8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported):  January 17, 2007

JPMORGAN CHASE & CO.

(Exact name of registrant as specified in its charter)

Delaware	1-5805	13-2624428
(State or Other Jurisdiction of	(Commission File Number)	(IRS Employer
Incorporation)		Identification No.)
270 Park Avenue, New York, NY		10017
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (212) 270-6000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EX-12.1: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

EX-12.2: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS

EX-99.1: EARNINGS RELEASE - FOURTH QUARTER 2006 RESULTS

EX-99.2: EARNINGS RELEASE FINANCIAL SUPPLEMENT - FOURTH QUARTER 2006

Item 2.02 Results of Operations and Financial Condition

On January 17, 2007, JPMorgan Chase & Co. (“JPMorgan Chase” or the “Firm”) reported 2006 fourth quarter net income of $4.5 billion, or $1.26 per share, compared with net income of $2.7 billion, or $0.76 per share, for the fourth quarter of 2005. A copy of the 2006 fourth quarter earnings release is attached hereto as Exhibit 99.1, and a copy of the earnings release financial supplement is attached hereto as Exhibit 99.2.

Each of the Exhibits provided with this Form 8-K shall be deemed to be “filed” for purposes of the Securities Exchange Act of 1934, as amended.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits

Exhibit Number	Description of Exhibit
12.1	JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges
12.2	JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividend Requirements
99.1	JPMorgan Chase & Co. Earnings Release – Fourth Quarter 2006 Results
99.2	JPMorgan Chase & Co. Earnings Release Financial Supplement – Fourth Quarter 2006

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of JPMorgan Chase’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. Factors that could cause JPMorgan Chase’s results to differ materially from those described in the forward-looking statements can be found in the Firm’s Quarterly Reports on Form 10-Q for the quarters ended September 30, 2006, June 30, 2006 and March 31, 2006 (as amended), and in the 2005 Annual Report on Form 10-K for the year ended December 31, 2005 (as amended), filed with the Securities and Exchange Commission and available at the Securities and Exchange Commission’s Internet site (http://www.sec.gov).

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

JPMORGAN CHASE & CO.                (Registrant)
By:	/s/ Louis Rauchenberger
	Louis Rauchenberger
Managing Director and Controller  [Principal Accounting Officer]

Dated: January 17, 2007

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EXHIBIT INDEX

Exhibit Number	Description of Exhibit
12.1	JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges
12.2	JPMorgan Chase & Co. Computation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividend Requirements
99.1	JPMorgan Chase & Co. Earnings Release – Fourth Quarter 2006 Results
99.2	JPMorgan Chase & Co. Earnings Release Financial Supplement – Fourth Quarter 2006

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EX-12.1

EXHIBIT 12.1

JPMORGAN CHASE & CO.

Computation of Ratio of Earnings to Fixed Charges

Year ended December 31, (in millions, except ratios)	2006
Excluding Interest on Deposits
Income from continuing operations before income taxes	$	19,886
Fixed charges:
Interest expense		20,823
One-third of rents, net of income from subleases (a)		357
Total fixed charges		21,180
Less: Equity in undistributed income of affiliates		(152	)
Income from continuing operations before income taxes and fixed charges, excluding capitalized interest	$	40,914
Fixed charges, as above	$	21,180
Ratio of earnings to fixed charges		1.93
Including Interest on Deposits
Fixed charges, as above	$	21,180
Add: Interest on deposits		17,042
Total fixed charges and interest on deposits	$	38,222
Income from continuing operations before income taxes and fixed charges, excluding capitalized interest, as above	$	40,914
Add: Interest on deposits		17,042
Total income from continuing operations before income taxes, fixed charges and interest on deposits	$	57,956
Ratio of earnings to fixed charges		1.52

(a) The proportion deemed representative of the interest factor.

EX-12.2

EXHIBIT 12.2

JPMORGAN CHASE & CO.

Computation of Ratio of Earnings to Fixed Charges
and Preferred Stock Dividend Requirements

Year ended December 31, (in millions, except ratios)	2006
Excluding Interest on Deposits
Income from continuing operations before income taxes	$	19,886
Fixed charges:
Interest expense		20,823
One-third of rents, net of income from subleases (a)		357
Total fixed charges		21,180
Less: Equity in undistributed income of affiliates		(152	)
Income from continuing operations before income taxes and fixed charges, excluding capitalized interest	$	40,914
Fixed charges, as above	$	21,180
Preferred stock dividends (pre-tax)		6
Fixed charges including preferred stock dividends	$	21,186
Ratio of earnings to fixed charges and preferred stock dividend requirements		1.93
Including Interest on Deposits
Fixed charges including preferred stock dividends, as above	$	21,186
Add: Interest on deposits		17,042
Total fixed charges including preferred stock dividends and interest on deposits	$	38,228
Income from continuing operations before income taxes and fixed charges, excluding capitalized interest, as above	$	40,914
Add: Interest on deposits		17,042
Total income from continuing operations before income taxes, fixed charges and interest on deposits	$	57,956
Ratio of earnings to fixed charges and preferred stock dividend requirements		1.52

(a) The proportion deemed representative of the interest factor.

EX-99.1

JPMorgan Chase & Co.
270 Park Avenue, New York, NY 10017-2070
NYSE symbol: JPM

Exhibit 99.1

www.jpmorganchase.com

News release: IMMEDIATE RELEASE

JPMORGAN CHASE REPORTS RECORD QUARTERLY INCOME FROM
CONTINUING OPERATIONS OF $3.9 BILLION, OR $1.09 PER SHARE, ON RECORD
REVENUE OF $16.1 BILLION;

RECORD FULL-YEAR 2006 INCOME FROM CONTINUING OPERATIONS OF $13.6
BILLION, OR $3.82 PER SHARE, ON RECORD REVENUE OF $61.4 BILLION;

CONTINUING OPERATIONS EXCLUDES AFTER-TAX GAIN OF $622 MILLION, OR $0.17
PER SHARE, RELATED TO EXCHANGE OF CORPORATE TRUST BUSINESS

• Investment Bank generates strong earnings growth on record revenue

• Asset Management produces record revenue and earnings; assets under management exceed $1 trillion

• Commercial Banking generates record revenue on strong deposit and loan growth

• Income from continuing operations includes $359 million, or $0.10 per share, of tax audit benefits

New York, January 17, 2007 – JPMorgan Chase & Co. (NYSE: JPM) today reported 2006 fourth-quarter net income of $4.5 billion, or $1.26 per share, compared with net income of $2.7 billion, or $0.76 per share, for the fourth quarter of 2005. Reported results include a $622 million after-tax gain related to exiting the corporate trust business in the fourth quarter of 2006. Income from continuing operations was $3.9 billion, or $1.09 per share, in the current quarter compared with $2.6 billion, or $0.74 per share, for the fourth quarter of 2005. Current-quarter results also include $359 million of benefits related to tax audit resolutions and after-tax merger expense of $62 million.

Jamie Dimon, Chairman and Chief Executive Officer, said, “During the fourth quarter, we posted both record revenue and income from continuing operations, reflecting increasingly strong results across most of our businesses, especially in investment banking, where fees were at a record level and markets results improved significantly from the prior year. Corporate segment results also continued to improve. Overall in 2006 we achieved a number of important milestones: we successfully completed the New York Tri-state consumer conversion as well as many other key integration projects; we announced and closed the exchange of our corporate trust business for the consumer and middle-market franchise of The Bank of New York; and we continued to invest in and grow each of our businesses.”

Commenting on 2007, Dimon added, “The firm is focused on driving improvement in performance through both continued cost discipline and investment in all areas of our franchise; converting and integrating The Bank of New York branches; and completing the wholesale deposit conversion, which is the last significant integration activity related to the Bank One merger.”

Investor Contact: Julia Bates	Media Contact: Joe Evangelisti
(212) 270-7318	(212) 270-7438

JPMorgan Chase & Co.
News Release

In the discussion below of the business segments and JPMorgan Chase, information is presented on a managed basis. Managed basis starts with GAAP results and includes the following adjustments: for Card Services and the firm as a whole, the impact of credit card securitizations is excluded; and for each line of business and the firm as a whole, net revenue is shown on a tax-equivalent basis. For more information about managed basis, as well as other non-GAAP financial measures used by management to evaluate the performance of each line of business, see Notes 1 and 2 (page 14).

The following discussion compares the fourth quarter of 2006 with the fourth quarter of 2005 unless otherwise noted.

INVESTMENT BANK (IB)

Results for IB								3Q06					4Q05
($ millions)	4Q06		3Q06		4Q05			$ O/(U)			O/(U) %		$ O/(U)		O/(U) %
Net Revenue		$ 4,721		$ 4,673		$ 3,195			$    48			1%		$ 1,526		48%
Provision for Credit Losses		63		7		(83	)		56		NM			146	NM
Noninterest Expense		3,066		3,101		2,163			(35	)		(1)		903		42
Net Income		$ 1,009		$    976		$    667			$    33			3%		$    342		51%

Discussion of Results:

Net income of $1.0 billion increased by $342 million, or 51%, compared with the prior year. Earnings growth reflected record revenue, primarily offset by higher expense and the lack of a benefit from the provision for credit losses. Compared with the prior quarter, net income increased by $33 million, or 3%, reflecting higher revenue and lower expense, primarily offset by a higher provision for credit losses.

Net revenue was $4.7 billion, up 48% from the prior year, driven by record investment banking fees and improved markets results. Investment banking fees of $1.6 billion were up 36% from the prior year driven by debt underwriting and advisory fees, both of which were at record levels. Debt underwriting fees of $771 million were up 51% driven by record loan syndication and strong bond underwriting fees. Advisory fees of $482 million were up 41%, which reflected strength across regions. Both debt underwriting and advisory performance benefited from high levels of corporate and financial sponsor activity in the quarter. Equity underwriting fees of $327 million were up 5% reflecting strength in common stock offerings in Europe and the Americas. Fixed Income Markets revenue of $2.0 billion was up 77% from a weak prior-year quarter with improved performance in credit markets, currencies, and emerging markets, partially offset by lower results in securitized products. Compared with the prior quarter, Fixed Income Markets were down 17% from a strong prior quarter due to weaker commodities. Equity Markets revenue of $909 million nearly doubled from the prior year on strength in cash equities and equity derivatives and reflected strong performance across regions. Credit Portfolio revenue of $263 million was down 43%, largely reflecting lower gains from loan workouts.

Provision for credit losses was $63 million for the quarter compared with a benefit of $83 million in the prior year. The current-period provision continues to reflect portfolio activity. Credit quality remained stable.

