One of the major questions going in to today’s JP Morgan earnings was, what happened to the “London Whale” trading loss that cost the bank billions as of this summer.
During the last earnings report, the losses exploded from $2 billion to $5.8 billion. But this quarter, JP Morgan smashed expectations — so where did the loss go?
The toxic portfolio was moved to the investment bank in July, and according to the bank’s press release, since then it’s become pretty minor:
The portion of the synthetic credit portfolio transferred from the Chief Investment Office in Corporate to the IB on July 2, 2012 experienced a modest loss, which was included in Fixed Income Markets revenue. Credit Portfolio reported net revenue of $90 million.
And take a look at the JP Morgan’s investment banking business in general, you’ll see that the numbers have surged since Q2 and Q3 2011. Check out the table below:
Good on them.