Several banks and brokerages have turned in recent months to public and private investors for billions of dollars in capital to shore up their balance sheets, hit by the global credit crunch.
The report came on the day that JPMorgan, the third-largest U.S. bank, reported a 50 percent drop in quarterly profit. Still, its results calmed investors, who had hoped the bank would deal with the credit crisis better than some others.
Its profit was $2.37 billion, or 68 cents per share, down from $4.79 billion, or $1.34, in the year-earlier period. Results included a gain of $955 million from a stake in credit card network Visa, which went public last month.
The New York-based bank set aside $4.42 billion for loan losses and took about $2.6 billion of write-downs tied to mortgages, loans to fund corporate buyouts and tight credit markets. Its total allowance for credit losses rose $2.52 billion from the end of 2007 to $12.6 billion.
JPMorgan Profit Falls 50% But Results Beat Estimates
On Wednesday, JPMorgan said quarterly profit fell by half, although shares rose as the third-largest bank avoided the kind of massive losses that crippled many of its rivals.
The bank absorbed more than $5 billion of losses and write-downs tied to mortgages and broken-down corporate credit markets.
Nevertheless those losses were less dramatic than those of rivals such as Citigroup ,UBS and Merrill Lynch .
"JPMorgan did relatively well in a very difficult operating environment," Sandler O'Neill analyst Jeff Harte said. "Unfortunately, it doesn't appear that environment will get better in the near future."
JPMorgan's first-quarter profit dropped to $2.37 billion, or 68 cents a share, from $4.79 billion, or $1.34, a year earlier.
The profit included a $955 million gain on the bank's stake in credit card giant Visa Inc, which went public last month.
The results exceeded the average analyst estimate of 64 cents according to Thomson First Call, which excluded the Visa gain. Reuters Estimates, which included Visa in its forecasts, said the average estimate was 71 cents.
Net revenue fell 11 percent to $16.9 billion, in line with expectations.
Still, JPMorgan Chief Executive Jamie Dimon cautioned that financial markets face a long period of uncertainty. "We simply don't know. There are some good signs and some bad signs," Dimon told reporters in a briefing.
In credit markets, clogged with risky buyout loans extended in better times, Dimon said "I do think we're well more than half way through -- maybe 75 to 80 percent through.