Noninterest expense was $3.1 billion, up by $903 million, or 42%, from the prior year. This increase was due primarily to higher performance-based compensation.

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JPMorgan Chase & Co.
News Release

Highlights Include:

§	Ranked #1 in Investment Banking Fees for full-year 2006 based upon revenue, according to Dealogic.
§	Ranked #2 in Announced M&A in the Europe, Middle East and Africa region based upon volume, according to Dealogic.
§	Named Risk magazine’s 2006 Energy House of the Year and IFR Global Interest Rates and Commodities House of the Year.
§	Total average loans of $84.7 billion were up by $20.9 billion, or 33%, from the prior year and down by $1.0 billion, or 1%, from the prior quarter. Average loans retained of $60.9 billion were up by $12.5 billion, or 26%, from the prior year and down by $0.7 billion, or 1%, from the prior quarter. Average loans held-for-sale of $23.7 billion were up by $8.4 billion, or 54%, from the prior year and down by $0.3 billion, or 1%, from the prior quarter.
§	Allowance for loan losses to average loans was 1.73% for the current quarter, down from 1.87% in the prior year; nonperforming assets were $269 million, down 58% from the prior year and down 41% from the prior quarter.
§	Return on Equity was 19% on $21 billion of allocated capital.

RETAIL FINANCIAL SERVICES (RFS)

Results for RFS							3Q06					4Q05
($ millions)	4Q06		3Q06		4Q05		$ O/(U)			O/(U) %		$ O/(U)			O/(U) %
Net Revenue		$ 3,728		$ 3,555		$ 3,594		$  173			5%		$   134			4%
Provision for Credit Losses		262		114		158		148			130		104			66
Noninterest Expense		2,291		2,139		2,141		152			7		150			7
Net Income		$    718		$    746		$    803		($    28	)		(4)%		($     85	)		(11)%

Discussion of Results:

Net income of $718 million was down by $85 million, or 11%, from the prior year. Results were impacted by the following items, which are all reported in the Regional Banking segment: a current quarter pre-tax net loss of $215 million compared with a prior year pre-tax net loss of $120 million due to mortgage loans transferred to held-for-sale; the acquisition of The Bank of New York’s consumer banking business on October 1, 2006; and the absence of the insurance business, which was sold on July 1, 2006.

Net revenue of $3.7 billion was up by $134 million, or 4%, from the prior year. Net interest income of $2.6 billion was up 4% due to The Bank of New York transaction and the acquisition of Collegiate Funding Services, higher deposit and home equity loan balances in Regional Banking, and wider loan spreads in Auto Finance. These benefits were offset partially by the sale of the insurance business in the third quarter of 2006, lower auto loan and lease balances, and narrower spreads on deposits and loans in Regional Banking. Noninterest revenue of $1.1 billion was up by $36 million, or 3%, including the impact in Regional Banking of a $233 million current-quarter loss, compared with a $120 million prior-year loss, both related to mortgage loans transferred to held-for-sale. Results benefited from increases in deposit-related and branch production fees, higher automobile operating lease revenue and The Bank of New York transaction. These benefits were offset partially by the sale of the insurance business.

The provision for credit losses of $262 million was up by $104 million from the prior year, primarily due to the establishment of additional allowance for loan losses related to loans acquired from The Bank of New York, increased net charge-offs (reflecting portfolio seasoning

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JPMorgan Chase & Co.
News Release

and some deterioration in subprime mortgage) and a change in the timing of loss recognition in Auto Finance.

Noninterest expense of $2.3 billion was up 7%, primarily due to The Bank of New York transaction and the acquisition of Collegiate Funding Services, investments in the retail distribution network and higher depreciation expense on owned automobiles subject to operating leases. These increases were offset partially by the sale of the insurance business.

Regional Banking net income of $619 million was down by $50 million from the prior year. Net revenue of $2.9 billion was up by $105 million, or 4%, including the impact of a $233 million current-quarter loss resulting from $13.3 billion of mortgage loans transferred to held-for-sale, compared with a prior-year loss of $120 million resulting from $3.3 billion of mortgage loans transferred to held-for-sale. Results benefited from The Bank of New York transaction; the acquisition of Collegiate Funding Services; growth in deposits and home equity loans; and increases in deposit-related fees, investment sales and credit card sales. These benefits were offset partially by the sale of the insurance business, a shift to narrower-spread deposit products, and narrower spreads on mortgages. The provision for credit losses was $165 million, up by $78 million, primarily due to additional allowance for loan losses related to the acquisition of loans from The Bank of New York and increased net charge-offs due to portfolio seasoning and some deterioration in subprime mortgage. Noninterest expense of $1.7 billion was up by $94 million, or 6%, from the prior year. The increase was due to The Bank of New York transaction, the acquisition of Collegiate Funding Services and investments in the retail distribution network, partially offset by the sale of the insurance business.

Highlights Include:

§	Checking accounts of 10.0 million were up by 1.2 million, or 14%, from the prior year, and up by 725,000, or 8%, from the prior quarter. Total checking accounts included approximately 615,000 accounts acquired from The Bank of New York.
§	Average total deposits increased to $200.7 billion, up 13% from the prior year and 7% from the prior quarter. Excluding approximately $11.5 billion of deposit balances acquired from The Bank of New York, average total deposits increased 7% from the prior year and 1% from the prior quarter.
§	Number of branches increased to 3,079, up by 438 from the prior year and 402 from the prior quarter, including 339 acquired from The Bank of New York.
§	Branch sales of credit cards increased 49% from the prior year and decreased 7% from a strong prior-quarter level.
§	Branch sales of investments products increased 56% from the prior year and 16% from the prior quarter.
§	Business Banking loan originations of $1.5 billion were up 28% from the prior year and 11% from the prior quarter.
§	Overhead ratio (excluding amortization of core deposit intangibles) increased to 55%; excluding the $233 million mark-to-market on mortgage loans transferred to held-for-sale, the overhead ratio was 51%.
§	Average home equity loans of $84.2 billion were up by $11.5 billion from the prior year; period-end home equity loans were $85.7 billion.
§	Net charge-off rate was 0.37%, up from 0.25% in the prior year.

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JPMorgan Chase & Co.
News Release

Mortgage Banking net income was $34 million compared with $63 million in the prior year. Net revenue of $410 million was down by $14 million, or 3%, from the prior year. Revenue comprises production revenue and net mortgage servicing revenue. Production revenue was $215 million, up by $81 million, reflecting increased loan sales and wider gain on sale margins that benefited from a shift in the sales mix. Net mortgage servicing revenue, which includes loan servicing revenue, MSR risk management results and other changes in fair value, was $195 million, compared with $290 million in the prior year. Loan servicing revenue of $598 million increased by $52 million on a 13% increase in third-party loans serviced. MSR risk management revenue of negative $31 million declined by $84 million from the prior year and reflected a fully hedged position. Other changes in fair value of the MSR asset, representing run-off of the asset against the realization of servicing cash flows, were negative $372 million. Noninterest expense was $354 million, up by $29 million, or 9%, primarily due to higher compensation expense related to an increase in the number of loan officers.

Highlights Include:

§	Mortgage loan originations of $31.0 billion were down 3% from the prior year and up 9% from the prior quarter.
§	Total third-party mortgage loans serviced were $526.7 billion, an increase of $59.2 billion, or 13%, from the prior year.

Auto Finance net income of $65 million was down by $6 million from the prior year. Net revenue of $411 million was up by $43 million, or 12%, reflecting higher automobile operating lease revenue and wider loan spreads on lower loan and direct finance lease balances. The provision for credit losses of $97 million increased by $26 million, primarily the result of a change in the timing of recognition of bankruptcy-related credit losses for auto loans. Noninterest expense of $207 million increased by $27 million, or 15%, driven by increased depreciation expense on owned automobiles subject to operating leases.

Highlights Include:

§	Average loan receivables were $38.7 billion, down by $3.9 billion, or 9%, from the prior year and down by $0.2 billion, or 1%, from the prior quarter.
§	Average lease-related assets of $3.4 billion declined by $2.1 billion, or 38%, from the prior year.
§	The net charge-off rate was 0.75%, compared with 0.66% in the prior year.

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JPMorgan Chase & Co.
News Release

CARD SERVICES (CS)

Results for CS							3Q06					4Q05
($ millions)	4Q06		3Q06		4Q05		$ O/(U)		O/(U) %			$ O/(U)			O/(U) %
Net Revenue		$ 3,750		$ 3,646		$ 3,721		$ 104		3	%		$     29			1	%
Provision for Credit Losses		1,281		1,270		2,236		11		1			(955	)		(43	)
Noninterest Expense		1,341		1,253		1,017		88		7			324			32
Net Income		$    719		$    711		$    302		$     8		1	%		$   417			138	%

Discussion of Results:

Net income of $719 million was up by $417 million from the prior year. Results were driven by a lower provision for credit losses due to significantly lower bankruptcy filings.

End-of-period managed loans of $152.8 billion increased by $10.6 billion, or 7%, from the prior year and by $9.0 billion, or 6%, from the prior quarter. Average managed loans of $147.4 billion increased by $8.5 billion, or 6%, from the prior year and by $5.7 billion, or 4%, from the prior quarter. The current quarter included loans acquired with the Sears Canada credit card business, which closed in the fourth quarter of 2005 (loan balances include $2.1 billion of average managed loans in the current quarter and $1.2 billion of average managed loans in the prior year), and loans acquired with the Kohl’s private label portfolio, which closed in the second quarter of 2006 (loan balances include $2.0 billion of average and $2.5 billion of end-of-period managed loans in the current quarter). Compared with the prior year, both average managed and end-of-period managed loans continued to be affected negatively by higher customer payment rates. Management believes that contributing to the higher payment rates are the new minimum payment rules and a higher proportion of customers in rewards-based programs. Compared with the prior quarter, payment rates have declined slightly.

Net managed revenue was $3.8 billion, up by $29 million, or 1%, from the prior year. Net interest income of $2.9 billion was up by $92 million, or 3%. The increase in net interest income was driven by an increase in average managed loan balances, higher fees and lower revenue reversals associated with lower charge-offs. These increases were offset primarily by higher cost of funds on balance growth in promotional, introductory and transactor loan balances, which increased due to continued investment in marketing. Noninterest revenue of $808 million was down by $63 million, or 7%. Interchange income increased, benefiting from 17% higher charge volume, but was more than offset by higher volume-driven payments to partners, including Kohl’s, and increased rewards expense (both of which are netted against interchange income).

