basis) |
• | Net interest income and net yield excluding CIB’s Markets businesses |
• | Certain credit metrics and ratios, which exclude PCI loans |
• | Tangible common equity (“TCE”), ROTCE, and TBVPS. |
Three months ended March 31, | |||||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||||
(in millions, except ratios) | Reported results | Fully taxable-equivalent adjustments(a) | Managed basis | Reported results | Fully taxable-equivalent adjustments(a) | Managed basis | |||||||||||||||||||
Other income | $ | 1,475 | $ | 585 | $ | 2,060 | $ | 1,626 | $ | 455 | $ | 2,081 | |||||||||||||
Total noninterest revenue | 14,670 | 585 | 15,255 | 14,595 | 455 | 15,050 | |||||||||||||||||||
Net interest income | 14,453 | 143 | 14,596 | 13,312 | 158 | 13,470 | |||||||||||||||||||
Total net revenue | 29,123 | 728 | 29,851 | 27,907 | 613 | 28,520 | |||||||||||||||||||
Pre-provision profit | 12,728 | 728 | 13,456 | 11,827 | 613 | 12,440 | |||||||||||||||||||
Income before income tax expense | 11,233 | 728 | 11,961 | 10,662 | 613 | 11,275 | |||||||||||||||||||
Income tax expense | $ | 2,054 | $ | 728 | $ | 2,782 | $ | 1,950 | $ | 613 | $ | 2,563 | |||||||||||||
Overhead ratio | 56 | % | NM | 55 | % | 58 | % | NM | 56 | % |
(a) | Predominantly recognized in CIB, CB and Corporate. |
(in millions, except rates) | Three months ended March 31, | ||||||||
2019 | 2018 | Change | |||||||
Net interest income – managed basis(a)(b) | $ | 14,596 | $ | 13,470 | 8 | % | |||
Less: CIB Markets net interest income(c) | 624 | 1,030 | (39 | ) | |||||
Net interest income excluding CIB Markets(a) | $ | 13,972 | $ | 12,440 | 12 | ||||
Average interest-earning assets | $ | 2,313,103 | $ | 2,203,413 | 5 | ||||
Less: Average CIB Markets interest-earning assets(c) | 663,389 | 591,547 | 12 | ||||||
Average interest-earning assets excluding CIB Markets | $ | 1,649,714 | $ | 1,611,866 | 2 | % | |||
Net interest yield on average interest-earning assets – managed basis | 2.56 | % | 2.48 | % | |||||
Net interest yield on average CIB Markets interest-earning assets(c) | 0.38 | 0.71 | |||||||
Net interest yield on average interest-earning assets excluding CIB Markets | 3.43 | % | 3.13 | % |
(a) | Interest includes the effect of related hedges. Taxable-equivalent amounts are used where applicable. |
(b) | For a reconciliation of net interest income on a reported and managed basis, refer to the table above relating to the reconciliation from the Firm’s reported U.S. GAAP results to managed basis. |
(c) | For further information on CIB’s Markets businesses, refer to page 24. |
Period-end | Average | |||||||||||||
(in millions, except per share and ratio data) | Mar 31, 2019 | Dec 31, 2018 | Three months ended March 31, | |||||||||||
2019 | 2018 | |||||||||||||
Common stockholders’ equity | $ | 232,844 | $ | 230,447 | $ | 230,051 | $ | 227,615 | ||||||
Less: Goodwill | 47,474 | 47,471 | 47,475 | 47,504 | ||||||||||
Less: Other intangible assets | 737 | 748 | 744 | 845 | ||||||||||
Add: Certain Deferred tax liabilities(a) | 2,293 | 2,280 | 2,287 | 2,210 | ||||||||||
Tangible common equity | $ | 186,926 | $ | 184,508 | $ | 184,119 | $ | 181,476 | ||||||
Return on tangible common equity | NA | NA | 19 | % | 19 | % | ||||||||
Tangible book value per share | $ | 57.62 | $ | 56.33 | NA | NA |
(a) | Represents deferred tax liabilities related to tax-deductible goodwill and to identifiable intangibles created in nontaxable transactions, which are netted against goodwill and other intangibles when calculating TCE. |
BUSINESS SEGMENT RESULTS |
Three months ended March 31, | Consumer & Community Banking | Corporate & Investment Bank | Commercial Banking | ||||||||||||||||||||||
(in millions, except ratios) | 2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||
Total net revenue | $ | 13,751 | $ | 12,597 | 9 | % | $ | 9,848 | $ | 10,483 | (6 | )% | $ | 2,338 | $ | 2,166 | 8 | ||||||||
Total noninterest expense | 7,211 | 6,909 | 4 | 5,453 | 5,659 | (4 | ) | 873 | 844 | 3 | |||||||||||||||
Pre-provision profit/(loss) | 6,540 | 5,688 | 15 | 4,395 | 4,824 | (9 | ) | 1,465 | 1,322 | 11 | |||||||||||||||
Provision for credit losses | 1,314 | 1,317 | — | 87 | (158 | ) | NM | 90 | (5 | ) | NM | ||||||||||||||
Net income/(loss) | 3,963 | 3,326 | 19 | 3,251 | 3,974 | (18 | ) | 1,053 | 1,025 | 3 | |||||||||||||||
Return on equity (“ROE”) | 30 | % | 25 | % | 16 | % | 22 | % | 19 | % | 20 | % |
Three months ended March 31, | Asset & Wealth Management | Corporate | Total | |||||||||||||||||||||
(in millions, except ratios) | 2019 | 2018 | Change | 2019 | 2018 | Change | 2019 | 2018 | Change | |||||||||||||||
Total net revenue | $ | 3,489 | $ | 3,506 | — | $ | 425 | $ | (232 | ) | NM | $ | 29,851 | $ | 28,520 | 5 | ||||||||
Total noninterest expense | 2,647 | 2,581 | 3 | 211 | 87 | 143 | 16,395 | 16,080 | 2 | |||||||||||||||
Pre-provision profit/(loss) | 842 | 925 | (9 | ) | 214 | (319 | ) | NM | 13,456 | 12,440 | 8 | |||||||||||||
Provision for credit losses | 2 | 15 | (87 | ) | 2 | (4 | ) | NM | 1,495 | 1,165 | 28 | |||||||||||||
Net income/(loss) | 661 | 770 | (14 | ) | 251 | (383 | ) | NM | 9,179 | 8,712 | 5 | |||||||||||||
Return on equity (“ROE”) | 25 | % | 34 | % | NM | NM | 16 | % | 15 | % |
CONSUMER & COMMUNITY BANKING |
Selected income statement data | ||||||||||
Three months ended March 31, | ||||||||||
(in millions, except ratios) | 2019 | 2018 | Change | |||||||
Revenue | ||||||||||
Lending- and deposit-related fees | $ | 873 | $ | 857 | 2 | % | ||||
Asset management, administration and commissions | 618 | 575 | 7 | |||||||
Mortgage fees and related income | 396 | 465 | (15 | ) | ||||||
Card income | 1,168 | 1,170 | — | |||||||
All other income | 1,278 | 1,072 | 19 | |||||||
Noninterest revenue | 4,333 | 4,139 | 5 | |||||||
Net interest income | 9,418 | 8,458 | 11 | |||||||
Total net revenue | 13,751 | 12,597 | 9 | |||||||
Provision for credit losses | 1,314 | 1,317 | — | |||||||
Noninterest expense | ||||||||||
Compensation expense | 2,708 | 2,660 | 2 | |||||||
Noncompensation expense(a) | 4,503 | 4,249 | 6 | |||||||
Total noninterest expense | 7,211 | 6,909 | 4 | |||||||
Income before income tax expense | 5,226 | 4,371 | 20 | |||||||
Income tax expense | 1,263 | 1,045 | 21 | |||||||
Net income | $ | 3,963 | $ | 3,326 | 19 | |||||
Revenue by line of business | ||||||||||
Consumer & Business Banking | $ | 6,568 | $ | 5,722 | 15 | |||||
Home Lending | 1,346 | 1,509 | (11 | ) | ||||||
Card, Merchant Services & Auto | 5,837 | 5,366 | 9 | |||||||
Mortgage fees and related income details: | ||||||||||
Net production revenue | 200 | 95 | 111 | |||||||
Net mortgage servicing revenue(b) | 196 | 370 | (47 | ) | ||||||
Mortgage fees and related income | $ | 396 | $ | 465 | (15 | )% | ||||
Financial ratios | ||||||||||
Return on equity | 30 | % | 25 | % | ||||||
Overhead ratio | 52 | 55 |
(a) | Included operating lease depreciation expense of $969 million and $777 million for the three months ended March 31, 2019 and 2018, respectively. |
(b) | Included MSR risk management results of $(9) million and $17 million for the three months ended March 31, 2019 and 2018, respectively. |
• | higher deposit margins and balance growth in CBB, as well as higher loan balances and margin expansion in Card, |
• | higher rates driving loan spread compression in Home Lending. |
• | higher auto lease volume and |
• | higher net mortgage production revenue reflecting higher mortgage production margins, as well as the impact of a loan sale, |
• | lower net mortgage servicing revenue reflecting a lower level of third-party loans serviced and lower MSR risk management results. |
• | technology, marketing and other investments in the business, as well as higher auto lease depreciation, |
• | expense efficiencies and the absence of the prior-year FDIC surcharge. |
• | lower net charge-offs in the residential real estate and auto portfolios, offset by higher net charge-offs in the credit card portfolio, driven by loan growth. |
Selected metrics | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in millions, except headcount) | 2019 | 2018 | Change | |||||||
Selected balance sheet data (period-end) | ||||||||||
Total assets | $ | 552,486 | $ | 540,659 | 2 | % | ||||
Loans: | ||||||||||
Consumer & Business Banking | 26,492 | 25,856 | 2 | |||||||
Home equity | 34,417 | 40,777 | (16 | ) | ||||||
Residential mortgage | 196,182 | 199,548 | (2 | ) | ||||||
Home Lending | 230,599 | 240,325 | (4 | ) | ||||||
Card | 150,527 | 140,414 | 7 | |||||||
Auto | 62,786 | 66,042 | (5 | ) | ||||||
Total loans | 470,404 | 472,637 | — | |||||||
Core loans | 420,417 | 409,296 | 3 | |||||||
Deposits | 702,587 | 685,170 | 3 | |||||||
Equity | 52,000 | 51,000 | 2 | |||||||
Selected balance sheet data (average) | ||||||||||
Total assets | $ | 553,832 | $ | 538,938 | 3 | |||||
Loans: | ||||||||||
Consumer & Business Banking | 26,488 | 25,845 | 2 | |||||||
Home equity | 35,224 | 41,786 | (16 | ) | ||||||
Residential mortgage | 203,725 | 198,653 | 3 | |||||||
Home Lending | 238,949 | 240,439 | (1 | ) | ||||||
Card | 151,134 | 142,927 | 6 | |||||||
Auto | 62,763 | 65,863 | (5 | ) | ||||||
Total loans | 479,334 | 475,074 | 1 | |||||||
Core loans | 428,215 | 410,147 | 4 | |||||||
Deposits | 681,013 | 659,599 | 3 | |||||||
Equity | 52,000 | 51,000 | 2 | |||||||
Headcount(a) | 128,419 | 133,408 | (4 | )% |
(a) | During the third quarter of 2018, approximately 1,200 employees transferred from CCB to CIB as part of the reorganization of the Commercial Card business. |
Selected metrics | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in millions, except ratio data) | 2019 | 2018 | Change | |||||||
Credit data and quality statistics | ||||||||||
Nonaccrual loans(a)(b) | $ | 3,265 | $ | 4,104 | (20)% | |||||
Net charge-offs/(recoveries)(c) | ||||||||||
Consumer & Business Banking | 59 | 53 | 11 | |||||||
Home equity | — | 16 | NM | |||||||
Residential mortgage | (5 | ) | 2 | NM | ||||||
Home Lending | (5 | ) | 18 | NM | ||||||
Card | 1,202 | 1,170 | 3 | |||||||
Auto | 58 | 76 | (24 | ) | ||||||
Total net charge-offs/(recoveries) | $ | 1,314 | $ | 1,317 | — | |||||
Net charge-off/(recovery) rate(c) | ||||||||||
Consumer & Business Banking | 0.90 | % | 0.83 | % | ||||||
Home equity(d) | — | 0.21 | ||||||||
Residential mortgage(d) | (0.01 | ) | — | |||||||
Home Lending(d) | (0.01 | ) | 0.03 | |||||||
Card | 3.23 | 3.32 | ||||||||
Auto | 0.37 | 0.47 | ||||||||
Total net charge-off/(recovery) rate(d) | 1.17 | 1.20 | ||||||||
30+ day delinquency rate | ||||||||||
Home Lending(e)(f) | 0.77 | % | 0.98 | % | ||||||
Card | 1.85 | 1.82 | ||||||||
Auto | 0.63 | 0.71 | ||||||||
90+ day delinquency rate — Card | 0.97 | 0.95 | ||||||||
Allowance for loan losses | ||||||||||
Consumer & Business Banking | $ | 796 | $ | 796 | — | |||||
Home Lending, excluding PCI loans | 1,003 | 1,003 | — | |||||||
Home Lending — PCI loans(c) | 1,738 | 2,205 | (21 | ) | ||||||
Card | 5,183 | 4,884 | 6 | |||||||
Auto | 465 | 464 | — | |||||||
Total allowance for loan losses(c) | $ | 9,185 | $ | 9,352 | (2 | )% |
(a) | Excludes PCI loans. The Firm is recognizing interest income on each pool of PCI loans as each of the pools is performing. |
(b) | At March 31, 2019 and 2018, nonaccrual loans excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $2.2 billion and $4.0 billion, respectively. These amounts have been excluded based upon the government guarantee. |
(c) | Net charge-offs/(recoveries) and the net charge-off/(recovery) rates for the three months ended March 31, 2019 and 2018, excluded $50 million and $20 million, respectively, of write-offs in the PCI portfolio. These write-offs decreased the allowance for loan losses for PCI loans. For further information on PCI write-offs, refer to Summary of changes in the allowance for credit losses on page 56. |
(d) | Excludes the impact of PCI loans. For the three months ended March 31, 2019 and 2018, the net charge-off/(recovery) rates including the impact of PCI loans were as follows: (1) home equity of –% and 0.16%, respectively; (2) residential mortgage of (0.01)% and –%, respectively; (3) Home Lending of (0.01)% and 0.03%, respectively; and (4) total CCB of 1.11% and 1.12%, respectively. |
(e) | At March 31, 2019 and 2018, excluded mortgage loans insured by U.S. government agencies of $3.2 billion and $5.7 billion, respectively, that are 30 or more days past due. These amounts have been excluded based upon the government guarantee. |
(f) | Excludes PCI loans. The 30+ day delinquency rate for PCI loans was 8.90% and 9.49% at March 31, 2019 and 2018, respectively. |
Selected metrics | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in billions, except ratios and where otherwise noted) | 2019 | 2018 | Change | |||||||
Business Metrics | ||||||||||
Number of branches | 5,028 | 5,106 | (2 | )% | ||||||
Active digital customers (in thousands)(a) | 50,651 | 47,911 | 6 | |||||||
Active mobile customers (in thousands)(b) | 34,371 | 30,924 | 11 | |||||||
Debit and credit card sales volume | $ | 255.1 | $ | 232.4 | 10 | |||||
Consumer & Business Banking | ||||||||||
Average deposits | $ | 668.5 | $ | 646.4 | 3 | |||||
Deposit margin | 2.62 | % | 2.20 | % | ||||||
Business banking origination volume | $ | 1.5 | $ | 1.7 | (11 | ) | ||||
Client investment assets | 312.3 | 276.2 | 13 | |||||||
Home Lending | ||||||||||
Mortgage origination volume by channel | ||||||||||
Retail | $ | 7.9 | $ | 8.3 | (5 | ) | ||||
Correspondent | 7.1 | 9.9 | (28 | ) | ||||||
Total mortgage origination volume(c) | $ | 15.0 | $ | 18.2 | (18 | ) | ||||
Total loans serviced (period-end) | $ | 791.5 | $ | 804.9 | (2 | ) | ||||
Third-party mortgage loans serviced (period-end) | 529.6 | 539.0 | (2 | ) | ||||||
MSR carrying value (period-end) | 6.0 | 6.2 | (3 | ) | ||||||
Ratio of MSR carrying value (period-end) to third-party mortgage loans serviced (period-end) | 1.13 | % | 1.15 | % | ||||||
MSR revenue multiple(d) | 3.32 | x | 3.19 | x | ||||||
Card, excluding Commercial Card | ||||||||||
Credit card sales volume | $ | 172.5 | $ | 157.1 | 10 | |||||
Card Services | ||||||||||
Net revenue rate | 11.63 | % | 11.61 | % | ||||||
Merchant Services | ||||||||||
Merchant processing volume | $ | 356.5 | $ | 316.3 | 13 | |||||
Auto | ||||||||||
Loan and lease origination volume | $ | 7.9 | $ | 8.4 | (6 | ) | ||||
Average auto operating lease assets | 20.8 | 17.6 | 18 | % |
(a) | Users of all web and/or mobile platforms who have logged in within the past 90 days. |
(b) | Users of all mobile platforms who have logged in within the past 90 days. |
(c) | Firmwide mortgage origination volume was $16.4 billion and $20.0 billion for the three months ended March 31, 2019 and 2018, respectively. |
(d) | Represents the ratio of MSR carrying value (period-end) to third-party mortgage loans serviced (period-end) divided by the ratio of annualized loan servicing-related revenue to third-party mortgage loans serviced (average). |
CORPORATE & INVESTMENT BANK |
Selected income statement data | ||||||||||
Three months ended March 31, | ||||||||||
(in millions, except ratios) | 2019 | 2018 | Change | |||||||
Revenue | ||||||||||
Investment banking fees | $ | 1,844 | $ | 1,696 | 9 | % | ||||
Principal transactions | 4,163 | 4,029 | 3 | |||||||
Lending- and deposit-related fees | 361 | 381 | (5 | ) | ||||||
Asset management, administration and commissions | 1,101 | 1,131 | (3 | ) | ||||||
All other income | 194 | 680 | (71 | ) | ||||||
Noninterest revenue | 7,663 | 7,917 | (3 | ) | ||||||
Net interest income | 2,185 | 2,566 | (15 | ) | ||||||
Total net revenue(a) | 9,848 | 10,483 | (6 | ) | ||||||
Provision for credit losses | 87 | (158 | ) | NM | ||||||
Noninterest expense | ||||||||||
Compensation expense | 2,949 | 3,036 | (3 | ) | ||||||
Noncompensation expense | 2,504 | 2,623 | (5 | ) | ||||||
Total noninterest expense | 5,453 | 5,659 | (4 | ) | ||||||
Income before income tax expense | 4,308 | 4,982 | (14 | ) | ||||||
Income tax expense | 1,057 | 1,008 | 5 | |||||||
Net income | $ | 3,251 | $ | 3,974 | (18 | )% | ||||
Financial ratios | ||||||||||
Return on equity | 16 | % | 22 | % | ||||||
Overhead ratio | 55 | 54 | ||||||||
Compensation expense as percentage of total net revenue | 30 | 29 |
(a) | Includes tax-equivalent adjustments, predominantly due to income tax credits related to alternative energy investments; income tax credits and amortization of the cost of investments in affordable housing projects; and tax-exempt income from municipal bonds of $539 million and $405 million for the three months ended March 31, 2019 and 2018, respectively. |
Selected income statement data | ||||||||||
Three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Revenue by business | ||||||||||
Investment Banking | $ | 1,745 | $ | 1,587 | 10 | % | ||||
Treasury Services | 1,147 | 1,116 | 3 | |||||||
Lending | 340 | 302 | 13 | |||||||
Total Banking | 3,232 | 3,005 | 8 | |||||||
Fixed Income Markets | 3,725 | 4,553 | (18 | ) | ||||||
Equity Markets | 1,741 | 2,017 | (14 | ) | ||||||
Securities Services | 1,014 | 1,059 | (4 | ) | ||||||
Credit Adjustments & Other(a) | 136 | (151 | ) | NM | ||||||
Total Markets & Investor Services | 6,616 | 7,478 | (12 | ) | ||||||
Total net revenue | $ | 9,848 | $ | 10,483 | (6 | )% |
(a) | Consists primarily of credit valuation adjustments (“CVA”) managed centrally within CIB and funding valuation adjustments (“FVA”) on derivatives. Results are primarily reported in principal transactions revenue. Results are presented net of associated hedging activities and net of CVA and FVA amounts allocated to Fixed Income Markets and Equity Markets. |
• | Investment Banking revenue was $1.7 billion, up 10%, predominantly driven by higher debt underwriting and advisory fees, partially offset by lower equity underwriting fees. The Firm maintained its #1 ranking for Global Investment Banking fees with overall share gains, according to Dealogic. |
– | Debt underwriting fees were $935 million, up 21%, driven by large acquisition financing deals. |
– | Advisory fees were $644 million, up 12% compared to a strong prior year, driven by a higher number of large completed transactions. |
– | Equity underwriting fees were $265 million, down 23%, driven by declines in industry-wide fee levels. |
• | Treasury Services revenue was $1.1 billion, up 3%, driven by growth in operating deposits as well as higher fees on increased payments volume partially offset by deposit margin compression. |
• | Lending revenue was $340 million, up 13%, driven by higher net interest income reflecting growth in loan balances. |
• | Fixed Income Markets revenue was $3.7 billion reflecting lower client activity in Currencies & Emerging Markets and Rates compared to the prior year, which benefited from strong performance. This decline was partially offset by improved performance in Credit Trading and Commodities from higher client flows. |
• | Equity Markets revenue was $1.7 billion, compared to a strong prior year, reflecting lower client activity, predominantly in derivatives. |
• | Securities Services revenue was $1.0 billion, down 4%, predominantly driven by fee and deposit margin compression, lower market levels, and the impact of a business exit, largely offset by increased client activity. |
• | Credit Adjustments & Other was a gain of $136 million, predominantly driven by the impact of lower funding spreads on derivatives. |
Selected metrics | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in millions, except headcount) | 2019 | 2018 | Change | |||||||
Selected balance sheet data (period-end) | ||||||||||
Assets | $ | 1,006,111 | $ | 909,845 | 11 | % | ||||
Loans: | ||||||||||
Loans retained(a) | 127,086 | 112,626 | 13 | |||||||
Loans held-for-sale and loans at fair value | 7,783 | 6,122 | 27 | |||||||
Total loans | 134,869 | 118,748 | 14 | |||||||
Core loans | 134,692 | 118,434 | 14 | |||||||
Equity | 80,000 | 70,000 | 14 | |||||||
Selected balance sheet data (average) | ||||||||||
Assets | $ | 959,842 | $ | 910,146 | 5 | |||||
Trading assets-debt and equity instruments | 381,312 | 354,869 | 7 | |||||||
Trading assets-derivative receivables | 50,609 | 60,161 | (16 | ) | ||||||
Loans: | ||||||||||
Loans retained(a) | $ | 126,990 | $ | 109,355 | 16 | |||||
Loans held-for-sale and loans at fair value | 8,615 | 5,480 | 57 | |||||||
Total loans | $ | 135,605 | $ | 114,835 | 18 | |||||
Core loans | 135,420 | 114,514 | 18 | |||||||
Equity | 80,000 | 70,000 | 14 | |||||||
Headcount(b) | 54,697 | 51,291 | 7 | % |
(a) | Loans retained includes credit portfolio loans, loans held by consolidated Firm-administered multi-seller conduits, trade finance loans, other held-for-investment loans and overdrafts. |
(b) | During the third quarter of 2018 approximately 1,200 employees transferred from CCB to CIB as part of the reorganization of the Commercial Card business. |
Selected metrics | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in millions, except ratios) | 2019 | 2018 | Change | |||||||
Credit data and quality statistics | ||||||||||
Net charge-offs/(recoveries) | $ | 30 | $ | 20 | 50 | % | ||||
Nonperforming assets: | ||||||||||
Nonaccrual loans: | ||||||||||
Nonaccrual loans retained(a) | $ | 812 | $ | 668 | 22 | % | ||||
Nonaccrual loans held-for-sale and loans at fair value | 313 | 29 | NM | |||||||
Total nonaccrual loans | 1,125 | 697 | 61 | |||||||
Derivative receivables | 44 | 132 | (67 | ) | ||||||
Assets acquired in loan satisfactions | 58 | 91 | (36 | ) | ||||||
Total nonperforming assets | $ | 1,227 | $ | 920 | 33 | |||||
Allowance for credit losses: | ||||||||||
Allowance for loan losses | $ | 1,252 | $ | 1,128 | 11 | |||||
Allowance for lending-related commitments | 758 | 800 | (5 | ) | ||||||
Total allowance for credit losses | $ | 2,010 | $ | 1,928 | 4 | % | ||||
Net charge-off/(recovery) rate(b) | 0.10 | % | 0.07 | % | ||||||
Allowance for loan losses to period-end loans retained | 0.99 | 1.00 | ||||||||
Allowance for loan losses to period-end loans retained, excluding trade finance and conduits(c) | 1.34 | 1.46 | ||||||||
Allowance for loan losses to nonaccrual loans retained(a) | 154 | 169 | ||||||||
Nonaccrual loans to total period-end loans | 0.83 | % | 0.59 | % |
(a) | Allowance for loan losses of $252 million and $298 million were held against these nonaccrual loans at March 31, 2019 and 2018, respectively. |
(b) | Loans held-for-sale and loans at fair value were excluded when calculating the net charge-off/(recovery) rate. |
Investment banking fees | ||||||||||
Three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Advisory | $ | 644 | $ | 575 | 12 | % | ||||
Equity underwriting | 265 | 346 | (23 | ) | ||||||
Debt underwriting(a) | 935 | 775 | 21 | |||||||
Total investment banking fees | $ | 1,844 | $ | 1,696 | 9 | % |
(a) | Includes loan syndications. |
League table results – wallet share | |||||||||||
Three months ended March 31, 2019 | Full-year 2018 | ||||||||||
Rank | Share | Rank | Share | ||||||||
Based on fees(a) | |||||||||||
Long-term debt(b) | |||||||||||
Global | # | 1 | 7.4 | # | 1 | 7.2 | |||||
U.S. | 1 | 11.0 | 1 | 11.2 | |||||||
Equity and equity-related(c) | |||||||||||
Global | 3 | 8.6 | 1 | 9.0 | |||||||
U.S. | 1 | 12.4 | 1 | 12.3 | |||||||
M&A(d) | |||||||||||
Global | 2 | 10.5 | 2 | 8.7 | |||||||
U.S. | 2 | 10.9 | 2 | 9.0 | |||||||
Loan syndications | |||||||||||
Global | 1 | 13.0 | 1 | 9.5 | |||||||
U.S. | 1 | 15.6 | 1 | 12.0 | |||||||
Global investment banking fees(e) | # | 1 | 9.6 | # | 1 | 8.6 |
(a) | Source: Dealogic as of April 1, 2019. Reflects the ranking of revenue wallet and market share. |
(b) | Long-term debt rankings include investment-grade, high-yield, supranationals, sovereigns, agencies, covered bonds, asset-backed securities (“ABS”) and mortgage-backed securities (“MBS”); and exclude money market, short-term debt, and U.S. municipal securities. |
(c) | Global equity and equity-related ranking includes rights offerings and Chinese A-Shares. |
(d) | Global M&A excludes any withdrawn transactions. U.S. M&A revenue wallet represents wallet from client parents based in the U.S. |
(e) | Global investment banking fees exclude money market, short-term debt and shelf deals. |
Three months ended March 31, | Three months ended March 31, | ||||||||||||||||||
2019 | 2018 | ||||||||||||||||||
(in millions) | Fixed Income Markets | Equity Markets | Total Markets | Fixed Income Markets | Equity Markets | Total Markets | |||||||||||||
Principal transactions | $ | 2,482 | $ | 1,557 | $ | 4,039 | $ | 2,732 | $ | 1,612 | $ | 4,344 | |||||||
Lending- and deposit-related fees | 49 | 2 | 51 | 47 | 1 | 48 | |||||||||||||
Asset management, administration and commissions | 103 | 434 | 537 | 113 | 458 | 571 | |||||||||||||
All other income | 219 | (4 | ) | 215 | 560 | 17 | 577 | ||||||||||||
Noninterest revenue | 2,853 | 1,989 | 4,842 | 3,452 | 2,088 | 5,540 | |||||||||||||
Net interest income(a) | 872 | (248 | ) | 624 | 1,101 | (71 | ) | 1,030 | |||||||||||
Total net revenue | $ | 3,725 | $ | 1,741 | $ | 5,466 | $ | 4,553 | $ | 2,017 | $ | 6,570 |
(a) | Declines in Markets net interest income were driven by higher funding costs. |
Selected metrics | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in millions, except where otherwise noted) | 2019 | 2018 | Change | |||||||
Assets under custody (“AUC”) by asset class (period-end) (in billions): | ||||||||||
Fixed Income | $ | 12,772 | $ | 13,145 | (3 | )% | ||||
Equity | 9,028 | 8,241 | 10 | |||||||
Other(a) | 2,916 | 2,640 | 10 | |||||||
Total AUC | $ | 24,716 | $ | 24,026 | 3 | |||||
Client deposits and other third-party liabilities (average)(b) | $ | 444,055 | $ | 423,301 | 5 | % |
(a) | Consists of mutual funds, unit investment trusts, currencies, annuities, insurance contracts, options and other contracts. |
(b) | Client deposits and other third-party liabilities pertain to the Treasury Services and Securities Services businesses. |
International metrics | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in millions, except where otherwise noted) | 2019 | 2018(c) | Change | |||||||
Total net revenue(a) | ||||||||||
Europe/Middle East/Africa | $ | 3,153 | $ | 3,693 | (15 | )% | ||||
Asia/Pacific | 1,419 | 1,422 | — | |||||||
Latin America/Caribbean | 403 | 436 | (8 | ) | ||||||
Total international net revenue | 4,975 | 5,551 | (10 | ) | ||||||
North America | 4,873 | 4,932 | (1 | ) | ||||||
Total net revenue | $ | 9,848 | $ | 10,483 | (6 | ) | ||||
Loans retained (period-end)(a) | ||||||||||
Europe/Middle East/Africa | $ | 26,359 | $ | 26,483 | — | |||||
Asia/Pacific | 18,006 | 16,179 | 11 | |||||||
Latin America/Caribbean | 7,397 | 6,321 | 17 | |||||||
Total international loans | 51,762 | 48,983 | 6 | |||||||
North America | 75,324 | 63,643 | 18 | |||||||
Total loans retained(a) | $ | 127,086 | $ | 112,626 | 13 | |||||
Client deposits and other third-party liabilities (average)(b) | ||||||||||
Europe/Middle East/Africa | $ | 164,138 | $ | 159,483 | 3 | |||||
Asia/Pacific | 85,082 | 83,599 | 2 | |||||||
Latin America/Caribbean | 27,484 | 25,480 | 8 | |||||||
Total international | $ | 276,704 | $ | 268,562 | 3 | |||||
North America | 167,351 | 154,739 | 8 | |||||||
Total client deposits and other third-party liabilities | $ | 444,055 | $ | 423,301 | 5 | |||||
AUC (period-end)(b) (in billions) | ||||||||||
North America | $ | 15,352 | $ | 14,493 | 6 | |||||
All other regions | 9,364 | 9,533 | (2 | ) | ||||||
Total AUC | $ | 24,716 | $ | 24,026 | 3 | % |
(a) | Total net revenue and loans retained (excluding loans held-for-sale and loans at fair value) are based on the location of the trading desk, booking location, or domicile of the client, as applicable. |
(b) | Client deposits and other third-party liabilities pertaining to the Treasury Services and Securities Services businesses, and AUC, are based on the domicile of the client. |
(c) | The prior period amounts have been revised to conform with the current period presentation. |
COMMERCIAL BANKING |
Selected income statement data | ||||||||||
Three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Revenue | ||||||||||
Lending- and deposit-related fees | $ | 227 | $ | 226 | — | % | ||||
All other income(a) | 431 | 323 | 33 | |||||||
Noninterest revenue | 658 | 549 | 20 | |||||||
Net interest income | 1,680 | 1,617 | 4 | |||||||
Total net revenue(b) | 2,338 | 2,166 | 8 | |||||||
Provision for credit losses | 90 | (5 | ) | NM | ||||||
Noninterest expense | ||||||||||
Compensation expense | 449 | 421 | 7 | |||||||
Noncompensation expense | 424 | 423 | — | |||||||
Total noninterest expense | 873 | 844 | 3 | |||||||
Income before income tax expense | 1,375 | 1,327 | 4 | |||||||
Income tax expense | 322 | 302 | 7 | |||||||
Net income | $ | 1,053 | $ | 1,025 | 3 | % |
(a) | Includes revenue from investment banking products, commercial card transactions and asset management fees. The prior period amounts have been revised to conform with the current period presentation. |
(b) | Total net revenue included tax-equivalent adjustments from income tax credits related to equity investments in designated community |
Commercial Banking provides comprehensive financial solutions, including lending, treasury services, investment banking and asset management products across three primary client segments: Middle Market Banking, Corporate Client Banking and Commercial Real Estate Banking.(a) Other includes amounts not aligned with a primary client segment. | ||||
Middle Market Banking covers midsized corporations, local governments and nonprofit clients. | ||||
Corporate Client Banking covers large corporations. | ||||
Commercial Real Estate Banking covers investors, developers, and owners of multifamily, office, retail, industrial and affordable housing properties. |
Selected income statement data (continued) | ||||||||||
Three months ended March 31, | ||||||||||
(in millions, except ratios) | 2019 | 2018 | Change | |||||||
Revenue by product | ||||||||||
Lending | $ | 1,012 | $ | 999 | 1 | % | ||||
Treasury services | 1,029 | 972 | 6 | |||||||
Investment banking(b) | 289 | 184 | 57 | |||||||
Other | 8 | 11 | (27 | ) | ||||||
Total Commercial Banking net revenue | $ | 2,338 | $ | 2,166 | 8 | |||||
Investment banking revenue, gross(c) | $ | 818 | $ | 569 | 44 | |||||
Revenue by client segments | ||||||||||
Middle Market Banking | $ | 951 | $ | 895 | 6 | |||||
Corporate Client Banking | 816 | 687 | 19 | |||||||
Commercial Real Estate Banking(a) | 547 | 560 | (2 | ) | ||||||
Other(a) | 24 | 24 | — | |||||||
Total Commercial Banking net revenue | $ | 2,338 | $ | 2,166 | 8 | % | ||||
Financial ratios | ||||||||||
Return on equity | 19 | % | 20 | % | ||||||
Overhead ratio | 37 | 39 |
(a) | Effective in the first quarter of 2019, client segment data includes Commercial Real Estate Banking which comprises the former Commercial Term Lending and Real Estate Banking client segments, and Community Development Banking (previously part of Other). The prior period amounts have been revised to conform with the current period presentation. |
(b) | Includes CB’s share of revenue from investment banking products sold to CB clients through the CIB. |
(c) | For discussion of revenue sharing, refer to page 60 of the 2018 Form 10-K. |
Selected metrics | ||||||||
As of or for the three months ended March 31, | ||||||||
(in millions, except headcount) | 2019 | 2018 | Change | |||||
Selected balance sheet data (period-end) | ||||||||
Total assets | $ | 216,111 | $ | 220,880 | (2 | )% | ||
Loans: | ||||||||
Loans retained | 204,927 | 202,812 | 1 | |||||
Loans held-for-sale and loans at fair value | 410 | 2,473 | (83 | ) | ||||
Total loans | $ | 205,337 | $ | 205,285 | — | |||
Core loans | 205,199 | 205,087 | — | |||||
Equity | 22,000 | 20,000 | 10 | |||||
