JPMorgan had a perfect year in trading in 2016.
The US bank is hosting its annual investor day Tuesday, February 28, and Daniel Pinto, chief executive of corporate and investment bank at the company, just delivered his presentation.
According to the slide below, the US bank didn’t have a single day of losses in the markets, and generated $US80 million in revenues a day on average, up from $US70 million in 2015. JPMorgan generated around $US21 billion in fixed income and equity sales and trading revenues in 2016. Market volatility was broadly flat, meanwhile.
Pinto said in his presentation that the bank spends a lot of time discussing the appropriate level of risk it should run.
“We need to take the amount of risk necessary to provide liquidity in any kind of market conditions,” he said. “If we try to be smarter, and take a punt to drive excess profitability, we will find ourselves in a bad place.”
The increase in daily markets revenue is a function of increased revenue across just about every business. Flow market-making revenues increased 21% from 2014 to 2016, while financing related revenues increased 24%.
The bank is now a top three player in 31 different business categories, a group of businesses that generate 83% of the revenue pool, according to JPMorgan. Equities, in particular, have been a focus of late, with the bank including a slide in the presentation on growth across prime brokerage, cash equities and equity derivatives.