America's scandal-racked JP Morgan Chase smashed Wall Street's forecasts yesterday with the help of a revival in so-called simple banking.
The bank, the world's biggest by assets, has been reeling in the wake of a trading scandal in which Bruno Iksil, nicknamed the London Whale, lost $5.8bn (3.6bn) through derivatives trades.
Yesterday, however, a boom in simple mortgage lending helped the bank to roar back and post a $1.4bn rise in third-quarter post-tax profits, which came in at $5.7bn.
The bank's earnings per share of $1.40 were well ahead of analysts' forecasts of $1.21, and the 34 per cent rise in profits came in a traditionally quiet quarter for earnings.
Jamie Dimon, the chief executive, who has been battling to repair the bank's reputation after the trading losses, said: "The firm reported strong performance across all our businesses in the third quarter. I am proud of the momentum we are seeing throughout our businesses."
Mortgage loan originations surged by 29 per cent to $47.3bn. A large part of that was down to efforts by the US government to stimulate the country's moribund housing market. …