PRESS RELEASE-2003 THIRD QUARTER EARNINGS

New York, October 22, 2003 - J.P. Morgan Chase & Co. (NYSE: JPM) today reported 2003 third quarter net income of $1.63 billion, or $0.78 per share. Net income for the third quarter of 2002 was $40 million, or $0.01 per share, and net income for the second quarter of 2003 was $1.83 billion, or $0.89 per share. Return on average common equity for the quarter was 15%.

Last year, results were provided on both a reported basis and an operating basis, which excluded merger and restructuring costs and special items. Operating earnings for the third quarter of 2002 were $325 million, or $0.16 per share.

For the first nine months of 2003, reported net income was $4.86 billion, or $2.35 per share, 137% above last year’s reported results of $2.05 billion, or $1.00 per share, and 83% higher than last year’s operating results of $2.65 billion, or $1.30 per share. Return on average common equity was 15% for the first nine months of 2003.

“Our results for the quarter and the first nine months of 2003 show the substantial progress we have made this year. Our focus on execution against the backdrop of an improving economy has resulted in significant reductions in risk concentrations, strong year-over-year earnings growth and improved competitive positions. I am especially pleased by the improvements in our commercial credit portfolio,” said William B. Harrison, Jr., Chairman and Chief Executive Officer.

•

Commercial credit costs were approximately $1.5 billion lower than in the third quarter of 2002, while commercial non-performing assets were down 39%.

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The Investment Bank and Chase Financial Services posted returns on allocated capital of 19% and 20%, respectively.

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Treasury & Securities Services and Investment Management & Private Banking posted higher revenues, earnings and returns on allocated capital compared to the second quarter of 2003. JPMorgan Partners had private equity gains of $120 million.

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Investment banking fees of $636 million were 20% higher than in the third quarter of 2002 because of higher equity underwriting fees and advisory fees, driven by market share gains. Compared to the second quarter of 2003, investment banking fees were down 17% due to lower debt underwriting and loan syndication fees, reflecting lower market volumes. For the first nine months of the year, the firm improved its rankings in Global Announced M&A to #3 and Global Equity & Equity Related to #4 and maintained its #1 ranking in Global Loan Syndications and its #2 ranking in U.S. Investment Grade Bonds.¹

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Capital markets and lending revenues for the quarter were $2.57 billion, up 32% from the third quarter of 2002 and down 26% from the second quarter of 2003.

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Capital markets and lending total return revenues for the quarter were $2.76 billion. Total return revenues represent financial revenues plus the unrealized gains or losses on investment securities and hedges (included in comprehensive income) and internally transfer-priced assets and liabilities. The primary contributor to the difference between financial revenues and total return revenues is Global Treasury. Fixed income capital markets revenues were up 62% from the third quarter of 2002, driven by increased client revenues and significantly higher portfolio management revenues, which related to market making and proprietary risk taking activities. Fixed income revenues were down 28% from the strong levels in the second quarter of 2003 as higher client revenues were more than offset by lower portfolio management revenues, primarily in our global interest rate businesses. Equity capital markets revenues were up substantially from the third quarter of 2002. Compared to the second quarter of 2003, equity capital markets revenues declined 13% with higher revenues in the cash business more than offset by lower revenues in equity derivatives. Global Treasury had revenues of $492 million, up from both the third quarter of 2002 and the second quarter of 2003.

•

Credit costs, reflecting a reduction in the allowance for credit losses, were negative $181 million for the quarter and negative $4 million for the second quarter of 2003. The lower provision resulted from restructurings of several non-performing commercial loans and improvement in the overall credit quality of the portfolio. In the third quarter of 2002, credit costs were $1.32 billion.

•

Expenses of $1.83 billion increased 11% from the third quarter of 2002 primarily driven by higher incentives resulting from improved financial performance, partially offset by lower non-compensation expenses and severance and related costs. Expenses declined 26% from the second quarter of 2003.

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Revenues were $3.35 billion for the quarter, down 9% from the third quarter of 2002 and 16% from the second quarter of 2003. Home Finance revenues of $662 million, comprised of operating and mortgage servicing hedging revenues, were down 32% from the third quarter of 2002. While markets were extremely volatile during the quarter, the hedging of mortgage servicing rights generated a small net loss of $6 million compared to excess hedging gains of $263 million in the third quarter of 2002 and

$233 million last quarter. Operating revenues were adversely affected by losses from the hedging of pipeline and warehouse loans and by customer rate lock extensions to accommodate record origination volumes. Year to date, Home Finance had record revenues, up 37% over the first nine months of 2002. Auto Finance revenues were $218 million, up 32% from the third quarter of 2002 reflecting continued strong origination volumes. Cardmember Services revenues were up 1% compared to the third quarter of 2002, reflecting slower growth in receivables. Regional Banking and Middle Market average deposits grew 8% and 20%, respectively, from the third quarter of 2002. However, both reported declining revenues as lower interest rates over the last year resulted in reduced net interest income, despite the higher balances.

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Expenses of $1.74 billion for the quarter were up 5% from the third quarter of 2002 reflecting higher business volumes and higher salaries and benefits.

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Credit costs of $883 million were 7% higher than the third quarter of 2002. Charge-offs increased 6% from the third quarter of 2002 as average managed loans increased 24%.

