JPMorgan and Goldman Sachs crash estimates with a massive 400% rise in profits – banking and finance

Three of the largest banks in the United States reported first-quarter accounts well above market estimates on Wednesday, April 14, marking a positive start to the earnings season.

Goldman Sachs reported record numbers in the first three months of this year, with earnings per share at $ 18.60, well above expectations of $ 10.22. These figures represent an increase of 498% over the same period last year. In terms of revenues, the estimates point to a total of $ 12.6 billion, which is largely overtaken by the bank, reaching $ 17.7 billion, more than double what it recorded in the same period in 2020.

“We have worked hard alongside our customers to prepare for a world beyond pandemic and a more stable economic environment,” said CEO David Solomon in presenting the results. “Our business remains very well positioned to help our clients reposition themselves for recovery, and this strength is reflected in the record revenues and profits this quarter.”

Like Goldman Sachs, JPMorgan also saw a profit increase of nearly 400% in the first quarter, after the largest U.S. bank released more than $ 5 billion in reserves it had set aside to cover pandemic-related defaults.

The bank closed the first quarter with earnings of $ 14.3 billion, or $ 4.5, per share, compared to 2.9 billion, or 78 cents per share, in the same period last year. Analysts estimated earnings of $ 3.10 per share.

However, revenue increased 14% to $ 33.1 billion.

JPMorgan, widely seen as a barometer of the overall health of the US economy, said consumer spending on its business has returned to pre-epidemic levels and increased 14% from the first quarter of 2019.

The results, aided by a positive comparison with the previous year, also benefited from a 57% increase in investment banking revenues.

“We believe the economy has the potential to deliver very strong multi-year growth,” CEO Jimmy Dimon said in a statement.

Wells Fargo also surprised analysts by announcing earnings of $ 1.05 per share, above expectations of 70 cents, and earnings of $ 18.06 billion, also higher than estimates of $ 17.5 billion.

This was at a time when the bank also released reserves of $ 1.05 billion.