Period-end loans by client segment | ||||||||
Middle Market Banking | $ | 56,846 | $ | 57,835 | (2 | ) | ||
Corporate Client Banking | 46,897 | 47,562 | (1 | ) | ||||
Commercial Real Estate Banking(a) | 100,622 | 98,395 | 2 | |||||
Other(a) | 972 | 1,493 | (35 | ) | ||||
Total Commercial Banking loans | $ | 205,337 | $ | 205,285 | — | |||
Selected balance sheet data (average) | ||||||||
Total assets | $ | 218,297 | $ | 217,159 | 1 | |||
Loans: | ||||||||
Loans retained | 204,462 | 201,966 | 1 | |||||
Loans held-for-sale and loans at fair value | 1,634 | 406 | 302 | |||||
Total loans | $ | 206,096 | $ | 202,372 | 2 | |||
Core loans | 205,949 | 202,161 | 2 | |||||
Average loans by client segment | ||||||||
Middle Market Banking | $ | 56,723 | $ | 56,754 | — | |||
Corporate Client Banking | 48,141 | 45,760 | 5 | |||||
Commercial Real Estate Banking(a) | 100,264 | 98,398 | 2 | |||||
Other(a) | 968 | 1,460 | (34 | ) | ||||
Total Commercial Banking loans | $ | 206,096 | $ | 202,372 | 2 | |||
Client deposits and other third-party liabilities | $ | 167,260 | $ | 175,618 | (5 | ) | ||
Equity | 22,000 | 20,000 | 10 | |||||
Headcount | 11,033 | 10,372 | 6 | % |
(a) | Effective in the first quarter of 2019, client segment data includes Commercial Real Estate Banking which comprises the former Commercial Term Lending and Real Estate Banking client segments, and Community Development Banking (previously part of Other). The prior period amounts have been revised to conform with the current period presentation. |
Selected metrics (continued) | ||||||||
As of or for the three months ended March 31, | ||||||||
(in millions, except ratios) | 2019 | 2018 | Change | |||||
Credit data and quality statistics | ||||||||
Net charge-offs/(recoveries) | $ | 11 | $ | — | NM | |||
Nonperforming assets | ||||||||
Nonaccrual loans: | ||||||||
Nonaccrual loans retained(a) | $ | 544 | $ | 666 | (18 | )% | ||
Nonaccrual loans held-for-sale and loans at fair value | — | — | — | |||||
Total nonaccrual loans | $ | 544 | $ | 666 | (18 | ) | ||
Assets acquired in loan satisfactions | — | 1 | NM | |||||
Total nonperforming assets | $ | 544 | $ | 667 | (18 | ) | ||
Allowance for credit losses: | ||||||||
Allowance for loan losses | $ | 2,766 | $ | 2,591 | 7 | |||
Allowance for lending-related commitments | 250 | 263 | (5 | ) | ||||
Total allowance for credit losses | $ | 3,016 | $ | 2,854 | 6 | % | ||
Net charge-off/(recovery) rate(b) | 0.02 | % | — | |||||
Allowance for loan losses to period-end loans retained | 1.35 | 1.28 | ||||||
Allowance for loan losses to nonaccrual loans retained(a) | 508 | 389 | ||||||
Nonaccrual loans to period-end total loans | 0.26 | 0.32 |
(a) | Allowance for loan losses of $132 million and $116 million was held against nonaccrual loans retained at March 31, 2019 and 2018, respectively. |
(b) | Loans held-for-sale and loans at fair value were excluded when calculating the net charge-off/(recovery) rate. |
ASSET & WEALTH MANAGEMENT |
Selected income statement data | ||||||||
(in millions, except ratios) | Three months ended March 31, | |||||||
2019 | 2018 | Change | ||||||
Revenue | ||||||||
Asset management, administration and commissions | $ | 2,416 | $ | 2,528 | (4 | )% | ||
All other income | 177 | 102 | 74 | |||||
Noninterest revenue | 2,593 | 2,630 | (1 | ) | ||||
Net interest income | 896 | 876 | 2 | |||||
Total net revenue | 3,489 | 3,506 | — | |||||
Provision for credit losses | 2 | 15 | (87 | ) | ||||
Noninterest expense | ||||||||
Compensation expense | 1,462 | 1,392 | 5 | |||||
Noncompensation expense | 1,185 | 1,189 | — | |||||
Total noninterest expense | 2,647 | 2,581 | 3 | |||||
Income before income tax expense | 840 | 910 | (8 | ) | ||||
Income tax expense | 179 | 140 | 28 | |||||
Net income | $ | 661 | $ | 770 | (14 | ) | ||
Revenue by line of business | ||||||||
Asset Management | $ | 1,761 | $ | 1,787 | (1 | ) | ||
Wealth Management | 1,728 | 1,719 | 1 | |||||
Total net revenue | $ | 3,489 | $ | 3,506 | — | |||
Financial ratios | ||||||||
Return on equity | 25 | % | 34 | % | ||||
Overhead ratio | 76 | 74 | ||||||
Pre-tax margin ratio: | ||||||||
Asset Management | 23 | 26 | ||||||
Wealth Management | 25 | 26 | ||||||
Asset & Wealth Management | 24 | 26 |
Selected metrics | ||||||||
As of or for the three months ended March 31, | ||||||||
(in millions, except ranking data, headcount and ratios) | 2019 | 2018 | Change | |||||
% of JPM mutual fund assets rated as 4- or 5-star(a) | 60 | % | 58 | % | ||||
% of JPM mutual fund assets ranked in 1st or 2nd quartile:(b) | ||||||||
1 year | 72 | 61 | ||||||
3 years | 78 | 67 | ||||||
5 years | 86 | 82 | ||||||
Selected balance sheet data (period-end) | ||||||||
Total assets | $ | 165,865 | $ | 158,439 | 5 | % | ||
Loans | 143,750 | 136,030 | 6 | |||||
Core loans | 143,750 | 136,030 | 6 | |||||
Deposits | 143,348 | 147,238 | (3 | ) | ||||
Equity | 10,500 | 9,000 | 17 | |||||
Selected balance sheet data (average) | ||||||||
Total assets | $ | 167,358 | $ | 154,345 | 8 | |||
Loans | 145,406 | 132,634 | 10 | |||||
Core loans | 145,406 | 132,634 | 10 | |||||
Deposits | 138,235 | 144,199 | (4 | ) | ||||
Equity | 10,500 | 9,000 | 17 | |||||
Headcount | 24,347 | 23,268 | 5 | |||||
Number of Wealth Management client advisors | 2,877 | 2,640 | 9 | |||||
Credit data and quality statistics | ||||||||
Net charge-offs | $ | 4 | $ | 1 | 300 | |||
Nonaccrual loans | 285 | 359 | (21 | ) | ||||
Allowance for credit losses: | ||||||||
Allowance for loan losses | $ | 325 | $ | 301 | 8 | |||
Allowance for lending-related commitments | 18 | 13 | 38 | |||||
Total allowance for credit losses | $ | 343 | $ | 314 | 9 | % | ||
Net charge-off rate | 0.01 | % | — | |||||
Allowance for loan losses to period-end loans | 0.23 | 0.22 | ||||||
Allowance for loan losses to nonaccrual loans | 114 | 84 | ||||||
Nonaccrual loans to period-end loans | 0.20 | 0.26 |
(a) | Represents the “overall star rating” derived from Morningstar for the U.S., the U.K., Luxembourg, Hong Kong and Taiwan domiciled funds; and Nomura “star rating” for Japan domiciled funds. Includes only Asset Management retail open-ended mutual funds that have a rating. Excludes money market funds, Undiscovered Managers Fund, and Brazil and India domiciled funds. |
(b) | Quartile ranking sourced from: Lipper for the U.S. and Taiwan domiciled funds; Morningstar for the U.K., Luxembourg and Hong Kong domiciled funds; Nomura for Japan domiciled funds and Fund Doctor for South Korea domiciled funds. Includes only Asset Management retail open-ended mutual funds that are ranked by the aforementioned sources. Excludes money market funds, Undiscovered Managers Fund, and Brazil and India domiciled funds. |
Client assets | ||||||||
March 31, | ||||||||
(in billions) | 2019 | 2018 | Change | |||||
Assets by asset class | ||||||||
Liquidity | $ | 476 | $ | 432 | 10 | % | ||
Fixed income | 495 | 467 | 6 | |||||
Equity | 427 | 432 | (1 | ) | ||||
Multi-asset and alternatives | 698 | 685 | 2 | |||||
Total assets under management | 2,096 | 2,016 | 4 | |||||
Custody/brokerage/administration/deposits | 801 | 772 | 4 | |||||
Total client assets | $ | 2,897 | $ | 2,788 | 4 | |||
Memo: | ||||||||
Alternatives client assets (a) | $ | 172 | $ | 169 | 2 | |||
Assets by client segment | ||||||||
Private Banking | $ | 597 | $ | 537 | 11 | |||
Institutional | 943 | 937 | 1 | |||||
Retail | 556 | 542 | 3 | |||||
Total assets under management | $ | 2,096 | $ | 2,016 | 4 | |||
Private Banking | $ | 1,371 | $ | 1,285 | 7 | |||
Institutional | 965 | 958 | 1 | |||||
Retail | 561 | 545 | 3 | |||||
Total client assets | $ | 2,897 | $ | 2,788 | 4 | % |
(a) | Represents assets under management, as well as client balances in brokerage accounts |
Client assets (continued) | ||||||
Three months ended March 31, | ||||||
(in billions) | 2019 | 2018 | ||||
Assets under management rollforward | ||||||
Beginning balance | $ | 1,987 | $ | 2,034 | ||
Net asset flows: | ||||||
Liquidity | (5 | ) | (21 | ) | ||
Fixed income | 19 | (5 | ) | |||
Equity | (6 | ) | 5 | |||
Multi-asset and alternatives | (3 | ) | 16 | |||
Market/performance/other impacts | 104 | (13 | ) | |||
Ending balance, March 31 | $ | 2,096 | $ | 2,016 | ||
Client assets rollforward | ||||||
Beginning balance | $ | 2,733 | $ | 2,789 | ||
Net asset flows | 9 | 14 | ||||
Market/performance/other impacts | 155 | (15 | ) | |||
Ending balance, March 31 | $ | 2,897 | $ | 2,788 |
International metrics | ||||||||
As of or for the three months ended March 31, | ||||||||
(in millions) | 2019 | 2018 | Change | |||||
Total net revenue (a) | ||||||||
Europe/Middle East/Africa | $ | 662 | $ | 726 | (9 | )% | ||
Asia/Pacific | 358 | 393 | (9 | ) | ||||
Latin America/Caribbean | 221 | 227 | (3 | ) | ||||
Total international net revenue | 1,241 | 1,346 | (8 | ) | ||||
North America | 2,248 | 2,160 | 4 | |||||
Total net revenue(a) | $ | 3,489 | $ | 3,506 | — |
(a) | Regional revenue is based on the domicile of the client. |
As of or for the three months ended March 31, | ||||||||
(in billions) | 2019 | 2018 | Change | |||||
Assets under management | ||||||||
Europe/Middle East/Africa | $ | 367 | $ | 378 | (3 | )% | ||
Asia/Pacific | 177 | 171 | 4 | |||||
Latin America/Caribbean | 66 | 59 | 12 | |||||
Total international assets under management | 610 | 608 | — | |||||
North America | 1,486 | 1,408 | 6 | |||||
Total assets under management | $ | 2,096 | $ | 2,016 | 4 | |||
Client assets | ||||||||
Europe/Middle East/Africa | $ | 432 | $ | 435 | (1 | ) | ||
Asia/Pacific | 243 | 237 | 3 | |||||
Latin America/Caribbean | 165 | 156 | 6 | |||||
Total international client assets | 840 | 828 | 1 | |||||
North America | 2,057 | 1,960 | 5 | |||||
Total client assets | $ | 2,897 | $ | 2,788 | 4 | % |
CORPORATE |
Selected income statement and balance sheet data | |||||||||
As of or for the three months ended March 31, | |||||||||
(in millions, except headcount) | 2019 | 2018 | Change | ||||||
Revenue | |||||||||
Principal transactions | $ | (62 | ) | $ | (144 | ) | 57 | % | |
Investment securities gains/(losses) | 13 | (245 | ) | NM | |||||
All other income | 57 | 204 | (72 | ) | |||||
Noninterest revenue | 8 | (185 | ) | NM | |||||
Net interest income | 417 | (47 | ) | NM | |||||
Total net revenue(a) | 425 | (232 | ) | NM | |||||
Provision for credit losses | 2 | (4 | ) | NM | |||||
Noninterest expense(b) | 211 | 87 | 143 | ||||||
Income/(loss) before income tax expense/(benefit) | 212 | (315 | ) | NM | |||||
Income tax expense/(benefit) | (39 | ) | 68 | NM | |||||
Net income/(loss) | $ | 251 | $ | (383 | ) | NM | |||
Total net revenue | |||||||||
Treasury and CIO | $ | 511 | $ | (38 | ) | NM | |||
Other Corporate | (86 | ) | (194 | ) | 56 | ||||
Total net revenue | $ | 425 | $ | (232 | ) | NM | |||
Net income/(loss) | |||||||||
Treasury and CIO | $ | 334 | $ | (187 | ) | NM | |||
Other Corporate | (83 | ) | (196 | ) | 58 | ||||
Total net income/(loss) | $ | 251 | $ | (383 | ) | NM | |||
Total assets (period-end) | $ | 796,615 | $ | 779,962 | 2 | ||||
Loans (period-end) | 1,885 | 1,724 | 9 | ||||||
Core loans(c) | 1,885 | 1,689 | 12 | ||||||
Headcount | 37,502 | 35,368 | 6 | % |
(a) | Included tax-equivalent adjustments, driven by tax-exempt income from municipal bond investments, of $86 million and $98 million for the three months ended March 31, 2019 and 2018, respectively. |
(b) | Included a net legal benefit of $(90) million and $(42) million for the three months ended March 31, 2019 and 2018, respectively. |
(c) | Average core loans were $1.6 billion for both the three months ended March 31, 2019 and 2018. |
Selected income statement and balance sheet data | ||||||||||
As of or for the three months ended March 31, | ||||||||||
(in millions) | 2019 | 2018 | Change | |||||||
Investment securities gains/(losses) | $ | 13 | $ | (245 | ) | NM | ||||
Available-for-sale (“AFS”) investment securities (average) | $ | 226,605 | $ | 204,323 | 11 | % | ||||
Held-to-maturity (“HTM”) investment securities (average) | 31,082 | 34,020 | (9 | ) | ||||||
Investment securities portfolio (average) | $ | 257,687 | $ | 238,343 | 8 | |||||
AFS investment securities (period-end) | $ | 234,832 | $ | 207,703 | 13 | |||||
HTM investment securities (period-end) | 30,849 | 29,042 | 6 | |||||||
Investment securities portfolio (period-end) | $ | 265,681 | $ | 236,745 | 12 | % |
ENTERPRISE-WIDE RISK MANAGEMENT |
• | Acceptance of responsibility, including identification and escalation of risk issues, by all individuals within the Firm; |
• | Ownership of risk identification, assessment, data and management within each of the lines of business and Corporate; and |
• | Firmwide structures for risk governance. |
Risk governance and oversight functions | Form 10-Q page reference | Form 10-K page reference |
Strategic risk | 84 | |
Capital risk | 32–36 | 85–94 |
Liquidity risk | 37–41 | 95–100 |
Reputation risk | 101 | |
Consumer credit risk | 43–47 | 106-111 |
Wholesale credit risk | 48–54 | 112-119 |
Investment portfolio risk | 57 | 123 |
Market risk | 58–62 | 124-131 |
Country risk | 63 | 132–133 |
Operational risk | 134-136 | |
Compliance risk | 137 | |
Conduct risk | 138 | |
Legal risk | 139 | |
Estimations and Model risk | 140 |
CAPITAL RISK MANAGEMENT |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||||
(in millions) | Standardized | Advanced | Minimum capital ratios | Standardized(b) | Advanced(b) | Minimum capital ratios | |||||||||||||||
Risk-based capital metrics: | |||||||||||||||||||||
CET1 capital | $ | 186,116 | $ | 186,116 | $ | 183,474 | $ | 183,474 | |||||||||||||
Tier 1 capital | 212,644 | 212,644 | 209,093 | 209,093 | |||||||||||||||||
Total capital | 241,483 | 231,454 | 237,511 | 227,435 | |||||||||||||||||
Risk-weighted assets | 1,542,903 | 1,432,526 | 1,528,916 | 1,421,205 | |||||||||||||||||
CET1 capital ratio | 12.1 | % | 13.0 | % | 10.5 | % | 12.0 | % | 12.9 | % | 9.0 | % | |||||||||
Tier 1 capital ratio | 13.8 | 14.8 | 12.0 | 13.7 | 14.7 | 10.5 | |||||||||||||||
Total capital ratio | 15.7 | 16.2 | 14.0 | 15.5 | 16.0 | 12.5 | |||||||||||||||
Leverage-based capital metrics: | |||||||||||||||||||||
Adjusted average assets(a) | $ | 2,637,741 | $ | 2,637,741 | $ | 2,589,887 | $ | 2,589,887 | |||||||||||||
Tier 1 leverage ratio | 8.1 | % | 8.1 | % | 4.0 | % | 8.1 | % | 8.1 | % | 4.0 | % | |||||||||
Total leverage exposure | NA | $ | 3,309,501 | NA | $ | 3,269,988 | |||||||||||||||
SLR | NA | 6.4 | % | 5.0 | % | NA | 6.4 | % | 5.0 | % |
(a) | Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets. |
(b) | The Firm’s capital ratios as of December 31, 2018 were equivalent whether calculated on a transitional or fully phased-in basis. |
(in millions) | March 31, 2019 | December 31, 2018 | ||||
Total stockholders’ equity | $ | 259,837 | $ | 256,515 | ||
Less: Preferred stock | 26,993 | 26,068 | ||||
Common stockholders’ equity | 232,844 | 230,447 | ||||
Less: | ||||||
Goodwill | 47,474 | 47,471 | ||||
Other intangible assets | 737 | 748 | ||||
Other CET1 capital adjustments | 810 | 1,034 | ||||
Add: | ||||||
Deferred tax liabilities(a) | 2,293 | 2,280 | ||||
Standardized/Advanced CET1 capital | 186,116 | 183,474 | ||||
Preferred stock | 26,993 | 26,068 | ||||
Less: Other Tier 1 adjustments | 465 | 449 | ||||
Standardized/Advanced Tier 1 capital | $ | 212,644 | $ | 209,093 | ||
Long-term debt and other instruments qualifying as Tier 2 capital | $ | 14,105 | $ | 13,772 | ||
Qualifying allowance for credit losses | 14,591 | 14,500 | ||||
Other | 143 | 146 | ||||
Standardized Tier 2 capital | $ | 28,839 | $ | 28,418 | ||
Standardized Total capital | $ | 241,483 | $ | 237,511 | ||
Adjustment in qualifying allowance for credit losses for Advanced Tier 2 capital | (10,029 | ) | (10,076 | ) | ||
Advanced Tier 2 capital | $ | 18,810 | $ | 18,342 | ||
Advanced Total capital | $ | 231,454 | $ | 227,435 |
(a) | Represents certain deferred tax liabilities related to tax-deductible goodwill and identifiable intangibles created in nontaxable transactions, which are netted against goodwill and other intangibles when calculating CET1 capital. |
Three months ended March 31, (in millions) | 2019 | ||
Standardized/Advanced CET1 capital at December 31, 2018 | $ | 183,474 | |
Net income applicable to common equity | 8,805 | ||
Dividends declared on common stock | (2,632 | ) | |
Net purchase of treasury stock | (3,795 | ) | |
Changes in additional paid-in capital | (992 | ) | |
Changes related to AOCI | 811 | ||
Adjustment related to DVA(a) | 719 | ||
Changes related to other CET1 capital adjustments | (274 | ) | |
Change in Standardized/Advanced CET1 capital | 2,642 | ||
Standardized/Advanced CET1 capital at March 31, 2019 | $ | 186,116 | |
Standardized/Advanced Tier 1 capital at December 31, 2018 | $ | 209,093 | |
Change in CET1 capital | 2,642 | ||
Net issuance of noncumulative perpetual preferred stock | 925 | ||
Other | (16 | ) | |
Change in Standardized/Advanced Tier 1 capital | 3,551 | ||
Standardized/Advanced Tier 1 capital at March 31, 2019 | $ | 212,644 | |
Standardized Tier 2 capital at December 31, 2018 | $ | 28,418 | |
Change in long-term debt and other instruments qualifying as Tier 2 | 333 | ||
Change in qualifying allowance for credit losses | 91 | ||
Other | (3 | ) | |
Change in Standardized Tier 2 capital | 421 | ||
Standardized Tier 2 capital at March 31, 2019 | $ | 28,839 | |
Standardized Total capital at March 31, 2019 | $ | 241,483 | |
Advanced Tier 2 capital at December 31, 2018 | $ | 18,342 | |
Change in long-term debt and other instruments qualifying as Tier 2 | 333 | ||
Change in qualifying allowance for credit losses | 138 | ||
Other | (3 | ) | |
Change in Advanced Tier 2 capital | 468 | ||
Advanced Tier 2 capital at March 31, 2019 | $ | 18,810 | |
Advanced Total capital at March 31, 2019 | $ | 231,454 |
(a) | Includes DVA related to structured notes recorded in AOCI. |
Standardized | Advanced | |||||||||||||||||||||
Three months ended March 31, 2019 (in millions) | Credit risk RWA | Market risk RWA | Total RWA | Credit risk RWA | Market risk RWA | Operational risk RWA | Total RWA | |||||||||||||||
December 31, 2018 | $ | 1,423,053 | $ | 105,863 | $ | 1,528,916 | $ | 926,647 | $ | 105,976 | $ | 388,582 | $ | 1,421,205 | ||||||||
Model & data changes(a) | (3,666 | ) | (2,153 | ) | (5,819 | ) | (1,753 | ) | (2,153 | ) | — | (3,906 | ) | |||||||||
Portfolio runoff(b) | (1,400 | ) | — | (1,400 | ) | (1,200 | ) | — | — | (1,200 | ) | |||||||||||
Movement in portfolio levels(c) | 14,777 | 6,429 | 21,206 | 9,782 | 6,408 | 237 | 16,427 | |||||||||||||||
Changes in RWA | 9,711 | 4,276 | 13,987 | 6,829 | 4,255 | 237 | 11,321 | |||||||||||||||
March 31, 2019 | $ | 1,432,764 | $ | 110,139 | $ | 1,542,903 | $ | 933,476 | $ | 110,231 | $ | 388,819 | $ | 1,432,526 |
(a) | Model & data changes refer to movements in levels of RWA as a result of revised methodologies and/or treatment per regulatory guidance (exclusive of rule changes). |
(b) | Portfolio runoff for credit risk RWA primarily reflects reduced risk from position rolloffs in legacy portfolios in Home Lending. |
(c) | Movement in portfolio levels (inclusive of rule changes) refers to: changes in book size, composition, credit quality, and market movements for credit risk RWA; changes in position and market movements for market risk RWA; and updates to cumulative losses for operational risk RWA. |
(in millions, except ratio) | March 31, 2019 | December 31, 2018 | ||||
Tier 1 capital | $ | 212,644 | $ | 209,093 | ||
Total average assets | 2,684,714 | 2,636,505 | ||||
Less: Adjustments for deductions from Tier 1 capital | 46,973 | 46,618 | ||||
Total adjusted average assets(a) | 2,637,741 | 2,589,887 | ||||
Off-balance sheet exposures(b) | 671,760 | 680,101 | ||||
Total leverage exposure | $ | 3,309,501 | $ | 3,269,988 | ||
SLR | 6.4 | % | 6.4 | % |
(a) | Adjusted average assets, for purposes of calculating the SLR, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets. |
(b) | Off-balance sheet exposures are calculated as the average of the three month-end spot balances during the quarter. |
(in billions) | March 31, 2019 | December 31, 2018 | |||||
Consumer & Community Banking | $ | 52.0 | $ | 51.0 | |||
Corporate & Investment Bank | 80.0 | 70.0 | |||||
Commercial Banking | 22.0 | 20.0 | |||||
Asset & Wealth Management | 10.5 | 9.0 | |||||
Corporate | 68.3 | 80.4 | |||||
Total common stockholders’ equity | $ | 232.8 | $ | 230.4 |
Three months ended March 31, | ||||||
(in millions) | 2019 | 2018 | ||||
Total shares of common stock repurchased | 49.5 | 41.4 | ||||
Aggregate common stock repurchases | $ | 5,091 | $ | 4,671 |
March 31, 2019 | ||||||
(in billions, except ratio) | Eligible External TLAC | Eligible LTD | ||||
Total eligible TLAC & LTD | $ | 382.7 | $ | 160.5 | ||
% of RWA | 24.8 | % | 10.4 | % | ||
Minimum requirement | 23.0 | 9.5 | ||||
Surplus/(shortfall) | $ | 27.8 | $ | 13.9 | ||
% of total leverage exposure | 11.6 | % | 4.8 | % | ||
Minimum requirement | 9.5 | 4.5 | ||||
Surplus/(shortfall) | $ | 68.3 | $ | 11.5 |
March 31, 2019 | ||||||
(in millions) | Actual | Minimum | ||||
Net Capital | $ | 18,067 | $ | 3,160 |
March 31, 2019 | ||||
(in millions, except ratios) | Estimated | Minimum ratios | ||
Total capital | $ | 55,732 | ||
CET1 ratio | 18.1 | % | 4.5 | |
Total capital ratio | 23.1 | % | 8.0 |
LIQUIDITY RISK MANAGEMENT |
Three months ended | |||||||||
Average amount (in millions) | March 31, 2019 | December 31, 2018 | March 31, 2018 | ||||||
HQLA | |||||||||
Eligible cash(a) | $ | 216,787 | $ | 297,069 | $ | 358,257 | |||
Eligible securities(b)(c) | 303,249 | 232,201 | 180,765 | ||||||
Total HQLA(d) | $ | 520,036 | $ | 529,270 | $ | 539,022 | |||
Net cash outflows | $ | 467,329 | $ | 467,704 | $ | 467,629 | |||
LCR | 111 | % | 113 | % | 115 | % | |||
Net excess HQLA(d) | $ | 52,707 | $ | 61,566 | $ | 71,393 |
(a) | Represents cash on deposit at central banks, primarily Federal Reserve Banks. |
(b) | Predominantly U.S. Treasuries, U.S. Agency MBS, and sovereign bonds net of applicable haircuts under the LCR rules. |
(c) | HQLA eligible securities may be reported in securities borrowed or purchased under resale agreements, trading assets, or investment securities on the Firm’s Consolidated balance sheets. |
(d) | Excludes average excess HQLA at JPMorgan Chase Bank, N.A. and Chase Bank USA, N.A. that are not transferable to non-bank affiliates. |
March 31, 2019 | December 31, 2018 | Three months ended March 31, | |||||||||||
Deposits | Average | ||||||||||||
(in millions) | 2019 | 2018 | |||||||||||
Consumer & Community Banking | $ | 702,587 | $ | 678,854 | $ | 681,013 | $ | 659,599 | |||||
Corporate & Investment Bank | 485,869 | 482,084 | 492,354 | 465,822 | |||||||||
Commercial Banking | 161,096 | 170,859 | 167,177 | 175,523 | |||||||||
Asset & Wealth Management | 143,348 | 138,546 | 138,235 | 144,199 | |||||||||
Corporate | 541 | 323 | 963 | 865 | |||||||||
Total Firm | $ | 1,493,441 | $ | 1,470,666 | $ | 1,479,742 | $ | 1,446,008 |
(in billions except ratios) | March 31, 2019 | December 31, 2018 | |||||
Deposits | $ | 1,493.4 | $ | 1,470.7 | |||
Deposits as a % of total liabilities | 60 | % | 62 | % | |||
Loans | $ | 956.2 | $ | 984.6 | |||
Loans-to-deposits ratio | 64 | % | 67 | % |
• | The increase in CIB reflected growth in operating deposits in Treasury Services. The increase in CCB was driven by growth in new accounts. |
• | The decrease in CB was primarily driven by migration of non-operating deposits. The decrease in AWM was largely driven by migration predominantly into the Firm’s investment-related products. |
March 31, 2019 | December 31, 2018 | Three months ended March 31, | |||||||||||
Sources of funds (excluding deposits) | Average | ||||||||||||
(in millions) | 2019 | 2018 | |||||||||||
Commercial paper | $ | 26,563 | $ | 30,059 | $ | 28,731 | $ | 25,993 | |||||
Other borrowed funds(a) | 9,648 | 8,789 | 10,247 | 12,147 | |||||||||
Total short-term unsecured funding(a) | $ | 36,211 | $ | 38,848 | $ | 38,978 | $ | 38,140 | |||||
Securities sold under agreements to repurchase(b) | $ | 208,338 | $ | 171,975 | $ | 197,454 | $ | 184,396 | |||||
Securities loaned(b) | 13,577 | 9,481 | 10,781 | 10,526 | |||||||||
Other borrowed funds(a)(c) | 35,094 | 30,428 | 35,583 | 19,463 | |||||||||
Obligations of Firm-administered multi-seller conduits(d) | $ | 10,788 | $ | 4,843 | $ | 7,386 | $ | 3,116 | |||||
Total short-term secured funding(a) | $ | 267,797 | $ | 216,727 | $ | 251,204 | $ | 217,501 | |||||
Senior notes | $ | 167,030 | $ | 162,733 | $ | 162,952 | $ | 150,218 | |||||
Trust preferred securities | — | — | — | 688 | |||||||||
Subordinated debt | 16,945 | 16,743 | 16,722 | 16,231 | |||||||||
Structured notes(e) | 59,634 | 53,090 | 57,395 | 47,001 | |||||||||
Total long-term unsecured funding | $ | 243,609 | $ | 232,566 | $ | 237,069 | $ | 214,138 | |||||
Credit card securitization(d) | $ | 13,416 | $ | 13,404 | $ | 13,409 | $ | 18,665 | |||||
Federal Home Loan Bank (“FHLB”) advances | 42,453 | 44,455 | 43,965 | 60,385 | |||||||||
Other long-term secured funding(f) | 4,831 | 5,010 | 4,891 | 4,482 | |||||||||
Total long-term secured funding | $ | 60,700 | $ | 62,869 | $ | 62,265 | $ | 83,532 | |||||
Preferred stock(g) | $ | 26,993 | $ | 26,068 | $ | 27,126 | $ | 26,068 | |||||
Common stockholders’ equity(g) | $ | 232,844 | $ | 230,447 | $ | 230,051 | $ | 227,615 |
(a) | The prior period amounts have been revised to conform with the current period presentation. |
(b) | Primarily consists of short-term securities loaned or sold under agreements to repurchase. |
(c) | Includes FHLB advances with original maturities of less than one year of $14.9 billion and $11.4 billion as of March 31, 2019 and December 31, 2018, respectively. |
(d) | Included in beneficial interests issued by consolidated variable interest entities on the Firm’s Consolidated balance sheets. |
(e) | Includes certain TLAC-eligible long-term unsecured debt issued by the Parent Company. |
(f) | Includes long-term structured notes which are secured. |
(g) | For additional information on preferred stock and common stockholders’ equity refer to Capital Risk Management on pages 32–36, Consolidated statements of changes in stockholders’ equity, and Note 20 and Note 21 of JPMorgan Chase’s 2018 Form 10-K. |
Long-term unsecured funding | |||||||||||||
Three months ended March 31, | Three months ended March 31, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
(Notional in millions) | Parent Company(b) | Subsidiaries(b) | |||||||||||
Issuance | |||||||||||||
Senior notes issued in the U.S. market | $ | 4,250 | $ | 4,000 | $ | 1,750 | $ | 4,011 | |||||
Senior notes issued in non-U.S. markets | 2,248 | — | — | — | |||||||||
Total senior notes | 6,498 | 4,000 | 1,750 | 4,011 | |||||||||
Structured notes(a) | 1,185 | 831 | 6,116 | 6,958 | |||||||||
Total long-term unsecured funding – issuance | $ | 7,683 | $ | 4,831 | $ | 7,866 | $ | 10,969 | |||||
Maturities/redemptions | |||||||||||||
Senior notes | $ | 3,750 | $ | 14,059 | $ | 1,815 | $ | 65 | |||||
Subordinated debt | 146 | — | — | — | |||||||||
Structured notes | 628 | 815 | 3,833 | 4,712 | |||||||||
Total long-term unsecured funding – maturities/redemptions | $ | 4,524 | $ | 14,874 | $ | 5,648 | $ | 4,777 |
(a) | Includes certain TLAC-eligible long-term unsecured debt issued by the Parent Company. |
(b) | The prior period amounts have been revised to conform with the current period presentation. |
Long-term secured funding | |||||||||||||
Three months ended March 31, | |||||||||||||
Issuance | Maturities/Redemptions | ||||||||||||
(in millions) | 2019 | 2018 | 2019 | 2018 | |||||||||
Credit card securitization | $ | — | $ | — | $ | — | $ | 4,400 | |||||
FHLB advances | — | 4,000 | 2,001 | 7,751 | |||||||||
Other long-term secured funding(a) | 35 | 121 | 246 | 16 | |||||||||
Total long-term secured funding | $ | 35 | $ | 4,121 | $ | 2,247 | $ | 12,167 |
(a) | Includes long-term structured notes which are secured. |
JPMorgan Chase & Co. | JPMorgan Chase Bank, N.A. Chase Bank USA, N.A. | J.P. Morgan Securities LLC J.P. Morgan Securities plc | |||||||||
March 31, 2019 | Long-term issuer | Short-term issuer | Outlook | Long-term issuer | Short-term issuer | Outlook | Long-term issuer | Short-term issuer | Outlook | ||
Moody’s Investors Service | A2 | P-1 | Stable | Aa2 | P-1 | Stable | Aa3 | P-1 | Stable | ||
Standard & Poor’s | A- | A-2 | Stable | A+ | A-1 | Stable | A+ | A-1 | Stable | ||
Fitch Ratings | AA- | F1+ | Stable | AA | F1+ | Stable | AA | F1+ | Stable |
CREDIT AND INVESTMENT RISK MANAGEMENT |
CREDIT PORTFOLIO |
Total credit portfolio | |||||||||||||
Credit exposure | Nonperforming(d)(e) | ||||||||||||
(in millions) | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||
Loans retained | $ | 943,841 | $ | 969,415 | $ | 4,959 | $ | 4,611 | |||||
Loans held-for-sale | 8,685 | 11,988 | 129 | — | |||||||||
Loans at fair value | 3,719 | 3,151 | 184 | 220 | |||||||||
Total loans–reported | 956,245 | 984,554 | 5,272 | 4,831 | |||||||||
Derivative receivables | 50,333 | 54,213 | 44 | 60 | |||||||||
Receivables from customers and other(a) | 20,952 | 30,217 | — | — | |||||||||
Total credit-related assets | 1,027,530 | 1,068,984 | 5,316 | 4,891 | |||||||||
Assets acquired in loan satisfactions | |||||||||||||
Real estate owned | NA | NA | 269 | 269 | |||||||||
Other | NA | NA | 31 | 30 | |||||||||
Total assets acquired in loan satisfactions | NA | NA | 300 | 299 | |||||||||
Lending-related commitments | 1,060,801 | 1,039,258 | 455 | 469 | |||||||||
Total credit portfolio | $ | 2,088,331 | $ | 2,108,242 | $ | 6,071 | $ | 5,659 | |||||
Credit derivatives used in credit portfolio management activities(b) | $ | (14,490 | ) | $ | (12,682 | ) | $ | — | $ | — | |||
Liquid securities and other cash collateral held against derivatives(c) | (13,976 | ) | (15,322 | ) | NA | NA |
(in millions, except ratios) | Three months ended March 31, | |||||
2019 | 2018 | |||||
Net charge-offs | $ | 1,361 | $ | 1,335 | ||
Average retained loans | ||||||
Loans | 956,557 | 920,428 | ||||
Loans – reported, excluding residential real estate PCI loans | 932,925 | 890,376 | ||||
Net charge-off rates | ||||||
Loans | 0.58 | % | 0.59 | % | ||
Loans – excluding PCI | 0.59 | 0.61 |
(a) | Receivables from customers and other primarily represents held-for-investment margin loans to brokerage customers. |
(b) | Represents the net notional amount of protection purchased and sold through credit derivatives used to manage both performing and nonperforming wholesale credit exposures; these derivatives do not qualify for hedge accounting under U.S. GAAP. For additional information, refer to Credit derivatives on page 54 and Note 4. |
(c) | Includes collateral related to derivative instruments where an appropriate legal opinion has not been either sought or obtained. |
(d) | Excludes PCI loans. The Firm is recognizing interest income on each pool of PCI loans as each of the pools is performing. |
(e) | At March 31, 2019, and December 31, 2018, nonperforming assets excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $2.2 billion and $2.6 billion, respectively, and real estate owned (“REO”) insured by U.S. government agencies of $69 million and $75 million, respectively. These amounts have been excluded based upon the government guarantee. In addition, the Firm’s policy is generally to exempt credit card loans from being placed on nonaccrual status as permitted by regulatory guidance issued by the Federal Financial Institutions Examination Council (“FFIEC”). |
CONSUMER CREDIT PORTFOLIO |
Consumer credit portfolio | |||||||||||||||||||||||||
Three months ended March 31, | |||||||||||||||||||||||||