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Revenues for the third quarter were $1.01 billion, down 2% from the third quarter of 2002, but up 3% from the second quarter of 2003. Adjusting for the gain last year, revenues were up 3% compared to the third quarter of 2002. Treasury Services revenues increased 7% from the third quarter of 2002 due to higher deposit balances, purchase card revenues and deposit balance deficiency fees. Institutional Trust Services revenues increased 8% from the prior year reflecting increased activity in the asset servicing business, higher deposit balances and the impact of acquisitions. Investor Services revenues declined 3% from the prior year, but increased 3% from the second quarter of 2003.

•

Expenses increased 5% from the third quarter of 2002, reflecting the impact of acquisitions, the cost associated with expensing of options and increased pension costs.

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Revenues of $737 million were 6% above the same period last year and 9% higher than the second quarter of 2003 due primarily to higher global equity valuations and the acquisition of Retirement Plan Services (which closed in the second quarter of 2003).

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Expenses of $613 million were 9% above the third quarter of 2002 primarily as a result of the acquisition of Retirement Plan Services and higher compensation expenses related to improved performance.

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Credit costs were negative $7 million for the third quarter of 2003, reflecting recoveries and improved portfolio credit quality. This compared to credit costs of $26 million in the third quarter of 2002.

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Total assets under supervision were $720 billion at September 30, 2003, up 14% from the third quarter of 2002 and 4% higher than the second quarter of 2003. Not reflected in assets under supervision is the firm’s 44% interest in American Century Companies, Inc., which had assets under management of $80 billion as of the end of the third quarter of 2003.

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During the quarter, JPMP’s direct private equity investments recorded net gains of $161 million compared to net losses of $239 million in the third quarter of 2002. The net gains included $134 million in realized cash gains, $26 million in mark-to-market gains on public securities and positive net valuation changes on private investments. The net valuation changes reflected writedowns of $65 million, which were entirely offset by $66 million of writeups related to investments for which recently completed financing activity provided indications of increased value.

•

Limited partner interests held in third-party private equity funds resulted in net losses of $41 million compared to net losses of $60 million in the third quarter of 2002.

Total Expenses

•

Expenses were $5.10 billion, up 10% from operating expenses in the third quarter of 2002. The increase was primarily driven by higher compensation expenses resulting from higher performance-related incentive accruals. Expenses were down 13% from the second quarter of 2003 primarily reflecting lower incentive accruals.

•

For the first nine months of 2003, expenses were $16.47 billion, an increase of 12% from operating expenses for the first nine months of last year. Expenses in the first nine months of 2003 included $100 million added to litigation reserves and $447 million in severance and related, including vacant real estate charges. Operating expenses in the first nine months of 2002 included $390 million in severance and related costs.

Credit

•

Commercial loan net charge-offs in the third quarter of 2003 were $259 million compared to $834 million in the third quarter of 2002 and $257 million in the second quarter of 2003. The charge-off ratio for commercial loans was 1.09% in the third quarter of 2003, compared to 3.53% in the third quarter of 2002 and 1.20% in the second quarter of 2003.

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Consumer loan net charge-offs on a managed basis, which includes credit card securitizations, were $826 million, up from $786 million in the third quarter of 2002 and down from $837 million in the second quarter of 2003. On a managed basis, the credit card net charge-off ratio was 5.80% for the third quarter of 2003, compared to 5.51% for the third quarter of 2002 and 6.01% for the second quarter of 2003. Excluding credit card securitizations, consumer net charge-offs were $355 million in the third quarter of 2003 compared to $432 million in the third quarter of 2002 and $357 million in the second quarter of 2003.

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Credit costs on a managed basis were $694 million in the third quarter of 2003 compared to $2.19 billion in the third quarter of 2002 and $915 million in the second quarter of 2003. In the third quarter of 2003, managed credit costs were $834 million for consumer loans and negative $140 million for commercial loans and lending-related commitments.

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Allowance for credit losses was $5.08 billion at September 30, 2003, compared to $5.84 billion at September 30, 2002 and $5.47 billion at June 30, 2003.

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Total nonperforming assets were $3.68 billion at September 30, 2003, down 34% from the third quarter of 2002 and 9% from the second quarter of 2003. Commercial criticized exposures (including loans, derivative receivables and unfunded commitments) declined $6.4 billion, or 36%, since September 30, 2002 and $1.5 billion, or 12%, since June 30, 2003.

Total assets and capital

•

Total assets as of September 30, 2003 were $793 billion, compared with $742 billion as of September 30, 2002 and $803 billion as of June 30, 2003. The firm adopted FIN 46 related to variable interest entities in July 2003; prior periods are not restated. Total assets include the effect of adopting FIN 46, which added $15 billion in assets. Commercial loans, excluding the impact of FIN 46, were $77 billion, $20 billion lower than on September 30, 2002 and $14 billion lower than on June 30, 2003. Commercial loans were $88 billion, including $11 billion related to consolidated variable interest entities primarily associated with multi-seller asset-backed commercial paper conduits. Managed consumer loans increased 27% from September 30, 2002 and 7% from June 30, 2003, primarily from increases in mortgage loans. The Tier 1 capital ratio was 8.7% at September 30, 2003. The June 30, 2003 capital ratio was previously reported as 8.7%. The firm changed the way it calculates risk-weighted assets this quarter, and calculating the June 30, 2003 ratio on the same basis as for September 30 would produce a ratio of 8.4% for June 30.

Other financial information (on a pre-tax basis)

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There were no items characterized by management as non-operating in the first nine months of 2003, as restructuring costs are now included in reported results. Special items in the third quarter of 2002 and the first nine months of 2002 were $431 million and $915 million, respectively, in merger and restructuring costs and real estate charges.

