JPMorgan Chase and Goldman Sachs Beat Analysts’ Expectations

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The big banks are booking big profits as customers shake off the pandemic and deal makers seize on busy markets.

JPMorgan Chase, the country’s largest bank by assets, on Tuesday reported net income of $11.9 billion in the second quarter, up from $4.7 billion a year earlier. Its earnings per share of $3.78 and revenue of $30.5 billion exceeded analysts’ expectations.

Consumers are starting to spend more on travel and entertainment, and they’re also buying homes and cars at a faster clip, the bank said. Its investment banking fees were the highest they’ve ever been, buoyed by a hot market for mergers and acquisitions.

“Consumer and wholesale balance sheets remain exceptionally strong as the economic outlook continues to improve,” Jamie Dimon, JPMorgan’s chief executive, said in a statement.

The company’s confidence in the rebound was reflected in the release of $3 billion from its rainy-day fund that was set aside for an expected onslaught of consumer defaults that never emerged, thanks to robust government stimulus efforts that helped keep many Americans afloat. Net charge-offs, or debt that the bank has given up trying to recoup, fell 53 percent, “reflecting the increasingly healthy condition of our customers and clients,” Mr. Dimon said.

Goldman Sachs also reported a bigger profit for the quarter compared with the same period a year ago, earning nearly $5.5 billion on revenue of nearly $15.4 billion. On a per-share basis, Goldman’s $15.02 showing was much higher than Wall Street’s prediction of $9.88. Analysts had expected Goldman’s profit to be just $3.4 billion.

But compared with the first three months of 2021, its earnings were smaller, indicating that the bank and Wall Street competitors may be reaching the end of the frenetic period of trading touched off by the pandemic.

Goldman’s trading revenue for the quarter was lower than earlier this year and the same period last year. Its trading in fixed income, commodities and other financial products brought in $4.9 billion in revenues for the quarter, compared with almost $7.6 billion earlier this year and $7.2 billion during the same period a year ago. Analysts had expected a better showing, predicting the bank would take in just over $5 billion from such trades.

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