(in millions, except ratios) | Credit exposure | Nonaccrual loans(f)(g) | Net charge-offs/(recoveries)(h) | Net charge-off/(recoveries) rate(h)(i) | |||||||||||||||||||||
Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||
Consumer, excluding credit card | |||||||||||||||||||||||||
Loans, excluding PCI loans and loans held-for-sale | |||||||||||||||||||||||||
Residential mortgage | $ | 220,158 | $ | 231,078 | $ | 1,755 | $ | 1,765 | $ | (3 | ) | $ | — | (0.01 | )% | — | % | ||||||||
Home equity | 27,072 | 28,340 | 1,276 | 1,323 | 1 | 17 | 0.01 | 0.21 | |||||||||||||||||
Auto(a)(b) | 62,786 | 63,573 | 111 | 128 | 58 | 76 | 0.37 | 0.47 | |||||||||||||||||
Consumer & Business Banking(b)(c) | 26,492 | 26,612 | 247 | 245 | 59 | 53 | 0.90 | 0.83 | |||||||||||||||||
Total loans, excluding PCI loans and loans held-for-sale | 336,508 | 349,603 | 3,389 | 3,461 | 115 | 146 | 0.13 | 0.17 | |||||||||||||||||
Loans – PCI | |||||||||||||||||||||||||
Home equity | 8,584 | 8,963 | NA | NA | NA | NA | NA | NA | |||||||||||||||||
Prime mortgage | 4,529 | 4,690 | NA | NA | NA | NA | NA | NA | |||||||||||||||||
Subprime mortgage | 1,909 | 1,945 | NA | NA | NA | NA | NA | NA | |||||||||||||||||
Option ARMs | 8,185 | 8,436 | NA | NA | NA | NA | NA | NA | |||||||||||||||||
Total loans – PCI | 23,207 | 24,034 | NA | NA | NA | NA | NA | NA | |||||||||||||||||
Total loans – retained | 359,715 | 373,637 | 3,389 | 3,461 | 115 | 146 | 0.13 | 0.16 | |||||||||||||||||
Loans held-for-sale | 4,199 | 95 | — | — | NA | NA | NA | NA | |||||||||||||||||
Total consumer, excluding credit card loans | 363,914 | 373,732 | 3,389 | 3,461 | 115 | 146 | 0.13 | 0.16 | |||||||||||||||||
Lending-related commitments(d) | 48,922 | 46,066 | |||||||||||||||||||||||
Receivables from customers | 20 | 154 | |||||||||||||||||||||||
Total consumer exposure, excluding credit card | 412,856 | 419,952 | |||||||||||||||||||||||
Credit card | |||||||||||||||||||||||||
Loans retained(e) | 150,515 | 156,616 | — | — | 1,202 | 1,170 | 3.23 | 3.32 | |||||||||||||||||
Loans held-for-sale | 12 | 16 | — | — | NA | NA | NA | NA | |||||||||||||||||
Total credit card loans | 150,527 | 156,632 | — | — | 1,202 | 1,170 | 3.23 | 3.32 | |||||||||||||||||
Lending-related commitments(d) | 626,922 | 605,379 | |||||||||||||||||||||||
Total credit card exposure | 777,449 | 762,011 | |||||||||||||||||||||||
Total consumer credit portfolio | $ | 1,190,305 | $ | 1,181,963 | $ | 3,389 | $ | 3,461 | $ | 1,317 | $ | 1,316 | 1.02 | % | 1.04 | % | |||||||||
Memo: Total consumer credit portfolio, excluding PCI | $ | 1,167,098 | $ | 1,157,929 | $ | 3,389 | $ | 3,461 | $ | 1,317 | $ | 1,316 | 1.07 | % | 1.10 | % |
(a) | At March 31, 2019, and December 31, 2018, excluded operating lease assets of $21.1 billion and $20.5 billion, respectively. These operating lease assets are included in other assets on the Firm’s Consolidated balance sheets. For further information, refer to Note 16. |
(b) | Includes certain business banking and auto dealer risk-rated loans that apply the wholesale methodology for determining the allowance for loan losses; these loans are managed by CCB, and therefore, for consistency in presentation, are included within the consumer portfolio. |
(c) | Predominantly includes Business Banking loans. |
(d) | Credit card and home equity lending-related commitments represent the total available lines of credit for these products. The Firm has not experienced, and does not anticipate, that all available lines of credit would be used at the same time. For credit card commitments, and if certain conditions are met, home equity commitments, the Firm can reduce or cancel these lines of credit by providing the borrower notice or, in some cases as permitted by law, without notice. For further information, refer to Note 22. |
(e) | Includes billed interest and fees net of an allowance for uncollectible interest and fees. |
(f) | At March 31, 2019 and December 31, 2018, nonaccrual loans excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $2.2 billion and $2.6 billion, respectively. These amounts have been excluded from nonaccrual loans based upon the government guarantee. In addition, the Firm’s policy is generally to exempt credit card loans from being placed on nonaccrual status, as permitted by regulatory guidance issued by the FFIEC. |
(g) | Excludes PCI loans. The Firm is recognizing interest income on each pool of PCI loans as each of the pools is performing. |
(h) | Net charge-offs/(recoveries) and the net charge-off/(recovery) rates excluded write-offs in the PCI portfolio of $50 million and $20 million for the three months ended March 31, 2019 and 2018, respectively. These write-offs decreased the allowance for loan losses for PCI loans. Refer to Allowance for Credit Losses on pages 55–56 for further information. |
(i) | Average consumer loans held-for-sale were $1.2 billion and $234 million for the three months ended March 31, 2019 and 2018, respectively. These amounts were excluded when calculating net charge-off/(recovery) rates. |
(in millions) | March 31, 2019 | December 31, 2018 | ||||
Current | $ | 2,463 | $ | 2,884 | ||
30-89 days past due | 1,074 | 1,528 | ||||
90 or more days past due | 2,168 | 2,600 | ||||
Total government guaranteed loans | $ | 5,705 | $ | 7,012 |
Summary of PCI loans lifetime principal loss estimates | |||||||||||||||
Lifetime loss estimates(a) | Life-to-date liquidation losses(b) | ||||||||||||||
(in billions) | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||
Home equity | $ | 14.3 | $ | 14.1 | $ | 13.0 | $ | 13.0 | |||||||
Prime mortgage | 4.1 | 4.1 | 3.9 | 3.9 | |||||||||||
Subprime mortgage | 3.4 | 3.3 | 3.2 | 3.2 | |||||||||||
Option ARMs | 10.3 | 10.3 | 9.9 | 9.9 | |||||||||||
Total | $ | 32.1 | $ | 31.8 | $ | 30.0 | $ | 30.0 |
(a) | Includes the original nonaccretable difference established in purchase accounting of $30.5 billion for principal losses plus additional principal losses recognized subsequent to acquisition through the provision and allowance for loan losses. The remaining nonaccretable difference for principal losses was $496 million and $512 million at March 31, 2019, and December 31, 2018, respectively. |
(b) | Represents both realization of loss upon loan resolution and any principal forgiven upon modification. |
Modified residential real estate loans | |||||||||||||
March 31, 2019 | December 31, 2018 | ||||||||||||
(in millions) | Retained loans | Non-accrual retained loans(d) | Retained loans | Non-accrual retained loans(d) | |||||||||
Modified residential real estate loans, excluding PCI loans(a)(b) | |||||||||||||
Residential mortgage | $ | 4,499 | $ | 1,456 | $ | 4,565 | $ | 1,459 | |||||
Home equity | 1,996 | 960 | 2,012 | 955 | |||||||||
Total modified residential real estate loans, excluding PCI loans | $ | 6,495 | $ | 2,416 | $ | 6,577 | $ | 2,414 | |||||
Modified PCI loans(c) | |||||||||||||
Home equity | $ | 2,061 | NA | $ | 2,086 | NA | |||||||
Prime mortgage | 3,115 | NA | 3,179 | NA | |||||||||
Subprime mortgage | 2,014 | NA | 2,041 | NA | |||||||||
Option ARMs | 6,262 | NA | 6,410 | NA | |||||||||
Total modified PCI loans | $ | 13,452 | NA | $ | 13,716 | NA |
(a) | Amounts represent the carrying value of modified residential real estate loans. |
(b) | At March 31, 2019, and December 31, 2018, $3.3 billion and $4.1 billion, respectively, of loans modified subsequent to repurchase from Ginnie Mae in accordance with the standards of the appropriate government agency (i.e., Federal Housing Administration (“FHA”), U.S. Department of Veterans Affairs (“VA”), Rural Housing Service of the U.S. Department of Agriculture (“RHS”)) are not included in the table above. When such loans perform subsequent to modification in accordance with Ginnie Mae guidelines, they are generally sold back into Ginnie Mae loan pools. Modified loans that do not re-perform become subject to foreclosure. For additional information about sales of loans in securitization transactions with Ginnie Mae, refer to Note 13. |
(c) | Amounts represent the unpaid principal balance of modified PCI loans. |
(d) | At March 31, 2019, and December 31, 2018, nonaccrual loans included $1.9 billion and $2.0 billion, respectively, of troubled debt restructurings (“TDRs”) for which the borrowers were less than 90 days past due. For additional information about loans modified in a TDR that are on nonaccrual status, refer to Note 11. |
Nonperforming assets(a) | |||||||
(in millions) | March 31, 2019 | December 31, 2018 | |||||
Nonaccrual loans(b) | |||||||
Residential real estate | $ | 3,031 | $ | 3,088 | |||
Other consumer | 358 | 373 | |||||
Total nonaccrual loans | 3,389 | 3,461 | |||||
Assets acquired in loan satisfactions | |||||||
Real estate owned | 211 | 210 | |||||
Other | 31 | 30 | |||||
Total assets acquired in loan satisfactions | 242 | 240 | |||||
Total nonperforming assets | $ | 3,631 | $ | 3,701 |
(a) | At March 31, 2019, and December 31, 2018, nonperforming assets excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $2.2 billion and $2.6 billion, respectively, and REO insured by U.S. government agencies of $69 million and $75 million, respectively. These amounts have been excluded based upon the government guarantee. |
(b) | Excludes PCI loans, which are accounted for on a pool basis. Since each pool is accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows, the past-due status of the pools, or that of individual loans within the pools, is not meaningful. The Firm is recognizing interest income on each pool of loans as each of the pools is performing. |
Nonaccrual loan activity | |||||||
Three months ended March 31, (in millions) | 2019 | 2018 | |||||
Beginning balance | $ | 3,461 | $ | 4,209 | |||
Additions | 581 | 911 | |||||
Reductions: | |||||||
Principal payments and other(a) | 235 | 340 | |||||
Charge-offs | 106 | 140 | |||||
Returned to performing status | 242 | 309 | |||||
Foreclosures and other liquidations | 70 | 71 | |||||
Total reductions | 653 | 860 | |||||
Net changes | (72 | ) | 51 | ||||
Ending balance | $ | 3,389 | $ | 4,260 |
(a) | Other reductions includes loan sales. |
WHOLESALE CREDIT PORTFOLIO |
Wholesale credit portfolio | |||||||||||||
Credit exposure | Nonperforming(c) | ||||||||||||
(in millions) | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||
Loans retained | $ | 433,611 | $ | 439,162 | $ | 1,570 | $ | 1,150 | |||||
Loans held-for-sale | 4,474 | 11,877 | 129 | — | |||||||||
Loans at fair value | 3,719 | 3,151 | 184 | 220 | |||||||||
Loans – reported | 441,804 | 454,190 | 1,883 | 1,370 | |||||||||
Derivative receivables | 50,333 | 54,213 | 44 | 60 | |||||||||
Receivables from customers and other(a) | 20,932 | 30,063 | — | — | |||||||||
Total wholesale credit-related assets | 513,069 | 538,466 | 1,927 | 1,430 | |||||||||
Lending-related commitments | 384,957 | 387,813 | 455 | 469 | |||||||||
Total wholesale credit exposure | $ | 898,026 | $ | 926,279 | $ | 2,382 | $ | 1,899 | |||||
Credit derivatives used in credit portfolio management activities(b) | $ | (14,490 | ) | $ | (12,682 | ) | $ | — | $ | — | |||
Liquid securities and other cash collateral held against derivatives | (13,976 | ) | (15,322 | ) | NA | NA |
(a) | Receivables from customers and other include $20.9 billion and $30.1 billion of held-for-investment margin loans at March 31, 2019, and December 31, 2018, respectively, to prime brokerage customers in CIB and AWM; these are classified in accrued interest and accounts receivable on the Consolidated balance sheets. |
(b) | Represents the net notional amount of protection purchased and sold through credit derivatives used to manage both performing and nonperforming wholesale credit exposures; these derivatives do not qualify for hedge accounting under U.S. GAAP. For additional information, refer to Credit derivatives on page 54, and Note 4. |
(c) | Excludes assets acquired in loan satisfactions. |
Wholesale credit exposure – maturity and ratings profile | |||||||||||||||||||||||||
Maturity profile(d) | Ratings profile | ||||||||||||||||||||||||
Due in 1 year or less | Due after 1 year through 5 years | Due after 5 years | Total | Investment-grade | Noninvestment-grade | Total | Total % of IG | ||||||||||||||||||
March 31, 2019 (in millions, except ratios) | AAA/Aaa to BBB-/Baa3 | BB+/Ba1 & below | |||||||||||||||||||||||
Loans retained | $ | 130,048 | $ | 200,469 | $ | 103,094 | $ | 433,611 | $ | 332,514 | $ | 101,097 | $ | 433,611 | 77 | % | |||||||||
Derivative receivables | 50,333 | 50,333 | |||||||||||||||||||||||
Less: Liquid securities and other cash collateral held against derivatives | (13,976 | ) | (13,976 | ) | |||||||||||||||||||||
Total derivative receivables, net of all collateral | 10,007 | 8,674 | 17,676 | 36,357 | 29,689 | 6,668 | 36,357 | 82 | |||||||||||||||||
Lending-related commitments | 71,622 | 302,913 | 10,422 | 384,957 | 293,073 | 91,884 | 384,957 | 76 | |||||||||||||||||
Subtotal | 211,677 | 512,056 | 131,192 | 854,925 | 655,276 | 199,649 | 854,925 | 77 | |||||||||||||||||
Loans held-for-sale and loans at fair value(a) | 8,193 | 8,193 | |||||||||||||||||||||||
Receivables from customers and other | 20,932 | 20,932 | |||||||||||||||||||||||
Total exposure – net of liquid securities and other cash collateral held against derivatives | $ | 884,050 | $ | 884,050 | |||||||||||||||||||||
Credit derivatives used in credit portfolio management activities(b)(c) | $ | (1,238 | ) | $ | (7,087 | ) | $ | (6,165 | ) | $ | (14,490 | ) | $ | (12,987 | ) | $ | (1,503 | ) | $ | (14,490 | ) | 90 | % |
Maturity profile(d) | Ratings profile | ||||||||||||||||||||||||
Due in 1 year or less | Due after 1 year through 5 years | Due after 5 years | Total | Investment-grade | Noninvestment-grade | Total | Total % of IG | ||||||||||||||||||
December 31, 2018 (in millions, except ratios) | AAA/Aaa to BBB-/Baa3 | BB+/Ba1 & below | |||||||||||||||||||||||
Loans retained | $ | 138,458 | $ | 196,974 | $ | 103,730 | $ | 439,162 | $ | 339,729 | $ | 99,433 | $ | 439,162 | 77 | % | |||||||||
Derivative receivables | 54,213 | 54,213 | |||||||||||||||||||||||
Less: Liquid securities and other cash collateral held against derivatives | (15,322 | ) | (15,322 | ) | |||||||||||||||||||||
Total derivative receivables, net of all collateral | 11,038 | 9,169 | 18,684 | 38,891 | 31,794 | 7,097 | 38,891 | 82 | |||||||||||||||||
Lending-related commitments | 79,400 | 294,855 | 13,558 | 387,813 | 288,724 | 99,089 | 387,813 | 74 | |||||||||||||||||
Subtotal | 228,896 | 500,998 | 135,972 | 865,866 | 660,247 | 205,619 | 865,866 | 76 | |||||||||||||||||
Loans held-for-sale and loans at fair value(a) | 15,028 | 15,028 | |||||||||||||||||||||||
Receivables from customers and other | 30,063 | 30,063 | |||||||||||||||||||||||
Total exposure – net of liquid securities and other cash collateral held against derivatives | $ | 910,957 | $ | 910,957 | |||||||||||||||||||||
Credit derivatives used in credit portfolio management activities(b)(c) | $ | (447 | ) | $ | (9,318 | ) | $ | (2,917 | ) | $ | (12,682 | ) | $ | (11,213 | ) | $ | (1,469 | ) | $ | (12,682 | ) | 88 | % |
(a) | Represents loans held-for-sale, primarily related to syndicated loans and loans transferred from the retained portfolio, and loans at fair value. |
(b) | These derivatives do not qualify for hedge accounting under U.S. GAAP. |
(c) | The notional amounts are presented on a net basis by underlying reference entity and the ratings profile shown is based on the ratings of the reference entity on which protection has been purchased. Predominantly all of the credit derivatives entered into by the Firm where it has purchased protection used in credit portfolio management activities are executed with investment-grade counterparties. |
(d) | The maturity profile of retained loans, lending-related commitments and derivative receivables is based on the remaining contractual maturity. Derivative contracts that are in a receivable position at March 31, 2019, may become payable prior to maturity based on their cash flow profile or changes in market conditions. |
Wholesale credit exposure – industries(a) | |||||||||||||||||||||||||||||
Selected metrics | |||||||||||||||||||||||||||||
30 days or more past due and accruing loans | Net charge-offs/ (recoveries) | Credit derivative hedges(g) | Liquid securities and other cash collateral held against derivative receivables | ||||||||||||||||||||||||||
Noninvestment-grade | |||||||||||||||||||||||||||||
As of or for the three months ended | Credit exposure(f) | Investment- grade | Noncriticized | Criticized performing | Criticized nonperforming | ||||||||||||||||||||||||
March 31, 2019 | |||||||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||
Real Estate | $ | 143,322 | $ | 117,700 | $ | 24,411 | $ | 1,099 | $ | 112 | $ | 173 | $ | — | $ | (2 | ) | $ | (1 | ) | |||||||||
Individuals and Individual Entities(b) | 94,490 | 83,570 | 10,347 | 239 | 334 | 1,411 | 2 | — | (876 | ) | |||||||||||||||||||
Consumer & Retail | 87,127 | 54,261 | 30,564 | 2,127 | 175 | 56 | 9 | (237 | ) | (6 | ) | ||||||||||||||||||
Technology, Media & Telecommunications | 64,629 | 41,182 | 21,013 | 2,305 | 129 | 5 | 11 | (772 | ) | (4 | ) | ||||||||||||||||||
Industrials | 57,857 | 37,773 | 18,372 | 1,534 | 178 | 170 | — | (479 | ) | (34 | ) | ||||||||||||||||||
Banks & Finance Cos | 48,425 | 32,849 | 15,373 | 198 | 5 | 3 | — | (553 | ) | (2,829 | ) | ||||||||||||||||||
Healthcare | 44,920 | 34,357 | 9,779 | 687 | 97 | 45 | 9 | (190 | ) | (157 | ) | ||||||||||||||||||
Oil & Gas | 44,136 | 24,937 | 17,398 | 1,157 | 644 | — | (1 | ) | (398 | ) | (8 | ) | |||||||||||||||||
Asset Managers | 43,884 | 38,396 | 5,455 | 4 | 29 | 114 | — | — | (4,824 | ) | |||||||||||||||||||
Utilities | 29,005 | 23,370 | 5,219 | 165 | 251 | 2 | 18 | (206 | ) | (58 | ) | ||||||||||||||||||
Automotive | 28,483 | 21,635 | 6,505 | 343 | — | 8 | — | (149 | ) | — | |||||||||||||||||||
State & Municipal Govt(c) | 27,135 | 26,530 | 602 | 3 | — | 7 | — | (34 | ) | (19 | ) | ||||||||||||||||||
Central Govt | 16,976 | 16,676 | 300 | — | — | 3 | — | (8,020 | ) | (1,700 | ) | ||||||||||||||||||
Metals & Mining | 16,347 | 8,687 | 7,365 | 268 | 27 | 2 | (1 | ) | (146 | ) | (4 | ) | |||||||||||||||||
Chemicals & Plastics | 16,325 | 11,870 | 4,321 | 134 | — | 3 | — | (10 | ) | — | |||||||||||||||||||
Transportation | 15,952 | 10,173 | 5,413 | 293 | 73 | 32 | — | (26 | ) | (36 | ) | ||||||||||||||||||
Insurance | 12,718 | 9,742 | 2,962 | — | 14 | 1 | — | (36 | ) | (2,129 | ) | ||||||||||||||||||
Financial Markets Infrastructure | 5,955 | 5,737 | 218 | — | — | — | — | — | (6 | ) | |||||||||||||||||||
Securities Firms | 3,980 | 2,623 | 1,357 | — | — | — | — | (158 | ) | (479 | ) | ||||||||||||||||||
All other(d) | 67,235 | 65,493 | 1,735 | 6 | 1 | — | (3 | ) | (3,074 | ) | (806 | ) | |||||||||||||||||
Subtotal | $ | 868,901 | $ | 667,561 | $ | 188,709 | $ | 10,562 | $ | 2,069 | $ | 2,035 | $ | 44 | $ | (14,490 | ) | $ | (13,976 | ) | |||||||||
Loans held-for-sale and loans at fair value | 8,193 | ||||||||||||||||||||||||||||
Receivables from customers and other | 20,932 | ||||||||||||||||||||||||||||
Total(e) | $ | 898,026 |
(continued from previous page) | |||||||||||||||||||||||||||||
Selected metrics | |||||||||||||||||||||||||||||
30 days or more past due and accruing loans | Net charge-offs/ (recoveries) | Credit derivative hedges(g) | Liquid securities and other cash collateral held against derivative receivables | ||||||||||||||||||||||||||
Noninvestment-grade | |||||||||||||||||||||||||||||
As of or for the year ended | Credit exposure(f) | Investment- grade | Noncriticized | Criticized performing | Criticized nonperforming | ||||||||||||||||||||||||
December 31, 2018 | |||||||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||
Real Estate | $ | 143,316 | $ | 117,988 | $ | 24,174 | $ | 1,019 | $ | 135 | $ | 70 | $ | (20 | ) | $ | (2 | ) | $ | (1 | ) | ||||||||
Individuals and Individual Entities(b) | 97,077 | 86,581 | 10,164 | 174 | 158 | 703 | 12 | — | (915 | ) | |||||||||||||||||||
Consumer & Retail | 94,815 | 60,678 | 31,901 | 2,033 | 203 | 43 | 55 | (248 | ) | (14 | ) | ||||||||||||||||||
Technology, Media & Telecommunications | 72,646 | 46,334 | 24,081 | 2,170 | 61 | 8 | 12 | (1,011 | ) | (12 | ) | ||||||||||||||||||
Industrials | 58,528 | 38,487 | 18,594 | 1,311 | 136 | 171 | 20 | (207 | ) | (29 | ) | ||||||||||||||||||
Banks & Finance Cos | 49,920 | 34,120 | 15,496 | 299 | 5 | 11 | — | (575 | ) | (2,290 | ) | ||||||||||||||||||
Healthcare | 48,142 | 36,687 | 10,625 | 761 | 69 | 23 | (5 | ) | (150 | ) | (133 | ) | |||||||||||||||||
Oil & Gas | 42,600 | 23,356 | 17,451 | 1,158 | 635 | 6 | 36 | (248 | ) | — | |||||||||||||||||||
Asset Managers | 42,807 | 36,722 | 6,067 | 4 | 14 | 10 | — | — | (5,829 | ) | |||||||||||||||||||
Utilities | 28,172 | 23,558 | 4,326 | 138 | 150 | — | 38 | (142 | ) | (60 | ) | ||||||||||||||||||
Automotive | 17,339 | 9,637 | 7,310 | 392 | — | 1 | — | (125 | ) | — | |||||||||||||||||||
State & Municipal Govt(c) | 27,351 | 26,746 | 603 | 2 | — | 18 | (1 | ) | — | (42 | ) | ||||||||||||||||||
Central Govt | 18,456 | 18,251 | 124 | 81 | — | 4 | — | (7,994 | ) | (2,130 | ) | ||||||||||||||||||
Metals & Mining | 15,359 | 8,188 | 6,767 | 385 | 19 | 1 | — | (174 | ) | (22 | ) | ||||||||||||||||||
Chemicals & Plastics | 16,035 | 11,490 | 4,427 | 118 | — | 4 | — | — | — | ||||||||||||||||||||
Transportation | 15,660 | 10,508 | 4,699 | 393 | 60 | 21 | 6 | (31 | ) | (112 | ) | ||||||||||||||||||
Insurance | 12,639 | 9,777 | 2,830 | — | 32 | — | — | (36 | ) | (2,080 | ) | ||||||||||||||||||
Financial Markets Infrastructure | 7,484 | 6,746 | 738 | — | — | — | — | — | (26 | ) | |||||||||||||||||||
Securities Firms | 4,558 | 3,099 | 1,459 | — | — | — | — | (158 | ) | (823 | ) | ||||||||||||||||||
All other(d) | 68,284 | 64,664 | 3,606 | 12 | 2 | 2 | 2 | (1,581 | ) | (804 | ) | ||||||||||||||||||
Subtotal | $ | 881,188 | $ | 673,617 | $ | 195,442 | $ | 10,450 | $ | 1,679 | $ | 1,096 | $ | 155 | $ | (12,682 | ) | $ | (15,322 | ) | |||||||||
Loans held-for-sale and loans at fair value | 15,028 | ||||||||||||||||||||||||||||
Receivables from customers and other | 30,063 | ||||||||||||||||||||||||||||
Total(e) | $ | 926,279 |
(a) | The industry rankings presented in the table as of December 31, 2018, are based on the industry rankings of the corresponding exposures at March 31, 2019, not actual rankings of such exposures at December 31, 2018. |
(b) | Individuals and Individual Entities predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts. |
(c) | In addition to the credit risk exposure to states and municipal governments (both U.S. and non-U.S.) at March 31, 2019, and December 31, 2018, noted above, the Firm held: $6.8 billion and $7.8 billion, respectively, of trading securities; $34.5 billion and $37.7 billion, respectively, of AFS securities; and $4.8 billion at both periods of held-to-maturity (“HTM”) securities, issued by U.S. state and municipal governments. For further information, refer to Note 2 and Note 9. |
(d) | All other includes: SPEs and Private education and civic organizations, representing approximately 91% and 9%, respectively, at March 31, 2019, and 92% and 8%, respectively, at December 31, 2018. |
(e) | Excludes cash placed with banks of $294.9 billion and $268.1 billion, at March 31, 2019, and December 31, 2018, respectively, which is predominantly placed with various central banks, primarily Federal Reserve Banks. |
(f) | Credit exposure is net of risk participations and excludes the benefit of credit derivatives used in credit portfolio management activities held against derivative receivables or loans and liquid securities and other cash collateral held against derivative receivables. |
(g) | Represents the net notional amounts of protection purchased and sold through credit derivatives used to manage the credit exposures; these derivatives do not qualify for hedge accounting under U.S. GAAP. The All other category includes purchased credit protection on certain credit indices. |
March 31, 2019 | ||||||||||||||||||
(in millions, except ratios) | Loans and Lending-related Commitments | Derivative Receivables | Credit exposure | % Investment-grade | % Drawn(c) | |||||||||||||
Multifamily(a) | $ | 85,970 | $ | 56 | $ | 86,026 | 89 | % | 92 | % | ||||||||
Other | 57,053 | 243 | 57,296 | 72 | 64 | |||||||||||||
Total Real Estate Exposure(b) | 143,023 | 299 | 143,322 | 82 | 81 | |||||||||||||
December 31, 2018 | ||||||||||||||||||
(in millions, except ratios) | Loans and Lending-related Commitments | Derivative Receivables | Credit exposure | % Investment- grade | % Drawn(c) | |||||||||||||
Multifamily(a) | $ | 85,683 | $ | 33 | $ | 85,716 | 89 | % | 92 | % | ||||||||
Other | 57,469 | 131 | 57,600 | 72 | 63 | |||||||||||||
Total Real Estate Exposure(b) | 143,152 | 164 | 143,316 | 82 | 81 |
(a) | Multifamily exposure is largely in California. |
(b) | Real Estate exposure is predominantly secured; unsecured exposure is predominantly investment-grade. |
(c) | Represents drawn exposure as a percentage of credit exposure. |
Wholesale nonaccrual loan activity | |||||||
Three months ended March 31, (in millions) | 2019 | 2018 | |||||
Beginning balance | $ | 1,370 | $ | 1,734 | |||
Additions | 773 | 313 | |||||
Reductions: | |||||||
Paydowns and other | 181 | 182 | |||||
Gross charge-offs | 51 | 55 | |||||
Returned to performing status | 23 | 117 | |||||
Sales | 5 | 70 | |||||
Total reductions | 260 | 424 | |||||
Net changes | 513 | (111 | ) | ||||
Ending balance | $ | 1,883 | $ | 1,623 |
Wholesale net charge-offs/(recoveries) | ||||||
(in millions, except ratios) | Three months ended March 31, | |||||
2019 | 2018 | |||||
Loans – reported | ||||||
Average loans retained | $ | 434,660 | $ | 404,859 | ||
Gross charge-offs | 52 | 65 | ||||
Gross recoveries | (8 | ) | (46 | ) | ||
Net charge-offs/(recoveries) | 44 | 19 | ||||
Net charge-off/(recovery) rate | 0.04 | % | 0.02 | % |
Derivative receivables | ||||||
(in millions) | March 31, 2019 | December 31, 2018 | ||||
Total, net of cash collateral | 50,333 | 54,213 | ||||
Liquid securities and other cash collateral held against derivative receivables(a) | (13,976 | ) | (15,322 | ) | ||
Total, net of collateral | $ | 36,357 | $ | 38,891 |
(a) | Includes collateral related to derivative instruments where appropriate legal opinions have not been either sought or obtained with respect to master netting agreements. |
Ratings profile of derivative receivables | |||||||||||
Rating equivalent | March 31, 2019 | December 31, 2018 | |||||||||
(in millions, except ratios) | Exposure net of all collateral | % of exposure net of all collateral | Exposure net of all collateral | % of exposure net of all collateral | |||||||
AAA/Aaa to AA-/Aa3 | $ | 11,249 | 31 | % | $ | 11,831 | 31 | % | |||
A+/A1 to A-/A3 | 5,072 | 14 | 7,428 | 19 | |||||||
BBB+/Baa1 to BBB-/Baa3 | 13,368 | 37 | 12,536 | 32 | |||||||
BB+/Ba1 to B-/B3 | 5,994 | 16 | 6,373 | 16 | |||||||
CCC+/Caa1 and below | 674 | 2 | 723 | 2 | |||||||
Total | $ | 36,357 | 100 | % | $ | 38,891 | 100 | % |
Credit derivatives used in credit portfolio management activities | |||||||
Notional amount of protection purchased and sold(a) | |||||||
(in millions) | March 31, 2019 | December 31, 2018 | |||||
Credit derivatives used to manage: | |||||||
Loans and lending-related commitments | $ | 1,529 | $ | 1,272 | |||
Derivative receivables | 12,961 | 11,410 | |||||
Credit derivatives used in credit portfolio management activities | $ | 14,490 | $ | 12,682 |
(a) | Amounts are presented net, considering the Firm’s net protection purchased or sold with respect to each underlying reference entity or index. |
ALLOWANCE FOR CREDIT LOSSES |
Summary of changes in the allowance for credit losses | |||||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||||
Three months ended March 31, | Consumer, excluding credit card | Credit card | Wholesale | Total | Consumer, excluding credit card | Credit card | Wholesale | Total | |||||||||||||||||
(in millions, except ratios) | |||||||||||||||||||||||||
Allowance for loan losses | |||||||||||||||||||||||||
Beginning balance at January 1, | $ | 4,146 | $ | 5,184 | $ | 4,115 | $ | 13,445 | $ | 4,579 | $ | 4,884 | $ | 4,141 | $ | 13,604 | |||||||||
Gross charge-offs | 246 | 1,344 | 52 | 1,642 | 284 | 1,291 | 65 | 1,640 | |||||||||||||||||
Gross recoveries | (131 | ) | (142 | ) | (8 | ) | (281 | ) | (138 | ) | (121 | ) | (46 | ) | (305 | ) | |||||||||
Net charge-offs | 115 | 1,202 | 44 | 1,361 | 146 | 1,170 | 19 | 1,335 | |||||||||||||||||
Write-offs of PCI loans(a) | 50 | — | — | 50 | 20 | — | — | 20 | |||||||||||||||||
Provision for loan losses | 114 | 1,202 | 176 | 1,492 | 146 | 1,170 | (189 | ) | 1,127 | ||||||||||||||||
Other | 2 | (1 | ) | 6 | 7 | 1 | — | (2 | ) | (1 | ) | ||||||||||||||
Ending balance at March 31, | $ | 4,097 | $ | 5,183 | $ | 4,253 | $ | 13,533 | $ | 4,560 | $ | 4,884 | $ | 3,931 | $ | 13,375 | |||||||||
Impairment methodology | |||||||||||||||||||||||||
Asset-specific(b) | $ | 151 | $ | 461 | $ | 417 | $ | 1,029 | $ | 266 | $ | 393 | $ | 474 | $ | 1,133 | |||||||||
Formula-based | 2,208 | 4,722 | 3,836 | 10,766 | 2,089 | 4,491 | 3,457 | 10,037 | |||||||||||||||||
PCI | 1,738 | — | — | 1,738 | 2,205 | — | — | 2,205 | |||||||||||||||||
Total allowance for loan losses | $ | 4,097 | $ | 5,183 | $ | 4,253 | $ | 13,533 | $ | 4,560 | $ | 4,884 | $ | 3,931 | $ | 13,375 | |||||||||
Allowance for lending-related commitments | |||||||||||||||||||||||||
Beginning balance at January 1, | $ | 33 | $ | — | $ | 1,022 | $ | 1,055 | $ | 33 | $ | — | $ | 1,035 | $ | 1,068 | |||||||||
Provision for lending-related commitments | — | — | 3 | 3 | — | — | 38 | 38 | |||||||||||||||||
Other | — | — | — | — | — | — | 1 | 1 | |||||||||||||||||
Ending balance at March 31, | $ | 33 | $ | — | $ | 1,025 | $ | 1,058 | $ | 33 | $ | — | $ | 1,074 | $ | 1,107 | |||||||||
Impairment methodology | |||||||||||||||||||||||||
Asset-specific | $ | — | $ | — | $ | 114 | $ | 114 | $ | — | $ | — | $ | 167 | $ | 167 | |||||||||
Formula-based | 33 | — | 911 | 944 | 33 | — | 907 | 940 | |||||||||||||||||
Total allowance for lending-related commitments(c) | $ | 33 | $ | — | $ | 1,025 | $ | 1,058 | $ | 33 | $ | — | $ | 1,074 | $ | 1,107 | |||||||||
Total allowance for credit losses | $ | 4,130 | $ | 5,183 | $ | 5,278 | $ | 14,591 | $ | 4,593 | $ | 4,884 | $ | 5,005 | $ | 14,482 | |||||||||
Memo: | |||||||||||||||||||||||||
Retained loans, end of period | $ | 359,715 | $ | 150,515 | $ | 433,611 | $ | 943,841 | $ | 373,243 | $ | 140,348 | $ | 412,020 | $ | 925,611 | |||||||||
Retained loans, average | 370,777 | 151,120 | 434,660 | 956,557 | 372,739 | 142,830 | 404,859 | 920,428 | |||||||||||||||||
PCI loans, end of period | 23,207 | — | — | 23,207 | 29,505 | — | 3 | 29,508 | |||||||||||||||||
Credit ratios | |||||||||||||||||||||||||
Allowance for loan losses to retained loans | 1.14 | % | 3.44 | % | 0.98 | % | 1.43 | % | 1.22 | % | 3.48 | % | 0.95 | % | 1.44 | % | |||||||||
Allowance for loan losses to retained nonaccrual loans(d) | 121 | NM | 271 | 273 | 108 | NM | 247 | 230 | |||||||||||||||||
Allowance for loan losses to retained nonaccrual loans excluding credit card | 121 | NM | 271 | 168 | 108 | NM | 247 | 146 | |||||||||||||||||
Net charge-off rates | 0.13 | 3.23 | 0.04 | 0.58 | 0.16 | 3.32 | 0.02 | 0.59 | |||||||||||||||||
Credit ratios, excluding residential real estate PCI loans | |||||||||||||||||||||||||
Allowance for loan losses to retained loans | 0.70 | 3.44 | 0.98 | 1.28 | 0.69 | 3.48 | 0.95 | 1.25 | |||||||||||||||||
Allowance for loan losses to retained nonaccrual loans(d) | 70 | NM | 271 | 238 | 56 | NM | 247 | 192 | |||||||||||||||||
