JPMorgan Chase & Co. (NYSE:JPM) reported robust third-quarter net interest income (NII) that outpaced analysts’ estimates, sending shares up more than 4% on Friday. The largest U.S. bank by assets recorded NII of $23.53 billion, topping the $22.8 billion expected by analysts, benefiting from the spread between what it earns on loans and pays on deposits.
Looking ahead, JPMorgan anticipates NII to moderate slightly to $22.9 billion in the fourth quarter, with an annual forecast of approximately $92.5 billion, up from $89.7 billion in fiscal 2023. This outlook reflects potential shifts as the Federal Reserve considers easing interest rates, ending a period of high rates that boosted banks’ income on loans.
During a recent industry event, JPMorgan President Daniel Pinto responded to projections of a $1.5 billion NII decrease by 2025, calling the forecast “not very reasonable” if the Fed cuts rates by 250 basis points. While Pinto suggested the reduction could be less than anticipated, he refrained from providing specific targets.
JPMorgan has previously cautioned about potential “overearning” on its lending income, signaling to investors that its recent elevated profits may adjust as the interest rate environment evolves.