J.P. Morgan Chase reported this morning that third quarter credit card profits rose 11% year-on-year to $786 million, compared to $759 million in the prior quarter and $711 million in the year-ago quarter. End-of-period managed loans of $149 billion increased by 4% year-on-year. Charge volume of $89.8 billion increased by 3% from the prior year. Net accounts opened during the quarter were nearly four million. Merchant processing volume of $181.4 billion increased by $1.7 billion from the prior quarter and up 8% from the prior year. Net interest income was $3.1 billion, up by $224 million, or 8%, from the prior year. The increase in net interest income was driven by an increased level of fees and higher average loan balances. These benefits were offset partially by the discontinuation of certain billing practices (including the elimination of certain over-limit fees and the two-cycle billing method for calculating finance charges) and a narrower loan spread. Noninterest revenue was $759 million, flat compared with the prior year. Increased net interchange income, which benefited from higher charge volume, was offset by lower net securitization gains. Charge volume growth of 3% reflects an approximate 10% growth rate in sales volume, offset primarily by a lower level of balance transfers, the result of a more targeted marketing effort. For complete details on Chase’s third quarter performance, visit CardData ([www.carddata.com]).
JPM CHASE HISTORICAL ($billions)
3Q/06 4Q/06 1Q/07 2Q/07 3Q/07
EOP Outstandings: $143.8 152.8 146.6 148.0 149.1
Charge Volume: $ 87.5 93.4 81.3 88.0 89.8
Source: CardData (www.carddata.com)