Business Segments

6 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

Business segments

Business segments

The Firm is managed on a line of business basis. There are four major reportable business segments – Consumer & Community Banking, Corporate & Investment Bank, Commercial Banking and Asset Management. In addition, there is a Corporate/Private Equity segment. The business segments are determined based on the products and services provided, or the type of customer served, and they reflect the manner in which financial information is currently evaluated by management. Results of these lines of business are presented on a managed basis. For a further discussion concerning JPMorgan Chase’s business segments, see Business Segment Results on page 19 of this Form

10-Q, and pages 84–85 and Note 33 of JPMorgan Chase’s 2013 Annual Report.

Segment results

The accompanying tables provide a summary of the Firm’s segment results for the three and six months ended June 30, 2014 and 2013, on a managed basis. Total net revenue (noninterest revenue and net interest income) for each of the segments is presented on a fully taxable-equivalent (“FTE”) basis. Accordingly, revenue from investments that receive tax credits and tax-exempt securities is presented in the managed results on a basis comparable to taxable investments and securities. This non-GAAP financial measure allows management to assess the comparability of revenue arising from both taxable and tax-exempt sources. The corresponding income tax impact related to tax-exempt items is recorded within income tax expense/(benefit).

Effective January 1, 2014, the Firm revised the capital allocated to certain businesses and will continue to assess the level of capital required for each line of business, as well as the assumptions and methodologies used to allocate capital to the business segments. Further refinements may be implemented in future periods.

Segment results and reconciliation(a)
As of or for the three months ended June 30, (in millions, except ratios)	Consumer & Community Banking						Corporate & Investment Bank						Commercial Banking						Asset Management
	2014			2013			2014			2013			2014			2013			2014			2013
Noninterest revenue	$	4,468		$	4,921		$	6,531		$	7,171		$	577		$	551		$	2,380		$	2,156
Net interest income	6,963			7,094			2,460			2,705			1,124			1,177			576			569
Total net revenue	11,431			12,015			8,991			9,876			1,701			1,728			2,956			2,725
Provision for credit losses	852			(19		)	(84		)	(6		)	(67		)	44			1			23
Noninterest expense	6,456			6,864			6,058			5,742			675			652			2,062			1,892
Income/(loss) before income tax expense/(benefit)	4,123			5,170			3,017			4,140			1,093			1,032			893			810
Income tax expense/(benefit)	1,680			2,081			1,054			1,302			435			411			341			310
Net income/(loss)	$	2,443		$	3,089		$	1,963		$	2,838		$	658		$	621		$	552		$	500
Average common equity	$	51,000		$	46,000		$	61,000		$	56,500		$	14,000		$	13,500		$	9,000		$	9,000
Total assets	447,277			460,642			873,288			873,527			192,523			184,124			128,362			115,157
Return on average common equity	19		%	27		%	13		%	20		%	19		%	18		%	25		%	22		%
Overhead ratio	56			57			67			58			40			38			70			69

As of or for the three months ended June 30, (in millions, except ratios)	Corporate/Private Equity						Reconciling Items(b)						Total
	2014			2013			2014			2013			2014			2013
Noninterest revenue	$	351		$	290		$	(651	)	$	(582	)	$	13,656		$	14,507
Net interest income	(81		)	(676		)	(244		)	(165		)	10,798			10,704
Total net revenue	270			(386		)	(895		)	(747		)	24,454			25,211
Provision for credit losses	(10		)	5			—			—			692			47
Noninterest expense	180			716			—			—			15,431			15,866
Income/(loss) before income tax expense/(benefit)	100			(1,107		)	(895		)	(747		)	8,331			9,298
Income tax expense/(benefit)	(269		)	(555		)	(895		)	(747		)	2,346			2,802
Net income/(loss)	$	369		$	(552	)	$	—		$	—		$	5,985		$	6,496
Average common equity	$	71,159		$	72,283		$	—		$	—		$	206,159		$	197,283
Total assets	878,886			806,044			NA			NA			2,520,336			2,439,494
Return on average common equity	NM			NM			NM			NM			11		%	13		%
Overhead ratio	NM			NM			NM			NM			63			63

Segment results and reconciliation(a)
As of or for the six months ended June 30, (in millions, except ratios)	Consumer & Community Banking						Corporate & Investment Bank						Commercial Banking						Asset Management
	2014			2013			2014			2013			2014			2013			2014			2013
Noninterest revenue	$	7,902		$	9,327		$	12,767		$	14,528		$	1,135		$	1,086		$	4,598		$	4,250
Net interest income	13,989			14,303			4,830			5,488			2,217			2,315			1,136			1,128
Total net revenue	21,891			23,630			17,597			20,016			3,352			3,401			5,734			5,378
Provision for credit losses	1,668			530			(35		)	5			(62		)	83			(8		)	44
Noninterest expense	12,893			13,654			11,662			11,853			1,361			1,296			4,137			3,768
Income/(loss) before income tax expense/(benefit)	7,330			9,446			5,970			8,158			2,053			2,022			1,605			1,566
Income tax expense/(benefit)	2,951			3,771			2,028			2,710			817			805			612			579
Net income/(loss)	$	4,379		$	5,675		$	3,942		$	5,448		$	1,236		$	1,217		$	993		$	987
Average common equity	$	51,000		$	46,000		$	61,000		$	56,500		$	14,000		$	13,500		$	9,000		$	9,000
Total assets	447,277			460,642			873,288			873,527			192,523			184,124			128,362			115,157
Return on average common equity	17		%	25		%	13		%	19		%	18		%	18		%	22		%	22		%
Overhead ratio	59			58			66			59			41			38			72			70

As of or for the six months ended June 30, (in millions, except ratios)	Corporate/Private Equity						Reconciling Items(b)						Total
	2014			2013			2014			2013			2014			2013
Noninterest revenue	$	875		$	651		$	(1,295	)	$	(1,146	)	$	25,982		$	28,696
Net interest income	(237		)	(1,270		)	(470		)	(327		)	21,465			21,637
Total net revenue	638			(619		)	(1,765		)	(1,473		)	47,447			50,333
Provision for credit losses	(21		)	2			—			—			1,542			664
Noninterest expense	14			718			—			—			30,067			31,289
Income/(loss) before income tax expense/(benefit)	645			(1,339		)	(1,765		)	(1,473		)	15,838			18,380
Income tax expense/(benefit)	(64		)	(1,037		)	(1,765		)	(1,473		)	4,579			5,355
Net income/(loss)	$	709		$	(302	)	$	—		$	—		$	11,259		$	13,025
Average common equity	$	68,989		$	71,016		$	—		$	—		$	203,989		$	196,016
Total assets	878,886			806,044			NA			NA			2,520,336			2,439,494
Return on average common equity	NM			NM			NM			NM			11		%	13		%
Overhead ratio	NM			NM			NM			NM			63			62

(a) Managed basis starts with the reported U.S. GAAP results and includes certain reclassifications that do not have any impact on net income as reported by the lines of business or by the Firm as a whole.

(b) Segment managed results reflect revenue on a FTE basis with the corresponding income tax impact recorded within income tax expense/(benefit). These FTE adjustments are eliminated in reconciling items to arrive at the Firm’s reported U.S. GAAP results.