JPMorgan Chase (JPM) earnings 1Q 2023

JPMorgan Chase is scheduled to report first-quarter earnings before the opening bell on Friday.

Here’s what Wall Street expects:

• Earnings: $3.41 per share, up 29.7% from a year earlier, according to Refinitiv.
• Revenue: $36.24 billion, up 14.7% year over year.
• Deposits: $2.31 trillion, according to StreetAccount.
• Provision for credit losses: $2.27 billion.
• Trading income: Interest income $5.29 billion, equities $2.86 billion.

JPMorgan, the largest U.S. bank by assets, will be closely watched for clues about how the industry fared after the collapse of two regional lenders last month.

Analysts expect a mixed bag of conflicting trends. For example, JPMorgan likely benefited from an influx of deposits after Silicon Valley Bank and Signature Bank experienced fatal bank runs.

But the industry has been forced to pay for deposits as clients move holdings to higher-yielding instruments such as money market funds. It will probably dampen the banks’ gains from rising interest rates amid the Federal Reserve’s attempts to curb inflation.

The flow of deposits through US financial institutions is the biggest concern for analysts and investors this quarter. That’s because smaller banks faced pressure last month as customers sought the perceived safety of megabanks, including JPMorgan and Bank of America. But the bigger picture may be that deposits are leaving the regulated banking system overall as customers realize they can earn higher returns outside of checking and savings accounts.

Another key question will be whether JPMorgan and others tighten lending standards ahead of an expected U.S. recession, which could limit economic growth this year by making it harder for consumers and businesses to borrow money.

The banks have started to set aside more loss provisions on expectations of a slowing economy later this year, and this could weigh on results. JPMorgan is expected to post a $2.27 billion provision for credit losses, according to the StreetAccount estimate.

Wall Street may provide little help this quarter, with investment banking fees likely to remain muted thanks to the still-closed IPO market. CFO Jeremy Barnum said in February that investment banking revenue was on track for a 20% decline from a year earlier and that trading was also trending “slightly worse”.

Finally, analysts will want to hear what JPMorgan CEO Jamie Dimon has to say about the economy and his expectations for how the regional banking crisis will play out. JPMorgan has played a central role in propping up a client bank, First Republic, that folded last month, in part by leading efforts to inject it with $30 billion in deposits.

Shares in JPMorgan are down around 4% this year, outpacing the 31% decline in the KBW Bank Index.

Wells Fargo and Citigroup are scheduled to announce results later Friday, while Goldman Sachs and Bank of America report on Tuesday and Morgan Stanley reveals results on Wednesday.

This story is in development. Please check back for updates.