JPMorgan Chase reported a decrease in its earnings in the fourth quarter of 2017 as the company experienced impacts from the recently enacted Tax Cuts and Jobs Act.
The company reported a net income of $4.2 billion in the fourth quarter of 2017, down 37% from $6.73 billion in the third quarter and in the fourth quarter of 2016. The company explained this loss was driven by a $2.4 billion impact from the recently passed tax reform.
Excluding the impact of tax reform, the bank reported net income could be $6.7 billion, a decrease of just 1% from the previous quarter and previous year.
Earnings per share also fell, dropping to $1.07 per diluted common share in the fourth quarter. This is down 39% from $1.76 per share in the third quarter and down 37% from $1.71 per share in the fourth quarter of 2016.
However, despite these loses, the bank’s CEO claimed the company experienced record growth during 2017.
“2017 was a record year on many measures for JPMorgan Chase as we added clients and customers and delivered record EPS,” JPMorgan CEO Jamie Dimon said. “We had healthy growth in treasury services, securities services and investment banking – we were #1 in IB fees globally, a record for the firm.”
“Commercial banking and asset and wealth management generated record revenue and net income,” Dimon said, listing a few of the bank’s accomplishments. “The commercial bank earned a record $2.3 billion of IB revenue and continued to add bankers and offices and now has offices in each of the top 50 MSAs.”
Dimon also explained that, despite the fourth-quarter loss tax reform brought to the bank’s revenues, it will be a positive step for the country.
“The enactment of tax reform in the fourth quarter is a significant positive outcome for the country,” he said. “U.S. companies will be more competitive globally, which will ultimately benefit all Americans.”
“The cumulative effect of retained and reinvested capital in the U.S. will help grow the economy, ultimately growing jobs and wages,” Dimon said. “We have always invested, even in difficult times, in our employees, customers and communities, and as a result of the tax plan we will be increasing and accelerating some of these investments.”
The bank reported an annual increase in its net revenue, however it is down from the third quarter. JPMorgan reported a net revenue of $25.5 billion in the fourth quarter, down 3% from $26.2 billion in the third quarter but up 5% from the fourth quarter of 2016’s $24.3 billion.