Photo: emseearr via flickr
JPMorgan just reported strong earnings for Q2, but this is an interesting line from the announcement:Noninterest expense was $5.6 billion, an increase of $1.4 billion, or 32%, from the prior year, driven by elevated foreclosure and default-related costs, including $1.0 billion for estimated costs of foreclosure-related matters.
That’s a huge, bottom-line killing jump in costs.
It’s exactly what Chris Whalen forecasted earlier this year, when he talked about the surge in operating costs: Whether it’s mowing the lawns, handling the foreclosure process, or warding off people trying to steal the copper pipes in houses, these foreclosures are costing JPMorgan a fortune.
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