The managed provision for credit losses was $1.3 billion, down by $955 million, or 43%, from the prior year. This benefit was due to a significant decrease in net charge-offs, reflecting the continued low level of bankruptcy losses, partially offset by increased contractual net charge-offs. Compared with the prior quarter, the managed provision for credit losses was relatively flat. The managed net charge-off rate for the quarter was 3.45%, down from 6.39% in the prior year and 3.58% in the prior quarter. The 30-day managed delinquency rate was 3.13%, up from 2.79% in the prior year, but down slightly from 3.17% in the prior quarter.

Noninterest expense of $1.3 billion was up by $324 million, or 32%, from the prior year due largely to higher marketing spending and recent acquisitions.

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JPMorgan Chase & Co.
News Release

Highlights Include:

§	Pre-tax income to average managed loans (ROO) was 3.04%, up from 1.34% in the prior year, but down from 3.14% in the prior quarter.
§	Net interest income as a percentage of average managed loans was 7.92%, down from 8.14% in the prior year and 8.07% in the prior quarter.
§	Net accounts opened during the quarter were 14.4 million, including approximately 9 million from the acquisitions of the BP and Pier 1 Imports, Inc. private label portfolios.
§	Charge volume of $93.4 billion increased by $13.8 billion, or 17%, from the prior year.
§	Merchant processing volume of $177.9 billion increased by $24.5 billion, or 16%, and total transactions of 5.0 billion increased by 653 million, or 15%, from the prior year.
§	Completed the acquisitions of the BP and Pier 1 Imports, Inc. private label portfolios, with approximately $600 million and $140 million of receivables, respectively.
§	Signed several new relationships with partners, including Marriott Rewards in Canada; and renewed partner relationships, including University of Maryland and Virginia Tech.

COMMERCIAL BANKING (CB)

Results for CB								3Q06							4Q05
($ millions)	4Q06		3Q06		4Q05				$ O/(U)			O/(U) %				$ O/(U)			O/(U) %
Net Revenue	$	1,018	$	933	$	916			$	85			9	%		$	102			11	%
Provision for Credit Losses		111		54		(17	)			57			106				128		NM
Noninterest Expense		485		500		476				(15	)		(3	)			9			2
Net Income	$	256	$	231	$	279			$	25			11	%		(	$23	)		(8	)%

Discussion of Results:

Net income of $256 million was down by $23 million, or 8%, from the prior year, driven by an increase in provision for credit losses, largely offset by record net revenue. Results for the current quarter include the impact of the acquisition of The Bank of New York’s middle-market business.

Record net revenue was $1.0 billion, up by $102 million, or 11%, from the prior year. Net interest income was $708 million, up by $46 million, or 7%, due to higher liability balances and loan volumes, which benefited from organic growth and The Bank of New York transaction. These benefits were offset primarily by a shift to narrower-spread liability products and loan-spread compression. Noninterest revenue of $310 million was up by $56 million, or 22%, partially due to record investment banking revenue.

On a segment basis, Middle Market Banking revenue of $661 million increased by $53 million, or 9%, from the prior year, due to growth across all product areas and The Bank of New York transaction. Mid-Corporate Banking revenue of $198 million increased by $50 million, or 34%, reflecting record investment banking revenue. Real Estate revenue of $120 million decreased by $2 million, or 2%.

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JPMorgan Chase & Co.
News Release

Provision for credit losses was $111 million compared with a benefit of $17 million in the prior year. The increase in provision was due largely to portfolio activity and the establishment of additional allowance for loan losses related to loans acquired from The Bank of New York. Net charge-offs remained stable.

Noninterest expense was $485 million, up by $9 million, or 2%, from the prior year, largely due to The Bank of New York transaction.

Highlights Include:

§	Completed The Bank of New York transaction, which added approximately 2,000 clients.
§	Overhead ratio was 48%.
§	Average loan and lease balances of $57.7 billion were up by $7.6 billion, or 15%, from the prior year, and up by $4.3 billion, or 8%, from the prior quarter. Current period includes approximately $2.3 billion of loans acquired from The Bank of New York.
§	Average liability balances of $79.1 billion were up by $10.2 billion, or 15%, from the prior year, and up by $7.0 billion, or 10%, from the prior quarter. Current period includes approximately $1.2 billion of liability balances acquired from The Bank of New York.
§	Nonperforming loans decreased by $151 million, or 56%, from the prior year, and decreased by $36 million, or 23%, from the prior quarter. The allowance for loan losses to average loans was 2.67% compared with 2.79% in the prior year.

TREASURY & SECURITIES SERVICES (TSS) ^(a)

Results for TSS							3Q06						4Q05
($ millions)	4Q06		3Q06		4Q05			$ O/(U)		O/(U) %				$ O/(U)		O/(U) %
Net Revenue	$	1,537	$	1,499	$	1,436		$	38		3	%		$	101		7	%
Noninterest Expense		1,104		1,064		997		$	40		4	%			107		11
Net Income	$	256	$	256	$	254			—		—			$	2		1	%

(a) Selected corporate trust businesses, previously reported in Treasury & Securities Services, were sold to The Bank of New York on October 1, 2006. These businesses have been deemed discontinued operations, and the related balance sheet and income statement activity has been transferred to the Corporate segment for all periods presented.

Discussion of Results:^{(see note (a) above)}

Net income was $256 million, up by $2 million, or 1%, from the prior year. Earnings benefited from increased revenue offset by higher compensation expense.

Net revenue was $1.5 billion, up by $101 million, or 7%, from the prior year. Noninterest revenue was $1.0 billion, up by $89 million, or 9%. The improvement was due largely to an increase in assets under custody to $13.9 trillion, which was driven by market value appreciation and new business. Also contributing to the improvement was growth in ADRs, securities lending and global clearing, all of which were driven by a combination of increased product usage by existing clients and new business. Net interest income was $501 million, up by $12 million, or 2%, from the prior year, benefiting from a 19% increase in average liability balances, primarily offset by the impact of growth in narrower-spread liability products.

8

JPMorgan Chase & Co.
News Release

Treasury Services net revenue of $700 million was up by $13 million, or 2%, from the prior year. Worldwide Securities Services net revenue of $837 million was up by $88 million, or 12%. TSS firmwide net revenue, which includes Treasury Services net revenue recorded in other lines of business, grew to $2.2 billion, up by $141 million, or 7%. Treasury Services firmwide net revenue grew to $1.3 billion, up by $53 million, or 4%.

Noninterest expense was $1.1 billion, up by $107 million, or 11%. The increase was due largely to higher compensation expense related to growth in headcount supporting increased client activity, business growth and investment in new product platforms.

Highlights Include:

§	Pre-tax margin(2) was 26%, down from 28% in the prior year and down from 27% in the prior quarter.
§	Average liability balances were $193 billion, an increase of 19%.
§	Assets under custody increased to $13.9 trillion, up 30%.
§	U.S. dollar ACH transactions originated increased 18%, and U.S. dollar clearing volumes increased 8%.
§	New client relationships and Treasury Services product launches included:

°	Appointed successor depositary bank for the ADR program for Petrobras, Brazil’s largest integrated energy company.
°	New outsourcing arrangement with South Africa’s Old Mutual Asset Managers’ investment administration operations.
°	Selected provider of Global Custody & Asset Servicing for the New Employees Retirement System of Texas.
°	Expansion of international image deposit network for U.S. dollar cash letters.
°	First connectivity with the new SWIFTNet Trade Services Utility (TSU).

ASSET MANAGEMENT (AM)

Results for AM									3Q06						4Q05
($ millions)	4Q06		3Q06			4Q05				$ O/(U)		O/(U) %				$ O/(U)		O/(U) %
Net Revenue	$	1,947	$	1,636		$	1,511			$	311		19	%		$	436		29	%
Provision for Credit Losses		14		(28	)		(10	)			42	NM					24	NM
Noninterest Expense		1,284		1,115			1,033				169		15				251		24
Net Income	$	407	$	346		$	342			$	61		18	%		$	65		19	%

Discussion of Results:

Net income was a record $407 million, up by $65 million, or 19%, from the prior year. Improved results were due to increased revenue offset primarily by higher compensation expense and the absence of a tax credit recognized in the prior year.

Net revenue was a record $1.9 billion, up by $436 million, or 29%, from the prior year. Noninterest revenue, principally fees and commissions, of $1.7 billion was up by $448 million, or 36%. This increase was due largely to increased assets under management and higher performance fees. Net interest income was $246 million, down by $12 million, or 5%, from the prior year, primarily due to both the sale of BrownCo in the fourth quarter of 2005 and a shift to narrower-spread deposit products, partially offset by higher loan and deposit balances.

9

JPMorgan Chase & Co.
News Release

Institutional revenue grew 55%, to $624 million, due to net asset inflows and performance fees. Retail revenue grew 29%, to $541 million, primarily due to market appreciation, net asset inflows and performance fees. Private Bank revenue grew 21%, to $528 million, due to higher asset management and placement fees, and deposit balances, partially offset by narrower spreads on deposits. Private Client Services revenue increased 1%, to $254 million, as increased revenue from higher assets under management was offset by narrower spreads on deposits and loans.

Assets under supervision were $1.3 trillion, up 17%, or $198 billion, from the prior year. Assets under management were $1.0 trillion, up 20%, or $166 billion, from the prior year. The increase was the result of net asset inflows in the retail segment, primarily in equity-related products; institutional flows, primarily in liquidity products; and market appreciation. Custody, brokerage, administration and deposit balances were $334 billion, up by $32 billion.

Provision for credit losses was $14 million, compared with a benefit of $10 million in the prior year.

Noninterest expense of $1.3 billion was up by $251 million, or 24%, from the prior year. The increase was due to higher compensation, increased minority interest expense related to Highbridge Capital Management, partially offset by the absence of BrownCo.

Highlights Include:

§	Pre-tax margin(2) was 33%, up from 32% in the prior year.
§	Assets under Supervision were $1.3 trillion, up 17%, or $198 billion, from the prior year.
§	Assets under Management were $1.0 trillion, up 20%, or $166 billion, from the prior year, including growth of 35%, or $26 billion, in alternative assets.
§	Assets under Management net inflows were $30 billion for fourth-quarter 2006 and $89 billion for 2006.
§	Average loans of $28.9 billion were up by $4.3 billion, or 17%, from the prior year, excluding the $2.0 billion reduction in average loans from the sale of BrownCo in the fourth quarter of 2005.
§	Average deposits of $51.3 billion were up by $9.1 billion, or 22%, from the prior year, excluding the $2.0 billion reduction in average deposits from the sale of BrownCo in the fourth quarter of 2005.
§	Acquired CCA Strategies LLC, an employee benefits and compensation consulting firm, which extends the firm’s retirement services capabilities.

