JP Morgan Chase 2009 Annual Report Download - page 251

Supplementary information
JPMorgan Chase & Co./2009 Annual Report 249
Selected quarterly financial data (unaudited)
As of or for the period ended 2009 2008
(in millions, except per-share, ratio and headcount data) 4th 3rd 2nd 1st 4th 3rd 2nd 1st
Selected income statement data
Noninterest revenue $ 10,786 $ 13,885 $ 12,953 $ 11,658 $ 3,394 $ 5,743 $ 10,105 $ 9,231
Net interest income 12,378 12,737 12,670 13,367 13,832 8,994 8,294 7,659
Total net revenue 23,164 26,622 25,623 25,025 17,226 14,737 18,399 16,890
Total noninterest expense 12,004 13,455 13,520 13,373 11,255 11,137 12,177 8,931
Pre-provision profit (a) 11,160 13,167 12,103 11,652 5,971 3,600 6,222 7,959
Provision for credit losses 7,284 8,104 8,031 8,596 7,755 3,811 3,455 4,424
Provision for credit losses – accounting conformity (b) — — — — (442) 1,976 — —
Income/(loss) before income tax expense/(benefit) and
extraordinary gain 3,876 5,063 4,072 3,056 (1,342) (2,187) 2,767 3,535
Income tax expense/(benefit) 598 1,551 1,351 915 (719) (2,133) 764 1,162
Income/(loss) before extraordinary gain 3,278 3,512 2,721 2,141 (623) (54) 2,003 2,373
Extraordinary gain (c) — 76 — — 1,325 581 — —
Net income $ 3,278 $ 3,588 $ 2,721 $ 2,141 $ 702 $ 527 $ 2,003 $ 2,373
Per-common-share data
Basic earnings (d)
Income/(loss) before extraordinary gain $ 0.75 $ 0.80 $ 0.28 $ 0.40 $ (0.29) $ (0.08) $ 0.54 $ 0.67
Net income 0.75 0.82 0.28 0.40 0.06 0.09 0.54 0.67
Diluted earnings (d)(e)
Income/(loss) before extraordinary gain $ 0.74 $ 0.80 $ 0.28 $ 0.40 $ (0.29) $ (0.08) $ 0.53 $ 0.67
Net income 0.74 0.82 0.28 0.40 0.06 0.09 0.53 0.67
Cash dividends declared per share 0.05 0.05 0.05 0.05 0.38 0.38 0.38 0.38
Book value per share 39.88 39.12 37.36 36.78 36.15 36.95 37.02 36.94
Common shares outstanding
Average: Basic 3,946.1 3,937.9 3,811.5 3,755.7 3,737.5 3,444.6 3,426.2 3,396.0
Diluted (d) 3,974.1 3,962.0 3,824.1 3,758.7 3,737.5(h)
3,444.6(h) 3,453.1 3,423.3
Common shares at period-end 3,942.0 3,938.7 3,924.1 3,757.7 3,732.8 3,726.9 3,435.7 3,400.8
Share price
High $ 47.47 $ 46.50 $ 38.94 $ 31.64 $ 50.63 $ 49.00 $ 49.95 $ 49.29
Low 40.04 31.59 25.29 14.96 19.69 29.24 33.96 36.01
Close 41.67 43.82 34.11 26.58 31.53 46.70 34.31 42.95
Market capitalization 164,261 172,596 133,852 99,881 117,695 174,048 117,881 146,066
Financial ratios
Return on common equity: (e)
Income/(loss) before extraordinary gain 8%
9% 3% 5% (3)% (1)% 6% 8%
Net income 8 9 3 5 1 1 6 8
Return on tangible common equity
Income/(loss) before extraordinary gain 12 13 5 8 (5) (1) 10 13
Net income 12 14 5 8 1 2 10 13
Return on assets:
Income/(loss) before extraordinary gain 0.65 0.70 0.54 0.42 (0.11) (0.01) 0.48 0.61
Net income 0.65 0.71 0.54 0.42 0.13 0.12 0.48 0.61
Tier 1 capital ratio 11.1 10.2 9.7 11.4 10.9 8.9 9.2 8.3
Total capital ratio 14.8 13.9 13.3 15.2 14.8 12.6 13.4 12.5
Tier 1 leverage ratio 6.9 6.5 6.2 7.1 6.9 7.2 6.4 5.9
Tier 1 common capital ratio (f) 8.8 8.2 7.7 7.3 7.0 6.8 7.1 6.9
Overhead ratio 52 51 53 53 65 76 66 53
Selected balance sheet data (period-end)
Trading assets $ 411,128 $ 424,435 $ 395,626 $ 429,700 $ 509,983 $ 520,257 $ 531,997 $ 485,280
Securities 360,390 372,867 345,563 333,861 205,943 150,779 119,173 101,647
Loans 633,458 653,144 680,601 708,243 744,898 761,381 538,029 537,056
Total assets 2,031,989 2,041,009 2,026,642 2,079,188 2,175,052 2,251,469 1,775,670 1,642,862
Deposits 938,367 867,977 866,477 906,969 1,009,277 969,783 722,905 761,626
Long-term debt 266,318 272,124 271,939 261,845 270,683 255,432 277,455 205,367
