America’s biggest bank continued to attract financial advisors in the first quarter of 2023, adding steam to its growing ambitions in wealth management amid a banking crisis that unfolded last month.
JPMorgan Chase reported record first-quarter revenue on Friday, along with a net headcount gain of 148 advisors across its lines of business. The banking crisis allowed some big banks to appeal more to advisors — who were expected to migrate to firms perceived as more stable, in contrast to stumbling smaller institutions like First Republic.
The total number of financial advisors across the bank’s wealth management lines rose to 8,314 — a bump of 2% from 8,166 last quarter, and 9% from 7,614 year over year.
Firmwide, profits of $12.6 billion popped 52% year over year and 15% over last quarter’s $11.0 billion. Reported revenue was $38.3 billion, up 25% over the past year and 11% over the past quarter’s $34.5 billion.
The company beat expectations with earnings per share of $4.10, which was 20% more than the analyst consensus of $3.41. The stock was up 7% as of around midday on Friday.
“Our years of investment and innovation, vigilant risk and controls framework, and fortress balance sheet allowed us to produce these returns, and also act as a pillar of strength in the banking system and stand by our clients during a period of heightened volatility,” Jamie Dimon, the Chairman and CEO of JPMorgan Chase said in a statement Friday.
Average deposits were down 3% from the past quarter, reflecting a widespread cash flight in recent months as clients ditched bank accounts that paid little for higher-yielding accounts elsewhere. But total deposits grew 2% over the past quarter to $2.38 trillion. The bank attributed the rise to last month’s banking crisis, which saw many consumers frantically pull funds out of regional and community banks and put them into the largest banks.
“As you would expect, we saw significant new account opening activity and meaningful deposit and money market fund inflows, most significantly in the commercial bank, Business Banking and AWS (Asset & Wealth Management),” Jeremy Barnum, the bank’s chief financial officer, said in an earnings call Friday.
“We estimate that we have retained approximately $50 billion of these deposit inflows at quarter end,” he said. But some of the surprise deposit inflows could leave again in “modest” amounts, Barnum said, as consumers reassess their options again.
“It’s a competitive market and it’s entirely possible that people temporarily come to us and then over time decide to go elsewhere,” Barnum said.
To see the main takeaways from JPMorgan Chase’s first-quarter earnings, scroll down the slideshow. For coverage of the firm’s fourth-quarter earnings, click here. For a look at the results from the third quarter, click here.
Note: The firm doesn’t break out some specific wealth management metrics across its organization, which includes the Global Private Bank in its Asset & Wealth Management division and J.P. Morgan Wealth Management, which is part of the Banking & Wealth Management unit.