The line of business operating results set forth above for the quarter and for prior periods reflect the revised internal management reporting policies previously disclosed in the firm’s Form 8-K dated July 11, 2003. The line of business results set forth above are presented on an operating or managed basis, which enables management to assess each business and measure overall firm results against targeted goals. The definition of operating basis starts with the reported U.S. GAAP results and then excludes the impact of merger and restructuring costs, credit card securitizations and special items (which management defined as significant nonrecurring gains or losses of $75 million or more during 2002). Both restructuring charges and special items are viewed by management as transactions that are not part of the firm’s normal daily business operations or are unusual in nature and therefore are not indicative of trends.

J.P. Morgan Chase & Co. is a leading global financial services firm with assets of $793 billion and operations in more than 50 countries. The firm is a leader in investment banking, financial services for consumers and businesses, financial transaction processing, investment management, private banking and private equity. A component of the Dow Jones Industrial Average, JPMorgan Chase is headquartered in New York and serves more than 30 million consumers nationwide, and many of the world’s most prominent corporate, institutional and government clients. Information about JPMorgan Chase is available on the Internet at www.jpmorganchase.com.

JPMorgan Chase will hold a conference call for the investment community on Wednesday, October 22, 2003 at 11:00 a.m. (Eastern Daylight Time) to review third quarter 2003 financial results. The dial-in number is (973) 628-9554. A live audio webcast of the call will be available on www.jpmorganchase.com. Slides for the call will also be available on www.jpmorganchase.com. A telephone replay of the presentation will be available beginning at 1:30 p.m. (EDT) on October 22, 2003 and continuing through 6:00 p.m. (EST) on October 28, 2003 at (973) 341-3080 pin #4205256. The replay also will be available on www.jpmorganchase.com beginning at 1:30 p.m. (EDT) on October 22, 2003. Additional detailed financial, statistical and business-related information is included in a financial supplement. The earnings

release and the financial supplement are available on the JPMorgan Chase web site (www.jpmorganchase.com).

This press release contains statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of JPMorgan Chase’s management and are subject to significant risks and uncertainties. These risks and uncertainties could cause our results to differ materially from those set forth in such forward-looking statements. Such risks and uncertainties are described in our Quarterly Report on Form 10-Q for the quarters ended June 30, 2003 and March 31, 2003 and in the 2002 Annual Report on Form 10-K, each filed with the Securities and Exchange Commission and available at the Securities and Exchange Commission’s internet site (www.sec.gov), to which reference is hereby made.


										3QTR 2003												2003
	3QTR			2QTR			3QTR			Over (Under)						YEAR TO DATE						Over (Under)
	2003			2003			2002			2Q 2003			3Q 2002			2003			2002			2002
INCOME STATEMENT
REVENUE:
Investment Banking Fees	$	649		$	779		$	545			(17	)%		19	%	$	2,044		$	2,085			(2	)%
Trading Revenue		829			1,546			26			(46	)		NM			3,673			2,089			76
Fees and Commissions		2,742			2,551			2,665			7			3			7,781			7,792			—
Private Equity Gains (Losses)		120			(29	)		(315	)		NM			NM			(130	)		(678	)		81
Securities Gains		164			768			578			(79	)		(72	)		1,417			816			74
Mortgage Fees and Related Income^(a)		(17	)		292			512			NM			NM			692			1,080			(36	)
Other Revenue		213			64			200			233			7			385			390			(1	)

Total Noninterest Revenue		4,700			5,971			4,211			(21	)		12			15,862			13,574			17
Net Interest Income		3,048			3,063			2,736			—			11			9,326			8,545			9

Revenue before Provision for Credit Losses		7,748			9,034			6,947			(14	)		12			25,188			22,119			14
Provision for Credit Losses		223			435			1,836			(49	)		(88	)		1,401			3,410			(59	)

TOTAL NET REVENUE		7,525			8,599			5,111			(12	)		47			23,787			18,709			27


EXPENSE:
Compensation Expense		2,713			3,231			2,367			(16	)		15			9,118			7,951			15
Occupancy Expense		391			543			478			(28	)		(18	)		1,430			1,181			21
Technology and Communications Expense		719			732			625			(2	)		15			2,088			1,919			9
Other Expense		1,272			1,226			1,248			4			2			3,732			3,735			—
Surety Settlement and Litigation Reserve ^(b)		—			100			—			NM			NM			100			—			NM
Merger and Restructuring Costs		—			—			333			NM			NM			—			817			NM

TOTAL NONINTEREST EXPENSE		5,095			5,832			5,051			(13	)		1			16,468			15,603			6

Income before Income Tax Expense		2,430			2,767			60			(12	)		NM			7,319			3,106			136
Income Tax Expense		802			940			20			(15	)		NM			2,464			1,056			133

NET INCOME	$	1,628		$	1,827		$	40			(11	)		NM		$	4,855		$	2,050			137


PER COMMON SHARE
Net Income:
Basic	$	0.80		$	0.90		$	0.01			(11	)%		NM		$	2.40		$	1.01			138	%
Diluted		0.78			0.89			0.01			(12	)		NM			2.35			1.00			135
Cash Dividends Declared		0.34			0.34			0.34			—			—	%		1.02			1.02			—
Share Price at Period End		34.33			34.18			18.99			—			81
Book Value at Period End		21.55			21.53			21.26			—			1

COMMON SHARES OUTSTANDING
Average Common Shares:
Basic		2,012.2			2,005.6			1,986.0			—	%		1	%		2,006.0			1,982.3			1	%
Diluted		2,068.2			2,050.6			2,005.8			1			3			2,047.0			2,009.3			2
Common Shares at Period End		2,039.2			2,035.1			1,995.9			—			2			2,039.2			1,995.9			2