Allowance for loan losses to retained nonaccrual loans excluding credit card | 70 | NM | 271 | 133 | 56 | NM | 247 | 108 | |||||||||||||||||
Net charge-off rates | 0.13 | % | 3.23 | % | 0.04 | % | 0.59 | % | 0.17 | % | 3.32 | % | 0.02 | % | 0.61 | % |
(a) | Write-offs of PCI loans are recorded against the allowance for loan losses when actual losses for a pool exceed estimated losses that were recorded as purchase accounting adjustments at the time of acquisition. A write-off of a PCI loan is recognized when the underlying loan is removed from a pool. |
(b) | Includes risk-rated loans that have been placed on nonaccrual status and loans that have been modified in a TDR. The asset-specific credit card allowance for loan losses modified in a TDR is calculated based on the loans’ original contractual interest rates and does not consider any incremental penalty rates. |
(c) | The allowance for lending-related commitments is reported in accounts payable and other liabilities on the Consolidated balance sheets. |
(d) | The Firm’s policy is generally to exempt credit card loans from being placed on nonaccrual status as permitted by regulatory guidance. |
INVESTMENT PORTFOLIO RISK MANAGEMENT |
MARKET RISK MANAGEMENT |
Total VaR | ||||||||||||||||||||||||||||||||||||||
Three months ended | ||||||||||||||||||||||||||||||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2018 | ||||||||||||||||||||||||||||||||||||
(in millions) | Avg. | Min | Max | Avg. | Min | Max | Avg. | Min | Max | |||||||||||||||||||||||||||||
CIB trading VaR by risk type | ||||||||||||||||||||||||||||||||||||||
Fixed income | $ | 44 | $ | 38 | $ | 50 | $ | 37 | $ | 28 | $ | 46 | $ | 34 | $ | 30 | $ | 39 | ||||||||||||||||||||
Foreign exchange | 9 | 4 | 15 | 6 | 3 | 10 | 9 | 6 | 15 | |||||||||||||||||||||||||||||
Equities | 16 | 13 | 22 | 20 | 16 | 26 | 17 | 15 | 22 | |||||||||||||||||||||||||||||
Commodities and other | 10 | 9 | 12 | 11 | 9 | 13 | 5 | 4 | 6 | |||||||||||||||||||||||||||||
Diversification benefit to CIB trading VaR | (32 | ) | (a) | NM | (b) | NM | (b) | (25 | ) | (a) | NM | (b) | NM | (b) | (25 | ) | (a) | NM | (b) | NM | (b) | |||||||||||||||||
CIB trading VaR | 47 | 36 | (b) | 61 | (b) | 49 | 32 | (b) | 58 | (b) | 40 | 35 | (b) | 49 | (b) | |||||||||||||||||||||||
Credit portfolio VaR | 5 | 4 | 6 | 4 | 3 | 4 | 3 | 3 | 4 | |||||||||||||||||||||||||||||
Diversification benefit to CIB VaR | (4 | ) | (a) | NM | (b) | NM | (b) | (4 | ) | (a) | NM | (b) | NM | (b) | (3 | ) | (a) | NM | (b) | NM | (b) | |||||||||||||||||
CIB VaR | 48 | 37 | (b) | 63 | (b) | 49 | 32 | (b) | 59 | (b) | 40 | 35 | (b) | 51 | (b) | |||||||||||||||||||||||
CCB VaR | 2 | 1 | 3 | 1 | — | 2 | 1 | 1 | 2 | |||||||||||||||||||||||||||||
Corporate VaR | 10 | 9 | 12 | 11 | 9 | 13 | 12 | 10 | 14 | |||||||||||||||||||||||||||||
Diversification benefit to other VaR | (2 | ) | (a) | NM | (b) | NM | (b) | (1 | ) | (a) | NM | (b) | NM | (b) | (1 | ) | (a) | NM | (b) | NM | (b) | |||||||||||||||||
Other VaR | 10 | 9 | (b) | 11 | (b) | 11 | 9 | (b) | 13 | (b) | 12 | 10 | (b) | 14 | (b) | |||||||||||||||||||||||
Diversification benefit to CIB and other VaR | (6 | ) | (a) | NM | (b) | NM | (b) | (9 | ) | (a) | NM | (b) | NM | (b) | (9 | ) | (a) | NM | (b) | NM | (b) | |||||||||||||||||
Total VaR | $ | 52 | $ | 40 | (b) | $ | 65 | (b) | $ | 51 | $ | 34 | (b) | $ | 62 | (b) | $ | 43 | $ | 37 | (b) | $ | 53 | (b) |
(a) | Average portfolio VaR is less than the sum of the VaR of the components described above, which is due to portfolio diversification. The diversification effect reflects that the risks are not perfectly correlated. |
(b) | Diversification benefit represents the difference between the total VaR and each reported level and the sum of its individual components. Diversification benefit reflects the non-additive nature of VaR due to imperfect correlation across lines of business, Corporate, and risk types. The maximum and minimum VaR for each portfolio may have occurred on different trading days than the components and consequently diversification benefit is not meaningful. |
January | February | March |
(in billions) | March 31, 2019 | December 31, 2018 | |||||
Parallel shift: | |||||||
+100 bps shift in rates | $ | 1.2 | $ | 0.9 | |||
-100 bps shift in rates | (2.5 | ) | (2.1 | ) | |||
Steeper yield curve: | |||||||
+100 bps shift in long-term rates | 0.7 | 0.5 | |||||
-100 bps shift in short-term rates | (1.3 | ) | (1.2 | ) | |||
Flatter yield curve: | |||||||
+100 bps shift in short-term rates | 0.5 | 0.4 | |||||
-100 bps shift in long-term rates | (1.2 | ) | (0.9 | ) |
(in billions) | March 31, 2019 | December 31, 2018 | |||||
Parallel shift: | |||||||
+100 bps shift in rates | $ | 0.6 | $ | 0.5 | |||
Flatter yield curve: | |||||||
+100 bps shift in short-term rates | 0.6 | 0.5 |
Gain/(loss) (in millions) | March 31, 2019 | December 31, 2018 | ||||||||||
Activity | Description | Sensitivity measure | ||||||||||
Investment activities(a) | ||||||||||||
Investment management activities | Consists of seed capital and related hedges; and fund co-investments | 10% decline in market value | $ | (112 | ) | $ | (102 | ) | ||||
Other investments | Consists of privately held equity and other investments held at fair value | 10% decline in market value | (221 | ) | (218 | ) | ||||||
Funding activities | ||||||||||||
Non-USD LTD cross-currency basis | Represents the basis risk on derivatives used to hedge the foreign exchange risk on the non-USD LTD(b) | 1 basis point parallel tightening of cross currency basis | (14 | ) | (13 | ) | ||||||
Non-USD LTD hedges foreign currency (“FX”) exposure | Primarily represents the foreign exchange revaluation on the fair value of the derivative hedges(b) | 10% depreciation of currency | 17 | 17 | ||||||||
Derivatives – funding spread risk | Impact of changes in the spread related to derivatives FVA | 1 basis point parallel increase in spread | (4 | ) | (4 | ) | ||||||
Fair value option elected liabilities – funding spread risk | Impact of changes in the spread related to fair value option elected liabilities DVA(b) | 1 basis point parallel increase in spread | 28 | 30 | ||||||||
Fair value option elected liabilities – interest rate sensitivity | Interest rate sensitivity on fair value option liabilities resulting from a change in the Firm’s own credit spread(b) | 1 basis point parallel increase in spread | — | 1 |
(a) | Excludes equity securities without readily determinable fair values that are measured under the measurement alternative. Refer to Note 2 for additional information. |
(b) | Impact recognized through OCI. |
COUNTRY RISK MANAGEMENT |
Top 20 country exposures (excluding the U.S.)(a) | ||||||||||||||||
(in billions) | March 31, 2019 | December 31, 2018(f) | ||||||||||||||
Lending and deposits(b) | Trading and investing(c)(d) | Other(e) | Total exposure | Total exposure | ||||||||||||
Germany | $ | 59.4 | $ | 11.2 | $ | 0.2 | $ | 70.8 | $ | 62.1 | ||||||
United Kingdom | 31.8 | 10.2 | 1.4 | 43.4 | 40.7 | |||||||||||
Japan | 29.7 | 6.0 | 0.3 | 36.0 | 29.1 | |||||||||||
China | 9.8 | 7.5 | 2.5 | 19.8 | 19.3 | |||||||||||
Switzerland | 10.1 | 0.5 | 5.6 | 16.2 | 12.8 | |||||||||||
Canada | 12.1 | 3.1 | — | 15.2 | 14.3 | |||||||||||
India | 6.2 | 4.8 | 2.0 | 13.0 | 11.8 | |||||||||||
Luxembourg | 11.2 | 0.5 | — | 11.7 | 11.0 | |||||||||||
Australia | 6.9 | 4.1 | — | 11.0 | 13.0 | |||||||||||
Brazil | 5.0 | 5.6 | — | 10.6 | 7.3 | |||||||||||
France | 9.5 | (0.1 | ) | 0.9 | 10.3 | 17.9 | ||||||||||
Netherlands | 5.4 | 1.2 | 2.5 | 9.1 | 5.8 | |||||||||||
Italy | 2.5 | 4.1 | 0.1 | 6.7 | 6.4 | |||||||||||
Singapore | 3.9 | 1.3 | 1.3 | 6.5 | 6.8 | |||||||||||
South Korea | 4.2 | 2.0 | 0.3 | 6.5 | 7.6 | |||||||||||
Spain | 3.6 | 2.3 | — | 5.9 | 5.1 | |||||||||||
Saudi Arabia | 4.8 | 0.4 | — | 5.2 | 5.3 | |||||||||||
Mexico | 4.3 | 0.5 | — | 4.8 | 5.5 | |||||||||||
Belgium | 3.5 | 1.0 | — | 4.5 | 2.3 | |||||||||||
Hong Kong | 2.1 | 1.2 | 0.8 | 4.1 | 5.4 |
(a) | Country exposures presented in the table reflect 87% of total firmwide non-U.S. exposure, where exposure is attributed to a specific country, at both March 31, 2019, and December 31, 2018. |
(b) | Lending and deposits includes loans and accrued interest receivable (net of eligible collateral and the allowance for loan losses), deposits with banks (including central banks), acceptances, other monetary assets, issued letters of credit net of participations, and unused commitments to extend credit. Excludes intra-day and operating exposures, such as those from settlement and clearing activities. |
(c) | Includes market-making inventory, AFS securities, and counterparty exposure on derivative and securities financings net of eligible collateral and hedging. |
(d) | Includes single reference entity (“single-name”), index and other multiple reference entity transactions for which one or more of the underlying reference entities is in a country listed in the above table. |
(e) | Predominantly includes physical commodity inventory. |
(f) | The country rankings presented in the table as of December 31, 2018, are based on the country rankings of the corresponding exposures at March 31, 2019, not actual rankings of such exposures at December 31, 2018. |
CRITICAL ACCOUNTING ESTIMATES USED BY THE FIRM |
• | A combined 5% decline in housing prices and a 100 basis point increase in unemployment rates from expectations could imply: |
◦ | an increase to modeled credit loss estimates of approximately $225 million for PCI loans. |
◦ | an increase to modeled annual credit loss estimates of approximately $50 million for residential real estate loans, excluding PCI loans. |
• | For credit card loans, a 100 basis point increase in unemployment rates from expectations could imply an increase to modeled annual credit loss estimates of approximately $800 million. |
• | An increase in probability of default (“PD”) factors consistent with a one-notch downgrade in the Firm’s internal risk ratings for its entire wholesale loan portfolio could imply an increase in the Firm’s modeled credit loss estimates of approximately $1.7 billion. |
• | A 100 basis point increase in estimated loss given default (“LGD”) for the Firm’s entire wholesale loan portfolio could imply an increase in the Firm’s modeled credit loss estimates of approximately $175 million. |
March 31, 2019 (in billions, except ratios) | Total assets at fair value | Total level 3 assets | ||||||
Trading–debt and equity instruments | $ | 483.0 | $ | 4.2 | ||||
Derivative receivables(a) | 50.3 | 5.9 | ||||||
Trading assets | 533.3 | 10.1 | ||||||
AFS securities | 236.5 | — | ||||||
Loans | 3.7 | 0.1 | ||||||
MSRs | 6.0 | 6.0 | ||||||
Other | 29.2 | 0.9 | ||||||
Total assets measured at fair value on a recurring basis | $ | 808.7 | $ | 17.1 | ||||
Total assets measured at fair value on a nonrecurring basis | 1.0 | 0.5 | ||||||
Total assets measured at fair value | $ | 809.7 | $ | 17.6 | ||||
Total Firm assets | $ | 2,737.2 | ||||||
Level 3 assets as a percentage of total Firm assets(a) | 0.6 | % | ||||||
Level 3 assets as a percentage of total Firm assets at fair value(a) | 2.2 | % |
(a) | For purposes of the table above, the derivative receivables total reflects the impact of netting adjustments; however, the $5.9 billion of derivative receivables classified as level 3 does not reflect the netting adjustment as such netting is not relevant to a presentation based on the transparency of inputs to the valuation of an asset. The level 3 balances would be reduced if netting were applied, including the netting benefit associated with cash collateral. |
ACCOUNTING AND REPORTING DEVELOPMENTS |
Financial Accounting Standards Board (“FASB”) Standards Adopted January 1, 2019 | ||||
Standard | Summary of guidance | Effects on financial statements | ||
Leases Issued February 2016 | • Requires lessees to recognize all leases longer than twelve months on the Consolidated balance sheets as a lease liability with a corresponding right-of-use asset. • Requires lessees and lessors to classify most leases using principles similar to existing lease accounting, but eliminates the “bright line” classification tests. • Expands qualitative and quantitative leasing disclosures. | • Adopted January 1, 2019. • The Firm elected the available practical expedient to not reassess whether existing contracts contain a lease or whether classification or unamortized initial lease costs would be different under the new lease guidance. The Firm elected the modified retrospective transition method, through a cumulative-effect adjustment to retained earnings without revising prior periods. • For further information, refer to Note 16. |
FASB Standards Issued but not yet Adopted | ||||
Standard | Summary of guidance | Effects on financial statements | ||
Financial instruments – credit losses Issued June 2016 | • Replaces existing incurred loss impairment guidance and establishes a single allowance framework for financial assets carried at amortized cost, which will reflect management’s estimate of credit losses over the full remaining expected life of the financial assets and will consider expected future changes in macroeconomic conditions. • Eliminates existing guidance for PCI loans, and requires recognition of the nonaccretable difference as an increase to the allowance for expected credit losses on financial assets purchased with more than insignificant credit deterioration since origination, which will be offset by an increase in the recorded investment of the related loans. • Requires inclusion of expected recoveries, limited to the cumulative amount of prior write-offs, when estimating the allowance for credit losses for in scope financial assets (including collateral dependent assets). • Amends existing impairment guidance for AFS securities to incorporate an allowance, which will allow for reversals of credit impairments in the event that the credit of an issuer improves. • Requires a cumulative-effect adjustment to retained earnings as of the beginning of the reporting period of adoption. | • Required effective date: January 1, 2020.(a) • The Firm has established a Firmwide, cross-discipline governance structure, which provides implementation oversight. The Firm continues to test and refine its current expected credit loss models that satisfy the requirements of the new standard. Oversight and testing, as well as efforts to meet expanded disclosure requirements, will extend through the remainder of 2019. • The Firm expects that the allowance related to the Firm’s loans and commitments will increase as it will cover credit losses over the full remaining expected life of the portfolios. The Firm currently intends to estimate losses over a two-year forecast period using the weighted-average of a range of macroeconomic scenarios (established on a Firmwide basis), and then revert to longer term historical loss experience to estimate losses over more extended periods. • The Firm currently expects the increase in the allowance to be in the range of $4-6 billion, primarily driven by Card. This estimate is subject to further refinement based on continuing reviews and approvals of models, methodologies and judgments. The ultimate impact will depend upon the nature and characteristics of the Firm’s portfolio at the adoption date, the macroeconomic conditions and forecasts at that date, and other management judgments. • The Firm plans to adopt the new guidance on January 1, 2020. | ||
Goodwill Issued January 2017 | • Requires an impairment loss to be recognized when the estimated fair value of a reporting unit falls below its carrying value. • Eliminates the second condition in the current guidance that requires an impairment loss to be recognized only if the estimated implied fair value of the goodwill is below its carrying value. | • Required effective date: January 1, 2020.(a) • Based on current impairment test results, the Firm does not expect a material effect on the Consolidated Financial Statements. However, the impact of the new accounting guidance will depend on the performance of the reporting units and the market conditions at the time of adoption. • After adoption, the guidance may result in more frequent goodwill impairment losses due to the removal of the second condition. • The Firm plans to adopt the new guidance on January 1, 2020. |
(a) | Early adoption is permitted. |
FORWARD-LOOKING STATEMENTS |
• | Local, regional and global business, economic and political conditions and geopolitical events; |
• | Changes in laws and regulatory requirements, including capital and liquidity requirements affecting the Firm’s businesses, and the ability of the Firm to address those requirements; |
• | Heightened regulatory and governmental oversight and scrutiny of JPMorgan Chase’s business practices, including dealings with retail customers; |
• | Changes in trade, monetary and fiscal policies and laws; |
• | Changes in income tax laws and regulations; |
• | Securities and capital markets behavior, including changes in market liquidity and volatility; |
• | Changes in investor sentiment or consumer spending or savings behavior; |
• | Ability of the Firm to manage effectively its capital and liquidity, including approval of its capital plans by banking regulators; |
• | Changes in credit ratings assigned to the Firm or its subsidiaries; |
• | Damage to the Firm’s reputation; |
• | Ability of the Firm to appropriately address social and environmental concerns that may arise from its business activities; |
• | Ability of the Firm to deal effectively with an economic slowdown or other economic or market disruption; |
• | Technology changes instituted by the Firm, its counterparties or competitors; |
• | The effectiveness of the Firm’s control agenda; |
• | Ability of the Firm to develop or discontinue products and services, and the extent to which products or services previously sold by the Firm (including but not limited to mortgages and asset-backed securities) require the Firm to incur liabilities or absorb losses not contemplated at their initiation or origination; |
• | Acceptance of the Firm’s new and existing products and services by the marketplace and the ability of the Firm to innovate and to increase market share; |
• | Ability of the Firm to attract and retain qualified employees; |
• | Ability of the Firm to control expenses; |
• | Competitive pressures; |
• | Changes in the credit quality of the Firm’s customers and counterparties; |
• | Adequacy of the Firm’s risk management framework, disclosure controls and procedures and internal control over financial reporting; |
• | Adverse judicial or regulatory proceedings; |
• | Changes in applicable accounting policies, including the introduction of new accounting standards; |
• | Ability of the Firm to determine accurate values of certain assets and liabilities; |
• | Occurrence of natural or man-made disasters or calamities or conflicts and the Firm’s ability to deal effectively with disruptions caused by the foregoing; |
• | Ability of the Firm to maintain the security of its financial, accounting, technology, data processing and other operational systems and facilities; |
• | Ability of the Firm to withstand disruptions that may be caused by any failure of its operational systems or those of third parties; |
• | Ability of the Firm to effectively defend itself against cyberattacks and other attempts by unauthorized parties to access information of the Firm or its customers or to disrupt the Firm’s systems; and |
• | The other risks and uncertainties detailed in Part I, |
Three months ended March 31, | ||||||||
(in millions, except per share data) | 2019 | 2018 | ||||||
Revenue | ||||||||
Investment banking fees | $ | $ | ||||||
Principal transactions | ||||||||
Lending- and deposit-related fees | ||||||||
Asset management, administration and commissions | ||||||||
Investment securities gains/(losses) | ( | ) | ||||||
Mortgage fees and related income | ||||||||
Card income | ||||||||
Other income | ||||||||
Noninterest revenue | ||||||||
Interest income | ||||||||
Interest expense | ||||||||
Net interest income | ||||||||
Total net revenue | ||||||||
Provision for credit losses | ||||||||
Noninterest expense | ||||||||
Compensation expense | ||||||||
Occupancy expense | ||||||||
Technology, communications and equipment expense | ||||||||
Professional and outside services | ||||||||
Marketing | ||||||||
Other expense | ||||||||
Total noninterest expense | ||||||||
Income before income tax expense | ||||||||
Income tax expense | ||||||||
Net income | $ | $ | ||||||
Net income applicable to common stockholders | $ | $ | ||||||
Net income per common share data | ||||||||
Basic earnings per share | $ | $ | ||||||
Diluted earnings per share | ||||||||
Weighted-average basic shares | ||||||||
Weighted-average diluted shares |
Three months ended March 31, | ||||||||
(in millions) | 2019 | 2018 | ||||||
Net income | $ | $ | ||||||
Other comprehensive income/(loss), after–tax | ||||||||
Unrealized gains/(losses) on investment securities | ( | ) | ||||||
Translation adjustments, net of hedges | ( | ) | ||||||
Fair value hedges | ( | ) | ||||||
Cash flow hedges | ( | ) | ||||||
Defined benefit pension and OPEB plans | ||||||||
DVA on fair value option elected liabilities | ( | ) | ||||||
Total other comprehensive income/(loss), after–tax | ( | ) | ||||||
Comprehensive income | $ | $ |
(in millions, except share data) | Mar 31, 2019 | Dec 31, 2018 | |||||
Assets | |||||||
Cash and due from banks | $ | $ | |||||
Deposits with banks | |||||||
Federal funds sold and securities purchased under resale agreements (included $13,969 and $13,235 at fair value) | |||||||
Securities borrowed (included $5,642 and $5,105 at fair value) | |||||||
Trading assets (included assets pledged of $153,313 and $89,073) | |||||||
Investment securities (included $236,516 and $230,394 at fair value and assets pledged of $10,516 and $11,432) | |||||||
Loans (included $3,719 and $3,151 at fair value) | |||||||
Allowance for loan losses | ( | ) | ( | ) | |||
Loans, net of allowance for loan losses | |||||||
Accrued interest and accounts receivable | |||||||
Premises and equipment | |||||||
Goodwill, MSRs and other intangible assets | |||||||
Other assets (included $10,277 and $9,630 at fair value and assets pledged of $3,090 and $3,457) | |||||||
Total assets(a) | $ | $ | |||||
Liabilities | |||||||
Deposits (included $31,804 and $23,217 at fair value) | $ | $ | |||||
Federal funds purchased and securities loaned or sold under repurchase agreements (included $971 and $935 at fair value) | |||||||
Short-term borrowings (included $7,198 and $7,130 at fair value) | |||||||
Trading liabilities | |||||||
Accounts payable and other liabilities (included $3,277 and $3,269 at fair value) | |||||||
Beneficial interests issued by consolidated VIEs (included $13 and $28 at fair value) | |||||||
Long-term debt (included $61,241 and $54,886 at fair value) | |||||||
Total liabilities(a) | |||||||
Commitments and contingencies (refer to Notes 22, 23 and 24) | |||||||
Stockholders’ equity | |||||||
Preferred stock ($1 par value; authorized 200,000,000 shares; issued 2,699,250 and 2,606,750 shares) | |||||||
Common stock ($1 par value; authorized 9,000,000,000 shares; issued 4,104,933,895 shares) | |||||||
Additional paid-in capital | |||||||
Retained earnings | |||||||
Accumulated other comprehensive loss | ( | ) | ( | ) | |||
Shares held in restricted stock units (“RSU”) Trust, at cost (472,953 shares) | ( | ) | ( | ) | |||
Treasury stock, at cost (860,960,924 and 829,167,674 shares) | ( | ) | ( | ) | |||
Total stockholders’ equity | |||||||
Total liabilities and stockholders’ equity | $ | $ |
(a) |
(in millions) | Mar 31, 2019 | Dec 31, 2018 | |||||
Assets | |||||||
Trading assets | $ | $ | |||||
Loans | |||||||
All other assets | |||||||
Total assets | $ | $ | |||||
Liabilities | |||||||
Beneficial interests issued by consolidated VIEs | $ | $ | |||||
All other liabilities | |||||||
Total liabilities | $ | $ |
Three months ended March 31, | ||||||||
(in millions, except per share data) | 2019 | 2018 | ||||||
Preferred stock | ||||||||
Balance at January 1 | $ | $ | ||||||
Issuance | ||||||||
Redemption | ( | ) | ||||||
Balance at March 31 | $ | $ | ||||||
Common stock | ||||||||
Balance at January 1 and March 31 | ||||||||
Additional paid-in capital | ||||||||
Balance at January 1 | ||||||||
Shares issued and commitments to issue common stock for employee shared-based compensation awards, and related tax effects | ( | ) | ( | ) | ||||
Other | ( | ) | ( | ) | ||||
Balance at March 31 | ||||||||
Retained earnings | ||||||||
Balance at January 1 | ||||||||
Cumulative effect of changes in accounting principles | ( | ) | ||||||
Net income | ||||||||
Dividends declared: | ||||||||
Preferred stock | ( | ) | ( | ) | ||||
Common stock ($0.80 and $0.56 per share) | ( | ) | ( | ) | ||||
Balance at March 31 | ||||||||
Accumulated other comprehensive income/(loss) | ||||||||
Balance at January 1 | ( | ) | ( | ) | ||||
Cumulative effect of changes in accounting principles | ||||||||
Other comprehensive income/(loss), after-tax | ( | ) | ||||||
Balance at March 31 | ( | ) | ( | ) | ||||
Shares held in RSU Trust, at cost | ||||||||
Balance at January 1 and March 31 | ( | ) | ( | ) | ||||
Treasury stock, at cost | ||||||||
Balance at January 1 | ( | ) | ( | ) | ||||
Repurchase | ( | ) | ( | ) | ||||
Reissuance | ||||||||
Balance at March 31 | ( | ) | ( | ) | ||||
Total stockholders’ equity | $ | $ |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Operating activities | |||||||
Net income | $ | $ | |||||
Adjustments to reconcile net income to net cash used in operating activities: | |||||||
Provision for credit losses | |||||||
Depreciation and amortization | |||||||
Deferred tax (benefit)/expense | ( | ) | |||||
Other | |||||||
Originations and purchases of loans held-for-sale | ( | ) | ( | ) | |||
Proceeds from sales, securitizations and paydowns of loans held-for-sale | |||||||
Net change in: | |||||||
Trading assets | ( | ) | ( | ) | |||
Securities borrowed | ( | ) | ( | ) | |||
Accrued interest and accounts receivable | ( | ) | |||||
Other assets | ( | ) | |||||
Trading liabilities | |||||||
Accounts payable and other liabilities | ( | ) | |||||
Other operating adjustments | ( | ) | |||||
Net cash (used in) operating activities | ( | ) | ( | ) | |||
Investing activities | |||||||
Net change in: | |||||||
Federal funds sold and securities purchased under resale agreements | ( | ) | |||||
Held-to-maturity securities: | |||||||
Proceeds from paydowns and maturities | |||||||
Purchases | ( | ) | |||||
Available-for-sale securities: | |||||||
Proceeds from paydowns and maturities | |||||||
Proceeds from sales | |||||||
Purchases | ( | ) | ( | ) | |||
Proceeds from sales and securitizations of loans held-for-investment | |||||||
Other changes in loans, net | ( | ) | |||||
All other investing activities, net | ( | ) | ( | ) | |||
Net cash provided by/(used in) investing activities | ( | ) | |||||
Financing activities | |||||||
Net change in: | |||||||
Deposits | |||||||
Federal funds purchased and securities loaned or sold under repurchase agreements | |||||||
Short-term borrowings | |||||||
Beneficial interests issued by consolidated VIEs | ( | ) | |||||
Proceeds from long-term borrowings | |||||||
Payments of long-term borrowings | ( | ) | ( | ) | |||
Proceeds from issuance of preferred stock | |||||||
Redemption of preferred stock | ( | ) | |||||
Treasury stock repurchased | ( | ) | ( | ) | |||
Dividends paid | ( | ) | ( | ) | |||
All other financing activities, net | ( | ) | ( | ) | |||
Net cash provided by financing activities | |||||||
Effect of exchange rate changes on cash and due from banks and deposits with banks | ( | ) | |||||
Net increase/(decrease) in cash and due from banks and deposits with banks | ( | ) | |||||
Cash and due from banks and deposits with banks at the beginning of the period | |||||||
Cash and due from banks and deposits with banks at the end of the period | $ | $ | |||||
Cash interest paid | $ | $ | |||||
Cash income taxes paid, net |
Assets and liabilities measured at fair value on a recurring basis | |||||||||||||||||
Fair value hierarchy | Derivative netting adjustments(f) | ||||||||||||||||
March 31, 2019 (in millions) | Level 1 | Level 2 | Level 3 | Total fair value | |||||||||||||
Federal funds sold and securities purchased under resale agreements | $ | $ | $ | $ | — | $ | |||||||||||
Securities borrowed | — | ||||||||||||||||
Trading assets: | |||||||||||||||||
Debt instruments: | |||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||
U.S. government agencies(a) | — | ||||||||||||||||
Residential – nonagency | — | ||||||||||||||||
Commercial – nonagency | — | ||||||||||||||||
Total mortgage-backed securities | — | ||||||||||||||||
U.S. Treasury and government agencies(a) | — | ||||||||||||||||
Obligations of U.S. states and municipalities | — | ||||||||||||||||
Certificates of deposit, bankers’ acceptances and commercial paper | — | ||||||||||||||||
Non-U.S. government debt securities | — | ||||||||||||||||
Corporate debt securities | — | ||||||||||||||||
Loans(b) | — | ||||||||||||||||
Asset-backed securities | — | ||||||||||||||||
Total debt instruments | — | ||||||||||||||||
Equity securities | — | ||||||||||||||||
Physical commodities(c) | — | ||||||||||||||||
Other | — | ||||||||||||||||
Total debt and equity instruments(d) | — | ||||||||||||||||
Derivative receivables: | |||||||||||||||||
Interest rate | ( | ) | |||||||||||||||
Credit | ( | ) | |||||||||||||||
Foreign exchange | ( | ) | |||||||||||||||
Equity | ( | ) | |||||||||||||||
Commodity | ( | ) | |||||||||||||||
Total derivative receivables | ( | ) | |||||||||||||||
Total trading assets(e) | ( | ) | |||||||||||||||
Available-for-sale securities: | |||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||
U.S. government agencies(a) | — | ||||||||||||||||
Residential – nonagency | — | ||||||||||||||||
Commercial – nonagency | — | ||||||||||||||||
Total mortgage-backed securities | — | ||||||||||||||||
U.S. Treasury and government agencies | — | ||||||||||||||||
Obligations of U.S. states and municipalities | — | ||||||||||||||||
Certificates of deposit | — | ||||||||||||||||
Non-U.S. government debt securities | — | ||||||||||||||||
Corporate debt securities | — | ||||||||||||||||
Asset-backed securities: | |||||||||||||||||
Collateralized loan obligations | — | ||||||||||||||||
Other | — | ||||||||||||||||
Total available-for-sale securities | — | ||||||||||||||||
Loans | — | ||||||||||||||||
Mortgage servicing rights | — | ||||||||||||||||
Other assets(e) | — | ||||||||||||||||
Total assets measured at fair value on a recurring basis | $ | $ | $ | $ | ( | ) | $ | ||||||||||
Deposits | $ | $ | $ | $ | — | $ | |||||||||||
Federal funds purchased and securities loaned or sold under repurchase agreements | — | ||||||||||||||||
Short-term borrowings | — | ||||||||||||||||
Trading liabilities: | |||||||||||||||||
Debt and equity instruments(d) | — | ||||||||||||||||
Derivative payables: | |||||||||||||||||
Interest rate | ( | ) | |||||||||||||||
Credit | ( | ) | |||||||||||||||
Foreign exchange | ( | ) | |||||||||||||||
Equity | ( | ) | |||||||||||||||
Commodity | ( | ) | |||||||||||||||
Total derivative payables | ( | ) | |||||||||||||||
Total trading liabilities | ( | ) | |||||||||||||||
Accounts payable and other liabilities | — | ||||||||||||||||
Beneficial interests issued by consolidated VIEs | — | ||||||||||||||||
Long-term debt | — | ||||||||||||||||
Total liabilities measured at fair value on a recurring basis | $ | $ | $ | $ | ( | ) | $ |
Fair value hierarchy | Derivative netting adjustments(f) | |||||||||||||||||
