JPMorgan Chase, America's largest bank by assets, made $5.3 billion in the last quarter of 2013 and had revenues of $24.1 billion. The bank's income of $5.3 billion fell just over 7% from the fourth quarter of last year, when the bank earned $5.7 billion. The bank's fourth-quarter earnings per share fell from $1.39 a share to $1.30 a share this year, largely thanks to the massive settlements the bank has paid in the last three months. Its revenue however, came in at just above what analysts polled by Bloomberg were expecting.
Earlier this month JPMorgan had to set aside another $400 million in litigation reserves to help pay its over $2 billion in settlements stemming from its alleged failure to raise sufficient alarm about Bernie Madoff's ponzi scheme despite being its primary bank. Because a portion of its total Madoff settlements could not be deducted on the firm's taxes, the bank incurred $847 million in legal expense in the fourth quarter, dragging down its results compared to last year.
This came on top of last quarter's announcement that JPMorgan had set aside another $9 billion-plus in reserves to pay for litigation, causing it to post a loss for the first time in a decade. Since September, JPMorgan has been ordered to pay out over $22 billion in fines, penalties, and compensation for homeowners, mortgage bond investors, and credit card customers in settlements with regulators, prosecutors, and private litigants.
"We are pleased to have made progress on our control, regulatory and litigation agendas and to have put some significant issues behind us this quarter," Chairman and CEO Jamie Dimon said in a statement. "It was in the best interests of our company and shareholders for us to accept responsibility, resolve these issues and move forward."
Investors could still be relatively pleased with the results. Its most significant litigation hurdles are finally behind them and its adjusted profits, which excludes the litigation amounts, came in at $1.40 a share, compared to analysts' expectations of $1.37.