PERFORMANCE RATIOS ^(c)
Return on Average Assets		0.83	%		0.96	%		0.02	%		(13	)bp		81	bp		0.84	%		0.38	%		46	bp
Return on Average Common Equity		15			17			—			(200	)		1,500			15			7			800

CAPITAL RATIOS
Tier I Capital Ratio		8.7	%^(d)		8.4	%^(e)		8.7	%		30	bp		—	bp
Total Capital Ratio		12.1	^(d)		12.0	^(e)		12.4			10			(30	)
Tier I Leverage Ratio		5.5	^(d)		5.5			5.4			—			10

SELECTED BALANCE SHEET ITEMS
Net Loans	$	231,448		$	222,307		$	206,215			4	%		12	%
Total Assets		792,700			802,603			741,759			(1	)		7
Deposits		313,626			318,248			292,171			(1	)		7
Long-Term Debt ^(f)		50,661			49,918			44,552			1			14
Common Stockholders’ Equity		43,948			43,812			42,428			—			4
Total Stockholders’ Equity		44,957			44,821			43,437			—			3

FULL-TIME EQUIVALENT EMPLOYEES		92,940			92,256			95,637			1			(3	)

(a)		Includes all mortgage-related noninterest revenues except Securities Gains. Third quarter 2003 amounts reflect $209 million of Mortgage Servicing Fees, Net of Amortization, Writedowns and Derivatives Hedging (previously recorded in Fees and Commissions), $(86) million of Residential Mortgage Origination/Sales Activities (Other Revenue), $(161) million of hedging of pipeline activities (Trading Revenue), and $21 million of all other revenues (Fees and Commissions and Other Revenue).
(b)		Included in the second quarter of 2003 was a $100 million addition to the Enron-related litigation reserve.
(c)		Ratios are based on annualized amounts.
(d)		Estimated
(e)		The Firm changed the way it calculates risk-weighted assets during the third quarter of 2003. The June 30, 2003 Tier 1 and Total Capital ratios of 8.4% and 12.0%, respectively, are calculated on the same basis as for September 30, 2003. The June 30, 2003 Tier 1 and Total Capital ratios were previously reported as 8.7% and 12.4%, respectively. Prior quarters have not been restated.
(f)		Includes Junior Subordinated Deferrable Interest Debentures Held by Trusts that Issued Guaranteed Capital Debt Securities and Guaranteed Preferred Beneficial Interests in Capital Debt Securities Issued by Consolidated Trusts. Excludes Beneficial Interests of Consolidated Variable Interest Entities.


	THIRD QUARTER 2003
	REPORTED			CREDIT			SPECIAL					OPERATING
	BASIS ^(a)			CARD ^(b)			ITEMS ^(c)		RECLASSES ^(d)			BASIS ^(e)
INCOME STATEMENT
Revenue
Investment Banking Fees	$	649		$	—		$	—	$	—		$	649
Trading Revenue		829			—			—		449			1,278
Fees and Commissions		2,742			(173	)		—		—			2,569
Private Equity — Gains (Losses)		120			—			—		—			120
Securities Gains		164			—			—		—			164
Mortgage Fees and Related Income		(17	)		—			—		—			(17	)
Other Revenue		213			(14	)		—		—			199
Net Interest Income		3,048			658			—		(449	)		3,257

Total Revenue		7,748			471			—		—			8,219

Noninterest Expense
Compensation Expense ^(f)		2,713			—			—		—			2,713
Noncompensation Expense ^(f)(g)		2,382			—			—		—			2,382
Merger and Restructuring Costs		—			—			—		—			—

Total Noninterest Expense		5,095			—			—		—			5,095

Operating Margin		2,653			471			—		—			3,124
Credit Costs		223			471			—		—			694

Income before Income Tax Expense		2,430			—			—		—			2,430
Income Tax Expense		802			—			—		—			802

Net Income	$	1,628		$	—		$	—	$	—		$	1,628


EARNINGS PER SHARE — DILUTED	$	0.78		$	—		$	—	$	—		$	0.78


	THIRD QUARTER 2002
	REPORTED			CREDIT			SPECIAL						OPERATING
	BASIS ^(a)			CARD ^(b)			ITEMS ^(c)			RECLASSES ^(d)			BASIS ^(e)
INCOME STATEMENT
Revenue
Investment Banking Fees	$	545		$	—		$	—		$	—		$	545
Trading Revenue		26			—			—			386			412
Fees and Commissions		2,665			(237	)		—			—			2,428
Private Equity — Gains (Losses)		(315	)		—			—			—			(315	)
Securities Gains		578			—			—			—			578
Mortgage Fees and Related Income		512			—			—			—			512
Other Revenue		200			(10	)		—			—			190
Net Interest Income		2,736			601			—			(386	)		2,951

Total Revenue		6,947			354			—			—			7,301

Noninterest Expense Compensation Expense ^(f)		2,367			—			—			—			2,367
Noncompensation Expense ^(f)(g)		2,351			—			(98	)		—			2,253
Merger and Restructuring Costs		333			—			(333	)		—			—

Total Noninterest Expense		5,051			—			(431	)		—			4,620

Operating Margin		1,896			354			431			—			2,681
Credit Costs		1,836			354			—			—			2,190

Income before Income Tax Expense		60			—			431			—			491
Income Tax Expense		20			—			146			—			166