December 31, 2018 (in millions) | Level 1 | Level 2 | Level 3 | Total fair value | ||||||||||||||
Federal funds sold and securities purchased under resale agreements | $ | $ | $ | $ | — | $ | ||||||||||||
Securities borrowed | — | |||||||||||||||||
Trading assets: | ||||||||||||||||||
Debt instruments: | ||||||||||||||||||
Mortgage-backed securities: | ||||||||||||||||||
U.S. government agencies(a) | — | |||||||||||||||||
Residential – nonagency | — | |||||||||||||||||
Commercial – nonagency | — | |||||||||||||||||
Total mortgage-backed securities | — | |||||||||||||||||
U.S. Treasury and government agencies(a) | — | |||||||||||||||||
Obligations of U.S. states and municipalities | — | |||||||||||||||||
Certificates of deposit, bankers’ acceptances and commercial paper | — | |||||||||||||||||
Non-U.S. government debt securities | — | |||||||||||||||||
Corporate debt securities | — | |||||||||||||||||
Loans(b) | — | |||||||||||||||||
Asset-backed securities | — | |||||||||||||||||
Total debt instruments | — | |||||||||||||||||
Equity securities | — | |||||||||||||||||
Physical commodities(c) | — | |||||||||||||||||
Other | — | |||||||||||||||||
Total debt and equity instruments(d) | — | |||||||||||||||||
Derivative receivables: | ||||||||||||||||||
Interest rate | ( | ) | ||||||||||||||||
Credit | ( | ) | ||||||||||||||||
Foreign exchange | ( | ) | ||||||||||||||||
Equity | ( | ) | ||||||||||||||||
Commodity | ( | ) | ||||||||||||||||
Total derivative receivables | ( | ) | ||||||||||||||||
Total trading assets(e) | ( | ) | ||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||
Mortgage-backed securities: | ||||||||||||||||||
U.S. government agencies(a) | — | |||||||||||||||||
Residential – nonagency | — | |||||||||||||||||
Commercial – nonagency | — | |||||||||||||||||
Total mortgage-backed securities | — | |||||||||||||||||
U.S. Treasury and government agencies | — | |||||||||||||||||
Obligations of U.S. states and municipalities | — | |||||||||||||||||
Certificates of deposit | — | |||||||||||||||||
Non-U.S. government debt securities | — | |||||||||||||||||
Corporate debt securities | — | |||||||||||||||||
Asset-backed securities: | ||||||||||||||||||
Collateralized loan obligations | — | |||||||||||||||||
Other | — | |||||||||||||||||
Total available-for-sale securities | — | |||||||||||||||||
Loans | — | |||||||||||||||||
Mortgage servicing rights | — | |||||||||||||||||
Other assets(e) | — | |||||||||||||||||
Total assets measured at fair value on a recurring basis | $ | $ | $ | $ | ( | ) | $ | |||||||||||
Deposits | $ | $ | $ | $ | — | $ | ||||||||||||
Federal funds purchased and securities loaned or sold under repurchase agreements | — | |||||||||||||||||
Short-term borrowings | — | |||||||||||||||||
Trading liabilities: | ||||||||||||||||||
Debt and equity instruments(d) | — | |||||||||||||||||
Derivative payables: | ||||||||||||||||||
Interest rate | ( | ) | ||||||||||||||||
Credit | ( | ) | ||||||||||||||||
Foreign exchange | ( | ) | ||||||||||||||||
Equity | ( | ) | ||||||||||||||||
Commodity | ( | ) | ||||||||||||||||
Total derivative payables | ( | ) | ||||||||||||||||
Total trading liabilities | ( | ) | ||||||||||||||||
Accounts payable and other liabilities | — | |||||||||||||||||
Beneficial interests issued by consolidated VIEs | — | |||||||||||||||||
Long-term debt | — | |||||||||||||||||
Total liabilities measured at fair value on a recurring basis | $ | $ | $ | $ | ( | ) | $ |
(a) | At March 31, 2019, and December 31, 2018, included total U.S. government-sponsored enterprise obligations of $ |
(b) | At March 31, 2019, and December 31, 2018, included within trading loans were $ |
(c) | Physical commodities inventories are generally accounted for at the lower of cost or net realizable value. “Net realizable value” is a term defined in U.S. GAAP as not exceeding fair value less costs to sell (“transaction costs”). Transaction costs for the Firm’s physical commodities inventories are either not applicable or immaterial to the value of the inventory. Therefore, net realizable value approximates fair value for the Firm’s physical commodities |
(d) | Balances reflect the reduction of securities owned (long positions) by the amount of identical securities sold but not yet purchased (short positions). |
(e) | Certain investments that are measured at fair value using the net asset value per share (or its equivalent) as a practical expedient are not required to be classified in the fair value hierarchy. At March 31, 2019, and December 31, 2018, the fair values of these investments, which include certain hedge funds, private equity funds, real estate and other funds, were $ |
(f) |
Level 3 inputs(a) | ||||||||||||||||||
March 31, 2019 | ||||||||||||||||||
Product/Instrument | Fair value (in millions) | Principal valuation technique | Unobservable inputs(g) | Range of input values | Weighted average | |||||||||||||
Residential mortgage-backed securities and loans(b) | $ | Discounted cash flows | Yield | % | – | % | % | |||||||||||
Prepayment speed | % | – | % | % | ||||||||||||||
Conditional default rate | % | – | % | % | ||||||||||||||
Loss severity | % | – | % | % | ||||||||||||||
Commercial mortgage-backed securities and loans(c) | Market comparables | Price | $ | – | $ | $ | ||||||||||||
Obligations of U.S. states and municipalities | Market comparables | Price | $ | – | $ | $ | ||||||||||||
Corporate debt securities | Market comparables | Price | $ | – | $ | $ | ||||||||||||
Loans(d) | Discounted cash flows | Yield | % | – | % | % | ||||||||||||
Market comparables | Price | $ | – | $ | $ | |||||||||||||
Asset-backed securities | Market comparables | Price | $ | – | $ | $ | ||||||||||||
Net interest rate derivatives | ( | ) | Option pricing | Interest rate spread volatility | 16 | bps | – | 38 | bps | |||||||||
Interest rate correlation | ( | )% | – | % | ||||||||||||||
IR-FX correlation | % | – | % | |||||||||||||||
Discounted cash flows | Prepayment speed | % | – | % | ||||||||||||||
Net credit derivatives | ( | ) | Discounted cash flows | Credit correlation | % | – | % | |||||||||||
Credit spread | 6 | bps | – | 1,396 | bps | |||||||||||||
Recovery rate | % | – | % | |||||||||||||||
Conditional default rate | % | – | % | |||||||||||||||
Loss severity | ||||||||||||||||||
Market comparables | Price | $ | – | $ | ||||||||||||||
Net foreign exchange derivatives | ( | ) | Option pricing | IR-FX correlation | ( | )% | – | % | ||||||||||
( | ) | Discounted cash flows | Prepayment speed | |||||||||||||||
Net equity derivatives | ( | ) | Option pricing | Equity volatility | % | – | % | |||||||||||
Equity correlation | % | – | % | |||||||||||||||
Equity-FX correlation | ( | )% | – | % | ||||||||||||||
Equity-IR correlation | % | – | % | |||||||||||||||
Net commodity derivatives | ( | ) | Option pricing | Forward commodity price | $ | 52 | – | $ 69 per barrel | ||||||||||
Commodity volatility | % | – | % | |||||||||||||||
Commodity correlation | ( | )% | – | % | ||||||||||||||
MSRs | Discounted cash flows | Refer to Note 14 | ||||||||||||||||
Other assets | Discounted cash flows | Credit spread | 55bps | 55bps | ||||||||||||||
Yield | % | – | % | % | ||||||||||||||
Market comparables | Price | $ | – | $ | $ | |||||||||||||
Long-term debt, short-term borrowings, and deposits(e) | Option pricing | Interest rate spread volatility | 16 | bps | – | 38 | bps | |||||||||||
Interest rate correlation | ( | )% | – | % | ||||||||||||||
IR-FX correlation | ( | )% | – | % | ||||||||||||||
Equity correlation | % | – | % | |||||||||||||||
Equity-FX correlation | ( | )% | – | % | ||||||||||||||
Equity-IR correlation | % | – | % | |||||||||||||||
Other level 3 assets and liabilities, net(f) |
(a) | The categories presented in the table have been aggregated based upon the product type, which may differ from their classification on the Consolidated balance sheets. Furthermore, the inputs presented for each valuation technique in the table are, in some cases, not applicable to every instrument valued using the technique as the characteristics of the instruments can differ. |
(b) | Includes U.S. government agency securities of $ |
(c) | Includes U.S. government agency securities of $ |
(d) | Comprises trading loans. |
(e) | Long-term debt, short-term borrowings and deposits include structured notes issued by the Firm that are financial instruments that typically contain embedded derivatives. The estimation of the fair value of structured notes includes the derivative features embedded within the instrument. The significant unobservable inputs are broadly consistent with those presented for derivative receivables. |
(f) | Includes level 3 assets and liabilities that are insignificant both individually and in aggregate. |
(g) |
Fair value measurements using significant unobservable inputs | |||||||||||||||||||||||||||||||||||
Three months ended March 31, 2019 (in millions) | Fair value at January 1, 2019 | Total realized/unrealized gains/(losses) | Transfers into level 3(h) | Transfers (out of) level 3(h) | Fair value at March 31, 2019 | Change in unrealized gains/(losses) related to financial instruments held at March 31, 2019 | |||||||||||||||||||||||||||||
Purchases(f) | Sales | Settlements(g) | |||||||||||||||||||||||||||||||||
Assets:(a) | |||||||||||||||||||||||||||||||||||
Trading assets: | |||||||||||||||||||||||||||||||||||
Debt instruments: | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||||||||||
Residential – nonagency | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Commercial – nonagency | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Total mortgage-backed securities | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
U.S. Treasury and government agencies | |||||||||||||||||||||||||||||||||||
Obligations of U.S. states and municipalities | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Non-U.S. government debt securities | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Corporate debt securities | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Loans | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Asset-backed securities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Total debt instruments | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Equity securities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Other | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Total trading assets – debt and equity instruments | (c) | ( | ) | ( | ) | ( | ) | (c) | |||||||||||||||||||||||||||
Net derivative receivables:(b) | |||||||||||||||||||||||||||||||||||
Interest rate | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Credit | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Foreign exchange | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
Equity | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Commodity | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Total net derivative receivables | ( | ) | (c) | ( | ) | ( | ) | ( | ) | (c) | |||||||||||||||||||||||||
Available-for-sale securities: | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities | ( | ) | |||||||||||||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||||||||||||||
Total available-for-sale securities | ( | ) | |||||||||||||||||||||||||||||||||
Loans | (c) | ( | ) | (c) | |||||||||||||||||||||||||||||||
Mortgage servicing rights | ( | ) | (e) | ( | ) | ( | ) | ( | ) | (e) | |||||||||||||||||||||||||
Other assets | ( | ) | (c) | ( | ) | ( | ) | ( | ) | ( | ) | (c) | |||||||||||||||||||||||
Fair value measurements using significant unobservable inputs | |||||||||||||||||||||||||||||||||||
Three months ended March 31, 2019 (in millions) | Fair value at January 1, 2019 | Total realized/unrealized (gains)/losses | Transfers into level 3(h) | Transfers (out of) level 3(h) | Fair value at March 31, 2019 | Change in unrealized (gains)/ losses related to financial instruments held at March 31, 2019 | |||||||||||||||||||||||||||||
Purchases | Sales | Issuances | Settlements(g) | ||||||||||||||||||||||||||||||||
Liabilities:(a) | |||||||||||||||||||||||||||||||||||
Deposits | $ | $ | (c)(i) | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | (c)(i) | |||||||||||||||||||
Short-term borrowings | (c)(i) | ( | ) | ( | ) | (c)(i) | |||||||||||||||||||||||||||||
Trading liabilities – debt and equity instruments | ( | ) | ( | ) | (c) | ||||||||||||||||||||||||||||||
Accounts payable and other liabilities | ( | ) | |||||||||||||||||||||||||||||||||
Beneficial interests issued by consolidated VIEs | ( | ) | (c) | ||||||||||||||||||||||||||||||||
Long-term debt | (c)(i) | ( | ) | ( | ) | (c)(i) |
Fair value measurements using significant unobservable inputs | |||||||||||||||||||||||||||||||||||
Three months ended March 31, 2018 (in millions) | Fair value at January 1, 2018 | Total realized/unrealized gains/(losses) | Transfers into level 3(h) | Transfers (out of) level 3(h) | Fair value at March 31, 2018 | Change in unrealized gains/(losses) related to financial instruments held at March 31, 2018 | |||||||||||||||||||||||||||||
Purchases(f) | Sales | Settlements(g) | |||||||||||||||||||||||||||||||||
Assets:(a) | |||||||||||||||||||||||||||||||||||
Trading assets: | |||||||||||||||||||||||||||||||||||
Debt instruments: | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||||||||||
U.S. government agencies | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | $ | ||||||||||||||||||||
Residential – nonagency | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Commercial – nonagency | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Total mortgage-backed securities | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
U.S. Treasury and government agencies | ( | ) | |||||||||||||||||||||||||||||||||
Obligations of U.S. states and municipalities | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Non-U.S. government debt securities | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Corporate debt securities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Loans | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Asset-backed securities | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Total debt instruments | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Equity securities | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||
Other | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Total trading assets – debt and equity instruments | (c) | ( | ) | ( | ) | ( | ) | (c) | |||||||||||||||||||||||||||
Net derivative receivables:(b) | |||||||||||||||||||||||||||||||||||
Interest rate | ( | ) | |||||||||||||||||||||||||||||||||
Credit | ( | ) | ( | ) | |||||||||||||||||||||||||||||||
Foreign exchange | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Equity | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||
Commodity | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Total net derivative receivables | ( | ) | (c) | ( | ) | ( | ) | ( | ) | ( | ) | (c) | |||||||||||||||||||||||
Available-for-sale securities: | |||||||||||||||||||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||||||||||||||||||
Asset-backed securities | ( | ) | |||||||||||||||||||||||||||||||||
Total available-for-sale securities | (d) | ( | ) | (d) | |||||||||||||||||||||||||||||||
Loans | (c) | ( | ) | (c) | |||||||||||||||||||||||||||||||
Mortgage servicing rights | (e) | ( | ) | ( | ) | (e) | |||||||||||||||||||||||||||||
Other assets | ( | ) | (c) | ( | ) | ( | ) | ( | ) | ( | ) | (c) | |||||||||||||||||||||||
Fair value measurements using significant unobservable inputs | |||||||||||||||||||||||||||||||||||
Three months ended March 31, 2018 (in millions) | Fair value at January 1, 2018 | Total realized/unrealized (gains)/losses | Transfers into level 3(h) | Transfers (out of) level 3(h) | Fair value at March 31, 2018 | Change in unrealized (gains)/losses related to financial instruments held at March 31, 2018 | |||||||||||||||||||||||||||||
Purchases | Sales | Issuances | Settlements(g) | ||||||||||||||||||||||||||||||||
Liabilities:(a) | |||||||||||||||||||||||||||||||||||
Deposits | $ | $ | ( | ) | (c)(i) | $ | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) | (c)(i) | |||||||||||||||
Short-term borrowings | (c)(i) | ( | ) | ( | ) | (c)(i) | |||||||||||||||||||||||||||||
Trading liabilities – debt and equity instruments | (c) | ( | ) | ( | ) | (c) | |||||||||||||||||||||||||||||
Accounts payable and other liabilities | ( | ) | |||||||||||||||||||||||||||||||||
Beneficial interests issued by consolidated VIEs | ( | ) | |||||||||||||||||||||||||||||||||
Long-term debt | ( | ) | (c)(i) | ( | ) | ( | ) | ( | ) | (c)(i) |
(a) | Level 3 assets as a percentage of total Firm assets accounted for at fair value (including assets measured at fair value on a nonrecurring basis) were |
(b) | All level 3 derivatives are presented on a net basis, irrespective of the underlying counterparty. |
(c) | Predominantly reported in principal transactions revenue, except for changes in fair value for CCB mortgage loans and lending-related commitments originated with the intent to sell, and mortgage loan purchase commitments, which are reported in mortgage fees and related income. |
(d) | Realized gains/(losses) on AFS securities, as well as other-than-temporary impairment (“OTTI”) losses that are recorded in earnings, are reported in investment securities gains/(losses). Unrealized gains/(losses) are reported in OCI. There were |
(e) | Changes in fair value for MSRs are reported in mortgage fees and related income. |
(f) | Loan originations are included in purchases. |
(g) | Includes financial assets and liabilities that have matured, been partially or fully repaid, impacts of modifications, deconsolidations associated with beneficial interests in VIEs and other items. |
(h) | All transfers into and/or out of level 3 are based on changes in the observability and/or significance of the valuation inputs and are assumed to occur at the beginning of the quarterly reporting period in which they occur. |
(i) |
• | $ |
• |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Credit and funding adjustments: | |||||||
Derivatives CVA | $ | $ | |||||
Derivatives FVA | ( | ) |
Fair value hierarchy | Total fair value | |||||||||||||
March 31, 2019 (in millions) | Level 1 | Level 2 | Level 3 | |||||||||||
Loans | $ | $ | $ | (b) | $ | |||||||||
Other assets(a) | ||||||||||||||
Total assets measured at fair value on a nonrecurring basis | $ | $ | $ | $ |
Fair value hierarchy | Total fair value | |||||||||||||
March 31, 2018 (in millions) | Level 1 | Level 2 | Level 3 | |||||||||||
Loans | $ | $ | $ | $ | ||||||||||
Other assets | ||||||||||||||
Total assets measured at fair value on a nonrecurring basis | $ | $ | $ | $ |
(a) | Primarily includes equity securities without readily determinable fair values that were adjusted based on observable price changes in orderly transactions from an identical or similar investment of the same issuer (measurement alternative). Of the $ |
(b) |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Loans | $ | ( | ) | $ | ( | ) | |
Other assets(a) | |||||||
Total nonrecurring fair value gains/(losses) | $ | $ |
(a) |
Three months ended | |||||||
March 31, | |||||||
As of or for the period ended, | |||||||
(in millions) | 2019 | 2018 | |||||
Other assets | |||||||
Carrying value(a) | $ | $ | |||||
Upward carrying value changes(b) | |||||||
Downward carrying value changes/impairment(c) | ( | ) |
(a) | The carrying value as of December 31, 2018 was $ |
(b) | The cumulative upward carrying value changes between January 1, 2018 and March 31, 2019 were $ |
(c) |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||||||||||||||
Estimated fair value hierarchy | Estimated fair value hierarchy | ||||||||||||||||||||||||||||||
(in billions) | Carrying value | Level 1 | Level 2 | Level 3 | Total estimated fair value | Carrying value | Level 1 | Level 2 | Level 3 | Total estimated fair value | |||||||||||||||||||||
Financial assets | |||||||||||||||||||||||||||||||
Cash and due from banks | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Deposits with banks | |||||||||||||||||||||||||||||||
Accrued interest and accounts receivable | |||||||||||||||||||||||||||||||
Federal funds sold and securities purchased under resale agreements | |||||||||||||||||||||||||||||||
Securities borrowed | |||||||||||||||||||||||||||||||
Investment securities, held-to-maturity | |||||||||||||||||||||||||||||||
Loans, net of allowance for loan losses(a) | |||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||
Financial liabilities | |||||||||||||||||||||||||||||||
Deposits | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Federal funds purchased and securities loaned or sold under repurchase agreements | |||||||||||||||||||||||||||||||
Short-term borrowings | |||||||||||||||||||||||||||||||
Accounts payable and other liabilities | |||||||||||||||||||||||||||||||
Beneficial interests issued by consolidated VIEs | |||||||||||||||||||||||||||||||
Long-term debt and junior subordinated deferrable interest debentures |
(a) |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||||||||||||||
Estimated fair value hierarchy | Estimated fair value hierarchy | ||||||||||||||||||||||||||||||
(in billions) | Carrying value(a) | Level 1 | Level 2 | Level 3 | Total estimated fair value | Carrying value(a) | Level 1 | Level 2 | Level 3 | Total estimated fair value(b) | |||||||||||||||||||||
Wholesale lending-related commitments | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ |
(a) | Excludes the current carrying values of the guarantee liability and the offsetting asset, each of which is recognized at fair value at the inception of the guarantees. |
(b) |
Three months ended March 31, | ||||||||||||||||||||||||
2019 | 2018 | |||||||||||||||||||||||
(in millions) | Principal transactions | All other income | Total changes in fair value recorded (d) | Principal transactions | All other income | Total changes in fair value recorded (d) | ||||||||||||||||||
Federal funds sold and securities purchased under resale agreements | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Securities borrowed | ( | ) | ( | ) | ||||||||||||||||||||
Trading assets: | ||||||||||||||||||||||||
Debt and equity instruments, excluding loans | ( | ) | ( | ) | ||||||||||||||||||||
Loans reported as trading assets: | ||||||||||||||||||||||||
Changes in instrument-specific credit risk | (c) | (c) | ||||||||||||||||||||||
Other changes in fair value | (c) | ( | ) | (c) | ( | ) | ||||||||||||||||||
Loans: | ||||||||||||||||||||||||
Changes in instrument-specific credit risk | ||||||||||||||||||||||||
Other changes in fair value | ( | ) | ( | ) | ||||||||||||||||||||
Other assets | ( | ) | (e) | ( | ) | |||||||||||||||||||
Deposits(a) | ( | ) | ( | ) | ||||||||||||||||||||
Federal funds purchased and securities loaned or sold under repurchase agreements | ( | ) | ( | ) | ||||||||||||||||||||
Short-term borrowings(a) | ( | ) | ( | ) | ||||||||||||||||||||
Trading liabilities | ( | ) | ( | ) | ||||||||||||||||||||
Other liabilities | ( | ) | ( | ) | ||||||||||||||||||||
Long-term debt(a)(b) | ( | ) | ( | ) |
(a) | Unrealized gains/(losses) due to instrument-specific credit risk (DVA) for liabilities for which the fair value option has been elected is recorded in OCI, while realized gains/(losses) are recorded in principal transactions revenue. Realized gains/(losses) due to instrument-specific credit risk recorded in principal transactions revenue were not material for the three months ended March 31, 2019 and 2018, respectively. |
(b) | Long-term debt measured at fair value predominantly relates to structured notes. Although the risk associated with the structured notes is actively managed, the gains/(losses) reported in this table do not include the income statement impact of the risk management instruments used to manage such risk. |
(c) | Reported in mortgage fees and related income. |
(d) | Changes in fair value exclude contractual interest, which is included in interest income and interest expense for all instruments other than hybrid financial instruments. For further information regarding interest income and interest expense, refer to Note 6. |
(e) | Reported in other income. |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||||
(in millions) | Contractual principal outstanding | Fair value | Fair value over/(under) contractual principal outstanding | Contractual principal outstanding | Fair value | Fair value over/(under) contractual principal outstanding | |||||||||||||||
Loans(a) | |||||||||||||||||||||
Nonaccrual loans | |||||||||||||||||||||
Loans reported as trading assets | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | |||||||||||
Loans | ( | ) | ( | ) | |||||||||||||||||
Subtotal | ( | ) | ( | ) | |||||||||||||||||
All other performing loans | |||||||||||||||||||||
Loans reported as trading assets | ( | ) | ( | ) | |||||||||||||||||
Loans | ( | ) | ( | ) | |||||||||||||||||
Total loans | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | |||||||||||
Long-term debt | |||||||||||||||||||||
Principal-protected debt | $ | (c) | $ | $ | ( | ) | $ | (c) | $ | $ | ( | ) | |||||||||
Nonprincipal-protected debt(b) | NA | NA | NA | NA | |||||||||||||||||
Total long-term debt | NA | $ | NA | NA | $ | NA | |||||||||||||||
Long-term beneficial interests | |||||||||||||||||||||
Nonprincipal-protected debt(b) | NA | $ | NA | NA | $ | NA | |||||||||||||||
Total long-term beneficial interests | NA | $ | NA | NA | $ | NA |
(a) | There were |
(b) | Remaining contractual principal is not applicable to nonprincipal-protected structured notes and long-term beneficial interests. Unlike principal-protected structured notes and long-term beneficial interests, for which the Firm is obligated to return a stated amount of principal at maturity, nonprincipal-protected structured notes and long-term beneficial interests do not obligate the Firm to return a stated amount of principal at maturity, but for structured notes to return an amount based on the performance of an underlying variable or derivative feature embedded in the note. However, investors are exposed to the credit risk of the Firm as issuer for both nonprincipal-protected and principal-protected notes. |
(c) |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||||||||
(in millions) | Long-term debt | Short-term borrowings | Deposits | Total | Long-term debt | Short-term borrowings | Deposits | Total | |||||||||||||||||
Risk exposure | |||||||||||||||||||||||||
Interest rate | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Credit | |||||||||||||||||||||||||
Foreign exchange | |||||||||||||||||||||||||
Equity | |||||||||||||||||||||||||
Commodity | |||||||||||||||||||||||||
Total structured notes | $ | $ | $ | $ | $ | $ | $ | $ |
Type of Derivative | Use of Derivative | Designation and disclosure | Affected segment or unit | 10-Q page reference |
Manage specifically identified risk exposures in qualifying hedge accounting relationships: | ||||
• Interest rate | Hedge fixed rate assets and liabilities | Fair value hedge | Corporate | 94-95 |
• Interest rate | Hedge floating-rate assets and liabilities | Cash flow hedge | Corporate | 96 |
• Foreign exchange | Hedge foreign currency-denominated assets and liabilities | Fair value hedge | Corporate | 94-95 |
• Foreign exchange | Hedge foreign currency-denominated forecasted revenue and expense | Cash flow hedge | Corporate | 96 |
• Foreign exchange | Hedge the value of the Firm’s investments in non-U.S. dollar functional currency entities | Net investment hedge | Corporate | 97 |
• Commodity | Hedge commodity inventory | Fair value hedge | CIB | 94-95 |
Manage specifically identified risk exposures not designated in qualifying hedge accounting relationships: | ||||
• Interest rate | Manage the risk of the mortgage pipeline, warehouse loans and MSRs | Specified risk management | CCB | 97 |
• Credit | Manage the credit risk of wholesale lending exposures | Specified risk management | CIB | 97 |
• Interest rate and foreign exchange | Manage the risk of certain other specified assets and liabilities | Specified risk management | Corporate | 97 |
Market-making derivatives and other activities: | ||||
• Various | Market-making and related risk management | Market-making and other | CIB | 97 |
• Various | Other derivatives | Market-making and other | CIB, AWM, Corporate | 97 |
Notional amounts(b) | ||||||
(in billions) | March 31, 2019 | December 31, 2018 | ||||
Interest rate contracts | ||||||
Swaps | $ | $ | ||||
Futures and forwards | ||||||
Written options | ||||||
Purchased options | ||||||
Total interest rate contracts | ||||||
Credit derivatives(a) | ||||||
Foreign exchange contracts | ||||||
Cross-currency swaps | ||||||
Spot, futures and forwards | ||||||
Written options | ||||||
Purchased options | ||||||
Total foreign exchange contracts | ||||||
Equity contracts | ||||||
Swaps | ||||||
Futures and forwards | ||||||
Written options | ||||||
Purchased options | ||||||
Total equity contracts | ||||||
Commodity contracts | ||||||
Swaps | ||||||
Spot, futures and forwards | ||||||
Written options | ||||||
Purchased options | ||||||
Total commodity contracts | ||||||
Total derivative notional amounts | $ | $ |
(a) | For more information on volumes and types of credit derivative contracts, refer to the Credit derivatives discussion on page 98. |
(b) |
Free-standing derivative receivables and payables(a) | |||||||||||||||||||||||||||||||
Gross derivative receivables | Gross derivative payables | ||||||||||||||||||||||||||||||
March 31, 2019 (in millions) | Not designated as hedges | Designated as hedges | Total derivative receivables | Net derivative receivables(b) | Not designated as hedges | Designated as hedges | Total derivative payables | Net derivative payables(b) | |||||||||||||||||||||||
Trading assets and liabilities | |||||||||||||||||||||||||||||||
Interest rate | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Credit | |||||||||||||||||||||||||||||||
Foreign exchange | |||||||||||||||||||||||||||||||
Equity | |||||||||||||||||||||||||||||||
Commodity | |||||||||||||||||||||||||||||||
Total fair value of trading assets and liabilities | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Gross derivative receivables | Gross derivative payables | ||||||||||||||||||||||||||||||
December 31, 2018 (in millions) | Not designated as hedges | Designated as hedges | Total derivative receivables | Net derivative receivables(b) | Not designated as hedges | Designated as hedges | Total derivative payables | Net derivative payables(b) | |||||||||||||||||||||||
Trading assets and liabilities | |||||||||||||||||||||||||||||||
Interest rate | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Credit | |||||||||||||||||||||||||||||||
Foreign exchange | |||||||||||||||||||||||||||||||
Equity | |||||||||||||||||||||||||||||||
Commodity | |||||||||||||||||||||||||||||||
Total fair value of trading assets and liabilities | $ | $ | $ | $ | $ | $ | $ | $ |
(a) | Balances exclude structured notes for which the fair value option has been elected. Refer to Note 3 for further information. |
(b) |
• | collateral that consists of non-cash financial instruments (generally U.S. government and agency securities and other G7 government securities) and cash collateral held at third-party custodians, which are shown separately as “Collateral not nettable on the Consolidated balance sheets” in the tables below, up to the fair value exposure amount. |
• | the amount of collateral held or transferred that exceeds the fair value exposure at the individual counterparty level, as of the date presented, which is excluded from the tables below; and |
