Jeremy Barnum
Chief Financial Officer at JPMorgan Chase & Co.
Thank you, and good morning, everyone.
Starting on page one, the firm reported net income of $14 billion, EPS of $4.81 on revenue of $43.7 billion with an ROTCE of 21%.
On page two, we have more on our fourth quarter results. The firm reported revenue of $43.7 billion, up $3.8 billion or 10% year-on-year. NII ex-markets was down $548 million or 2%, driven by the impact of lower rates and the associated deposit margin compression as well as lower deposit balances in CCB, largely offset by the impact of securities reinvestment, higher revolving balances in card and higher wholesale deposit balances. NIR ex markets was up $3.1 billion or 30%. Excluding the prior year's net investment securities losses, it was up 21%, largely on higher asset management fees and investment banking fees. And markets revenue was up $1.2 billion or 21%. Expenses of $22.8 billion were down $1.7 billion or 7% year-on-year. Excluding the prior year's FDIC special assessment, expenses were up $1.2 billion or 5%, predominantly driven by compensation as well as higher brokerage and distribution fees and credit costs were $2.6 billion, reflecting net charge-offs of $2.4 billion and a net reserve of $267 million.
On page three, you can see the reported results for the full-year. I'll remind you that there were a number of significant items in 2024. Excluding those items, the firm reported net income of $54 billion, EPS of $18.22, revenue of $173 billion, and we delivered an ROTCE of 20%. Touching on a couple of highlights for the year. In CCB, we had a record number of first-time investors and acquired nearly 10 million new card accounts. In CIB, we had record revenue in markets, payments and security services. And in AWM, we had record long-term net inflows of $234 billion, positive across all channels, regions and asset classes.
On to balance sheet and capital on page four. We ended the quarter with a CET1 ratio of 15.7%, up 40 basis points versus the prior quarter as net income and lower RWA were largely offset by both OCI losses and capital distributions, which included $4 billion of net common share repurchases this quarter. The $24 billion decrease in RWA reflects a seasonal decline in markets activity and lower wholesale lending, which was predominantly offset by a seasonal increase in card.
Now let's go to our businesses, starting with CCB on page five. CCB reported net income of $4.5 billion on revenue of $18.4 billion, which was up 1% year-on-year. In Banking and Wealth Management, revenue was down 7% year-on-year on deposit margin compression and lower deposits, partially offset by growth in wealth management revenue. Average deposits were down 4% year-on-year and flat sequentially as consumer balances have stabilized. Client investment assets were up 14% year-on-year, predominantly driven by market performance, and we continue to see healthy flows across branch and digital channels. In home lending, revenue was up 12% year-on-year, predominantly driven by higher production revenue. Turning to card services and auto, revenue was up 14% year-on-year, largely driven by card NII on higher revolving balances. Card outstandings were up 11% due to strong account acquisition and revolver growth. And in auto, originations were $10.6 billion, up 7%, reflecting higher lease volume on robust new vehicle inventory. Expenses of $9.7 billion were up 4% year-on-year, predominantly driven by field compensation and growth in technology. In terms of credit performance this quarter, credit costs were $2.6 billion, reflecting net charge-offs of $2.1 billion, up $428 million year-on-year, driven by card. The net reserve build was $557 million, predominantly driven by higher card revolving balances.
Next, the Commercial and investment bank on page six. CIB reported net income of $6.6 billion on revenue of $17.6 billion. IV fees were up 49% year-on-year and we ranked number one with wallet share of 9.3% for 2024. Advisory fees were up 41%, benefiting from large deals and share growth in a number of key sectors. Underwriting fees were up meaningfully with debt up 56% and equity up 54%, primarily driven by favorable market conditions. In terms of the outlook for the overall investment banking wallet, in light of the positive momentum, we remain optimistic about our pipeline. Payments revenue was $4.7 billion, up 3% year-on-year, excluding equity investments, driven by higher deposit balances and fee growth, largely offset by deposit margin compression. Lending revenue was $1.9 billion, up 9% year-on-year, predominantly driven by lower losses on hedges. Moving to markets, total revenue was $7 billion, up 21% year-on-year. Fixed income was up 20% with better performance in credit as well as continued outperformance in currencies and emerging markets. Equities was up 22% on elevated client activity and derivatives amid increased volatility and higher trading volumes in cash. Security services revenue was $1.3 billion, up 10% year-on-year, driven by fee growth on higher client activity and market levels as well as higher deposit balances. Expenses of $8.7 billion were up 7% year-on-year, predominantly driven by higher brokerage, technology and legal expense. Average banking and payments loans were down 2% year-on-year and down 1% sequentially. Global corporate and investment banking loans were down 2% quarter-on-quarter, driven by paydowns in lower short-term financing, primarily offset by newer originations. In commercial banking, middle-market loans were also down 2%, driven by paydowns, predominantly offset by new originations and commercial real estate loans were flat as new originations were offset by paydowns. Average client deposits were up 9% year-on-year and 5% sequentially, driven by underlying client growth. Finally, credit costs were $61 million, driven by net downgrade activity and the net impact of charge-offs, largely offset by a reserve release due to an update to certain loss assumptions.
