JPMorgan Chase posted a 68% increase in fourth-quarter earnings on strong investment banking growth and a gain from the sale of the bank's corporate trust business.
But credit quality weakened somewhat, as it has at other major banks, suggesting that both commercial and individual customers are having more trouble keeping up with their bills.
The New York-based bank, the nation's third largest, said net income was $4.53 billion, or $1.26 a share, in the October-December period, up from $2.7 billion, or 76 cents a share, a year earlier.
Excluding the $622 million after-tax gain on the sale of its trust business, earnings totaled $3.9 billion.
Revenue was $16.05 billion, slightly above the analysts' expectation, and 19% ahead of the $13.48 billion reported in the fourth quarter of 2005.
Investment banking revenue surged 48% to $4.72 billion, and net income from that activity rose 51% to $1 billion. That led to big-ticket pay at the bank, where its compensation expense rose to $1.9 billion, compared with the year-ago level of $1.1 billion.
The bank also saw across-the-board gains in advisory, loan syndication and bond underwriting fees.
Meanwhile, JPMorgan's various operating segments reported mixed results on credit quality. The provision for credit losses at its retail finance division, which includes home equity and car loans, rose 66% to $262 million.
In contrast, the bank's credit card unit saw its provision for credit losses fall 43% to $1.3 billion because of significantly lower bankruptcy filings, JPMorgan said.
Despite a cooling trend in housing sales, JPMorgan's mortgage loan originations were up 9% from the previous quarter at $31 billion.
JPMorgan's asset management business generated a 19% gain in net income as assets under supervision rose 17% to $1.3 trillion.