Net Income	$	40		$	—		$	285		$	—		$	325


EARNINGS PER SHARE — DILUTED	$	0.01		$	—		$	0.15		$	—		$	0.16

(a)		Represents condensed results as reported in JPMorgan Chase’s financial statements.
(b)		Represents the impact of credit card securitizations. For securitized receivables, amounts that normally would be reported as net interest income and as provision for credit losses are reported as noninterest revenue.
(c)		Includes merger and restructuring costs and other special items. There were no special items reported in the third quarter of 2003. The 2002 third quarter included $333 million (pre-tax) of merger and restructuring costs, and a $98 million (pre-tax) charge for excess real estate capacity.
(d)		On an operating basis, JPMorgan Chase reclassifies trading-related net interest income from Net Interest Income to Trading Revenue.
(e)		In addition to analyzing the Firm’s results on a reported basis, management looks at results on an “operating basis” (or “managed basis”) to assess each of its businesses and to measure overall Firm results against targeted goals. The definition of operating basis starts with the reported U.S. GAAP results and then excludes the impact of merger and restructuring costs, credit card securitizations, and special items (which management defined as significant nonrecurring gains or losses of $75 million or more during 2002). Both restructuring charges and special items are viewed by management as transactions that are not part of the Firm’s normal daily business operations or are unusual in nature and therefore are not indicative of trends. For a more detailed explanation of how the Firm looks at results on an “operating basis,” see Reconciliation from Reported Results to Operating Basis on page 32 of JPMorgan Chase’s June 30, 2003, Quarterly Report on Form 10-Q and on page 22 of JPMorgan Chase’s 2002 Annual Report.
(f)		Includes severance and other related costs associated with expense containment programs implemented in 2002.
(g)		Includes Occupancy Expense, Technology and Communications Expense, Other Expense and Surety Settlement and Litigation Reserve.


	YEAR TO DATE 2003
	REPORTED			CREDIT			SPECIAL					OPERATING
	BASIS ^(a)			CARD ^(b)			ITEMS ^(c)		RECLASSES ^(d)			BASIS ^(e)
INCOME STATEMENT
Revenue
Investment Banking Fees	$	2,044		$	—		$	—	$	—		$	2,044
Trading Revenue		3,673			—			—		1,611			5,284
Fees and Commissions		7,781			(464	)		—		—			7,317
Private Equity — Gains (Losses)		(130	)		—			—		—			(130	)
Securities Gains		1,417			—			—		—			1,417
Mortgage Fees and Related Income		692			—			—		—			692
Other Revenue		385			(42	)		—		—			343
Net Interest Income		9,326			1,914			—		(1,611	)		9,629

Total Revenue		25,188			1,408			—		—			26,596

Noninterest Expense
Compensation Expense ^(f)		9,118			—			—		—			9,118
Noncompensation Expense ^(f)(g)		7,350			—			—		—			7,350
Merger and Restructuring Costs		—			—			—		—			—

Total Noninterest Expense		16,468			—			—		—			16,468

Operating Margin		8,720			1,408			—		—			10,128
Credit Costs		1,401			1,408			—		—			2,809

Income before Income Tax Expense		7,319			—			—		—			7,319
Income Tax Expense		2,464			—			—		—			2,464

Net Income	$	4,855		$	—		$	—	$	—		$	4,855


EARNINGS PER SHARE — DILUTED	$	2.35		$	—		$	—	$	—		$	2.35


	YEAR TO DATE 2002
	REPORTED			CREDIT			SPECIAL						OPERATING
	BASIS ^(a)			CARD ^(b)			ITEMS ^(c)			RECLASSES ^(d)			BASIS ^(e)
INCOME STATEMENT
Revenue
Investment Banking Fees	$	2,085		$	—		$	—		$	—		$	2,085
Trading Revenue		2,089			—			—			1,212			3,301
Fees and Commissions		7,792			(468	)		—			—			7,324
Private Equity — Gains (Losses)		(678	)		—			—			—			(678	)
Securities Gains		816			—			—			—			816
Mortgage Fees and Related Income		1,080			—			—			—			1,080
Other Revenue		390			(49	)		—			—			341
Net Interest Income		8,545			1,526			—			(1,212	)		8,859

Total Revenue		22,119			1,009			—			—			23,128

Noninterest Expense
Compensation Expense ^(f)		7,951			—			—			—			7,951
Noncompensation Expense ^(f)(g)		6,835			—			(98	)		—			6,737
Merger and Restructuring Costs		817			—			(817	)		—			—

Total Noninterest Expense		15,603			—			(915	)		—			14,688

Operating Margin		6,516			1,009			915			—			8,440
Credit Costs		3,410			1,009			—			—			4,419

Income before Income Tax Expense		3,106			—			915			—			4,021
Income Tax Expense		1,056			—			311			—			1,367