• | collateral held or transferred that relates to derivative receivables or payables where an appropriate legal opinion has not been either sought or obtained with respect to the master netting agreement, which is excluded from the tables below. |
March 31, 2019 | December 31, 2018 | |||||||||||||||||||||||
(in millions) | Gross derivative receivables | Amounts netted on the Consolidated balance sheets | Net derivative receivables | Gross derivative receivables | Amounts netted on the Consolidated balance sheets | Net derivative receivables | ||||||||||||||||||
U.S. GAAP nettable derivative receivables | ||||||||||||||||||||||||
Interest rate contracts: | ||||||||||||||||||||||||
Over-the-counter (“OTC”) | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||
OTC–cleared | ( | ) | ( | ) | ||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total interest rate contracts | ( | ) | ( | ) | ||||||||||||||||||||
Credit contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
OTC–cleared | ( | ) | ( | ) | ||||||||||||||||||||
Total credit contracts | ( | ) | ( | ) | ||||||||||||||||||||
Foreign exchange contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
OTC–cleared | ( | ) | ( | ) | ||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total foreign exchange contracts | ( | ) | ( | ) | ||||||||||||||||||||
Equity contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total equity contracts | ( | ) | ( | ) | ||||||||||||||||||||
Commodity contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
OTC–cleared | ( | ) | ||||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total commodity contracts | ( | ) | ( | ) | ||||||||||||||||||||
Derivative receivables with appropriate legal opinion | ( | ) | (d) | ( | ) | (d) | ||||||||||||||||||
Derivative receivables where an appropriate legal opinion has not been either sought or obtained | ||||||||||||||||||||||||
Total derivative receivables recognized on the Consolidated balance sheets | $ | $ | $ | $ | ||||||||||||||||||||
Collateral not nettable on the Consolidated balance sheets(b)(c) | ( | ) | ( | ) | ||||||||||||||||||||
Net amounts | $ | $ |
March 31, 2019 | December 31, 2018 | |||||||||||||||||||||||
(in millions) | Gross derivative payables | Amounts netted on the Consolidated balance sheets | Net derivative payables | Gross derivative payables | Amounts netted on the Consolidated balance sheets | Net derivative payables | ||||||||||||||||||
U.S. GAAP nettable derivative payables | ||||||||||||||||||||||||
Interest rate contracts: | ||||||||||||||||||||||||
OTC | $ | $ | ( | ) | $ | $ | $ | ( | ) | $ | ||||||||||||||
OTC–cleared | ( | ) | ( | ) | ||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total interest rate contracts | ( | ) | ( | ) | ||||||||||||||||||||
Credit contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
OTC–cleared | ( | ) | ( | ) | ||||||||||||||||||||
Total credit contracts | ( | ) | ( | ) | ||||||||||||||||||||
Foreign exchange contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
OTC–cleared | ( | ) | ( | ) | ||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total foreign exchange contracts | ( | ) | ( | ) | ||||||||||||||||||||
Equity contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total equity contracts | ( | ) | ( | ) | ||||||||||||||||||||
Commodity contracts: | ||||||||||||||||||||||||
OTC | ( | ) | ( | ) | ||||||||||||||||||||
OTC–cleared | ( | ) | ||||||||||||||||||||||
Exchange-traded(a) | ( | ) | ( | ) | ||||||||||||||||||||
Total commodity contracts | ( | ) | ( | ) | ||||||||||||||||||||
Derivative payables with appropriate legal opinion | ( | ) | (d) | ( | ) | (d) | ||||||||||||||||||
Derivative payables where an appropriate legal opinion has not been either sought or obtained | ||||||||||||||||||||||||
Total derivative payables recognized on the Consolidated balance sheets | $ | $ | $ | $ | ||||||||||||||||||||
Collateral not nettable on the Consolidated balance sheets(b)(c) | ( | ) | ( | ) | ||||||||||||||||||||
Net amounts | $ | $ |
(a) | Exchange-traded derivative balances that relate to futures contracts are settled daily. |
(b) | Represents liquid security collateral as well as cash collateral held at third-party custodians related to derivative instruments where an appropriate legal opinion has been obtained. For some counterparties, the collateral amounts of financial instruments may exceed the derivative receivables and derivative payables balances. Where this is the case, the total amount reported is limited to the net derivative receivables and net derivative payables balances with that counterparty. |
(c) | Derivative collateral relates only to OTC and OTC-cleared derivative instruments. |
(d) |
OTC and OTC-cleared derivative payables containing downgrade triggers | ||||||
(in millions) | March 31, 2019 | December 31, 2018 | ||||
Aggregate fair value of net derivative payables | $ | $ | ||||
Collateral posted |
Liquidity impact of downgrade triggers on OTC and OTC-cleared derivatives | |||||||||||||
March 31, 2019 | December 31, 2018 | ||||||||||||
(in millions) | Single-notch downgrade | Two-notch downgrade | Single-notch downgrade | Two-notch downgrade | |||||||||
Amount of additional collateral to be posted upon downgrade(a) | $ | $ | $ | $ | |||||||||
Amount required to settle contracts with termination triggers upon downgrade(b) |
(a) | Includes the additional collateral to be posted for initial margin. |
(b) |
Gains/(losses) recorded in income | Income statement impact of excluded components(e) | OCI impact | ||||||||||||||||||
Three months ended March 31, 2019 (in millions) | Derivatives | Hedged items | Income statement impact | Amortization approach | Changes in fair value | Derivatives - Gains/(losses) recorded in OCI(f) | ||||||||||||||
Contract type | ||||||||||||||||||||
Interest rate(a)(b) | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||
Foreign exchange(c) | ( | ) | ( | ) | ||||||||||||||||
Commodity(d) | ( | ) | ||||||||||||||||||
Total | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ |
Gains/(losses) recorded in income | Income statement impact of excluded components(e) | OCI impact | ||||||||||||||||||
Three months ended March 31, 2018 (in millions) | Derivatives | Hedged items | Income statement impact | Amortization approach | Changes in fair value | Derivatives - Gains/(losses) recorded in OCI(f) | ||||||||||||||
Contract type | ||||||||||||||||||||
Interest rate(a)(b) | $ | ( | ) | $ | $ | $ | $ | $ | ||||||||||||
Foreign exchange(c) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Commodity(d) | ( | ) | ||||||||||||||||||
Total | $ | ( | ) | $ | $ | $ | ( | ) | $ | $ | ( | ) |
(a) | Primarily consists of hedges of the benchmark (e.g., London Interbank Offered Rate (“LIBOR”)) interest rate risk of fixed-rate long-term debt and AFS securities. Gains and losses were recorded in net interest income. |
(b) | Excludes the amortization expense associated with the inception hedge accounting adjustment applied to the hedged item. This expense is recorded in net interest income and substantially offsets the income statement impact of the excluded components. Also excludes the accrual of interest on interest rate swaps and the related hedged items. |
(c) | Primarily consists of hedges of the foreign currency risk of long-term debt and AFS securities for changes in spot foreign currency rates. Gains and losses related to the derivatives and the hedged items due to changes in foreign currency rates and the income statement impact of excluded components were recorded primarily in principal transactions revenue and net interest income. |
(d) | Consists of overall fair value hedges of physical commodities inventories that are generally carried at the lower of cost or net realizable value (net realizable value approximates fair value). Gains and losses were recorded in principal transactions revenue. |
(e) | The assessment of hedge effectiveness excludes certain components of the changes in fair values of the derivatives and hedged items such as forward points on foreign exchange forward contracts, time values and cross-currency basis spreads. The initial amount of the excluded components may be amortized into income over the life of the derivative, or changes in fair value may be recognized in current period earnings. |
(f) |
Carrying amount of the hedged items(a)(b) | Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items: | |||||||||||||
March 31, 2019 (in millions) | Active hedging relationships | Discontinued hedging relationships(d) | Total | |||||||||||
Assets | ||||||||||||||
Investment securities - AFS | $ | (c) | $ | ( | ) | $ | $ | |||||||
Liabilities | ||||||||||||||
Long-term debt | $ | $ | $ | $ | ||||||||||
Beneficial interests issued by consolidated VIEs | ( | ) | ( | ) | ||||||||||
Carrying amount of the hedged items(a)(b) | Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items: | |||||||||||||
December 31, 2018 (in millions) | Active hedging relationships | Discontinued hedging relationships(d) | Total | |||||||||||
Assets | ||||||||||||||
Investment securities - AFS | $ | (c) | $ | ( | ) | $ | $ | ( | ) | |||||
Liabilities | ||||||||||||||
Long-term debt | $ | $ | $ | $ | ||||||||||
Beneficial interests issued by consolidated VIEs | ( | ) | ( | ) |
(a) | Excludes physical commodities with a carrying value of $ |
(b) | Excludes hedged items where only foreign currency risk is the designated hedged risk, as basis adjustments related to foreign currency hedges will not reverse through the income statement in future periods. At March 31, 2019 and December 31, 2018, the carrying amount excluded for available-for-sale securities is $ |
(c) | Carrying amount represents the amortized cost. |
(d) |
Derivatives gains/(losses) recorded in income and other comprehensive income/(loss) | |||||||||
Three months ended March 31, 2019 (in millions) | Amounts reclassified from AOCI to income | Amounts recorded in OCI | Total change in OCI for period | ||||||
Contract type | |||||||||
Interest rate(a) | $ | $ | $ | ||||||
Foreign exchange(b) | ( | ) | |||||||
Total | $ | ( | ) | $ | $ | ||||
Derivatives gains/(losses) recorded in income and other comprehensive income/(loss) | |||||||||
Three months ended March 31, 2018 (in millions) | Amounts reclassified from AOCI to income | Amounts recorded in OCI | Total change in OCI for period | ||||||
Contract type | |||||||||
Interest rate(a) | $ | $ | ( | ) | $ | ( | ) | ||
Foreign exchange(b) | ( | ) | |||||||
Total | $ | $ | ( | ) | $ | ( | ) |
(a) | Primarily consists of hedges of LIBOR-indexed floating-rate assets and floating-rate liabilities. Gains and losses were recorded in net interest income. |
(b) |
2019 | 2018 | ||||||||||||||||
Three months ended March 31, (in millions) | Amounts recorded in income(a) | Amounts recorded in OCI | Amounts recorded in income(a)(b) | Amounts recorded in OCI | |||||||||||||
Foreign exchange derivatives | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) |
(a) | Certain components of hedging derivatives are permitted to be excluded from the assessment of hedge effectiveness, such as forward points on foreign exchange forward contracts. The Firm elects to record changes in fair value of these amounts directly in other income. |
(b) |
Derivatives gains/(losses) recorded in income | ||||||
Three months ended March 31, | ||||||
(in millions) | 2019 | 2018 | ||||
Contract type | ||||||
Interest rate(a) | $ | $ | ( | ) | ||
Credit(b) | ( | ) | ( | ) | ||
Foreign exchange(c)(d) | ( | ) | ||||
Total (d) | $ | $ | ( | ) |
(a) | Primarily represents interest rate derivatives used to hedge the interest rate risk inherent in the mortgage pipeline, warehouse loans and MSRs, as well as written commitments to originate warehouse loans. Gains and losses were recorded predominantly in mortgage fees and related income. |
(b) | Relates to credit derivatives used to mitigate credit risk associated with lending exposures in the Firm’s wholesale businesses. These derivatives do not include credit derivatives used to mitigate counterparty credit risk arising from derivative receivables, which is included in gains and losses on derivatives related to market-making activities and other derivatives. Gains and losses were recorded in principal transactions revenue. |
(c) | Primarily relates to derivatives used to mitigate foreign exchange risk of specified foreign currency-denominated assets and liabilities. Gains and losses were recorded in principal transactions revenue. |
(d) |
Maximum payout/Notional amount | ||||||||||||||
March 31, 2019 (in millions) | Protection sold | Protection purchased with identical underlyings(b) | Net protection (sold)/purchased(c) | Other protection purchased(d) | ||||||||||
Credit derivatives | ||||||||||||||
Credit default swaps | $ | ( | ) | $ | $ | $ | ||||||||
Other credit derivatives(a) | ( | ) | ||||||||||||
Total credit derivatives | ( | ) | ||||||||||||
Credit-related notes | ||||||||||||||
Total | $ | ( | ) | $ | $ | $ | ||||||||
Maximum payout/Notional amount | ||||||||||||||
December 31, 2018 (in millions) | Protection sold | Protection purchased with identical underlyings(b) | Net protection (sold)/purchased(c) | Other protection purchased(d) | ||||||||||
Credit derivatives | ||||||||||||||
Credit default swaps | $ | ( | ) | $ | $ | $ | ||||||||
Other credit derivatives(a) | ( | ) | ||||||||||||
Total credit derivatives | ( | ) | ||||||||||||
Credit-related notes | ||||||||||||||
Total | $ | ( | ) | $ | $ | $ |
(a) | Other credit derivatives predominantly consists of credit swap options and total return swaps. |
(b) | Represents the total notional amount of protection purchased where the underlying reference instrument is identical to the reference instrument on protection sold; the notional amount of protection purchased for each individual identical underlying reference instrument may be greater or lower than the notional amount of protection sold. |
(c) | Does not take into account the fair value of the reference obligation at the time of settlement, which would generally reduce the amount the seller of protection pays to the buyer of protection in determining settlement value. |
(d) |
Protection sold — credit derivatives and credit-related notes ratings(a)/maturity profile | |||||||||||||
March 31, 2019 (in millions) | <1 year | 1–5 years | >5 years | Total notional amount | Fair value of receivables(b) | Fair value of payables(b) | Net fair value | ||||||
Risk rating of reference entity | |||||||||||||
Investment-grade | $( | $( | $( | $( | $ | $( | $ | ||||||
Noninvestment-grade | ( | ( | ( | ( | ( | ||||||||
Total | $( | $( | $( | $( | $ | $( | $ |
December 31, 2018 (in millions) | <1 year | 1–5 years | >5 years | Total notional amount | Fair value of receivables(b) | Fair value of payables(b) | Net fair value | ||||||
Risk rating of reference entity | |||||||||||||
Investment-grade | $( | $( | $( | $( | $ | $( | $ | ||||||
Noninvestment-grade | ( | ( | ( | ( | ( | ( | |||||||
Total | $( | $( | $( | $( | $ | $( | $ |
(a) | The ratings scale is primarily based on external credit ratings defined by S&P and Moody’s. |
(b) |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Underwriting | |||||||
Equity | $ | $ | |||||
Debt | |||||||
Total underwriting | |||||||
Advisory | |||||||
Total investment banking fees | $ | $ |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Trading revenue by instrument type | |||||||
Interest rate | $ | $ | |||||
Credit | |||||||
Foreign exchange | |||||||
Equity | |||||||
Commodity | |||||||
Total trading revenue | |||||||
Private equity gains/(losses) | ( | ) | |||||
Principal transactions | $ | $ |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Lending-related fees | $ | $ | |||||
Deposit-related fees | |||||||
Total lending- and deposit-related fees | $ | $ |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Asset management fees | |||||||
Investment management fees(a) | $ | $ | |||||
All other asset management fees(b) | |||||||
Total asset management fees | |||||||
Total administration fees(c) | |||||||
Commissions and other fees | |||||||
Brokerage commissions | |||||||
All other commissions and fees | |||||||
Total commissions and fees | |||||||
Total asset management, administration and commissions | $ | $ |
(a) | Represents fees earned from managing assets on behalf of the Firm’s clients, including investors in Firm-sponsored funds and owners of separately managed investment accounts. |
(b) | Represents fees for services that are ancillary to investment management services, such as commissions earned on the sales or distribution of mutual funds to clients. |
(c) |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Interchange and merchant processing income | $ | $ | |||||
Rewards costs and partner payments | ( | ) | ( | ) | |||
Other card income(a) | ( | ) | ( | ) | |||
Total card income | $ | $ |
(a) |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Legal expense/(benefit) | $ | ( | ) | $ | |||
FDIC-related expense |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Interest income | |||||||
Loans(a) | $ | $ | |||||
Taxable securities | |||||||
Non-taxable securities(b) | |||||||
Total investment securities(a) | |||||||
Trading assets | |||||||
Federal funds sold and securities purchased under resale agreements | |||||||
Securities borrowed | |||||||
Deposits with banks | |||||||
All other interest-earning assets(c) | |||||||
Total interest income | |||||||
Interest expense | |||||||
Interest-bearing deposits | |||||||
Federal funds purchased and securities loaned or sold under repurchase agreements | |||||||
Short-term borrowings(d) | |||||||
Trading liabilities – debt and all other interest-bearing liabilities(e) | |||||||
Long-term debt | |||||||
Beneficial interest issued by consolidated VIEs | |||||||
Total interest expense | |||||||
Net interest income | |||||||
Provision for credit losses | |||||||
Net interest income after provision for credit losses | $ | $ |
(a) | Includes the amortization/accretion of unearned income (e.g., purchase premiums/discounts, net deferred fees/costs, etc.). |
(b) | Represents securities which are tax-exempt for U.S. federal income tax purposes. |
(c) | Includes held-for-investment margin loans, which are classified in accrued interest and accounts receivable, and all other interest-earning assets which are classified in other assets on the Consolidated balance sheets. |
(d) | Includes commercial paper. |
(e) |
(in millions) | Three months ended March 31, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Pension plans | OPEB plans | ||||||||||||
Components of net periodic benefit cost | |||||||||||||
Benefits earned during the period | $ | $ | $ | $ | |||||||||
Interest cost on benefit obligations | |||||||||||||
Expected return on plan assets | ( | ) | ( | ) | ( | ) | ( | ) | |||||
Amortization: | |||||||||||||
Net (gain)/loss | |||||||||||||
Prior service (credit)/cost | ( | ) | |||||||||||
Net periodic defined benefit cost | ( | ) | ( | ) | |||||||||
Other defined benefit pension plans(a) | NA | NA | |||||||||||
Total defined benefit plans | ( | ) | ( | ) | |||||||||
Total defined contribution plans | NA | NA | |||||||||||
Total pension and OPEB cost included in noninterest expense | $ | $ | $ | ( | ) | $ | ( | ) |
(a) |
(in billions) | March 31, 2019 | December 31, 2018 | |||||
Fair value of plan assets | |||||||
Defined benefit pension plans | $ | $ | |||||
OPEB plans |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Cost of prior grants of RSUs, performance share units (“PSUs”) and stock appreciation rights (“SARs”) that are amortized over their applicable vesting periods | $ | $ | |||||
Accrual of estimated costs of share-based awards to be granted in future periods including those to full-career eligible employees | |||||||
Total noncash compensation expense related to employee share-based incentive plans | $ | $ |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||||||||||
(in millions) | Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | |||||||||||||||||||
Available-for-sale securities | |||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||
U.S. government agencies(a) | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
Residential: | |||||||||||||||||||||||||||
U.S. | |||||||||||||||||||||||||||
Non-U.S. | |||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||
Total mortgage-backed securities | |||||||||||||||||||||||||||
U.S. Treasury and government agencies | |||||||||||||||||||||||||||
Obligations of U.S. states and municipalities | |||||||||||||||||||||||||||
Certificates of deposit | |||||||||||||||||||||||||||
Non-U.S. government debt securities | |||||||||||||||||||||||||||
Corporate debt securities | |||||||||||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||||||||||
Collateralized loan obligations | |||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||
Total available-for-sale securities | |||||||||||||||||||||||||||
Held-to-maturity securities | |||||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||||
U.S. government agencies(b) | |||||||||||||||||||||||||||
Total mortgage-backed securities | |||||||||||||||||||||||||||
Obligations of U.S. states and municipalities | |||||||||||||||||||||||||||
Total held-to-maturity securities | |||||||||||||||||||||||||||
Total investment securities | $ | $ | $ | $ | $ | $ | $ | $ |
(a) | Includes total U.S. government-sponsored enterprise obligations with fair values of $ |
(b) |
Investment securities with gross unrealized losses | |||||||||||||||||||
Less than 12 months | 12 months or more | ||||||||||||||||||
March 31, 2019 (in millions) | Fair value | Gross unrealized losses | Fair value | Gross unrealized losses | Total fair value | Total gross unrealized losses | |||||||||||||
Available-for-sale securities | |||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||
U.S. government agencies | $ | $ | $ | $ | $ | $ | |||||||||||||
Residential: | |||||||||||||||||||
U.S. | |||||||||||||||||||
Non-U.S. | |||||||||||||||||||
Commercial | |||||||||||||||||||
Total mortgage-backed securities | |||||||||||||||||||
U.S. Treasury and government agencies | |||||||||||||||||||
Obligations of U.S. states and municipalities | |||||||||||||||||||
Certificates of deposit | |||||||||||||||||||
Non-U.S. government debt securities | |||||||||||||||||||
Corporate debt securities | |||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||
Collateralized loan obligations | |||||||||||||||||||
Other | |||||||||||||||||||
Total available-for-sale securities | |||||||||||||||||||
Held-to-maturity securities | |||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||
U.S. government agencies | |||||||||||||||||||
Total mortgage-backed securities | |||||||||||||||||||
Obligations of U.S. states and municipalities | |||||||||||||||||||
Total held-to-maturity securities | |||||||||||||||||||
Total investment securities with gross unrealized losses | $ | $ | $ | $ | $ | $ |
Investment securities with gross unrealized losses | |||||||||||||||||||
Less than 12 months | 12 months or more | ||||||||||||||||||
December 31, 2018 (in millions) | Fair value | Gross unrealized losses | Fair value | Gross unrealized losses | Total fair value | Total gross unrealized losses | |||||||||||||
Available-for-sale securities | |||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||
U.S. government agencies | $ | $ | $ | $ | $ | $ | |||||||||||||
Residential: | |||||||||||||||||||
U.S. | $ | ||||||||||||||||||
Non-U.S. | |||||||||||||||||||
Commercial | |||||||||||||||||||
Total mortgage-backed securities | |||||||||||||||||||
U.S. Treasury and government agencies | |||||||||||||||||||
Obligations of U.S. states and municipalities | |||||||||||||||||||
Certificates of deposit | |||||||||||||||||||
Non-U.S. government debt securities | |||||||||||||||||||
Corporate debt securities | |||||||||||||||||||
Asset-backed securities: | |||||||||||||||||||
Collateralized loan obligations | |||||||||||||||||||
Other | |||||||||||||||||||
Total available-for-sale securities | |||||||||||||||||||
Held-to-maturity securities | |||||||||||||||||||
Mortgage-backed securities | |||||||||||||||||||
U.S. government agencies | |||||||||||||||||||
Total mortgage-backed securities | |||||||||||||||||||
Obligations of U.S. states and municipalities | |||||||||||||||||||
Total held-to-maturity securities | |||||||||||||||||||
Total investment securities with gross unrealized losses | $ | $ | $ | $ | $ | $ |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Realized gains | $ | $ | |||||
Realized losses | ( | ) | ( | ) | |||
OTTI losses | ( | ) | (a) | ||||
Net investment securities gains/(losses) | $ | $ | ( | ) |
By remaining maturity March 31, 2019 (in millions) | Due in one year or less | Due after one year through five years | Due after five years through 10 years | Due after 10 years(c) | Total | |||||||||||
Available-for-sale securities | ||||||||||||||||
Mortgage-backed securities(a) | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
U.S. Treasury and government agencies | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Obligations of U.S. states and municipalities | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Certificates of deposit | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Non-U.S. government debt securities | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Corporate debt securities | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Asset-backed securities | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Total available-for-sale securities | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Held-to-maturity securities | ||||||||||||||||
Mortgage-backed securities(a) | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Obligations of U.S. states and municipalities | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % | |||||||||||
Total held-to-maturity securities | ||||||||||||||||
Amortized cost | $ | $ | $ | $ | $ | |||||||||||
Fair value | ||||||||||||||||
Average yield(b) | % | % | % | % | % |
(a) | As of March 31, 2019, mortgage-backed securities issued by Fannie Mae exceeded 10% of JPMorgan Chase’s total stockholders’ equity; the amortized cost and fair value of such securities was $ |
(b) | Average yield is computed using the effective yield of each security owned at the end of the period, weighted based on the amortized cost of each security. The effective yield considers the contractual coupon, amortization of premiums and accretion of discounts, and the effect of related hedging derivatives. Taxable-equivalent amounts are used where applicable. The effective yield excludes unscheduled principal prepayments; and accordingly, actual maturities of securities may differ from their contractual or expected maturities as certain securities may be prepaid. |
(c) |
March 31, 2019 | ||||||||||||||||
(in millions) | Gross amounts | Amounts netted on the Consolidated balance sheets | Amounts presented on the Consolidated balance sheets(b) | Amounts not nettable on the Consolidated balance sheets(c) | Net amounts(d) | |||||||||||
Assets | ||||||||||||||||
Securities purchased under resale agreements | $ | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Securities borrowed | ( | ) | ( | ) | ||||||||||||
Liabilities | ||||||||||||||||
Securities sold under repurchase agreements | $ | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Securities loaned and other(a) | ( | ) | ( | ) |
December 31, 2018 | ||||||||||||||||
(in millions) | Gross amounts | Amounts netted on the Consolidated balance sheets | Amounts presented on the Consolidated balance sheets(b) | Amounts not nettable on the Consolidated balance sheets(c) | Net amounts(d) | |||||||||||
Assets | ||||||||||||||||
Securities purchased under resale agreements | $ | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Securities borrowed | ( | ) | ( | ) | ||||||||||||
Liabilities | ||||||||||||||||
Securities sold under repurchase agreements | $ | $ | ( | ) | $ | $ | ( | ) | $ | |||||||
Securities loaned and other(a) | ( | ) | ( | ) |
(a) | Includes securities-for-securities lending agreements of $ |
(b) | Includes securities financing agreements accounted for at fair value. At March 31, 2019 and December 31, 2018, included securities purchased under resale agreements of $ |
(c) | In some cases, collateral exchanged with a counterparty exceeds the net asset or liability balance with that counterparty. In such cases, the amounts reported in this column are limited to the related net asset or liability with that counterparty. |
(d) |
Gross liability balance | |||||||||||||
March 31, 2019 | December 31, 2018 | ||||||||||||
(in millions) | Securities sold under repurchase agreements | Securities loaned and other | Securities sold under repurchase agreements | Securities loaned and other | |||||||||
Mortgage-backed securities | |||||||||||||
U.S. government agencies | $ | $ | $ | $ | |||||||||
Residential - nonagency | |||||||||||||
Commercial - nonagency | |||||||||||||
U.S. Treasury and government agencies | |||||||||||||
Obligations of U.S. states and municipalities | |||||||||||||
Non-U.S. government debt | |||||||||||||
Corporate debt securities | |||||||||||||
Asset-backed securities | |||||||||||||
Equity securities | |||||||||||||
Total | $ | $ | $ | $ |
Remaining contractual maturity of the agreements | |||||||||||||||||
Overnight and continuous | Greater than 90 days | ||||||||||||||||
March 31, 2019 (in millions) | Up to 30 days | 30 – 90 days | Total | ||||||||||||||
Total securities sold under repurchase agreements | $ | $ | $ | $ | $ | ||||||||||||
Total securities loaned and other |
Remaining contractual maturity of the agreements | |||||||||||||||||
Overnight and continuous | Greater than 90 days | ||||||||||||||||
December 31, 2018 (in millions) | Up to 30 days | 30 – 90 days | Total | ||||||||||||||
Total securities sold under repurchase agreements | $ | $ | $ | $ | $ | ||||||||||||
Total securities loaned and other |
• | Originated or purchased loans held-for-investment (i.e., “retained”), other than PCI loans |
• | Loans held-for-sale |
• | Loans at fair value |
• | PCI loans held-for-investment |
Consumer, excluding credit card(a) | Credit card | Wholesale(f) | ||
Residential real estate – excluding PCI • Residential mortgage(b) • Home equity(c) Other consumer loans(d) • Auto • Consumer & Business Banking(e) Residential real estate – PCI • Home equity • Prime mortgage • Subprime mortgage • Option ARMs | • Credit card loans | • Commercial and industrial • Real estate • Financial institutions • Governments & Agencies • Other(g) |
(a) | Includes loans held in CCB, prime mortgage and home equity loans held in AWM and prime mortgage loans held in Corporate. |
(b) | Predominantly includes prime loans (including option ARMs). |
(c) | Includes senior and junior lien home equity loans. |
(d) | Includes certain business banking and auto dealer risk-rated loans that apply the wholesale methodology for determining the allowance for loan losses; these loans are managed by CCB, and therefore, for consistency in presentation, are included with the other consumer loan classes. |
(e) | Predominantly includes Business Banking loans. |
(f) | Includes loans held in CIB, CB, AWM and Corporate. Excludes prime mortgage and home equity loans held in AWM and prime mortgage loans held in Corporate. Classes are internally defined and may not align with regulatory definitions. |
(g) |
March 31, 2019 | Consumer, excluding credit card | Credit card(a) | Wholesale | Total | ||||||||||||
(in millions) | ||||||||||||||||
