The first major banks to report, JP Morgan and Wells Fargo debuted a strong start to second quarter earnings as profits soared in their wealth divisions even as the economic recovery remained somewhat volatile the past three months.
Net income at Wells Fargos Wealth, Brokerage and Retirement divisions leapt up 29% from the first quarter and 27% from last year, topping off at a record $434 million. JP Morgans asset management unit, which includes its private bank, retail and institutional services, saw similar results as profits rose 28% year-over-year to $500 million.
Wells Fargo achieved outstanding results for the second quarter, with our diluted EPS growing for the 14th consecutive quarter and our returns on assets and equity increasing from second quarter 2012 and first quarter 2013, the firms chairman and CEO John Stumpf, said in a statement. Wells Fargo against demonstrated an ability to grow during a dynamic economic and interest rate environment.
Client assets and headcount were relatively flat for the wealth management unit (excluding the retail brokerage and retirement divisions). Total assets in the wealth management unit rose 3% last year to $203 billion. The number of financial advisors fell 1% from last quarter to 15,268. The firm said that it had swung a profit thanks in large part to strong growth in asset-based fees and increased brokerage transaction revenue.
JP Morgans private banking operation reported revenue had risen 11% year-over-year to $1.5 billion. Client assets were up 12% from the second quarter last year, topping off at $910 billion. Advisor headcount had remained relatively flat, rising by seven to 2,804.
Our earnings reflected strong performance across our businesses, JP Morgans chairman and CEO Jamie Dimon said in a statement. And notably, Asset Management had $25 billion of net long-term client flows, the seventeenth consecutive quarter of positive net long-term client flows.