Net Income	$	2,050		$	—		$	604		$	—		$	2,654


EARNINGS PER SHARE — DILUTED	$	1.00		$	—		$	0.30		$	—		$	1.30

(a)		Represents condensed results as reported in JPMorgan Chase’s financial statements.
(b)		Represents the impact of credit card securitizations. For securitized receivables, amounts that normally would be reported as net interest income and as provision for credit losses are reported as noninterest revenue.
(c)		Includes merger and restructuring costs and other special items. There were no special items reported in the first nine months of 2003. The first nine months of 2002 included $817 million (pre-tax) of merger and restructuring costs, and a $98 million (pre-tax) charge for excess real estate capacity.
(d)		On an operating basis, JPMorgan Chase reclassifies trading-related net interest income from Net Interest Income to Trading Revenue.
(e)		In addition to analyzing the Firm’s results on a reported basis, management looks at results on an “operating basis” (or “managed basis”) to assess each of its businesses and to measure overall Firm results against targeted goals. The definition of operating basis starts with the reported U.S. GAAP results and then excludes the impact of merger and restructuring costs, credit card securitizations, and special items (which management defined as significant nonrecurring gains or losses of $75 million or more during 2002). Both restructuring charges and special items are viewed by management as transactions that are not part of the Firm’s normal daily business operations or are unusual in nature and therefore are not indicative of trends. For a more detailed explanation of how the Firm looks at results on an “operating basis,” see Reconciliation from Reported Results to Operating Basis on page 32 of JPMorgan Chase’s June 30, 2003, Quarterly Report on Form 10-Q and on page 22 of JPMorgan Chase’s 2002 Annual Report.
(f)		Includes severance and other related costs associated with expense containment programs implemented in 2002.
(g)		Includes Occupancy Expense, Technology and Communications Expense, Other Expense and Surety Settlement and Litigation Reserve.


										3QTR 2003												YTD 2003
	3QTR			2QTR			3QTR			Over (Under)						YEAR TO DATE						Over (Under)
	2003			2003			2002			2Q 2003			3Q 2002			2003			2002			2002
OPERATING INCOME STATEMENT ^(a)
OPERATING REVENUE:
Investment Banking Fees	$	649		$	779		$	545			(17	)%		19	%	$	2,044		$	2,085			(2	)%
Trading-Related Revenue (Includes Trading NII)		1,278			2,025			412			(37	)		210			5,284			3,301			60
Fees and Commissions		2,569			2,429			2,428			6			6			7,317			7,324			—
Private Equity Gains (Losses)		120			(29	)		(315	)		NM			NM			(130	)		(678	)		81
Securities Gains		164			768			578			(79	)		(72	)		1,417			816			74
Mortgage Fees and Related Income		(17	)		292			512			NM			NM			692			1,080			(36	)
Other Revenue		199			40			190			398			5			343			341			1
Net Interest Income (Excludes Trading NII)		3,257			3,210			2,951			1			10			9,629			8,859			9

TOTAL OPERATING REVENUE		8,219			9,514			7,301			(14	)		13			26,596			23,128			15

OPERATING EXPENSE:
Compensation Expense ^(b)		2,713			3,231			2,367			(16	)		15			9,118			7,951			15
Noncompensation Expense ^(b)(c)		2,382			2,601			2,253			(8	)		6			7,350			6,737			9

TOTAL OPERATING EXPENSE		5,095			5,832			4,620			(13	)		10			16,468			14,688			12

Credit Costs		694			915			2,190			(24	)		(68	)		2,809			4,419			(36	)
Corporate Credit Allocation		—			—			—			NM			NM			—			—			NM

Operating Income before Income Tax Expense		2,430			2,767			491			(12	)		395			7,319			4,021			82
Income Tax Expense		802			940			166			(15	)		383			2,464			1,367			80

OPERATING EARNINGS		1,628			1,827			325			(11	)		401			4,855			2,654			83
Special Items		—			—			(285	)		NM			NM			—			(604	)		NM

NET INCOME	$	1,628		$	1,827		$	40			(11	)		NM		$	4,855		$	2,050			137


OPERATING BASIS
Diluted Earnings per Share	$	0.78		$	0.89		$	0.16			(12	)		388		$	2.35		$	1.30			81
Shareholder Value Added		311			536			(964	)		(42	)		NM			995			(1,080	)		NM
Return on Average Managed Assets ^(d)		0.79	%		0.92	%		0.17	%		(13	)bp		62	bp		0.80	%		0.47	%		33	bp
Return on Common Equity ^(d)		15			17			3			(200	)		1,200			15			8			700
Common Dividend Payout Ratio		44			40			222			400			NM			44			79			(3,500	)
Compensation Expense as a % of Revenue		33			34			32			(100	)		100			34			34			—
Noncompensation Expense as a % of Revenue		29			27			31			200			(200	)		28			29			(100	)
Overhead Ratio		62			61			63			100			(100	)		62			64			(200	)

(a)		See pages 8 and 9 for a reconciliation of reported results to operating basis.
(b)		Includes severance and other related costs associated with expense containment programs implemented in 2002.
(c)		Includes Occupancy Expense, Technology and Communications Expense, Amortization of Intangibles, Other Expense and Surety Settlement and Litigation Reserve.
(d)		Ratios are based on annualized amounts.


										3QTR 2003												YTD 2003
	3QTR			2QTR			3QTR			Over (Under)						YEAR TO DATE						Over (Under)
	2003			2003			2002			2Q 2003			3Q 2002			2003			2002			2002
OPERATING REVENUE
Investment Bank	$	3,203		$	4,254		$	2,481			(25	)%		29	%	$	11,518		$	9,291			24	%
Treasury & Securities Services		1,013			985			1,029			3			(2	)		2,934			2,961			(1	)
Investment Management & Private Banking		737			679			695			9			6			2,058			2,189			(6	)
JPMorgan Partners		78			(70	)		(359	)		NM			NM			(270	)		(860	)		69
Chase Financial Services		3,350			3,976			3,667			(16	)		(9	)		11,021			10,121			9
Support Units and Corporate		(162	)		(310	)		(212	)		48			24			(665	)		(574	)		(16	)