Retained | $ | $ | $ | $ | (b) | |||||||||||
Held-for-sale | ||||||||||||||||
At fair value | ||||||||||||||||
Total | $ | $ | $ | $ | ||||||||||||
December 31, 2018 | Consumer, excluding credit card | Credit card(a) | Wholesale | Total | ||||||||||||
(in millions) | ||||||||||||||||
Retained | $ | $ | $ | $ | (b) | |||||||||||
Held-for-sale | ||||||||||||||||
At fair value | ||||||||||||||||
Total | $ | $ | $ | $ |
(a) | Includes accrued interest and fees net of an allowance for the uncollectible portion of accrued interest and fee income. |
(b) |
2019 | 2018 | ||||||||||||||||||||||||||||
Three months ended March 31, (in millions) | Consumer, excluding credit card | Credit card | Wholesale | Total | Consumer, excluding credit card | Credit card | Wholesale | Total | |||||||||||||||||||||
Purchases | $ | (a)(b) | $ | $ | $ | $ | (a)(b) | $ | $ | $ | |||||||||||||||||||
Sales | |||||||||||||||||||||||||||||
Retained loans reclassified to held-for-sale |
(a) | Purchases predominantly represent the Firm’s voluntary repurchase of certain delinquent loans from loan pools as permitted by Government National Mortgage Association (“Ginnie Mae”) guidelines. The Firm typically elects to repurchase these delinquent loans as it continues to service them and/or manage the foreclosure process in accordance with applicable requirements of Ginnie Mae, FHA, RHS, and/or VA. |
(b) |
(in millions) | March 31, 2019 | December 31, 2018 | ||||
Residential real estate – excluding PCI | ||||||
Residential mortgage | $ | $ | ||||
Home equity | ||||||
Other consumer loans | ||||||
Auto | ||||||
Consumer & Business Banking | ||||||
Residential real estate – PCI | ||||||
Home equity | ||||||
Prime mortgage | ||||||
Subprime mortgage | ||||||
Option ARMs | ||||||
Total retained loans | $ | $ |
Residential real estate – excluding PCI loans | ||||||||||||||||||||||
(in millions, except ratios) | Residential mortgage | Home equity | Total residential real estate – excluding PCI | |||||||||||||||||||
Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||||||||
Loan delinquency(a) | ||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | ||||||||||||||||
30–149 days past due | ||||||||||||||||||||||
150 or more days past due | ||||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | ||||||||||||||||
% of 30+ days past due to total retained loans(b) | % | % | % | % | % | % | ||||||||||||||||
90 or more days past due and government guaranteed(c) | $ | $ | $ | $ | $ | $ | ||||||||||||||||
Nonaccrual loans | ||||||||||||||||||||||
Current estimated LTV ratios(d)(e) | ||||||||||||||||||||||
Greater than 125% and refreshed FICO scores: | ||||||||||||||||||||||
Equal to or greater than 660 | $ | $ | $ | $ | $ | $ | ||||||||||||||||
Less than 660 | ||||||||||||||||||||||
101% to 125% and refreshed FICO scores: | ||||||||||||||||||||||
Equal to or greater than 660 | ||||||||||||||||||||||
Less than 660 | ||||||||||||||||||||||
80% to 100% and refreshed FICO scores: | ||||||||||||||||||||||
Equal to or greater than 660 | ||||||||||||||||||||||
Less than 660 | ||||||||||||||||||||||
Less than 80% and refreshed FICO scores: | ||||||||||||||||||||||
Equal to or greater than 660 | ||||||||||||||||||||||
Less than 660 | ||||||||||||||||||||||
No FICO/LTV available | ||||||||||||||||||||||
U.S. government-guaranteed | ||||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | ||||||||||||||||
Geographic region(f) | ||||||||||||||||||||||
California | $ | $ | $ | $ | $ | $ | ||||||||||||||||
New York | ||||||||||||||||||||||
Illinois | ||||||||||||||||||||||
Texas | ||||||||||||||||||||||
Florida | ||||||||||||||||||||||
Washington | ||||||||||||||||||||||
Colorado | ||||||||||||||||||||||
New Jersey | ||||||||||||||||||||||
Massachusetts | ||||||||||||||||||||||
Arizona | ||||||||||||||||||||||
All other(g) | ||||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ |
(a) | Individual delinquency classifications include mortgage loans insured by U.S. government agencies as follows: current included $ |
(b) | At March 31, 2019, and December 31, 2018, residential mortgage loans excluded mortgage loans insured by U.S. government agencies of $ |
(c) | These balances, which are 90 days or more past due, were excluded from nonaccrual loans as the loans are guaranteed by U.S government agencies. Typically the principal balance of the loans is insured and interest is guaranteed at a specified reimbursement rate subject to meeting agreed-upon servicing guidelines. At March 31, 2019, and December 31, 2018, these balances included $ |
(d) | Represents the aggregate unpaid principal balance of loans divided by the estimated current property value. Current property values are estimated, at a minimum, quarterly, based on home valuation models using nationally recognized home price index valuation estimates incorporating actual data to the extent available and forecasted data where actual data is not available. These property values do not represent actual appraised loan level collateral values; as such, the resulting ratios are necessarily imprecise and should be viewed as estimates. Current estimated combined LTV for junior lien home equity loans considers all available lien positions, as well as unused lines, related to the property. |
(e) | Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis. |
(f) | The geographic regions presented in the table are ordered based on the magnitude of the corresponding loan balances at March 31, 2019. |
(g) |
Total loans | Total 30+ day delinquency rate | ||||||||||
(in millions, except ratios) | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||
HELOCs:(a) | |||||||||||
Within the revolving period(b) | $ | $ | % | % | |||||||
Beyond the revolving period | |||||||||||
HELOANs | |||||||||||
Total | $ | $ | % | % |
(a) | These HELOCs are predominantly revolving loans for a |
(b) |
(in millions) | Residential mortgage | Home equity | Total residential real estate – excluding PCI | |||||||||||||||||
Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||||||
Impaired loans | ||||||||||||||||||||
With an allowance | $ | $ | $ | $ | $ | $ | ||||||||||||||
Without an allowance(a) | ||||||||||||||||||||
Total impaired loans(b)(c) | $ | $ | $ | $ | $ | $ | ||||||||||||||
Allowance for loan losses related to impaired loans | $ | $ | $ | $ | $ | $ | ||||||||||||||
Unpaid principal balance of impaired loans(d) | ||||||||||||||||||||
Impaired loans on nonaccrual status(e) |
(a) | Represents collateral-dependent residential real estate loans that are charged off to the fair value of the underlying collateral less cost to sell. The Firm reports, in accordance with regulatory guidance, residential real estate loans that have been discharged under Chapter 7 bankruptcy and not reaffirmed by the borrower (“Chapter 7 loans”) as collateral-dependent nonaccrual TDRs, regardless of their delinquency status. At March 31, 2019, Chapter 7 residential real estate loans included approximately |
(b) | At March 31, 2019, and December 31, 2018, $ |
(c) | Predominantly all residential real estate impaired loans, excluding PCI loans, are in the U.S. |
(d) | Represents the contractual amount of principal owed at March 31, 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors including charge-offs, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans. |
(e) |
Three months ended March 31, (in millions) | Average impaired loans | Interest income on impaired loans(a) | Interest income on impaired loans on a cash basis(a) | |||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||
Residential mortgage | $ | $ | $ | $ | $ | $ | ||||||||||||||
Home equity | ||||||||||||||||||||
Total residential real estate – excluding PCI | $ | $ | $ | $ | $ | $ |
(a) |
Three months ended March 31, | ||||||
(in millions) | 2019 | 2018 | ||||
Residential mortgage | $ | $ | ||||
Home equity | ||||||
Total residential real estate – excluding PCI | $ | $ |
Three months ended March 31, | Total residential real estate – excluding PCI | |||||||||||||
Residential mortgage | Home equity | |||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | |||||||||
Number of loans approved for a trial modification | ||||||||||||||
Number of loans permanently modified | ||||||||||||||
Concession granted:(a) | ||||||||||||||
Interest rate reduction | % | % | % | % | % | % | ||||||||
Term or payment extension | ||||||||||||||
Principal and/or interest deferred | ||||||||||||||
Principal forgiveness | ||||||||||||||
Other(b) |
(a) | Represents concessions granted in permanent modifications as a percentage of the number of loans permanently modified. The sum of the percentages exceeds |
(b) |
Three months ended March 31, (in millions, except weighted-average data) | Residential mortgage | Home equity | Total residential real estate – excluding PCI | |||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||
Weighted-average interest rate of loans with interest rate reductions – before TDR | % | % | % | % | % | % | ||||||||||||||
Weighted-average interest rate of loans with interest rate reductions – after TDR | ||||||||||||||||||||
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR | ||||||||||||||||||||
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR | ||||||||||||||||||||
Charge-offs recognized upon permanent modification | $ | $ | $ | $ | $ | $ | ||||||||||||||
Principal deferred | ||||||||||||||||||||
Principal forgiven | ||||||||||||||||||||
Balance of loans that redefaulted within one year of permanent modification(a) | $ | $ | $ | $ | $ | $ |
(a) |
(in millions, except ratios) | Auto | Consumer & Business Banking | Total other consumer | |||||||||||||||||
Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||||||
Loan delinquency | ||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | ||||||||||||||
30–119 days past due | ||||||||||||||||||||
120 or more days past due | ||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | ||||||||||||||
% of 30+ days past due to total retained loans | % | % | % | % | % | % | ||||||||||||||
Nonaccrual loans(a) | ||||||||||||||||||||
Geographic region(b) | ||||||||||||||||||||
California | $ | $ | $ | $ | $ | $ | ||||||||||||||
Texas | ||||||||||||||||||||
New York | ||||||||||||||||||||
Illinois | ||||||||||||||||||||
Florida | ||||||||||||||||||||
Arizona | ||||||||||||||||||||
Ohio | ||||||||||||||||||||
New Jersey | ||||||||||||||||||||
Michigan | ||||||||||||||||||||
Colorado | ||||||||||||||||||||
All other | ||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | ||||||||||||||
Loans by risk ratings(c) | ||||||||||||||||||||
Noncriticized | $ | $ | $ | $ | $ | $ | ||||||||||||||
Criticized performing | ||||||||||||||||||||
Criticized nonaccrual |
(a) | There were |
(b) | The geographic regions presented in this table are ordered based on the magnitude of the corresponding loan balances at March 31, 2019. |
(c) | For risk-rated business banking and auto loans, the primary credit quality indicator is the risk rating of the loan, including whether the loans are considered to be criticized and/or nonaccrual. |
(in millions) | March 31, 2019 | December 31, 2018 | |||||
Impaired loans | |||||||
With an allowance | $ | $ | |||||
Without an allowance(a) | |||||||
Total impaired loans(b)(c) | $ | $ | |||||
Allowance for loan losses related to impaired loans | $ | $ | |||||
Unpaid principal balance of impaired loans(d) | |||||||
Impaired loans on nonaccrual status |
(a) | When discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged off and/or there have been interest payments received and applied to the loan balance. |
(b) | Predominantly all other consumer impaired loans are in the U.S. |
(c) | Other consumer average impaired loans were $ |
(d) |
(in millions, except ratios) | Home equity | Prime mortgage | Subprime mortgage | Option ARMs | Total PCI | |||||||||||||||||||||||||||||
Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||||||||||||||||
Carrying value(a) | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Loan delinquency (based on unpaid principal balance) | ||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
30–149 days past due | ||||||||||||||||||||||||||||||||||
150 or more days past due | ||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
% of 30+ days past due to total loans | % | % | % | % | % | % | % | % | % | % | ||||||||||||||||||||||||
Current estimated LTV ratios (based on unpaid principal balance)(b)(c) | ||||||||||||||||||||||||||||||||||
Greater than 125% and refreshed FICO scores: | ||||||||||||||||||||||||||||||||||
Equal to or greater than 660 | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Less than 660 | ||||||||||||||||||||||||||||||||||
101% to 125% and refreshed FICO scores: | ||||||||||||||||||||||||||||||||||
Equal to or greater than 660 | ||||||||||||||||||||||||||||||||||
Less than 660 | ||||||||||||||||||||||||||||||||||
80% to 100% and refreshed FICO scores: | ||||||||||||||||||||||||||||||||||
Equal to or greater than 660 | ||||||||||||||||||||||||||||||||||
Less than 660 | ||||||||||||||||||||||||||||||||||
Lower than 80% and refreshed FICO scores: | ||||||||||||||||||||||||||||||||||
Equal to or greater than 660 | ||||||||||||||||||||||||||||||||||
Less than 660 | ||||||||||||||||||||||||||||||||||
No FICO/LTV available | ||||||||||||||||||||||||||||||||||
Total unpaid principal balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Geographic region (based on unpaid principal balance)(d) | ||||||||||||||||||||||||||||||||||
California | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Florida | ||||||||||||||||||||||||||||||||||
New York | ||||||||||||||||||||||||||||||||||
Washington | ||||||||||||||||||||||||||||||||||
Illinois | ||||||||||||||||||||||||||||||||||
New Jersey | ||||||||||||||||||||||||||||||||||
Massachusetts | ||||||||||||||||||||||||||||||||||
Maryland | ||||||||||||||||||||||||||||||||||
Virginia | ||||||||||||||||||||||||||||||||||
Arizona | ||||||||||||||||||||||||||||||||||
All other | ||||||||||||||||||||||||||||||||||
Total unpaid principal balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ |
(a) | Carrying value includes the effect of fair value adjustments that were applied to the consumer PCI portfolio at the date of acquisition. |
(b) | Represents the aggregate unpaid principal balance of loans divided by the estimated current property value. Current property values are estimated, at a minimum, quarterly, based on home valuation models using nationally recognized home price index valuation estimates incorporating actual data to the extent available and forecasted data where actual data is not available. These property values do not represent actual appraised loan level collateral values; as such, the resulting ratios are necessarily imprecise and should be viewed as estimates. Current estimated combined LTV for junior lien home equity loans considers all available lien positions, as well as unused lines, related to the property. |
(c) | Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis. |
(d) |
Total loans | Total 30+ day delinquency rate | ||||||||||
(in millions, except ratios) | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||
HELOCs(a)(b) | % | % | |||||||||
HELOANs | |||||||||||
Total | $ | $ | % | % |
(a) | In general, these HELOCs are revolving loans for a |
(b) |
Total PCI | ||||||
(in millions, except ratios) | Three months ended March 31, | |||||
2019 | 2018 | |||||
Beginning balance | $ | $ | ||||
Accretion into interest income | ( | ) | ( | ) | ||
Changes in interest rates on variable-rate loans | ( | ) | ||||
Other changes in expected cash flows(a) | ( | ) | ( | ) | ||
Balance at March 31 | $ | $ | ||||
Accretable yield percentage | % | % |
(a) |
(in millions, except ratios) | March 31, 2019 | December 31, 2018 | ||||
Loan delinquency | ||||||
Current and less than 30 days past due and still accruing | $ | $ | ||||
30–89 days past due and still accruing | ||||||
90 or more days past due and still accruing | ||||||
Total retained loans | $ | $ | ||||
Loan delinquency ratios | ||||||
% of 30+ days past due to total retained loans | % | % | ||||
% of 90+ days past due to total retained loans | ||||||
Geographic region(a) | ||||||
California | $ | $ | ||||
Texas | ||||||
New York | ||||||
Florida | ||||||
Illinois | ||||||
New Jersey | ||||||
Ohio | ||||||
Pennsylvania | ||||||
Colorado | ||||||
Michigan | ||||||
All other | ||||||
Total retained loans | $ | $ | ||||
Percentage of portfolio based on carrying value with estimated refreshed FICO scores | ||||||
Equal to or greater than 660 | % | % | ||||
Less than 660 | ||||||
No FICO available |
(a) |
(in millions) | March 31, 2019 | December 31, 2018 | ||||
Impaired credit card loans with an allowance(a)(b)(c) | $ | $ | ||||
Allowance for loan losses related to impaired credit card loans |
(a) | The carrying value and the unpaid principal balance are the same for credit card impaired loans. |
(b) | There were no impaired loans without an allowance. |
(c) |
Three months ended March 31, | ||||||
(in millions) | 2019 | 2018 | ||||
Average impaired credit card loans | $ | $ | ||||
Interest income on impaired credit card loans |
(in millions, except weighted-average data) | Three months ended March 31, | |||||
2019 | 2018 | |||||
Weighted-average interest rate of loans – before TDR | % | % | ||||
Weighted-average interest rate of loans – after TDR | ||||||
Loans that redefaulted within one year of modification(a)(b) | $ | $ |
(a) | Represents loans modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within |
(b) |
Commercial and industrial | Real estate | Financial institutions | Governments & Agencies | Other(d) | Total retained loans | ||||||||||||||||||||||||||||||||||
(in millions, except ratios) | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||||||||||||||||||
Loans by risk ratings | |||||||||||||||||||||||||||||||||||||||
Investment-grade | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Noninvestment-grade: | |||||||||||||||||||||||||||||||||||||||
Noncriticized | |||||||||||||||||||||||||||||||||||||||
Criticized performing | |||||||||||||||||||||||||||||||||||||||
Criticized nonaccrual | |||||||||||||||||||||||||||||||||||||||
Total noninvestment- grade | |||||||||||||||||||||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
% of total criticized exposure to total retained loans | % | % | % | % | % | % | % | % | % | % | % | % | |||||||||||||||||||||||||||
% of criticized nonaccrual to total retained loans | |||||||||||||||||||||||||||||||||||||||
Loans by geographic distribution(a) | |||||||||||||||||||||||||||||||||||||||
Total non-U.S. | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Total U.S. | |||||||||||||||||||||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Loan delinquency(b) | |||||||||||||||||||||||||||||||||||||||
Current and less than 30 days past due and still accruing | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
30–89 days past due and still accruing | |||||||||||||||||||||||||||||||||||||||
90 or more days past due and still accruing(c) | |||||||||||||||||||||||||||||||||||||||
Criticized nonaccrual | |||||||||||||||||||||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ |
(a) | The U.S. and non-U.S. distribution is determined based predominantly on the domicile of the borrower. |
(b) | The credit quality of wholesale loans is assessed primarily through ongoing review and monitoring of an obligor’s ability to meet contractual obligations rather than relying on the past due status, which is generally a lagging indicator of credit quality. For a further discussion, refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K. |
(c) | Represents loans that are considered well-collateralized and therefore still accruing interest. |
(d) |
(in millions, except ratios) | Multifamily | Other commercial | Total real estate loans | |||||||||||||||||
Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||||||
Real estate retained loans | $ | $ | $ | $ | $ | $ | ||||||||||||||
Criticized exposure | ||||||||||||||||||||
% of total criticized exposure to total real estate retained loans | % | % | % | % | % | % | ||||||||||||||
Criticized nonaccrual | $ | $ | $ | $ | $ | $ | ||||||||||||||
% of criticized nonaccrual loans to total real estate retained loans | % | % | % | % | % | % |
(in millions) | Commercial and industrial | Real estate | Financial institutions | Governments & Agencies | Other | Total retained loans | |||||||||||||||||||||||||||||||||||||
Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | ||||||||||||||||||||||||||||||||
Impaired loans | |||||||||||||||||||||||||||||||||||||||||||
With an allowance | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Without an allowance(a) | |||||||||||||||||||||||||||||||||||||||||||
Total impaired loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | (c) | $ | (c) | |||||||||||||||||||||||||||||
Allowance for loan losses related to impaired loans | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Unpaid principal balance of impaired loans(b) |
(a) | When the discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged-off and/or there have been interest payments received and applied to the loan balance. |
(b) | Represents the contractual amount of principal owed at March 31, 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs; interest payments received and applied to the carrying value; net deferred loan fees or costs; and unamortized discount or premiums on purchased loans. |
(c) |
Three months ended March 31, | ||||||
(in millions) | 2019 | 2018 | ||||
Commercial and industrial | $ | $ | ||||
Real estate | ||||||
Financial institutions | ||||||
Governments & Agencies | ||||||
Other | ||||||
Total(a)(b) | $ | $ |
(a) | The related interest income on accruing impaired loans and interest income recognized on a cash basis were not material for the three months ended March 31, 2019 and 2018. |
(b) |
2019 | 2018 | ||||||||||||||||||||||||||||
Three months ended March 31, (in millions) | Consumer, excluding credit card | Credit card | Wholesale | Total | Consumer, excluding credit card | Credit card | Wholesale | Total | |||||||||||||||||||||
Allowance for loan losses | |||||||||||||||||||||||||||||
Beginning balance at January 1, | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Gross charge-offs | |||||||||||||||||||||||||||||
Gross recoveries | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||
Net charge-offs | |||||||||||||||||||||||||||||
Write-offs of PCI loans(a) | |||||||||||||||||||||||||||||
Provision for loan losses | ( | ) | |||||||||||||||||||||||||||
Other | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
Ending balance at March 31, | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Allowance for loan losses by impairment methodology | |||||||||||||||||||||||||||||
Asset-specific(b) | $ | $ | (c) | $ | $ | $ | $ | (c) | $ | $ | |||||||||||||||||||
Formula-based | |||||||||||||||||||||||||||||
PCI | |||||||||||||||||||||||||||||
Total allowance for loan losses | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Loans by impairment methodology | |||||||||||||||||||||||||||||
Asset-specific | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Formula-based | |||||||||||||||||||||||||||||
PCI | |||||||||||||||||||||||||||||
Total retained loans | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Impaired collateral-dependent loans | |||||||||||||||||||||||||||||
Net charge-offs | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Loans measured at fair value of collateral less cost to sell | |||||||||||||||||||||||||||||
Allowance for lending-related commitments | |||||||||||||||||||||||||||||
Beginning balance at January 1, | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Provision for lending-related commitments | |||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||
Ending balance at March 31, | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Allowance for lending-related commitments by impairment methodology | |||||||||||||||||||||||||||||
Asset-specific | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Formula-based | |||||||||||||||||||||||||||||
Total allowance for lending-related commitments | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Lending-related commitments by impairment methodology | |||||||||||||||||||||||||||||
Asset-specific | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||
Formula-based | |||||||||||||||||||||||||||||
Total lending-related commitments | $ | $ | $ | $ | $ | $ | $ | $ |
(a) | Write-offs of PCI loans are recorded against the allowance for loan losses when actual losses for a pool exceed estimated losses that were recorded as purchase accounting adjustments at the time of acquisition. A write-off of a PCI loan is recognized when the underlying loan is removed from a pool. |
(b) | Includes risk-rated loans that have been placed on nonaccrual status and loans that have been modified in a TDR. |
(c) |
Line of Business | Transaction Type | Activity | Form 10-Q page reference |
CCB | Credit card securitization trusts | Securitization of originated credit card receivables | 123 |
Mortgage securitization trusts | Servicing and securitization of both originated and purchased residential mortgages | 123-125 | |
CIB | Mortgage and other securitization trusts | Securitization of both originated and purchased residential and commercial mortgages, and other consumer loans | 123-125 |
Multi-seller conduits | Assist clients in accessing the financial markets in a cost-efficient manner and structures transactions to meet investor needs | 125 | |
Municipal bond vehicles | Financing of municipal bond investments | 125 |
Principal amount outstanding | JPMorgan Chase interest in securitized assets in nonconsolidated VIEs(c)(d)(e) | |||||||||||||||||||||
March 31, 2019 (in millions) | Total assets held by securitization VIEs | Assets held in consolidated securitization VIEs | Assets held in nonconsolidated securitization VIEs with continuing involvement | Trading assets | Investment securities | Other financial assets | Total interests held by JPMorgan Chase | |||||||||||||||
Securitization-related(a) | ||||||||||||||||||||||
Residential mortgage: | ||||||||||||||||||||||
Prime/Alt-A and option ARMs | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||
Subprime | ||||||||||||||||||||||
Commercial and other(b) | ||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ |
Principal amount outstanding | JPMorgan Chase interest in securitized assets in nonconsolidated VIEs(c)(d)(e) | |||||||||||||||||||||
December 31, 2018 (in millions) | Total assets held by securitization VIEs | Assets held in consolidated securitization VIEs | Assets held in nonconsolidated securitization VIEs with continuing involvement | Trading assets | Investment securities | Other financial assets | Total interests held by JPMorgan Chase | |||||||||||||||
Securitization-related(a) | ||||||||||||||||||||||
Residential mortgage: | ||||||||||||||||||||||
Prime/Alt-A and option ARMs | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||
Subprime | ||||||||||||||||||||||
Commercial and other(b) | ||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ |
(a) | Excludes U.S. government agency securitizations and re-securitizations, which are not Firm-sponsored. Refer to pages 127–128 of this Note for information on the Firm’s loan sales to U.S. government agencies. |
(b) | Consists of securities backed by commercial loans (predominantly real estate) and non-mortgage-related consumer receivables purchased from third parties. |
(c) | Excludes the following: retained servicing (refer to Note 14 for a discussion of MSRs); securities retained from loan sales to U.S. government agencies; interest rate and foreign exchange derivatives primarily used to manage interest rate and foreign exchange risks of securitization entities (Refer to Note 4 for further information on derivatives); senior and subordinated securities of $ |
(d) | Includes interests held in re-securitization transactions. |
(e) |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Transfers of securities to VIEs | |||||||
Agency | $ | $ |
Nonconsolidated re-securitization VIEs | |||||||
(in millions) | March 31, 2019 | December 31, 2018 | |||||
Firm-sponsored private-label | |||||||
Assets held in VIEs with continuing involvement(a) | $ | $ | |||||
Interest in VIEs | |||||||
Agency | |||||||
Interest in VIEs |
(a) |
Assets | Liabilities | |||||||||||||||||||||
March 31, 2019 (in millions) | Trading assets | Loans | Other(b) | Total assets(c) | Beneficial interests in VIE assets(d) | Other(e) | Total liabilities | |||||||||||||||
VIE program type | ||||||||||||||||||||||
Firm-sponsored credit card trusts | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||
Firm-administered multi-seller conduits | ||||||||||||||||||||||
Municipal bond vehicles | ||||||||||||||||||||||
Mortgage securitization entities(a) | ||||||||||||||||||||||
Other | ||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||
Assets | Liabilities | |||||||||||||||||||||
December 31, 2018 (in millions) | Trading assets | Loans | Other(b) | Total assets(c) | Beneficial interests in VIE assets(d) | Other(e) | Total liabilities | |||||||||||||||
VIE program type | ||||||||||||||||||||||
Firm-sponsored credit card trusts | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||
Firm-administered multi-seller conduits | ||||||||||||||||||||||
Municipal bond vehicles | ||||||||||||||||||||||
Mortgage securitization entities(a) | ||||||||||||||||||||||
Other | ||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ |
(a) | Includes residential and commercial mortgage securitizations. |
(b) | Includes assets classified as cash and other assets on the Consolidated balance sheets. |
(c) | The assets of the consolidated VIEs included in the program types above are used to settle the liabilities of those entities. The assets and liabilities include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation. |
(d) | The interest-bearing beneficial interest liabilities issued by consolidated VIEs are classified in the line item on the Consolidated balance sheets titled, “Beneficial interests issued by consolidated variable interest entities.” The holders of these beneficial interests generally do not have recourse to the general credit of JPMorgan Chase. For conduits program-wide credit enhancements, refer to note 14 of JPMorgan Chase’s 2018 Form 10-K. Included in beneficial interests in VIE assets are long-term beneficial interests of $ |
(e) |
Three months ended March 31, | |||||||||||||
2019 | 2018 | ||||||||||||
(in millions) | Residential mortgage(f) | Commercial and other(g) | Residential mortgage(f) | Commercial and other(g) | |||||||||
Principal securitized | $ | $ | $ | $ | |||||||||
All cash flows during the period(a): | |||||||||||||
Proceeds received from loan sales as financial instruments(b)(c) | $ | $ | $ | $ | |||||||||
Servicing fees collected(d) | |||||||||||||
Cash flows received on interests |
(a) | Excludes re-securitization transactions. |
(b) | Predominantly includes Level 2 assets. |
(c) | The carrying value of the loans accounted for at fair value approximated the proceeds received upon loan sale. |
(d) | The prior period amounts have been revised to conform with the current period presentation. |
(e) | Includes cash paid by the Firm to reacquire assets from nonconsolidated entities – for example, loan repurchases due to representation and warranties and servicer “clean-up” calls. |
(f) | Includes prime mortgages only. Excludes loan securitization transactions entered into with Ginnie Mae, Fannie Mae and Freddie Mac. |
(g) |
