JPMorgan Chase shares plummeted after the bank said expectations for net interest income next year were too high.
JPMorgan Chase shares fell 7% Tuesday after the bank's president told analysts that expectations for net interest income were too optimistic.
The current estimate for NII -- one of the main ways that banks earn money -- of $89.5 billion is too high given expectations for interest rates, JPMorgan president Daniel Pinto told an audience at a financial conference.shares fell 7% Tuesday after the bank's president told analysts that expectations for net interest income in 2025 were too optimistic.While the bank expects to be in the"ballpark" of the 2024 target for NII of about $91.
NII, one of the main ways banks make money, is the difference in the cost of a bank's deposits and what it earns by lending money or investing it in securities. When interest rates decline, new loans made by the bank and new bonds it purchases will yield less. "Clearly, as rates go lower, you have less pressure on repricing of deposits," Pinto said."But as you know, we are quite asset sensitive."Decision 2024
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