OPERATING REVENUE	$	8,219		$	9,514		$	7,301			(14	)		13		$	26,596		$	23,128			15


EARNINGS
Investment Bank	$	922		$	1,086		$	(255	)		(15	)		NM		$	2,950		$	1,024			188
Treasury & Securities Services		157			126			201			25			(22	)		414			503			(18	)
Investment Management & Private Banking		85			67			68			27			25			187			250			(25	)
JPMorgan Partners		10			(91	)		(278	)		NM			NM			(298	)		(692	)		57
Chase Financial Services		460			881			761			(48	)		(40	)		2,015			1,899			6
Support Units and Corporate		(6	)		(242	)		(172	)		98			97			(413	)		(330	)		(25	)

OPERATING EARNINGS		1,628			1,827			325			(11	)		401			4,855			2,654			83
Special Items (Net of Taxes):
Real Estate Charge		—			—			(65	)		NM			NM			—			(65	)		NM
Merger and Restructuring Costs		—			—			(220	)		NM			NM			—			(539	)		NM

NET INCOME	$	1,628		$	1,827		$	40			(11	)		NM		$	4,855		$	2,050			137


AVERAGE ALLOCATED CAPITAL
Investment Bank	$	18,910		$	20,061		$	19,448			(6	)		(3	)	$	19,911		$	19,779			1
Treasury & Securities Services		2,604			2,765			2,601			(6	)		—			2,708			2,678			1
Investment Management & Private Banking		5,490			5,481			5,607			—			(2	)		5,470			5,678			(4	)
JPMorgan Partners		5,721			5,916			6,183			(3	)		(7	)		5,873			6,358			(8	)
Chase Financial Services		8,991			8,650			8,634			4			4			8,705			8,650			1
Support Units and Corporate		1,415			(114	)		(305	)		NM			NM			(80	)		(1,979	)		96

TOTAL ALLOCATED CAPITAL	$	43,131		$	42,759		$	42,168			1			2		$	42,587		$	41,164			3


EARNINGS PER SHARE – DILUTED
OPERATING EARNINGS	$	0.78		$	0.89		$	0.16			(12	)		388		$	2.35		$	1.30			81
Special Items (Net of Taxes):
Real Estate Charge		—			—			(0.03	)		NM			NM			—			(0.03	)		NM
Merger and Restructuring Costs		—			—			(0.12	)		NM			NM			—			(0.27	)		NM

NET INCOME	$	0.78		$	0.89		$	0.01			(12	)		NM		$	2.35		$	1.00			135


OPERATING RETURN ON ALLOCATED CAPITAL
Investment Bank		19	%		22	%		NM			(300	)bp		NM			20	%		7	%		1,300	bp
Treasury & Securities Services		24			18			31	%		600			(700	)bp		20			25			(500	)
Investment Management & Private Banking		6			5			5			100			100			4			6			(200	)
Chase Financial Services		20			41			35			(2,100	)		(1,500	)		31			29			200
OPERATING RETURN ON ALLOCATED CAPITAL		15			17			3			(200	)		1,200			15			8			700


										Sep 30, 2003
										Over (Under)
	Sep 30			Jun 30			Sep 30			Jun 30			Sep 30
	2003			2003			2002			2003			2002
ASSETS
Cash and Due from Banks	$	18,585		$	23,398		$	18,159			(21	)%		2	%
Deposits with Banks		10,601			10,393			13,447			2			(21	)
Federal Funds Sold and Securities Purchased under Resale Agreements		88,752			69,748			63,748			27			39
Securities Borrowed		37,096			41,067			35,283			(10	)		5
Trading Assets:
Debt and Equity Instruments		146,731			139,275			151,264			5			(3	)
Derivative Receivables		83,787			93,602			87,518			(10	)		(4	)
Securities		65,152			82,549			79,768			(21	)		(18	)
Loans (Net of Allowance for Loan Losses)		231,448			222,307			206,215			4			12
Private Equity Investments		7,797			7,901			8,013			(1	)		(3	)
Goodwill		8,134			8,132			8,108			—			—
Mortgage Servicing Rights		4,007			2,967			3,606			35			11
Other Intangibles:
Purchased Credit Card Relationships		1,078			1,141			1,337			(6	)		(19	)
All Other Intangibles		311			320			311			(3	)		—
Other Assets		89,221			99,803			64,982			(11	)		37

TOTAL ASSETS(a)	$	792,700		$	802,603		$	741,759			(1	)		7



LIABILITIES
Deposits	$	313,626		$	318,248		$	292,171			(1	)		7
Federal Funds Purchased and Securities Sold under Repurchase Agreements		131,959			155,330			154,745			(15	)		(15	)
Commercial Paper		14,790			12,382			13,775			19			7
Other Borrowed Funds		8,174			12,176			12,646			(33	)		(35	)
Trading Liabilities:
Debt and Equity Instruments		87,516			72,825			71,607			20			22
Derivative Payables		68,285			72,831			70,593			(6	)		(3	)
Accounts Payable, Accrued Expenses and Other Liabilities (including the Allowance for Lending-Related Commitments)		54,333			64,072			38,233			(15	)		42
Beneficial Interests of Consolidated Variable Interest Entities		18,399			—			—			NM			NM
Long-Term Debt		43,945			43,371			39,113			1			12
Junior Subordinated Deferrable Interest Debentures Held by Trusts that Issued Guaranteed Capital Debt Securities		6,716			1,108			—			NM			NM
Guaranteed Preferred Beneficial Interests in Capital Debt Securities Issued by Consolidated Trusts		—			5,439			5,439			NM			NM

TOTAL LIABILITIES		747,743			757,782			698,322			(1	)		7

STOCKHOLDERS’ EQUITY
Preferred Stock		1,009			1,009			1,009			—			—
Common Stock		2,041			2,036			2,023			—			1
Capital Surplus		13,238			12,898			13,113			3			1
Retained Earnings		28,540			27,633			26,940			3			6
Accumulated Other Comprehensive Income		187			1,293			1,465			(86	)		(87	)
Treasury Stock, at Cost		(58	)		(48	)		(1,113	)		(21	)		95

TOTAL STOCKHOLDERS’ EQUITY		44,957			44,821			43,437			—			3

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	792,700		$	802,603		$	741,759			(1	)		7

(a)

At September 30, 2003, includes an incremental $15 billion related to variable interest entities that were consolidated during the third quarter of 2003 in accordance with FIN 46. Also includes approximately $3 billion of variable interest entities consolidated prior to the third quarter of 2003 that continue to be consolidated in accordance with FIN 46.