Common stockholders’ equity 157,213 154,101 146,614 138,201 134,945 137,691 127,176 125,627
Total stockholders’ equity 165,365 162,253 154,766 170,194 166,884 145,843 133,176 125,627
Headcount 222,316 220,861 220,255 219,569 224,961 228,452 195,594 182,166
Credit quality metrics
Allowance for credit losses $ 32,541 $ 31,454 $ 29,818 $ 28,019 $ 23,823 $ 19,765 $ 13,932 $ 12,601
Allowance for loan losses to total retained loans 5.04%
4.74% 4.33% 3.95% 3.18% 2.56% 2.57% 2.29%
Allowance for loan losses to retained loans excluding
purchased credit-impaired loans (g) 5.51 5.28 5.01 4.53 3.62 2.87 2.57 2.29
Nonperforming assets $ 19,741 $ 20,362 $ 17,517 $ 14,654 $ 12,714 $ 9,520 $ 6,233 $ 5,143
Net charge-offs 6,177 6,373 6,019 4,396 3,315 2,484 2,130 1,906
Net charge-off rate 3.85%
3.84% 3.52% 2.51% 1.80% 1.91% 1.67% 1.53%
Wholesale net charge-off rate 2.31 1.93 1.19 0.32 0.33 0.10 0.08 0.18
Consumer net charge-off rate 4.60 4.79 4.69 3.61 2.59 3.13 2.77 2.43
(a) Pre-provision profit is total net revenue less noninterest expense. The Firm believes that this financial measure is useful in assessing the ability of a lending institution to generate income in excess of its
provision for credit losses.
(b) The third and fourth quarters of 2008 included an accounting conformity loan loss reserve provision related to the acquisition of Washington Mutual’s banking operations.
(c) On September 25, 2008, JPMorgan Chase acquired the banking operations of Washington Mutual. On May 30, 2008, a wholly-owned subsidiary of JPMorgan Chase merged with and into The Bear Stearns Companies,
Inc. (“Bear Stearns”), and Bear Stearns became a wholly-owned subsidiary of JPMorgan Chase. The Washington Mutual acquisition resulted in negative goodwill, and accordingly, the Firm recorded an extraordinary gain.
For additional information of these transactions, see Note 2 on pages 151–156 of this Annual Report.
(d) Effective January 1, 2009, the Firm implemented new FASB guidance for participating securities. Accordingly, prior-period amounts have been revised as required. For further discussion of the Guidance,
see Note 25 on page 232 of this Annual Report.
(e) The calculation of second-quarter 2009 earnings per share and net income applicable to common equity include a one-time, noncash reduction of $1.1 billion, or $0.27 per share, resulting from
repayment of U.S. Troubled Asset Relief Program (“TARP”) preferred capital. Excluding this reduction, the adjusted Return on common equity (“ROE”) and Return on tangible common equity (“ROTCE”)
were 6% and 10% for second-quarter 2009. For further discussion, see “Explanation and reconciliation of the Firm’s use of non-GAAP financial measures” on page 58–60 of this Annual Report.
(f) Tier 1 common is calculated as Tier 1 capital less qualifying perpetual preferred stock, qualifying trust preferred securities and qualifying minority interest in subsidiaries. The Firm uses the Tier 1 common
capital ratio, a non-GAAP financial measure, to assess and compare the quality and composition of the Firm’s capital with the capital of other financial services companies. For further discussion, see
Regulatory capital on pages 90–92 of this Annual Report.
(g) Excludes the impact of home lending purchased credit-impaired loans and loans held by the Washington Mutual Master Trust. For further discussion, see Allowance for credit losses on pages 123–125
of this Annual Report.
(h) Common equivalent shares have been excluded from the computation of diluted earnings per share for the third and fourth quarters of 2008, as the effect on income/(loss) before extraordinary gain
would be antidilutive.