JPMorgan chief says $25bn bailout offers growth potential

CAPITAL INJECTION:JAMIE DIMON, the chief executive of JPMorgan Chase, said yesterday the US government's $25 billion (€19 billion) injection of capital into the bank could present it with growth opportunities that were not open to some of its troubled competitors.

Mr Dimon's comments came on the heels of the bank's third-quarter earnings announcement, in which JPMorgan Chase reported net income of $527 million, or 11 cents per share.

The bank's earnings were weighed down with losses associated with the takeover of Washington Mutual, which it completed late last month.

Without the acquisition-charges, JPMorgan Chase would have reported $1.17 billion in income, or 28 cents per share.Total revenues, at $14.7 billion, were down from the previous year's total of $16.1 billion.

Asked whether he had any plans to use the $25 billion capital injection from the government, Mr Dimon said the new funds could present JPMorgan Chase with opportunities.

"We hope to have ways to use it to benefit our shareholders and to continue to be there for our clients," he said.

He added: "I think that if you're a bank filling a hole, you obviously can't . If you're a bank that obviously is not filling a hole, you can do some of that."

Mr Dimon was also asked about whether he planned to access the government's facility to reduce mortgage exposures.

"I don't think it's highly relevant to us honestly, and we're down to smaller numbers now, and so the answer is probably not, but we'll see how the details come out and we'll figure out them," he said.

"But I think the . . . facility when it comes out will help the market, and that will help anyone who wants to trade . . . because you'll have real prices and real discovery and real ability to manage your own assets and capital."

JPMorgan Chase's earnings were bolstered by a strong performance in investment banking, which reported $882 million in income, a gain of $586 million over the previous year's results.

Results for the bank's retail services division were weaker, at $247 million, down 61 per cent from the prior year's figures, based in part on credit losses associated with the bank's home equity and mortgage portfolios.

Profits were also down at the bank's card services unit, driven by an increase in the provision for credit losses. Commercial banking income grew 21 per cent for the quarter, to $312 million, driven largely by growth in higher deposit-related fees, investment banking fees and net interest income.