JPMorgan raises 2024 interest income forecast to $91 billion

NEW YORK (Reuters) -JPMorgan Chase on Monday raised its forecast for net interest income (NII), or the difference between what it makes on loans and pays out on deposits, to $91 billion, excluding the markets division.

Shares of the bank rose about 1% in premarket trading ahead of the bank’s investor day event scheduled to kick off in New York later in the morning.

JPMorgan’s previous forecasts for NII had disappointed analysts as they were expecting the bank to reap greater benefits from persistently higher interest rates.

The lender boosted its NII forecast in April to $89 billion, from an earlier $88 billion, excluding the markets division. At the time, including trading, the company had kept its NII forecast unchanged at $90 billion.

JPMorgan acquired billions in loans after it bought the collapsed First Republic Bank last May. The purchase fueled interest income and helped propel profits to a record.

Chief Financial Officer Jeremy Barnum had tempered NII expectations for months, saying the gains were not sustainable.

With JPMorgan coming off a year of record profits, investors are eager to learn about the firm’s succession plans, investments in artificial intelligence and opportunities beyond traditional banking.

Dimon, 68, has run JPMorgan for more than 18 years, outlasting many other CEOs in the banking industry. Also, several executives, who served under Dimon, have gone on to run other major financial institutions, making his succession plans a longtime object of speculation.

Dimon said last year that he could step down in 3.5 years.

JPMorgan’s board recently identified Jennifer Piepszak and Troy Rohrbaugh, the co-CEOs of its commercial and investment bank, as candidates for the top job. Marianne Lake, CEO of consumer and community banking, and Mary Erdoes, CEO of asset and wealth management, are also in the running.

The stock has risen 20.4% in 2024, outpacing an S&P index of bank shares as well as the broader equity markets. It closed at a record high on Friday.

(Reporting by Nupur Anand in New York and Manya Saini in Benglauru; editing by Lananh Nguyen and Anil D’Silva)