										Sep 30, 2003
										Over (Under)
	Sep 30			Jun 30			Sep 30			Jun 30			Sep 30
	2003			2003			2002			2003			2002
CREDIT EXPOSURE:
Commercial Loans ^(a)	$	88,408		$	91,056		$	97,486			(3	)%		(9	)%
Derivative Receivables ^(b)		83,787			93,602			87,518			(10	)		(4	)
Other Receivables ^(c)		108			108			1,130			—			(90	)

Total Commercial Credit-Related Assets		172,303			184,766			186,134			(7	)		(7	)
Lending-Related Commitments ^(d)(e)		209,042			229,119			238,150			(9	)		(12	)

Total Commercial Credit Exposure ^(f)		381,345			413,885			424,284			(8	)		(10	)
Managed Consumer Loans ^(g)		182,108			170,127			143,835			7			27

Total Credit Portfolio	$	563,453		$	584,012		$	568,119			(4	)		(1	)


NET CHARGE-OFFS:
Commercial Loans	$	259		$	257		$	834			1			(69	)
Lending-Related Commitments		—			—			—			NM			NM

Total Commercial Credit Exposure		259			257			834			1			(69	)
Managed Credit Card ^(g)		734			748			687			(2	)		7
All Other Consumer		92			89			99			3			(7	)

Total Managed Consumer Loans		826			837			786			(1	)		5

Total Credit Portfolio	$	1,085		$	1,094		$	1,620			(1	)		(33	)


NET CHARGE-OFF RATES — ANNUALIZED:
Total Commercial Loans		1.09	%		1.20	%		3.53	%		(11	)bp		(244	)bp
Managed Credit Card		5.80			6.01			5.51			(21	)		29
Total Credit Portfolio		0.88			0.91			1.36			(3	)		(48	)

NONPERFORMING ASSETS:
Commercial Loans	$	2,598		$	2,963		$	3,596			(12	)%		(28	)%
Derivative Receivables		260			276			169			(6	)		54
Other Receivables ^(c)		108			108			1,130			—			(90	)
Consumer Loans		513			493			507			4			1
Assets Acquired in Loan Satisfactions		203			227			140			(11	)		45

Total Credit Portfolio ^(h)	$	3,682		$	4,067		$	5,542			(9	)		(34	)


J.P. Morgan Chase & Co.
270 Park Avenue, New York, NY 10017-2070
NYSE symbol: JPM
www.jpmorganchase.com



News release: IMMEDIATE RELEASE



Investor Contact:	Ann Borowiec	Media Contact:	Joe Evangelisti
	(212) 270-7318		(212) 270-7438

(a)		At September 30, 2003, includes $10.9 billion of exposure related to consolidated variable interest entities in accordance with FIN 46, of which $10.4 billion is associated with multi-seller asset-backed commercial paper conduits.
(b)		At September 30, 2003, Derivative Receivables decreased $360 million in accordance with FIN 46.
(c)		Represents, at September 30, 2003, the Enron-related letter of credit, which continues to be the subject of litigation with a credit-worthy entity and which was classified in Other Assets.
(d)		At September 30, 2003, total commitments related to asset-backed commercial paper conduits consolidated in accordance with FIN 46 are $18.7 billion, of which $6.8 billion is included in Lending-Related Commitments. The remaining $11.9 billion of commitments related to these variable interest entities were excluded as their underlying assets are reported as follows: $10.4 billion in Loans and $1.5 billion in Available-for-sale Securities.
(e)		Includes unused advised lines of credit of $20 billion at September 30, 2003, $19 billion at June 30, 2003, and $18 billion at September 30, 2002.
(f)		Includes all Enron-related credit exposures. Credit exposure excludes risk participations and does not reflect the benefit of credit derivative hedges or liquid collateral held against derivatives contracts.
(g)		Includes securitized credit card receivables.
(h)		Nonperforming assets exclude nonaccrual loans held for sale (“HFS”) of $192 million at September 30, 2003. HFS loans are carried at the lower of cost or market, and declines in value are recorded in Other Revenue.



J.P. MORGAN CHASE & CO. CONSOLIDATED FINANCIAL HIGHLIGHTS — REPORTED BASIS (in millions, except per share, ratio and employee data)



J.P. MORGAN CHASE & CO. RECONCILIATION OF QUARTERLY REPORTED TO OPERATING RESULTS (in millions, except per share data)



J.P. MORGAN CHASE & CO. LINES OF BUSINESS FINANCIAL HIGHLIGHTS SUMMARY (in millions, except per share and ratio data)



J.P. MORGAN CHASE & CO. CONSOLIDATED BALANCE SHEET (in millions)



J.P. MORGAN CHASE & CO. CREDIT-RELATED INFORMATION (in millions, except ratios)