JPMorgan’s third quarter earnings are out and the bank missed analyst estimates.
The bank reported net income of $6.8 billion and earnings per share of $1.68, but said underlying earnings – excluding tax benefits and other items – were $5.4 billion, equivalent to earnings per share of $1.32.
The bank was able to book tax benefits of $2.2 billion over the quarter due to the resolution of tax audits and the release of deferred taxes.
Wall Street analysts expected earnings of $1.38 per share for JPMorgan, according to Bloomberg. A year ago the bank posted earnings of $1.36 a share.
The bank also posted a miss on revenue for the third quarter of 2015, at $23.5 billion. That represented a 6% decline on the third quarter of last year.
The bank was expected to generate between $23.26 billion and $24.61 billion in revenues, according to Bloomberg, making for an average target of $24.04 billion.
The bank said the decline was “driven by lower CIB Markets revenue including business simplification and lower Mortgage Banking revenue.”
The bank also said it had upped it reserves in the wholesale business by more than $300 million, “driven by select downgrades, including oil and gas.”
“We saw the impact of a challenging global environment and continued low rates reflected in the wholesale businesses’ results, while the consumer businesses benefited from favorable trends and credit quality,” CEO Jamie Dimon said in a public statement. “We continue to focus on our commitments, optimize our balance sheet and manage our expenses. We are also building the businesses for the future, dedicating resources to controls, cybersecurity and technology.”
The Tuesday afternoon report for JPMorgan comes after back-to-back earnings beats.
Shares immediately fell by more than 1% in after-hours trading on the news of the earnings and revenue miss.
This is a big week for Wall Street banks. More earnings are on the way; including Wells Fargo and Bank of America on Wednesday October 14; and Citigroup and Goldman Sachs Thursday October 15. Morgan Stanley will reveal results next week.