10

JPMorgan Chase & Co.
News Release

CORPORATE

Results for Corporate										3Q06							4Q05
($ millions)	4Q06			3Q06			4Q05				$ O/(U)			O/(U) %				$ O/(U)			O/(U) %
Net Revenue	$	194		$	287		$	386			($	93	)		(32	)%		($	192	)		(50	)%
Provision for Credit Losses		(2	)		1			—				(3	)	NM					(2	)	NM
Noninterest Expense		175			479			603				(304	)		(63	)%			(428	)		(71	)%
Income (Loss) from Continuing Operations		541			(34	)		(5	)			575		NM					546		NM
Income from Discontinued Operations (after-tax) (a)		620			65			56				555		NM					564		NM
Net Income	$	1,161		$	31		$	51			$	1,130		NM				$	1,110		NM

(a) Discontinued operations include the related balance sheet and income statement activity of selected corporate trust businesses sold to The Bank of New York on October 1, 2006. Prior to the second quarter of 2006, these corporate trust businesses were reported in Treasury & Securities Services.

Discussion of Results:^{(see note (a) above)}

Net income was $1.2 billion compared with $51 million in the prior year. Current quarter results include a $622 million after-tax gain related to the sale of selected corporate trust businesses and the benefit of $359 million of tax audit resolutions, while prior-year results include a $752 million after-tax gain on the sale of BrownCo. In comparison with the prior year, Private Equity earnings were $136 million, up from $121 million; Treasury net loss was $11 million compared with a net loss of $575 million; Other Corporate net income was $416 million, compared with net income of $449 million (Other Corporate results include the tax credits in the current quarter and the gain on the sale of BrownCo in the prior year); and earnings from Discontinued Operations were $620 million, compared with $56 million, reflecting the gain on the sale of selected corporate trust businesses.

Net revenue was $194 million compared with $386 million in the prior year. Net interest income was negative $87 million compared with negative $655 million in the prior year. Treasury was the primary driver of the improvement, with net interest income of $96 million compared with negative $391 million, benefiting from an improved net interest spread and an increase in the available-for-sale securities portfolio. Noninterest revenue was $281 million compared with $1.0 billion in the prior year. This decline reflects both the absence of the $1.3 billion gain on the sale of BrownCo and securities losses of $547 million in the prior year.

Noninterest expense was $175 million, down from $603 million in the prior year, and down from $479 million in the prior quarter. Insurance recoveries related to certain material litigation were $137 million in the current period, $208 in the prior year and $17 million in the prior quarter. Merger costs of $100 million were incurred in the current quarter, $77 million in the prior year and $48 million in the prior quarter. Prior-year expense also included a $145 million cost due to the accelerated vesting of stock options.

Discontinued operations include the related balance sheet and income statement activity of selected corporate trust businesses sold to The Bank of New York on October 1, 2006. Prior to the second quarter of 2006, these corporate trust businesses were reported in Treasury & Securities Services. Current-quarter net income was $620 million, which included a $622 million after-tax gain on sale compared with net income of $56 million in the prior year.

11

JPMorgan Chase & Co.
News Release

Highlights Include:

§ Private Equity portfolio was $6.1 billion, down from $6.2 billion in the prior year and up from $5.6 billion in the prior quarter. The portfolio represented 8.6% of stockholders’ equity less goodwill, down from 9.7% in the prior year and up from 8.0% in the prior quarter.

JPMORGAN CHASE (JPM)^(a)

Results for JPM							3Q06						4Q05
($ millions)	4Q06		3Q06		4Q05			$ O/(U)		O/(U) %				$ O/(U)			O/(U) %
Net Revenue	$	16,895	$	16,229	$	14,759		$	666		4	%		$	2,136			14	%
Provision for Credit Losses		1,727		1,419		2,286			308		22				(559	)		(24	)
Noninterest Expense		9,746		9,651		8,430			95		1				1,316			16
Income from Continuing Operations		3,906		3,232		2,642			674		21				1,264			48
Income from Discontinued Operations (after-tax)(b)		620		65		56			555	NM					564		NM
Net Income	$	4,526	$	3,297	$	2,698		$	1,229		37	%		$	1,828			68	%

(a)	Presented on a managed basis; see Note 1 (Page 14) for further explanation of managed basis. Net revenue on a GAAP basis was $16,054 million, $15,400 million and $13,482 million for the fourth quarter of 2006, third quarter of 2006 and fourth quarter of 2005, respectively.
(b)	Discontinued operations include the related balance sheet and income statement activity of selected corporate trust businesses sold to The Bank of New York on October 1, 2006. Prior to the second quarter of 2006, these corporate trust businesses were reported in Treasury & Securities Services.

Results in the fourth quarter of 2006 included the following items:

($ Millions)	Pre - Tax			After-Tax
Gain on exchange of corporate trust (Corporate)	$	1,081		$	622
Tax audit resolutions (Corporate)		—			359
Material litigation insurance recoveries (Corporate)		137			85
SFAS 123R incremental expense (all LOBs)		(43	)		(27	)
Merger costs (Corporate)		(100	)		(62	)
RFS portfolio repositioning (Regional Banking)		($215	)		($133	)

Discussion of Results:^{(see notes (a) (b) above)}

Net income was $4.5 billion, up by $1.8 billion, compared with $2.7 billion in the prior year. The increase in earnings was driven by higher revenue, the after-tax gain related to the exchange of selected corporate trust businesses, the benefit from tax audit resolutions and lower managed provision for credit losses. These increases were offset partially by higher noninterest expense and the absence of a $752 million after-tax gain on the sale of BrownCo in the prior year.

Net managed revenue was $16.9 billion, up by $2.1 billion, or 14%, from the prior year. Noninterest revenue of $9.8 billion was up by $1.3 billion, or 15%, reflecting the following: strong principal transactions revenue; absence of prior-year losses on the sale of securities in Treasury; increased asset management, administration, and commissions revenue; and record investment banking fees. Partially offsetting these benefits was the absence of the prior-year gain on the sale of BrownCo, losses on mortgage loans transferred to held-for-sale and lower credit card fee income. Net interest income was $7.1 billion, up by $825 million, or 13%, due to an improvement in the Corporate segment’s net interest spread; increases in consumer loans, consumer deposits and wholesale liabilities; and wider spreads on trading-related assets. This increase was offset partially by consumer loan–spread compression, and a shift to narrower-spread wholesale and consumer liabilities.

12

JPMorgan Chase & Co.
News Release

The managed provision for credit losses was $1.7 billion, down by $559 million, or 24%, from the prior year, largely due to lower bankruptcy-related losses in Card Services. The wholesale provision for credit losses was $184 million for the quarter, compared with a benefit of $108 million in the prior year. The $184 million provision reflects portfolio activity and stable credit quality. The wholesale loan net charge-off rate was 0.07% for both the current quarter and the prior year. The total consumer managed provision for credit losses was $1.5 billion, $851 million lower than the prior year, primarily due to lower bankruptcy-related losses in Card Services. The firm had total nonperforming assets of $2.3 billion at December 31, 2006, down by $249 million, or 10%, from the prior-year level of $2.6 billion.

Noninterest expense was $9.7 billion, up by $1.3 billion, or 16%, from the prior year. Insurance recoveries related to certain material litigation were $137 million in the current period, $208 million in the prior year and $17 million in the prior quarter. Merger costs of $100 million were incurred in the current quarter, $77 million in the prior year and $48 million in the prior quarter. Prior-year expense also included a $145 million cost due to the accelerated vesting of stock options. Expense growth also was driven by higher compensation expense, acquisitions and marketing expense. Partially offsetting this growth were divestitures and expense efficiencies.

Highlights Include:

§	Tier 1 capital ratio was 8.7% at December 31, 2006 (estimated), 8.6% at September 30, 2006, and 8.5% at December 31, 2005.
§	During the quarter, $1.0 billion of common stock was repurchased, reflecting 21.1 million shares purchased at an average price of $47.33 per share. Year-to-date, $3.9 billion of common stock was repurchased, reflecting 90.7 million shares purchased at an average price of $43.41 per share. As of December 31, 2006, $5.2 billion of capacity remained under the $8.0 billion share purchase program approved on March 21, 2006.
§	Headcount of 174,360 increased by 2,771 since September 30, 2006.

13

JPMorgan Chase & Co.
News Release

Merger and other financial information

•       Merger savings and cost related: For the quarter ended December 31, 2006, approximately $700 million of merger savings have been realized, which is an annualized rate of $2.8 billion, in line with management’s target for the year. Management estimates that annualized savings will be approximately $3.0 billion by the end of 2007. Merger costs of $100 million were expensed during the fourth quarter of 2006, bringing the total amount incurred to $3.4 billion (including capitalized costs) since the beginning of 2004. Management currently expects total merger costs will be approximately $3.8 billion (including The Bank of New York transaction). The remaining merger costs are expected to be incurred by the end of 2007.

•      FASB Statement No. 123R (“Share-Based Payment”): JPMorgan Chase adopted Statement of Financial Accounting Standards No. 123 (Revised 2004), (“Share-Based Payment”) as of January 1, 2006, under the modified prospective method. SFAS 123R requires that stock compensation granted to retirement-eligible employees be fully expensed at, or prior to, the time of grant rather than amortized over the vesting period. As a result of the adoption of SFAS 123R in the first quarter of 2006, the firm expensed the full amount of the compensation expense associated with grants of restricted stock made in January 2006 to retirement-eligible employees. In addition, during the first quarter of 2006, the firm began to accrue the estimated cost of grants expected to be awarded in January 2007 to retirement-eligible employees. The total incremental expense recorded in 2006 was $712 million. Awards granted to retirement-eligible employees prior to January 1, 2006, have not been accelerated and will continue to be amortized over the original vesting periods. The incremental expense incurred during 2006 were non-cash charges and represented accelerated recognition of costs that would have been incurred in future periods.

Notes:

1.      In addition to analyzing the firm’s results on a reported basis, management analyzes the firm’s and the lines’ of business results on a managed basis, which is a non-GAAP financial measure. The firm’s definition of managed basis starts with the reported U.S. GAAP results and includes the following adjustments: First, for Card Services and the firm, managed basis excludes the impact of credit card securitizations on total net revenue, the provision for credit losses, net charge-offs and loan receivables. JPMorgan Chase uses the concept of “managed receivables” to evaluate the credit performance and overall financial performance of the underlying credit card loans, both sold and not sold: as the same borrower is continuing to use the credit card for ongoing charges, a borrower’s credit performance will affect both the loan receivables sold under SFAS 140 and those not sold. Thus, in its disclosures regarding managed loan receivables, JPMorgan Chase treats the sold receivables as if they were still on the balance sheet in order to disclose the credit performance (such as net charge-off rates) of the entire managed credit card portfolio. Second, managed revenue (noninterest revenue and net interest income) for each of the segments and the firm is presented on a tax-equivalent basis. Accordingly, revenue from tax-exempt securities and investments that receive tax credits are presented in the managed results on a basis comparable to taxable securities and investments. This methodology allows management to assess the comparability of revenue arising from both taxable and tax-exempt sources. The corresponding income tax impact related to these items is recorded within income tax expense. See page 6 of JPMorgan Chase’s Earnings Release Financial Supplement (fourth quarter of 2006) for a reconciliation of JPMorgan Chase’s income statement from a reported to managed basis.