Then to complete our lines of business, asset and wealth management on page seven. AWM reported net income of $1.5 billion with pre-tax margin of 35%. Revenue of $5.8 billion was up 13% year-on-year, predominantly driven by growth in management fees on higher average market levels and strong net inflows as well as higher performance fees. Expenses of $3.8 billion were up 11% year-on-year, predominantly driven by higher compensation, including revenue-related compensation and continued growth in our private banking advisor teams as well as higher distribution fees. Long-term net inflows were $76 billion for the quarter, positive across all asset classes. In liquidity, we saw net inflows of $94 billion for the quarter and $140 billion for the full year. And we had client asset net inflows of $468 billion for the year. AUM of $4 trillion and client assets of $5.9 trillion were both up 18% year-on-year, driven by continued net inflows and higher market levels. And finally, loans were up 2% quarter-on-quarter and deposits were up 5% quarter-on-quarter.
Turning to corporate on page eight. Corporate reported net income of $1.3 billion. Revenue of $2 billion was up $223 million year-on-year. NII of $2 billion was down $415 million year-on-year, driven by the impact of lower rates, largely offset by balance sheet actions, primarily securities reinvestment activity. NIR was a net loss of $30 million compared to the net loss of $668 million in the prior year, driven by lower net investment securities losses this quarter. And expenses of $550 million were down $3 billion year-on-year, predominantly driven by the absence of the FDIC special assessment of $2.9 billion in the prior year.
With that, let's pivot to the outlook, starting with NII on page nine. We expect 2025 NII ex-markets to be approximately $90 billion. Going through the drivers, as usual, the outlook assumes that rates follow the forward curve. It's worth noting that the NII decrease is driven by both the cut expected in 2025 and the impact of the 100 basis points of cuts in the back half of 2024. You can see on the page that we've illustrated the historical trajectory of card loan growth. We expect healthy card loan growth again this year, but below the 12% pace we saw in 2024 as tailwinds from revolver normalization are largely behind us. Turning to deposits, term-line [Phonetic] deposits have stabilized and we expect to see a more visible growth trend assert itself in the second half of 2025. It's notable that we can already see that trend in consumer checking deposits. On deposit margin, we expect modest compression due to lower rates. When you put all that together, we expect the NII trough could be sometime in the middle of the year, followed by growth as we illustrated at the bottom of the bar. And for completeness, we expect firm-wide NII to be approximately $94 billion as a function of markets NII increasing to about $4 billion, which you should think of as being primarily offset in NIR. Finally, I want to point out that starting this quarter, we are including an estimate of earnings at-risk in the earnings supplement, so you no longer have to wait for the K or the Q to get that number.
Now let's turn to expenses on page 10. We expect 2025 expense to be about $95 billion. Looking at the chart in the middle of the page, I'll touch on the drivers of the year-on-year change, which you'll note are very consistent with what you've been hearing from us recently. The largest increase is volume and revenue-related expense, which is primarily driven by expected growth in auto leasing as well as capital markets. As a reminder, this comes with higher revenues. We continue to hire bankers and advisors to support business growth as well as expand our branch network. The increase in tech spend is primarily business-driven as we continue to invest in new products, features and customer platforms as well as modernization. Marketing remains a driver of spend as we continue to see attractive opportunities, resulting in strong demand and engagement in our card business. And finally, while we haven't explicitly called it out in each bar, inflation remains a source of some upward pressure. And as always, we are generating efficiencies to help offset it.
Now, let's turn to page 11 to cover credit and wrap-up. On credit, we expect the 2025 card net charge-off rate to be in-line with our previous guidance of approximately 3.6%. So in closing, 2024 was another year of record revenue and net income, and we're proud of what we accomplished. As we look ahead to 2025, we still expect NII normalization, although to a lesser extent than we previously thought. And taking a step-back, we think it's important to acknowledge the tension in the risks and uncertainties in the environment and the degree of optimism embedded in asset prices and expectations. In that context, we remain upbeat about the strength of the franchise, but we are focused on being prepared for a wide range of scenarios.
Finally, let me say a few words about the wildfires in Los Angeles. While we don't expect much of a financial impact from it, we have a presence in the area across all three lines of business, so we're keeping in close contact with our customers, clients and employees. We are offering support in a variety of ways, including waiving consumer and business banking fees as well as making a contribution to local relief organizations, offering employee donation matching and supporting employee volunteer efforts.
With that, I'll turn it over to Jamie before we open up the line for Q&A.