Three months ended March 31, | ||||||
(in millions) | 2019 | 2018 | ||||
Carrying value of loans sold | $ | $ | ||||
Proceeds received from loan sales as cash | ||||||
Proceeds from loan sales as securities(a)(b) | ||||||
Total proceeds received from loan sales(c) | $ | $ | ||||
Gains on loan sales(d)(e) | $ | $ |
(a) | Includes securities from U.S. GSEs and Ginnie Mae that are generally sold shortly after receipt or retained as part of the Firm’s Investment securities portfolio. |
(b) | Included in level 2 assets. |
(c) | Excludes the value of MSRs retained upon the sale of loans. |
(d) | Gains on loan sales include the value of MSRs. |
(e) |
(in millions) | Mar 31, 2019 | Dec 31, 2018 | ||||
Loans repurchased or option to repurchase(a) | $ | $ | ||||
Real estate owned | ||||||
Foreclosed government-guaranteed residential mortgage loans(b) |
(a) | Predominantly all of these amounts relate to loans that have been repurchased from Ginnie Mae loan pools. |
(b) |
Net liquidation losses(a) | ||||||||||||||||||||
Securitized assets | 90 days past due | Three months ended March 31, | ||||||||||||||||||
(in millions) | Mar 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | 2019 | 2018 | ||||||||||||||
Securitized loans | ||||||||||||||||||||
Residential mortgage: | ||||||||||||||||||||
Prime / Alt-A & option ARMs | $ | $ | $ | $ | $ | $ | ||||||||||||||
Subprime | ( | ) | ||||||||||||||||||
Commercial and other | ||||||||||||||||||||
Total loans securitized | $ | $ | $ | $ | $ | $ | ( | ) |
(a) |
(in millions) | March 31, 2019 | December 31, 2018 | ||||
Consumer & Community Banking | $ | $ | ||||
Corporate & Investment Bank | ||||||
Commercial Banking | ||||||
Asset & Wealth Management | ||||||
Total goodwill | $ | $ |
Three months ended March 31, | |||||||
(in millions) | 2019 | 2018 | |||||
Balance at beginning of period | $ | $ | |||||
Changes during the period from: | |||||||
Other(a) | ( | ) | |||||
Balance at March 31, | $ | $ |
(a) |
As of or for the three months ended March 31, | |||||||
(in millions, except where otherwise noted) | 2019 | 2018 | |||||
Fair value at beginning of period | $ | $ | |||||
MSR activity: | |||||||
Originations of MSRs | |||||||
Purchase of MSRs | |||||||
Disposition of MSRs(a) | ( | ) | ( | ) | |||
Net additions/(dispositions) | ( | ) | |||||
Changes due to collection/realization of expected cash flows | ( | ) | ( | ) | |||
Changes in valuation due to inputs and assumptions: | |||||||
Changes due to market interest rates and other(b) | ( | ) | |||||
Changes in valuation due to other inputs and assumptions: | |||||||
Projected cash flows (e.g., cost to service) | |||||||
Discount rates | |||||||
Prepayment model changes and other(c) | ( | ) | |||||
Total changes in valuation due to other inputs and assumptions | |||||||
Total changes in valuation due to inputs and assumptions | ( | ) | |||||
Fair value at March 31, | $ | $ | |||||
Change in unrealized gains/(losses) included in income related to MSRs held at March 31, | $ | ( | ) | $ | |||
Contractual service fees, late fees and other ancillary fees included in income | |||||||
Third-party mortgage loans serviced at March 31, (in billions) | |||||||
Servicer advances, net of an allowance for uncollectible amounts, at March 31, (in billions)(d) |
(a) | Includes excess MSRs transferred to agency-sponsored trusts in exchange for stripped mortgage backed securities (“SMBS”). In each transaction, a portion of the SMBS was acquired by third parties at the transaction date; the Firm acquired the remaining balance of those SMBS as trading securities. |
(b) | Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments. |
(c) | Represents changes in prepayments other than those attributable to changes in market interest rates. |
(d) |
Three months ended March 31, | ||||||||
(in millions) | 2019 | 2018 | ||||||
CCB mortgage fees and related income | ||||||||
Net production revenue | $ | $ | ||||||
Net mortgage servicing revenue: | ||||||||
Operating revenue: | ||||||||
Loan servicing revenue | ||||||||
Changes in MSR asset fair value due to collection/realization of expected cash flows | ( | ) | ( | ) | ||||
Total operating revenue | ||||||||
Risk management: | ||||||||
Changes in MSR asset fair value due to market interest rates and other(a) | ( | ) | ||||||
Other changes in MSR asset fair value due to other inputs and assumptions in model(b) | ||||||||
Change in derivative fair value and other | ( | ) | ||||||
Total risk management | ( | ) | ||||||
Total net mortgage servicing revenue | ||||||||
Total CCB mortgage fees and related income | ||||||||
All other | ||||||||
Mortgage fees and related income | $ | $ |
(a) | Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments. |
(b) |
(in millions, except rates) | Mar 31, 2019 | Dec 31, 2018 | ||||||
Weighted-average prepayment speed assumption (constant prepayment rate) | % | % | ||||||
Impact on fair value of 10% adverse change | $ | ( | ) | $ | ( | ) | ||
Impact on fair value of 20% adverse change | ( | ) | ( | ) | ||||
Weighted-average option adjusted spread(a) | % | % | ||||||
Impact on fair value of a 100 basis point adverse change | $ | ( | ) | $ | ( | ) | ||
Impact on fair value of a 200 basis point adverse change | ( | ) | ( | ) |
(a) |
(in millions) | March 31, 2019 | December 31, 2018 | |||||
U.S. offices | |||||||
Noninterest-bearing | $ | $ | |||||
Interest-bearing (included $27,792 and $19,691 at fair value)(a) | |||||||
Total deposits in U.S. offices | |||||||
Non-U.S. offices | |||||||
Noninterest-bearing | |||||||
Interest-bearing (included $4,012 and $3,526 at fair value)(a) | |||||||
Total deposits in non-U.S. offices | |||||||
Total deposits | $ | $ |
(a) |
As of March 31, (in millions, except where otherwise noted) | |||
2019 | |||
Right-of-use assets | $ | ||
Lease liabilities | |||
Weighted average remaining lease term (in years) | |||
Weighted average discount rate | % | ||
Three months ended March 31, (in millions) | |||
2019 | |||
Rental expense | |||
Gross rental expense | $ | ||
Sublease rental income | ( | ) | |
Net rental expense | $ | ||
Supplemental cash flow information | |||
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows | $ | ||
Supplemental non-cash information | |||
Right-of-use assets obtained in exchange for operating lease obligations | $ | ||
Year ended December 31, (in millions) | |||
2019 (excluding three months ended March 31, 2019) | $ | ||
2020 | |||
2021 | |||
2022 | |||
2023 | |||
After 2023 | |||
Total future minimum lease payments | |||
Less: Imputed interest | ( | ) | |
Total | $ |
(in millions) | March 31, 2019 | December 31, 2018 | |||||
Carrying value of assets subject to operating leases, net of accumulated depreciation | $ | $ | |||||
Accumulated depreciation |
Three months ended March 31, (in millions) | 2019 | 2018 | |||||
Operating lease income | $ | $ | |||||
Depreciation expense |
Year ended December 31, (in millions) | |||
2019 (excluding three months ended March 31, 2019) | $ | ||
2020 | |||
2021 | |||
2022 | |||
2023 | |||
After 2023 | |||
Total future minimum lease payments | $ |
Shares | Carrying value (in millions) | Issue date | Contractual rate in effect at March 31, 2019 | Earliest redemption date | Date at which dividend rate becomes floating | Floating annual rate of three-month LIBOR plus: | Dividend declared per share(b) | |||||||||||||||
March 31, 2019(a) | December 31, 2018(a) | March 31, 2019 | December 31, 2018 | Three months ended March 31, 2019 | ||||||||||||||||||
Fixed-rate: | ||||||||||||||||||||||
Series P | $ | $ | % | NA | NA | $ | ||||||||||||||||
Series T | NA | NA | ||||||||||||||||||||
Series W | NA | NA | ||||||||||||||||||||
Series Y | NA | NA | ||||||||||||||||||||
Series AA | NA | NA | ||||||||||||||||||||
Series BB | NA | NA | ||||||||||||||||||||
Series DD | NA | NA | ||||||||||||||||||||
Series EE | NA | NA | (c) | |||||||||||||||||||
Fixed-to-floating-rate: | ||||||||||||||||||||||
Series I | $ | $ | LIBOR + 3.47% | LIBOR + 3.47% | ||||||||||||||||||
Series Q | LIBOR + 3.25 | |||||||||||||||||||||
Series R | LIBOR + 3.30 | |||||||||||||||||||||
Series S | LIBOR + 3.78 | |||||||||||||||||||||
Series U | LIBOR + 3.33 | |||||||||||||||||||||
Series V | LIBOR + 3.32 | |||||||||||||||||||||
Series X | LIBOR + 3.33 | |||||||||||||||||||||
Series Z | LIBOR + 3.80 | |||||||||||||||||||||
Series CC | LIBOR + 2.58 | |||||||||||||||||||||
Total preferred stock | $ | $ |
(a) | Represented by depositary shares. |
(b) | Dividends are declared quarterly. Dividends are payable quarterly on fixed-rate preferred stock. Dividends are payable semiannually on fixed-to-floating-rate preferred stock while at a fixed rate, and payable quarterly after converting to a floating rate. |
(c) |
(in millions, except per share amounts) | Three months ended March 31, | |||||
2019 | 2018 | |||||
Basic earnings per share | ||||||
Net income | $ | $ | ||||
Less: Preferred stock dividends | ||||||
Net income applicable to common equity | ||||||
Less: Dividends and undistributed earnings allocated to participating securities | ||||||
Net income applicable to common stockholders | $ | $ | ||||
Total weighted-average basic shares outstanding | ||||||
Net income per share | $ | $ | ||||
Diluted earnings per share | ||||||
Net income applicable to common stockholders | $ | $ | ||||
Total weighted-average basic shares outstanding | ||||||
Add: Employee stock options, SARs, warrants and unvested PSUs | ||||||
Total weighted-average diluted shares outstanding | ||||||
Net income per share | $ | $ |
As of or for the three months ended March 31, 2019 (in millions) | Unrealized gains/(losses) on investment securities | Translation adjustments, net of hedges | Fair value hedges | Cash flow hedges | Defined benefit pension and OPEB plans | DVA on fair value option elected liabilities | Accumulated other comprehensive income/(loss) | ||||||||||||||||||||||||||||||
Balance at January 1, 2019 | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||||||||||||||||
Net change | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
Balance at March 31, 2019 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||
As of or for the three months ended March 31, 2018 (in millions) | Unrealized gains/(losses) on investment securities | Translation adjustments, net of hedges | Fair value hedges | Cash flow hedges | Defined benefit pension and OPEB plans | DVA on fair value option elected liabilities | Accumulated other comprehensive income/(loss) | ||||||||||||||||||||||||||||||
Balance at January 1, 2018 | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||||||||||||||||||||||
Cumulative effect of changes in accounting principles(a) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Net change | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
Balance at March 31, 2018 | $ | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) |
(a) | Represents the adjustment to AOCI as a result of the accounting standards adopted in the first quarter of 2018, refer to Note 1 of JPMorgan Chase’s 2018 Form 10-K. |
2019 | 2018 | ||||||||||||||||||||||
Three months ended March 31, (in millions) | Pre-tax | Tax effect | After-tax | Pre-tax | Tax effect | After-tax | |||||||||||||||||
Unrealized gains/(losses) on investment securities: | |||||||||||||||||||||||
Net unrealized gains/(losses) arising during the period | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) | |||||||||||
Reclassification adjustment for realized (gains)/losses included in net income(a) | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Net change | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Translation adjustments(b): | |||||||||||||||||||||||
Translation | ( | ) | ( | ) | |||||||||||||||||||
Hedges | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||
Net change | ( | ) | ( | ) | |||||||||||||||||||
Fair value hedges, net change(c): | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Cash flow hedges: | |||||||||||||||||||||||
Net unrealized gains/(losses) arising during the period | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Reclassification adjustment for realized (gains)/losses included in net income(d) | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Net change | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Defined benefit pension and OPEB plans: | |||||||||||||||||||||||
Net gain/(loss) arising during the period | ( | ) | ( | ) | |||||||||||||||||||
Reclassification adjustments included in net income(e): | |||||||||||||||||||||||
Amortization of net loss | ( | ) | ( | ) | |||||||||||||||||||
Amortization of prior service cost/(credit) | ( | ) | ( | ) | |||||||||||||||||||
Foreign exchange and other | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Net change | ( | ) | ( | ) | |||||||||||||||||||
DVA on fair value option elected liabilities, net change: | ( | ) | ( | ) | ( | ) | |||||||||||||||||
Total other comprehensive income/(loss) | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) |
(a) | The pre-tax amount is reported in Investment securities gains/(losses) in the Consolidated statements of income. |
(b) | Reclassifications of pre-tax realized gains/(losses) on translation adjustments and related hedges are reported in other income/expense in the Consolidated statements of income. There were no sales or liquidations of legal entities that resulted in reclassifications in the periods presented. |
(c) | Represents changes in fair value of cross-currency swaps attributable to changes in cross-currency basis spreads, which are excluded from the assessment of hedge effectiveness and recorded in other comprehensive income. The initial cost of cross-currency basis spreads is recognized in earnings as part of the accrual of interest on the cross currency swap. |
(d) | The pre-tax amounts are predominantly recorded in noninterest revenue, net interest income and compensation expense in the Consolidated statements of income. |
(e) |
(in billions) | March 31, 2019 | December 31, 2018 | ||||
Cash reserves – Federal Reserve Banks | $ | $ | ||||
Segregated for the benefit of securities and futures brokerage customers | ||||||
Cash reserves at non-U.S. central banks and held for other general purposes | ||||||
Total restricted cash(a) | $ | $ |
(a) |
• | Cash and securities pledged with clearing organizations for the benefit of customers of $ |
• |
Minimum capital ratios | Well-capitalized ratios | ||||||||
BHC(a)(e)(f) | IDI(b)(e)(f) | BHC(c) | IDI(d) | ||||||
Capital ratios | |||||||||
CET1 | % | % | % | % | |||||
Tier 1 | |||||||||
Total | |||||||||
Tier 1 leverage | |||||||||
SLR |
(a) | Represents the minimum capital ratios applicable to the Firm under Basel III. The CET1 minimum capital ratio includes a capital conservation buffer of |
(b) | Represents requirements for JPMorgan Chase’s IDI subsidiaries. The CET1 minimum capital ratio includes a capital conservation buffer of |
(c) | Represents requirements for bank holding companies pursuant to regulations issued by the Federal Reserve. |
(d) | Represents requirements for IDI subsidiaries pursuant to regulations issued under the FDIC Improvement Act. |
(e) | For the period ended December 31, 2018, the CET1, Tier 1, Total and Tier 1 leverage minimum capital ratios applicable to the Firm were |
(f) | Represents minimum SLR requirement of |
March 31, 2019 (in millions, except ratios) | Basel III Standardized Fully Phased-In | Basel III Advanced Fully Phased-In | |||||||||||||||||
JPMorgan Chase & Co. | JPMorgan Chase Bank, N.A. | Chase Bank USA, N.A. | JPMorgan Chase & Co. | JPMorgan Chase Bank, N.A. | Chase Bank USA, N.A. | ||||||||||||||
Regulatory capital | |||||||||||||||||||
CET1 capital | $ | $ | $ | $ | $ | $ | |||||||||||||
Tier 1 capital | |||||||||||||||||||
Total capital | |||||||||||||||||||
Assets | |||||||||||||||||||
Risk-weighted | |||||||||||||||||||
Adjusted average(a) | |||||||||||||||||||
Capital ratios(b) | |||||||||||||||||||
CET1 | % | % | % | % | % | % | |||||||||||||
Tier 1 | |||||||||||||||||||
Total | |||||||||||||||||||
Tier 1 leverage(c) |
December 31, 2018 (in millions, except ratios) | Basel III Standardized Transitional | Basel III Advanced Transitional | |||||||||||||||||
JPMorgan Chase & Co. | JPMorgan Chase Bank, N.A. | Chase Bank USA, N.A. | JPMorgan Chase & Co. | JPMorgan Chase Bank, N.A. | Chase Bank USA, N.A. | ||||||||||||||
Regulatory capital | |||||||||||||||||||
CET1 capital | $ | $ | $ | $ | $ | $ | |||||||||||||
Tier 1 capital | |||||||||||||||||||
Total capital | |||||||||||||||||||
Assets | |||||||||||||||||||
Risk-weighted | |||||||||||||||||||
Adjusted average(a) | |||||||||||||||||||
Capital ratios(b) | |||||||||||||||||||
CET1 | % | % | % | % | % | % | |||||||||||||
Tier 1 | |||||||||||||||||||
Total | |||||||||||||||||||
Tier 1 leverage(c) |
(a) | Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets. |
(b) | For each of the risk-based capital ratios, the capital adequacy of the Firm and its IDI subsidiaries is evaluated against the lower of the two ratios as calculated under Basel III approaches (Standardized or Advanced). |
(c) | The Tier 1 leverage ratio is not a risk-based measure of capital. |
March 31, 2019 | December 31, 2018 | ||||||||||||||||||
Basel III Advanced Fully Phased-In | Basel III Advanced Fully Phased-In | ||||||||||||||||||
(in millions, except ratios) | JPMorgan Chase & Co. | JPMorgan Chase Bank, N.A. | Chase Bank USA, N.A. | JPMorgan Chase & Co. | JPMorgan Chase Bank, N.A. | Chase Bank USA, N.A. | |||||||||||||
Total leverage exposure | $ | $ | $ | $ | $ | $ | |||||||||||||
SLR | % | % | % | % | % | % |
Off–balance sheet lending-related financial instruments, guarantees and other commitments | ||||||||||||||||||||||||||
Contractual amount | Carrying value(h) | |||||||||||||||||||||||||
March 31, 2019 | Dec 31, 2018 | Mar 31, 2019 | Dec 31, 2018 | |||||||||||||||||||||||
By remaining maturity (in millions) | Expires in 1 year or less | Expires after 1 year through 3 years | Expires after 3 years through 5 years | Expires after 5 years | Total | Total | ||||||||||||||||||||
Lending-related | ||||||||||||||||||||||||||
Consumer, excluding credit card: | ||||||||||||||||||||||||||
Home equity | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Residential mortgage(a) | ||||||||||||||||||||||||||
Auto | ||||||||||||||||||||||||||
Consumer & Business Banking | ||||||||||||||||||||||||||
Total consumer, excluding credit card | ||||||||||||||||||||||||||
Credit card | ||||||||||||||||||||||||||
Total consumer(b) | ||||||||||||||||||||||||||
Wholesale: | ||||||||||||||||||||||||||
Other unfunded commitments to extend credit(c) | ||||||||||||||||||||||||||
Standby letters of credit and other financial guarantees(c) | ||||||||||||||||||||||||||
Other letters of credit(c) | ||||||||||||||||||||||||||
Total wholesale(d) | ||||||||||||||||||||||||||
Total lending-related | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Other guarantees and commitments | ||||||||||||||||||||||||||
Securities lending indemnification agreements and guarantees(e) | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
Derivatives qualifying as guarantees | ||||||||||||||||||||||||||
Unsettled resale and securities borrowed agreements | ||||||||||||||||||||||||||
Unsettled repurchase and securities loaned agreements | — | — | — | |||||||||||||||||||||||
Loan sale and securitization-related indemnifications: | ||||||||||||||||||||||||||
Mortgage repurchase liability | NA | NA | NA | NA | NA | NA | ||||||||||||||||||||
Loans sold with recourse | NA | NA | NA | NA | ||||||||||||||||||||||
Exchange & clearing house guarantees and commitments(f) | ||||||||||||||||||||||||||
Other guarantees and commitments(g) | ( | ) | ( | ) |
(a) | Includes certain commitments to purchase loans from correspondents. |
(b) | Predominantly all consumer lending-related commitments are in the U.S. |
(c) | At March 31, 2019, and December 31, 2018, reflected the contractual amount net of risk participations totaling $ |
(d) | Predominantly all wholesale lending-related commitments are in the U.S. |
(e) | At March 31, 2019, and December 31, 2018, collateral held by the Firm in support of securities lending indemnification agreements was $ |
(f) | At December 31, 2018, includes guarantees to the Fixed Income Clearing Corporation under the sponsored member repo program and commitments and guarantees associated with the Firm’s membership in certain clearing houses. |
(g) | At March 31, 2019, and December 31, 2018, primarily includes letters of credit hedged by derivative transactions and managed on a market risk basis, and unfunded commitments related to institutional lending. Additionally, includes unfunded commitments predominantly related to certain tax-oriented equity investments. |
(h) |
March 31, 2019 | December 31, 2018 | ||||||||||||||
(in millions) | Standby letters of credit and other financial guarantees | Other letters of credit | Standby letters of credit and other financial guarantees | Other letters of credit | |||||||||||
Investment-grade(a) | $ | $ | $ | $ | |||||||||||
Noninvestment-grade(a) | |||||||||||||||
Total contractual amount | $ | $ | $ | $ | |||||||||||
Allowance for lending-related commitments | $ | $ | $ | $ | |||||||||||
Guarantee liability | |||||||||||||||
Total carrying value | $ | $ | $ | $ | |||||||||||
Commitments with collateral | $ | $ | $ | $ |
(a) |
(in millions) | March 31, 2019 | December 31, 2018 | |||||
Notional amounts | |||||||
Derivative guarantees | $ | $ | |||||
Stable value contracts with contractually limited exposure | |||||||
Maximum exposure of stable value contracts with contractually limited exposure | |||||||
Fair value | |||||||
Derivative payables | |||||||
Derivative receivables |
(in billions) | March 31, 2019 | December 31, 2018 | |||||
Assets that may be sold or repledged or otherwise used by secured parties | $ | $ | |||||
Assets that may not be sold or repledged or otherwise used by secured parties | |||||||
Assets pledged at Federal Reserve banks and FHLBs | |||||||
Total assets pledged | $ | $ |
(in billions) | March 31, 2019 | December 31, 2018 | |||||
Collateral permitted to be sold or repledged, delivered, or otherwise used | $ | $ | |||||
Collateral sold, repledged, delivered or otherwise used |
• | the number, variety and varying stages of the proceedings, including the fact that many are in preliminary stages, |
• | the existence in many such proceedings of multiple defendants, including the Firm, whose share of liability (if any) has yet to be determined, |
• | the numerous yet-unresolved issues in many of the proceedings, including issues regarding class certification and the scope of many of the claims, and |
• | the attendant uncertainty of the various potential outcomes of such proceedings, including where the Firm has made assumptions concerning future rulings by the court or other adjudicator, or about the behavior or incentives of adverse parties or regulatory authorities, and those assumptions prove to be incorrect. |
Segment results and reconciliation(a) | |||||||||||||||||||||||||||
As of or for the three months ended March 31, (in millions, except ratios) | Consumer & Community Banking | Corporate & Investment Bank | Commercial Banking | Asset & Wealth Management | |||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||
Noninterest revenue | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
Net interest income | |||||||||||||||||||||||||||
Total net revenue | |||||||||||||||||||||||||||
Provision for credit losses | ( | ) | ( | ) | |||||||||||||||||||||||
Noninterest expense | |||||||||||||||||||||||||||
Income before income tax expense | |||||||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||||||
Net income | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
Average equity | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||
Total assets | |||||||||||||||||||||||||||
Return on equity | % | % | % | % | % | % | % | % | |||||||||||||||||||
Overhead ratio |
As of or for the three months ended March 31, (in millions, except ratios) | Corporate | Reconciling Items(a) | Total | |||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||
Noninterest revenue | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||
Net interest income | ( | ) | ( | ) | ( | ) | ||||||||||||||
Total net revenue | ( | ) | ( | ) | ( | ) | ||||||||||||||
Provision for credit losses | ( | ) | ||||||||||||||||||
Noninterest expense | ||||||||||||||||||||
Income/(loss) before income tax expense/(benefit) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Income tax expense/(benefit) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Net income/(loss) | $ | $ | ( | ) | $ | $ | $ | $ | ||||||||||||
Average equity | $ | $ | $ | $ | $ | $ | ||||||||||||||
Total assets | NA | NA | ||||||||||||||||||
Return on equity | NM | NM | NM | NM | % | % | ||||||||||||||
Overhead ratio | NM | NM | NM | NM |
(a) |
JPMorgan Chase & Co. | ||||||||||||||||||||
Consolidated average balance sheets, interest and rates (unaudited) | ||||||||||||||||||||
(Taxable-equivalent interest and rates; in millions, except rates) | ||||||||||||||||||||
Three months ended March 31, 2019 | Three months ended March 31, 2018 | |||||||||||||||||||
Average balance | Interest(f) | Rate (annualized) | Average balance | Interest(f) | Rate (annualized) | |||||||||||||||
Assets | ||||||||||||||||||||
Deposits with banks | $ | 290,281 | $ | 1,170 | 1.64 | % | $ | 423,807 | $ | 1,321 | 1.26 | |||||||||
Federal funds sold and securities purchased under resale agreements | 288,478 | 1,647 | 2.32 | 198,362 | 731 | 1.49 | ||||||||||||||
Securities borrowed | 123,467 | 356 | 1.17 | 109,733 | 62 | 0.23 | ||||||||||||||
Trading assets – debt instruments | 336,750 | 2,782 | 3.35 | 256,040 | 2,118 | 3.35 | ||||||||||||||
Taxable securities | 220,817 | 1,705 | 3.13 | 195,641 | 1,313 | 2.72 | ||||||||||||||
Nontaxable securities(a) | 38,583 | 453 | 4.76 | 44,113 | 510 | 4.69 | ||||||||||||||
Total investment securities | 259,400 | 2,158 | 3.37 | (g) | 239,754 | 1,823 | 3.08 | (g) | ||||||||||||
Loans | 968,019 | 12,920 | 5.41 | 926,548 | 11,117 | 4.87 | ||||||||||||||
All other interest-earning assets(b) | 46,708 | 1,004 | 8.72 | 49,169 | 681 | 5.61 | ||||||||||||||
Total interest-earning assets | 2,313,103 | 22,037 | 3.86 | 2,203,413 | 17,853 | 3.29 | ||||||||||||||
Allowance for loan losses | (13,532 | ) | (13,482 | ) | ||||||||||||||||
Cash and due from banks | 21,458 | 22,173 | ||||||||||||||||||
Trading assets – equity instruments | 94,389 | 107,688 | ||||||||||||||||||
Trading assets – derivative receivables | 52,522 | 60,492 | ||||||||||||||||||
Goodwill, MSRs and other intangible assets | 54,302 | 54,702 | ||||||||||||||||||
Other assets | 162,472 | 151,057 | ||||||||||||||||||
Total assets | $ | 2,684,714 | $ | 2,586,043 | ||||||||||||||||
Liabilities | ||||||||||||||||||||
Interest-bearing deposits | $ | 1,104,032 | $ | 2,188 | 0.80 | % | $ | 1,046,521 | $ | 1,060 | 0.41 | |||||||||
Federal funds purchased and securities loaned or sold under repurchase agreements | 209,065 | 1,110 | 2.15 | 196,112 | 578 | 1.20 | ||||||||||||||
Short-term borrowings(c) | 74,562 | 427 | 2.33 | 57,603 | 209 | 1.47 | ||||||||||||||
Trading liabilities – debt and all other interest-bearing liabilities(d)(e) | 183,702 | 1,224 | 2.70 | 171,488 | 660 | 1.56 | ||||||||||||||
Beneficial interests issued by consolidated VIEs | 22,829 | 150 | 2.66 | 23,561 | 123 | 2.11 | ||||||||||||||
Long-term debt | 285,925 | 2,342 | 3.32 | 279,005 | 1,753 | 2.55 | ||||||||||||||
Total interest-bearing liabilities | 1,880,115 | 7,441 | 1.61 | 1,774,290 | 4,383 | 1.00 | ||||||||||||||
Noninterest-bearing deposits | 375,710 | 399,487 | ||||||||||||||||||
Trading liabilities – equity instruments(e) | 34,510 | 28,631 | ||||||||||||||||||
Trading liabilities – derivative payables | 39,567 | 41,745 | ||||||||||||||||||
All other liabilities, including the allowance for lending-related commitments | 97,635 | 88,207 | ||||||||||||||||||
Total liabilities | 2,427,537 | 2,332,360 | ||||||||||||||||||
Stockholders’ equity | ||||||||||||||||||||
Preferred stock | 27,126 | 26,068 | ||||||||||||||||||
Common stockholders’ equity | 230,051 | 227,615 | ||||||||||||||||||
Total stockholders’ equity | 257,177 | 253,683 | ||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 2,684,714 | $ | 2,586,043 | ||||||||||||||||
Interest rate spread | 2.25 | % | 2.29 | |||||||||||||||||
Net interest income and net yield on interest-earning assets | $ | 14,596 | 2.56 | $ | 13,470 | 2.48 |
GLOSSARY OF TERMS AND ACRONYMS |
• | All wholesale nonaccrual loans |
• | All TDRs (both wholesale and consumer), including ones that have returned to accrual status |
• | Interchange income: Fees earned by credit and debit card issuers on sales transactions. |
• | Rewards costs: The cost to the Firm for points earned by cardholders enrolled in credit card rewards programs. |
• | Partner payments: Payments to co-brand credit card partners based on the cost of loyalty program rewards earned by cardholders on credit card transactions. |
LINE OF BUSINESS METRICS |
Three months ended March 31, 2019 | Total shares of common stock repurchased | Average price paid per share of common stock(a) | Aggregate repurchases of common equity (in millions)(a) | Dollar value of remaining authorized repurchase (in millions)(a) | |||||||||||
January | 17,344,594 | $ | 101.12 | $ | 1,754 | $ | 8,628 | ||||||||
February | 13,838,052 | 103.80 | 1,436 | 7,191 | |||||||||||
March | 18,352,000 | 103.57 | 1,901 | 5,290 | (b) | ||||||||||
First quarter | 49,534,646 | $ | 102.78 | $ | 5,091 | $ | 5,290 | (b) |
(a) | Excludes commissions cost. |
(b) | Represents the amount remaining under the $20.7 billion repurchase program that was authorized by the Board of Directors on June 28, 2018. |
Exhibit No. | Description of Exhibit | |
15 | ||
31.1 | ||
31.2 | ||
32 | ||
101.INS | The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.(c) | |
101.SCH | XBRL Taxonomy Extension Schema Document.(a) | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document.(a) | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document.(a) | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document.(a) | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document.(a) |
(a) | Filed herewith. |
(b) | Furnished herewith. This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934. |
(c) | Pursuant to Rule 405 of Regulation S-T, includes the following financial information included in the Firm’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2019, formatted in XBRL (eXtensible Business Reporting Language) interactive data files: (i) the Consolidated statements of income (unaudited) for the three months ended March 31, 2019 and 2018, (ii) the Consolidated statements of comprehensive income (unaudited) for the three months ended March 31, 2019 and 2018, (iii) the Consolidated balance sheets (unaudited) as of March 31, 2019, and December 31, 2018, (iv) the Consolidated statements of changes in stockholders’ equity (unaudited) for the three months ended March 31, 2019 and 2018, (v) the Consolidated statements of cash flows (unaudited) for the three months ended March 31, 2019 and 2018, and (vi) the Notes to Consolidated Financial Statements (unaudited). |
JPMorgan Chase & Co. |
(Registrant) |
By: | /s/ Nicole Giles |
Nicole Giles | |
Managing Director and Firmwide Controller | |
(Principal Accounting Officer) |
Date: | May 2, 2019 |
Exhibit No. | Description of Exhibit | |
15 | ||
31.1 | ||
31.2 | ||
32 | ||
101.INS | The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. | |
† | This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934. |