2.      Pre-tax margin represents income before income tax expense divided by total net revenue, which is, in management’s view, a comprehensive measure of pre-tax performance derived by measuring earnings after all costs are taken into consideration. It is, therefore, another basis by which management evaluates the performance of TSS and AM against that of competitors.

14

JPMorgan Chase & Co.
News Release

JPMorgan Chase & Co. (NYSE: JPM) is a leading global financial services firm with assets of $1.4 trillion and operations in more than 50 countries. The firm is a leader in investment banking, financial services for consumers, small business and commercial banking, financial transaction processing, asset management, and private equity. A component of the Dow Jones Industrial Average, JPMorgan Chase serves millions of consumers in the United States and many of the world’s most prominent corporate, institutional and government clients under its JPMorgan and Chase brands. Information about the firm is available at www.jpmorganchase.com.

JPMorgan Chase will host a conference call today at 9:00 a.m. (Eastern Time) to review fourth-quarter financial results. Investors can call (800) 565-5442 (domestic) / (913) 312-1298 (international), or listen via live audio webcast. The live audio webcast and presentation slides will be available on www.jpmorganchase.com under Investor Relations, Investor Presentations. A replay of the conference call will be available beginning at 1:00 p.m. (Eastern Time) on January 17, 2007, through midnight, Friday, January 26, 2007 (Eastern Time), at (888) 203-1112 (domestic) or (719) 457-0820 (international) access code 8499264. The replay also will be available on www.jpmorganchase.com. Additional detailed financial, statistical and business-related information is included in a financial supplement. The earnings release and the financial supplement are available on the JPMorgan Chase Internet site www.jpmorganchase.com.

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of JPMorgan Chase’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. Factors that could cause JPMorgan Chase’s results to differ materially from those described in the forward-looking statements can be found in the firm’s Quarterly Reports on Form 10-Q for the quarters ended September 30, 2006, June 30, 2006, and March 31, 2006 (as amended), and in the Annual Report on Form 10-K for the year ended December 31, 2005 (as amended), filed with the Securities and Exchange Commission and available at the Securities and Exchange Commission’s Internet site (http://www.sec.gov).

15

JPMORGAN CHASE & CO.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(in millions, except per share, ratio and headcount data)

	QUARTERLY TRENDS															FULL YEAR
										4Q06 Change												2006 Change
	4Q06			3Q06			4Q05			3Q06			4Q05			2006			2005			2005
SELECTED INCOME STATEMENT DATA
Total Net Revenue	$	16,054		$	15,400		$	13,482			4	%		19	%	$	61,437		$	53,748			14	%
Provision for Credit Losses		1,134			812			1,224			40			(7	)		3,270			3,483			(6	)
Noninterest Expense		9,746			9,651			8,430			1			16			38,281			38,426			—
Income from Continuing Operations (after-tax)		3,906			3,232			2,642			21			48			13,649			8,254			65
Income from Discontinued Operations (after-tax) (a)		620			65			56		NM			NM				795			229			247
Net Income		4,526			3,297			2,698			37			68			14,444			8,483			70
PER COMMON SHARE:
Basic Earnings
Income from Continuing Operations	$	1.13		$	0.93		$	0.76			22			49		$	3.93		$	2.36			67
Net Income		1.31			0.95			0.78			38			68			4.16			2.43			71
Diluted Earnings
Income from Continuing Operations	$	1.09		$	0.90		$	0.74			21			47		$	3.82		$	2.32			65
Net Income		1.26			0.92			0.76			37			66			4.04			2.38			70
Cash Dividends Declared		0.34			0.34			0.34			—			—			1.36			1.36			—
Book Value		33.45			32.75			30.71			2			9			33.45			30.71			9
Closing Share Price		48.30			46.96			39.69			3			22			48.30			39.69			22
COMMON SHARES OUTSTANDING:
Weighted-Average Diluted Shares Outstanding		3,578.6			3,574.0			3,563.9			—			—			3,573.9			3,557.3			—
Common Shares Outstanding at Period-end		3,461.7			3,467.5			3,486.7			—			(1	)		3,461.7			3,486.7			(1	)
FINANCIAL RATIOS: (b)
Income from Continuing Operations:
Return on Common Equity (“ROE”)		14	%		11	%		10	%								12	%		8	%
Return on Equity-Goodwill (“ROE-GW”) (c)		22			19			17									20			13
Return on Assets (“ROA”)		1.14			0.98			0.87									1.04			0.70
Net Income:
ROE		16			12			10									13			8
ROE-GW (c)		26			19			17									22			14
ROA		1.32			1.00			0.89									1.10			0.72
CAPITAL RATIOS:
Tier 1 Capital Ratio		8.7	(e)		8.6			8.5
Total Capital Ratio		12.3	(e)		12.1			12.0
SELECTED BALANCE SHEET DATA (Period-end)
Total Assets	$	1,351,520		$	1,338,029		$	1,198,942			1			13		$	1,351,520		$	1,198,942			13
Wholesale Loans		183,742			179,403			150,111			2			22			183,742			150,111			22
Consumer Loans		299,385			284,141			269,037			5			11			299,385			269,037			11
Deposits		638,788			582,115			554,991			10			15			638,788			554,991			15
Common Stockholders’ Equity		115,790			113,561			107,072			2			8			115,790			107,072			8
Headcount		174,360			171,589			168,847			2			3			174,360			168,847			3
LINE OF BUSINESS EARNINGS
Investment Bank	$	1,009		$	976		$	667			3			51		$	3,674		$	3,673			—
Retail Financial Services		718			746			803			(4	)		(11	)		3,213			3,427			(6	)
Card Services		719			711			302			1			138			3,206			1,907			68
Commercial Banking		256			231			279			11			(8	)		1,010			951			6
Treasury & Securities Services		256			256			254			—			1			1,090			863			26
Asset Management		407			346			342			18			19			1,409			1,216			16
Corporate (d)		1,161			31			51		NM			NM				842			(3,554	)	NM
Net Income	$	4,526		$	3,297		$	2,698			37			68		$	14,444		$	8,483			70

(a)	On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses including trustee, paying agent, loan agency and document management services for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses are being reported as discontinued operations for each of the periods presented.
(b)	Quarterly ratios are based upon annualized amounts.
(c)	Income from continuing operations and Net income applicable to common stock divided by Total average common equity (net of goodwill). The Firm uses return on equity less goodwill, a non-GAAP financial measure, to evaluate the operating performance of the Firm. The Firm also utilizes this measure to facilitate comparisons to competitors.
(d)	Includes the after-tax impact of discontinued operations, material litigation reserve charges/recoveries, tax audit benefits and Merger costs. See Corporate for additional details.
(e)	Estimated.

16

EX-99.2

Exhibit 99.2

EARNINGS RELEASE FINANCIAL SUPPLEMENT

FOURTH QUARTER 2006

JPMORGAN CHASE & CO.
TABLE OF CONTENTS

	Page
Consolidated Results
Consolidated Financial Highlights		2
Statements of Income		3
Consolidated Balance Sheets		4
Condensed Average Balance Sheets and Annualized Yields		5
Reconciliation from Reported to Managed Summary		6
Business Detail
Line of Business Financial Highlights — Managed Basis		7
Investment Bank		8
Retail Financial Services		10
Card Services — Managed Basis		14
Commercial Banking		17
Treasury & Securities Services		19
Asset Management		21
Corporate		24
Credit-Related Information		26
Supplemental Detail
Capital		31
Glossary of Terms		32

Page 1

JPMORGAN CHASE & CO.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(in millions, except per share, ratio and headcount data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
SELECTED INCOME STATEMENT DATA
Total Net Revenue	$	16,054		$	15,400		$	14,940		$	15,043		$	13,482			4	%		19	%	$	61,437		$	53,748			14	%
Provision for Credit Losses		1,134			812			493			831			1,224			40			(7	)		3,270			3,483			(6	)
Noninterest Expense		9,746			9,651			9,236			9,648			8,430			1			16			38,281			38,426			—
Income from Continuing Operations (after-tax)		3,906			3,232			3,484			3,027			2,642			21			48			13,649			8,254			65
Income from Discontinued Operations (after-tax) (a)		620			65			56			54			56		NM			NM				795			229			247
Net Income		4,526			3,297			3,540			3,081			2,698			37			68			14,444			8,483			70
PER COMMON SHARE:
Basic Earnings
Income from Continuing Operations	$	1.13		$	0.93		$	1.00		$	0.87		$	0.76			22			49		$	3.93		$	2.36			67
Net Income		1.31			0.95			1.02			0.89			0.78			38			68			4.16			2.43			71
Diluted Earnings
Income from Continuing Operations	$	1.09		$	0.90		$	0.98		$	0.85		$	0.74			21			47		$	3.82		$	2.32			65
Net Income		1.26			0.92			0.99			0.86			0.76			37			66			4.04			2.38			70
Cash Dividends Declared		0.34			0.34			0.34			0.34			0.34			—			—			1.36			1.36			—
Book Value		33.45			32.75			31.89			31.19			30.71			2			9			33.45			30.71			9
Closing Share Price		48.30			46.96			42.00			41.64			39.69			3			22			48.30			39.69			22
COMMON SHARES OUTSTANDING:
Weighted-Average Diluted Shares Outstanding		3,578.6			3,574.0			3,572.2			3,570.8			3,563.9			—			—			3,573.9			3,557.3			—
Common Shares Outstanding at Period-end		3,461.7			3,467.5			3,470.6			3,473.0			3,486.7			—			(1	)		3,461.7			3,486.7			(1	)
FINANCIAL RATIOS: (b)
Income from Continuing Operations:
Return on Common Equity (“ROE”)		14	%		11	%		13	%		11	%		10	%								12	%		8	%
Return on Equity-Goodwill (“ROE-GW”) (c)		22			19			21			19			17									20			13
Return on Assets (“ROA”)		1.14			0.98			1.05			0.98			0.87									1.04			0.70
Net Income:
ROE		16			12			13			12			10									13			8
ROE-GW (c)		26			19			22			20			17									22			14
ROA		1.32			1.00			1.06			1.00			0.89									1.10			0.72
CAPITAL RATIOS:
Tier 1 Capital Ratio		8.7	(e)		8.6			8.5			8.5			8.5
Total Capital Ratio		12.3	(e)		12.1			12.0			12.1			12.0
SELECTED BALANCE SHEET DATA (Period-end)
Total Assets	$	1,351,520		$	1,338,029		$	1,328,001		$	1,273,282		$	1,198,942			1			13		$	1,351,520		$	1,198,942			13
Wholesale Loans		183,742			179,403			178,215			164,799			150,111			2			22			183,742			150,111			22
Consumer Loans		299,385			284,141			276,889			267,282			269,037			5			11			299,385			269,037			11
Deposits		638,788			582,115			593,716			584,465			554,991			10			15			638,788			554,991			15
Common Stockholders’ Equity		115,790			113,561			110,684			108,337			107,072			2			8			115,790			107,072			8
Headcount		174,360			171,589			172,423			170,787			168,847			2			3			174,360			168,847			3
LINE OF BUSINESS EARNINGS
Investment Bank	$	1,009		$	976		$	839		$	850		$	667			3			51		$	3,674		$	3,673			—
Retail Financial Services		718			746			868			881			803			(4	)		(11	)		3,213			3,427			(6	)
Card Services		719			711			875			901			302			1			138			3,206			1,907			68
Commercial Banking		256			231			283			240			279			11			(8	)		1,010			951			6
Treasury & Securities Services		256			256			316			262			254			—			1			1,090			863			26
Asset Management		407			346			343			313			342			18			19			1,409			1,216			16
Corporate (d)		1,161			31			16			(366	)		51		NM			NM				842			(3,554	)	NM
Net Income	$	4,526		$	3,297		$	3,540		$	3,081		$	2,698			37			68		$	14,444		$	8,483			70

