JP Morgan Chase 2015 Annual Report Download - page 91

JPMorgan Chase & Co./2015 Annual Report 81
Calculation of certain U.S. GAAP and non-GAAP financial measures
Certain U.S. GAAP and non-GAAP financial measures are calculated as
follows:
Book value per share (“BVPS”)
Common stockholders’ equity at period-end /
Common shares at period-end
Overhead ratio
Total noninterest expense / Total net revenue
Return on assets (“ROA”)
Reported net income / Total average assets
Return on common equity (“ROE”)
Net income* / Average common stockholders’ equity
Return on tangible common equity (“ROTCE”)
Net income* / Average tangible common equity
Tangible book value per share (“TBVPS”)
Tangible common equity at period-end / Common shares at period-end
* Represents net income applicable to common equity
Tangible common equity (“TCE”), ROTCE and TBVPS are
each non-GAAP financial measures. TCE represents the
Firm’s common stockholders’ equity (i.e., total stockholders’
equity less preferred stock) less goodwill and identifiable
intangible assets (other than MSRs), net of related deferred
tax liabilities. ROTCE measures the Firm’s earnings as a
percentage of average TCE. TBVPS represents the Firm’s TCE
at period-end divided by common shares at period-end.
TCE, ROTCE, and TBVPS are meaningful to the Firm, as well
as investors and analysts, in assessing the Firm’s use of
equity.
Additionally, certain credit and capital metrics and ratios
disclosed by the Firm are non-GAAP measures. For
additional information on these non-GAAP measures, see
Credit Risk Management on pages 112–132, and Capital
Management on pages 149–158.
Tangible common equity
Period-end Average
Dec 31,
2015
Dec 31,
2014
Year ended December 31,
(in millions, except per share and ratio data) 2015 2014 2013
Common stockholders’ equity $ 221,505 $ 211,664 $ 215,690 $ 207,400 $ 196,409
Less: Goodwill 47,325 47,647 47,445 48,029 48,102
Less: Certain identifiable intangible assets 1,015 1,192 1,092 1,378 1,950
Add: Deferred tax liabilities(a) 3,148 2,853 2,964 2,950 2,885
Tangible common equity $ 176,313 $ 165,678 $ 170,117 $ 160,943 $ 149,242
Return on tangible common equity NA NA 13% 13% 11%
Tangible book value per share $ 48.13 $ 44.60 NA NA N/A
(a) Represents deferred tax liabilities related to tax-deductible goodwill and to identifiable intangibles created in nontaxable transactions, which are netted
against goodwill and other intangibles when calculating TCE.