New York City (AFP) – U.S. banking giant JPMorgan Chase on Friday reported a rare quarterly loss due to high legal costs, even as its underlying business produced results that bested expectations.
The bank, the nation’s largest by assets, reported a net loss of $380 million on revenues of $23.12 billion, due in large part to a $9.15 billion charge for legal expenses following a series of high-profile regulatory problems.
However, when the special items were stripped away, the bank earned $1.42 per share, 21 cents above expectations.
JPMorgan chief executive Jamie Dimon said the results demonstrated “strong underlying performance across the businesses” but that results were “marred by large legal expenses.”
“We continuously evaluate our legal reserves, but in this highly charged and unpredictable environment, with escalating demands and penalties from multiple government agencies, we thought it was prudent to significantly strengthen them,” Dimon said.
He continued: “While we expect our litigation costs should abate and normalize over time, they may continue to be volatile over the next several quarters.”
JPMorgan in September signed off on a $920 million settlement to resolve some civil charges related to the “London whale” debacle, during which the company lost $6.2 billion in errant and poorly-managed trades.
The bank in July also agreed to pay $410 million in penalties to resolve charges it manipulated some U.S. lectricity markets.
However, regulators continue to probe both of these cases. Moreover, the bank is in talks with the Justice Department over a large settlement related to its sale of mortgage-backed securities ahead of the housing bust. The housing settlement could reach $11 billion or more.
The quarterly loss Friday compared to a profit of $5.71 billion in the year-ago period on revenues of $25.15 billion.
Copyright 2013 The National Memo