(a)	On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses including trustee, paying agent, loan agency and document management services for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses are being reported as discontinued operations for each of the periods presented.
(b)	Quarterly ratios are based upon annualized amounts.
(c)	Income from continuing operations and Net income applicable to common stock divided by Total average common equity (net of goodwill). The Firm uses return on equity less goodwill, a non-GAAP financial measure, to evaluate the operating performance of the Firm. The Firm also utilizes this measure to facilitate comparisons to competitors.
(d)	Includes the after-tax impact of discontinued operations, material litigation reserve charges/recoveries, tax audit benefits and Merger costs. See Corporate for additional details.
(e)	Estimated.

Page 2

JPMORGAN CHASE & CO.
STATEMENTS OF INCOME
(in millions, except per share and ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
REVENUE
Investment Banking Fees	$	1,565		$	1,416		$	1,370		$	1,169		$	1,145			11	%		37	%	$	5,520		$	4,088			35	%
Principal Transactions		2,480			2,636			2,628			2,602			1,423			(6	)		74			10,346			7,669			35
Lending & Deposit Related Fees		895			867			865			841			853			3			5			3,468			3,389			2
Asset Management, Administration and Commissions		3,145			2,798			2,933			2,849			2,605			12			21			11,725			9,891			19
Securities Gains (Losses)		35			40			(502	)		(116	)		(540	)		(13	)	NM				(543	)		(1,336	)		59
Mortgage Fees and Related Income		75			62			213			241			155			21			(52	)		591			1,054			(44	)
Credit Card Income		1,645			1,567			1,791			1,910			1,402			5			17			6,913			6,754			2
Other Income		522			635			464			554			1,761			(18	)		(70	)		2,175			2,684			(19	)
Noninterest Revenue		10,362			10,021			9,762			10,050			8,804			3			18			40,195			34,193			18
Interest Income (a)		16,097			15,157			14,617			13,236			12,120			6			33			59,107			45,075			31
Interest Expense (a)		10,405			9,778			9,439			8,243			7,442			6			40			37,865			25,520			48
Net Interest Income		5,692			5,379			5,178			4,993			4,678			6			22			21,242			19,555			9
TOTAL NET REVENUE		16,054			15,400			14,940			15,043			13,482			4			19			61,437			53,748			14
Provision for Credit Losses		1,134			812			493			831			1,224			40			(7	)		3,270			3,483			(6	)
NONINTEREST EXPENSE
Compensation Expense		4,985			5,390			5,268			5,548			4,237			(8	)		18			21,191			18,065			17
Occupancy Expense		625			563			553			594			637			11			(2	)		2,335			2,269			3
Technology, Communications and Equipment Expense		997			911			876			869			904			9			10			3,653			3,602			1
Professional & Outside Services		1,107			966			939			876			985			15			12			3,888			4,162			(7	)
Marketing		614			550			526			519			385			12			59			2,209			1,917			15
Other Expense (b)		948			877			631			816			839			8			13			3,272			6,199			(47	)
Amortization of Intangibles		370			346			357			355			366			7			1			1,428			1,490			(4	)
Merger Costs		100			48			86			71			77			108			30			305			722			(58	)
TOTAL NONINTEREST EXPENSE		9,746			9,651			9,236			9,648			8,430			1			16			38,281			38,426			—
Income from Continuing Operations before Income Tax Expense		5,174			4,937			5,211			4,564			3,828			5			35			19,886			11,839			68
Income Tax Expense		1,268			1,705			1,727			1,537			1,186			(26	)		7			6,237			3,585			74
Income from Continuing Operations (after-tax)		3,906			3,232			3,484			3,027			2,642			21			48			13,649			8,254			65
Income from Discontinued Operations (after-tax) (c)		620			65			56			54			56		NM			NM				795			229			247
NET INCOME	$	4,526		$	3,297		$	3,540		$	3,081		$	2,698			37			68		$	14,444		$	8,483			70
DILUTED EARNINGS PER SHARE
Income from Continuing Operations (after-tax)	$	1.09		$	0.90		$	0.98		$	0.85		$	0.74			21			47		$	3.82		$	2.32			65
Income from Discontinued Operations (after-tax) (c)		0.17			0.02			0.01			0.01			0.02		NM			NM				0.22			0.06			267
Net Income	$	1.26		$	0.92		$	0.99		$	0.86		$	0.76			37			66		$	4.04		$	2.38			70
FINANCIAL RATIOS
Income from Continuing Operations:
ROE		14	%		11	%		13	%		11	%		10	%								12	%		8	%
ROE-GW		22			19			21			19			17									20			13
ROA		1.14			0.98			1.05			0.98			0.87									1.04			0.70
Net Income:
ROE		16			12			13			12			10									13			8
ROE-GW		26			19			22			20			17									22			14
ROA		1.32			1.00			1.06			1.00			0.89									1.10			0.72
Effective Income Tax Rate (d)		25			35			33			34			31									31			30
Overhead Ratio		61			63			62			64			63									62			71
EXCLUDING IMPACT OF MERGER COSTS (e)
Income from Continuing Operations	$	3,906		$	3,232		$	3,484		$	3,027		$	2,642			21			48		$	13,649		$	8,254			65
Less Merger Costs (after-tax)		62			30			53			44			48			107			29			189			448			(58	)
Income from Continuing Operations Excluding Merger Costs	$	3,968		$	3,262		$	3,537		$	3,071		$	2,690			22			48		$	13,838		$	8,702			59
Diluted Per Share:
Income from Continuing Operations	$	1.09		$	0.90		$	0.98		$	0.85		$	0.74			21			47		$	3.82		$	2.32			65
Less Merger Costs (after-tax)		0.02			0.01			0.01			0.01			0.01			100			100			0.05			0.13			(62	)
Income from Continuing Operations Excluding Merger Costs	$	1.11		$	0.91		$	0.99		$	0.86		$	0.75			22			48		$	3.87		$	2.45			58

(a)	Prior periods have been adjusted to reflect the reclassification of certain balances to more appropriate income statement and balance sheet line items.
(b)	Insurance recoveries related to settlement of the Enron and WorldCom class action litigations and for certain other material legal proceedings were $137 million, $17 million, $260 million, $98 million and $208 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006 and December 31, 2005, respectively. Full year 2006 includes related insurance recoveries of $512 million. Full year 2005 includes $208 million of insurance recoveries and litigation reserve charges of $2,772 million.
(c)	On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses, including trustee, paying agent, loan agency and document management services, for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses are being reported as discontinued operations for each of the periods presented.
(d)	Based on Income from continuing operations.
(e)	Income from continuing operations excluding merger costs, a non-GAAP financial measure, is used by the Firm to facilitate comparison of results against the Firm’s ongoing operations and with other companies’ U.S. GAAP financial statements.

Page 3

JPMORGAN CHASE & CO.
CONSOLIDATED BALANCE SHEETS
(in millions)

																Dec 31, 2006
																Change
	Dec 31			Sep 30			Jun 30			Mar 31			Dec 31			Sep 30			Dec 31
	2006			2006			2006			2006			2005			2006			2005
ASSETS
Cash and Due from Banks	$	40,412		$	36,279		$	38,390		$	36,903		$	36,670			11	%		10	%
Deposits with Banks		13,547			17,130			14,437			10,545			21,661			(21	)		(37	)
Federal Funds Sold and Securities Purchased under Resale Agreements		140,524			156,194			157,438			153,755			133,981			(10	)		5
Securities Borrowed		73,688			89,222			87,377			93,280			74,604			(17	)		(1	)
Trading Assets:
Debt and Equity Instruments		310,137			289,891			295,604			259,275			248,590			7			25
Derivative Receivables		55,601			58,265			54,075			52,750			49,787			(5	)		12
Securities		91,975			86,548			78,022			67,126			47,600			6			93
Interests in Purchased Receivables (a)		—			—			—			29,029			29,740		NM			NM
Loans (Net of Allowance for Loan Losses)		475,848			456,488			448,028			424,806			412,058			4			15
Private Equity Investments		6,359			5,905			5,974			6,499			6,374			8			—
Accrued Interest and Accounts Receivable		22,891			21,178			24,418			21,657			22,421			8			2
Premises and Equipment		8,735			8,553			8,910			8,985			9,081			2			(4	)
Goodwill		45,186			43,372			43,498			43,899			43,621			4			4
Other Intangible Assets:
Mortgage Servicing Rights		7,546			7,378			8,247			7,539			6,452			2			17
Purchased Credit Card Relationships		2,935			2,982			3,138			3,243			3,275			(2	)		(10	)
All Other Intangibles		4,371			4,078			4,231			4,832			4,832			7			(10	)
Other Assets		51,765			53,181			54,981			49,159			48,195			(3	)		7
Assets of discontinued operations held-for-sale (b)		—			1,385			1,233			—			—		NM			NM
TOTAL ASSETS	$	1,351,520		$	1,338,029		$	1,328,001		$	1,273,282		$	1,198,942			1			13
LIABILITIES
Deposits:
U.S. Offices:
Noninterest-Bearing	$	132,781		$	117,197		$	127,311		$	128,982		$	135,599			13			(2	)
Interest-Bearing		337,812			310,401			312,517			309,779			287,774			9			17
Non-U.S. Offices:
Noninterest-Bearing		7,662			3,761			6,442			6,591			7,476			104			2
Interest-Bearing		160,533			150,756			147,446			139,113			124,142			6			29
Total Deposits		638,788			582,115			593,716			584,465			554,991			10			15
Federal Funds Purchased and Securities Sold under Repurchase Agreements		162,173			188,395			175,055			151,006			125,925			(14	)		29
Commercial Paper		18,849			18,135			18,554			15,933			13,863			4			36
Other Borrowed Funds		18,053			16,252			10,921			14,400			10,479			11			72
Trading Liabilities:
Debt and Equity Instruments		90,488			106,784			105,445			104,160			94,157			(15	)		(4	)
Derivative Payables		57,469			58,462			52,630			55,938			51,773			(2	)		11
Accounts Payable, Accrued Expenses and Other Liabilities (including the Allowance for Lending-Related Commitments)		88,096			73,585			82,569			73,693			78,460			20			12
Beneficial Interests Issued by Consolidated VIEs		16,184			16,254			15,432			42,237			42,197			—			(62	)
Long-Term Debt		133,421			126,619			125,280			112,133			108,357			5			23
Junior Subordinated Deferrable Interest Debentures Held by Trusts that Issued Guaranteed Capital Debt Securities		12,209			13,309			10,827			10,980			11,529			(8	)		6
Liabilities of discontinued operations held-for-sale (b)		—			24,558			26,888			—			—		NM			NM
TOTAL LIABILITIES		1,235,730			1,224,468			1,217,317			1,164,945			1,091,731			1			13
STOCKHOLDERS’ EQUITY
Preferred Stock		—			—			—			—			139		NM			NM
Common Stock		3,658			3,658			3,658			3,645			3,618			—			1
Capital Surplus		77,807			77,457			77,098			76,153			74,994			—			4
Retained Earnings		43,600			40,283			38,208			35,892			33,848			8			29
Accumulated Other Comprehensive Income (Loss)		(1,557	)		(526	)		(1,218	)		(1,017	)		(626	)		(196	)		(149	)
Treasury Stock, at Cost		(7,718	)		(7,311	)		(7,062	)		(6,336	)		(4,762	)		(6	)		(62	)
TOTAL STOCKHOLDERS’ EQUITY		115,790			113,561			110,684			108,337			107,211			2			8
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,351,520		$	1,338,029		$	1,328,001		$	1,273,282		$	1,198,942			1			13

(a)

As a result of restructuring certain multi-seller conduits the Firm administers, during the second quarter of 2006, JPMorgan Chase deconsolidated $29 billion of Interests in Purchased Receivables, $3 billion of Loans and $1 billion of Securities, and recorded $33 billion of Lending-Related Commitments.

(b)

On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses, including trustee, paying agent, loan agency and document management services, for the consumer, business banking and middle-market banking businesses of The Bank of New York. As a result of this transaction, assets and liabilities of this business were reclassified and reported as discontinued operations for the periods ended September 30, 2006 and June 30, 2006. JPMorgan Chase did not reclassify any Assets or Liabilities of discontinued operations held-for-sale at March 31, 2006 or December 31, 2005.

Page 4

JPMORGAN CHASE & CO.
CONDENSED AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS
(in millions, except rates)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
AVERAGE BALANCES (a)
ASSETS
Deposits with Banks	$	19,736		$	31,291		$	39,193		$	20,672		$	15,584			(37	)%		27	%	$	27,730		$	15,203			82	%
Federal Funds Sold and Securities Purchased under Resale Agreements		144,744			125,618			128,740			129,268			135,155			15			7			132,118			123,233			7
Securities Borrowed		82,184			82,216			86,742			84,220			72,359			—			14			83,831			63,023			33
Trading Assets - Debt Instruments		218,188			213,164			204,551			185,679			181,019			2			21			205,506			187,615			10
Securities		89,962			78,029			82,845			60,216			60,663			15			48			77,845			71,637			9
Interests in Purchased Receivables (b)		—			—			26,221			30,028			28,338			NM			NM			13,941			28,397			(51	)
Loans		484,140			461,673			442,601			429,043			421,434			5			15			454,535			409,988			11
Total Interest-Earning Assets		1,038,954			991,991			1,010,893			939,126			914,552			5			14			995,506			899,096			11
Trading Assets - Equity Instruments		81,985			75,366			70,045			70,762			56,970			9			44			74,573			49,458			51
All Other Noninterest-Earning Assets		241,668			218,118			229,898			219,045			214,256			11			13			227,218			218,086			4
Assets of discontinued operations held-for-sale (c)		—			23,664			23,033			19,424			19,006			NM			NM			16,497			18,426			(10	)
TOTAL ASSETS	$	1,362,607		$	1,309,139		$	1,333,869		$	1,248,357		$	1,204,784			4			13		$	1,313,794		$	1,185,066			11
LIABILITIES
Interest-Bearing Deposits	$	487,368		$	451,509		$	449,782		$	419,903		$	388,818			8			25		$	452,323		$	383,259			18
Federal Funds Purchased and Securities Sold under Repurchase Agreements		198,166			192,674			184,943			158,818			149,269			3			33			183,783			154,818			19
Commercial Paper		18,787			19,207			17,484			15,310			17,393			(2	)		8			17,710			14,450			23
Other Borrowings (d)		96,499			101,366			103,150			107,702			101,261			(5	)		(5	)		102,147			93,765			9
Beneficial Interests Issued by Consolidated VIEs		15,769			13,630			43,470			42,192			45,284			16			(65	)		28,652			44,675			(36	)
Long-Term Debt		140,515			133,279			125,723			118,875			117,597			5			19			129,667			112,370			15
Total Interest-Bearing Liabilities		957,104			911,665			924,552			862,800			819,622			5			17			914,282			803,337			14
Noninterest-Bearing Liabilities		290,741			262,843			278,229			259,936			261,522			11			11			272,994			258,866			5
Liabilities of discontinued operations held-for-sale (c)		—			22,825			22,131			18,317			17,576			NM			NM			15,787			17,149			(8	)
TOTAL LIABILITIES		1,247,845			1,197,333			1,224,912			1,141,053			1,098,720			4			14			1,203,063			1,079,352			11
Preferred Stock		—			—			—			137			139			NM			NM			34			207			(84	)
Common Stockholders’ Equity		114,762			111,806			108,957			107,167			105,925			3			8			110,697			105,507			5
TOTAL STOCKHOLDERS’ EQUITY		114,762			111,806			108,957			107,304			106,064			3			8			110,731			105,714			5
TOTAL LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS’ EQUITY	$	1,362,607		$	1,309,139		$	1,333,869		$	1,248,357		$	1,204,784			4			13		$	1,313,794		$	1,185,066			11
AVERAGE RATES (a)
INTEREST-EARNING ASSETS
Deposits with Banks		5.18	%		4.46	%		4.43	%		4.31	%		4.77	%								4.56	%		4.34	%
Federal Funds Sold and Securities Purchased under Resale Agreements		4.71			4.55			3.81			3.74			3.21									4.22			2.89
Securities Borrowed		4.56			4.28			3.89			3.51			3.00									4.06			2.57
Trading Assets - Debt Instruments		5.45			5.28			5.33			5.61			5.08									5.41			4.96
Securities		5.57			5.70			5.45			5.34			5.00									5.53			4.59
Interests in Purchased Receivables		NM			NM			4.92			4.47			3.97									4.68			3.29
Loans		7.35			7.37			7.25			7.06			6.57									7.26			6.34
Total Interest-Earning Assets		6.17			6.08			5.82			5.75			5.28									5.96			5.04
INTEREST-BEARING LIABILITIES
Interest-Bearing Deposits		3.99			3.93			3.67			3.43			3.18									3.77			2.61
Federal Funds Purchased and Securities Sold under Repurchase Agreements		4.86			4.63			4.30			3.90			3.38									4.45			3.05
Commercial Paper		4.76			4.78			4.31			3.97			3.40									4.49			2.81
Other Borrowings (d)		4.75			5.13			4.93			5.16			5.10									5.00			5.19
Beneficial Interests Issued by Consolidated VIEs		3.96			4.16			4.86			3.92			3.66									4.31			3.07
Long-Term Debt		4.34			4.08			4.34			4.21			4.01									4.24			3.70
Total Interest-Bearing Liabilities		4.31			4.26			4.09			3.87			3.60									4.14			3.18
INTEREST RATE SPREAD		1.86	%		1.82	%		1.73	%		1.88	%		1.68	%								1.82	%		1.86	%
NET YIELD ON INTEREST-EARNING ASSETS		2.19	%		2.17	%		2.07	%		2.19	%		2.05	%								2.16	%		2.20	%
NET YIELD ON INTEREST-EARNING ASSETS ADJUSTED FOR SECURITIZATIONS		2.54	%		2.54	%		2.50	%		2.67	%		2.51	%								2.56	%		2.72	%

(a)	Prior periods have been adjusted to reflect the reclassification of certain balances to more appropriate income statement and balance sheet line items.
(b)	As a result of restructuring certain multi-seller conduits the Firm administers, during the second quarter of 2006, JPMorgan Chase deconsolidated $29 billion of Interests in Purchased Receivables, $3 billion of Loans and $1 billion of Securities, and recorded $33 billion of Lending-Related Commitments.
(c)	As a result of the transaction with The Bank of New York, for purposes of the consolidated average balance sheet for assets and liabilities transferred to discontinued operations, JPMorgan Chase used Federal funds sold interest income as a reasonable estimate of the earnings on corporate trust deposits for the periods prior to the close of the transaction; therefore, JPMorgan Chase transferred to Assets of discontinued operations held-for-sale average Federal funds sold, along with the related interest income earned, and transferred to Liabilities of discontinued operations held-for-sale average corporate trust deposits.
(d)	Includes securities sold but not yet purchased.

Page 5

JPMORGAN CHASE & CO.
RECONCILIATION FROM REPORTED TO MANAGED SUMMARY
(in millions)

The Firm prepares its Consolidated financial statements using accounting principles generally accepted in the United States of America (“U.S. GAAP”). That presentation, which is referred to as “reported basis,” provides the reader with an understanding of the Firm’s results that can be tracked consistently from year to year and enables a comparison of the Firm’s performance with other companies’ U.S. GAAP financial statements. In addition to analyzing the Firm’s results on a reported basis, management reviews the Firm’s and the lines’ of business results on a “managed” basis, which is a non-GAAP financial measure. The Firm’s definition of managed basis starts with the reported U.S. GAAP results and includes the following adjustments: for Card Services and the Firm as a whole, the impact of credit card securitizations are excluded; and for each line of business and the Firm as a whole, Total net revenue is shown on a fully taxable equivalent (“FTE”) basis. These adjustments do not have any impact on Net income as reported by the lines of business or by the Firm as a whole. The impact of these adjustments are summarized below. For additional information about managed basis, please refer to the Glossary of Terms on page 32.

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
CREDIT CARD INCOME
Credit Card Income - Reported	$	1,645		$	1,567		$	1,791		$	1,910		$	1,402			5	%		17	%	$	6,913		$	6,754			2	%
Impact of:
Credit Card Securitizations		(726	)		(721	)		(937	)		(1,125	)		(442	)		(1	)		(64	)		(3,509	)		(2,718	)		(29	)
Credit Card Income - Managed	$	919		$	846		$	854		$	785		$	960			9			(4	)	$	3,404		$	4,036			(16	)
OTHER INCOME
Other Income - Reported	$	522		$	635		$	464		$	554		$	1,761			(18	)		(70	)	$	2,175		$	2,684			(19	)
Impact of:
Tax Equivalent Adjustments		195			165			170			146			158			18			23			676			571			18
Other Income - Managed	$	717		$	800		$	634		$	700		$	1,919			(10	)		(63	)	$	2,851		$	3,255			(12	)
TOTAL NONINTEREST REVENUE
Total Noninterest Revenue - Reported	$	10,362		$	10,021		$	9,762		$	10,050		$	8,804			3			18		$	40,195		$	34,193			18
Impact of:
Credit Card Securitizations		(726	)		(721	)		(937	)		(1,125	)		(442	)		(1	)		(64	)		(3,509	)		(2,718	)		(29	)
Tax Equivalent Adjustments		195			165			170			146			158			18			23			676			571			18
Total Noninterest Revenue - Managed	$	9,831		$	9,465		$	8,995		$	9,071		$	8,520			4			15		$	37,362		$	32,046			17
NET INTEREST INCOME
Net Interest Income - Reported	$	5,692		$	5,379		$	5,178		$	4,993		$	4,678			6			22		$	21,242		$	19,555			9
Impact of:
Credit Card Securitizations		1,319			1,328			1,498			1,574			1,504			(1	)		(12	)		5,719			6,494			(12	)
Tax Equivalent Adjustments		53			57			47			71			57			(7	)		(7	)		228			269			(15	)
Net Interest Income - Managed	$	7,064		$	6,764		$	6,723		$	6,638		$	6,239			4			13		$	27,189		$	26,318			3
TOTAL NET REVENUE
Total Net Revenue - Reported	$	16,054		$	15,400		$	14,940		$	15,043		$	13,482			4			19		$	61,437		$	53,748			14
Impact of:
Credit Card Securitizations		593			607			561			449			1,062			(2	)		(44	)		2,210			3,776			(41	)
Tax Equivalent Adjustments		248			222			217			217			215			12			15			904			840			8
Total Net Revenue - Managed	$	16,895		$	16,229		$	15,718		$	15,709		$	14,759			4			14		$	64,551		$	58,364			11
PROVISION FOR CREDIT LOSSES
Provision for Credit Losses - Reported	$	1,134		$	812		$	493		$	831		$	1,224			40			(7	)	$	3,270		$	3,483			(6	)
Impact of:
Credit Card Securitizations		593			607			561			449			1,062			(2	)		(44	)		2,210			3,776			(41	)
Provision for Credit Losses - Managed	$	1,727		$	1,419		$	1,054		$	1,280		$	2,286			22			(24	)	$	5,480		$	7,259			(25	)
INCOME TAX EXPENSE
Income Tax Expense - Reported	$	1,268		$	1,705		$	1,727		$	1,537		$	1,186			(26	)		7		$	6,237		$	3,585			74
Impact of:
Tax Equivalent Adjustments		248			222			217			217			215			12			15			904			840			8
Income Tax Expense - Managed	$	1,516		$	1,927		$	1,944		$	1,754		$	1,401			(21	)		8		$	7,141		$	4,425			61

Page 6

JPMORGAN CHASE & CO.
LINE OF BUSINESS FINANCIAL HIGHLIGHTS — MANAGED BASIS
(in millions, except ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
TOTAL NET REVENUE (FTE)
Investment Bank	$	4,721		$	4,673		$	4,184		$	4,699		$	3,195			1	%		48	%	$	18,277		$	14,613			25	%
Retail Financial Services		3,728			3,555			3,779			3,763			3,594			5			4			14,825			14,830			—
Card Services		3,750			3,646			3,664			3,685			3,721			3			1			14,745			15,366			(4	)
Commercial Banking		1,018			933			949			900			916			9			11			3,800			3,488			9
Treasury & Securities Services		1,537			1,499			1,588			1,485			1,436			3			7			6,109			5,539			10
Asset Management		1,947			1,636			1,620			1,584			1,511			19			29			6,787			5,664			20
Corporate		194			287			(66	)		(407	)		386			(32	)		(50	)		8			(1,136	)		NM
TOTAL NET REVENUE	$	16,895		$	16,229		$	15,718		$	15,709		$	14,759			4			14		$	64,551		$	58,364			11
NET INCOME (LOSS)
Investment Bank	$	1,009		$	976		$	839		$	850		$	667			3			51		$	3,674		$	3,673			—
Retail Financial Services		718			746			868			881			803			(4	)		(11	)		3,213			3,427			(6	)
Card Services		719			711			875			901			302			1			138			3,206			1,907			68
Commercial Banking		256			231			283			240			279			11			(8	)		1,010			951			6
Treasury & Securities Services		256			256			316			262			254			—			1			1,090			863			26
Asset Management		407			346			343			313			342			18			19			1,409			1,216			16
Corporate (a)		1,161			31			16			(366	)		51			NM			NM			842			(3,554	)		NM
TOTAL NET INCOME (b)	$	4,526		$	3,297		$	3,540		$	3,081		$	2,698			37			68		$	14,444		$	8,483			70
AVERAGE EQUITY (c)
Investment Bank	$	21,000		$	21,000		$	21,000		$	20,000		$	20,000			—			5		$	20,753		$	20,000			4
Retail Financial Services		16,000			14,300			14,300			13,896			13,700			12			17			14,629			13,383			9
Card Services		14,100			14,100			14,100			14,100			11,800			—			19			14,100			11,800			19
Commercial Banking		6,300			5,500			5,500			5,500			3,400			15			85			5,702			3,400			68
Treasury & Securities Services		2,200			2,200			2,200			2,545			1,525			—			44			2,285			1,525			50
Asset Management		3,500			3,500			3,500			3,500			2,400			—			46			3,500			2,400			46
Corporate		51,662			51,206			48,357			47,626			53,100			1			(3	)		49,728			52,999			(6	)
TOTAL AVERAGE EQUITY	$	114,762		$	111,806		$	108,957		$	107,167		$	105,925			3			8		$	110,697		$	105,507			5
RETURN ON EQUITY (c)
Investment Bank		19	%		18	%		16	%		17	%		13	%								18	%		18	%
Retail Financial Services		18			21			24			26			23									22			26
Card Services		20			20			25			26			10									23			16
Commercial Banking		16			17			21			18			33									18			28
Treasury & Securities Services		46			46			58			42			66									48			57
Asset Management		46			39			39			36			57									40			51

(a)	Includes the after-tax impact of discontinued operations, material litigation reserve charges/recoveries, tax audit benefits and Merger costs. See Corporate for additional details.
(b)	Net income includes Income from discontinued operations (after-tax) of $620 million, $65 million, $56 million, $54 million, and $56 million for the quarter ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively, and $795 million and $229 million for full year 2006 and 2005, respectively.
(c)	Each business segment is allocated capital by taking into consideration stand-alone peer comparisons, economic risk measures and regulatory capital requirements. At the time of the Merger, goodwill, as well as the associated capital, was allocated solely to Corporate. Effective January 2006, the Firm prospectively refined its methodology to allocate capital to the business segments to include any goodwill associated with line of business-directed acquisitions since the Merger.

Page 7

JPMORGAN CHASE & CO.
INVESTMENT BANK
FINANCIAL HIGHLIGHTS
(in millions, except ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
INCOME STATEMENT
REVENUE
Investment Banking Fees	$	1,580		$	1,419		$	1,368		$	1,170		$	1,161			11	%		36	%	$	5,537		$	4,096			35	%
Principal Transactions		2,217			2,449			2,045			2,375			1,163			(9	)		91			9,086			6,059			50
Lending & Deposit Related Fees		119			127			134			137			143			(6	)		(17	)		517			594			(13	)
Asset Management, Administration and Commissions		540			468			550			552			460			15			17			2,110			1,727			22
All Other Income		91			159			3			275			115			(43	)		(21	)		528			534			(1	)
Noninterest Revenue		4,547			4,622			4,100			4,509			3,042			(2	)		49			17,778			13,010			37
Net Interest Income		174			51			84			190			153			241			14			499			1,603			(69	)
TOTAL NET REVENUE (a)		4,721			4,673			4,184			4,699			3,195			1			48			18,277			14,613			25
Provision for Credit Losses		63			7			(62	)		183			(83	)		NM			NM			191			(838	)		NM
Credit Reimbursement from TSS (b)		31			30			30			30			40			3			(23	)		121			154			(21	)
NONINTEREST EXPENSE
Compensation Expense		1,880			2,093			1,961			2,256			1,096			(10	)		72			8,190			5,792			41
Noncompensation Expense		1,186			1,008			985			935			1,067			18			11			4,114			3,957			4
TOTAL NONINTEREST EXPENSE		3,066			3,101			2,946			3,191			2,163			(1	)		42			12,304			9,749			26
Income Before Income Tax Expense		1,623			1,595			1,330			1,355			1,155			2			41			5,903			5,856			1
Income Tax Expense		614			619			491			505			488			(1	)		26			2,229			2,183			2
NET INCOME	$	1,009		$	976		$	839		$	850		$	667			3			51		$	3,674		$	3,673			—
FINANCIAL RATIOS
ROE		19	%		18	%		16	%		17	%		13	%								18	%		18	%
ROA		0.62			0.62			0.50			0.53			0.43									0.57			0.61
Overhead Ratio		65			66			70			68			68									67			67
Compensation Expense as a % of Total Net Revenue (c)		39			44			45			43			34									43			40
REVENUE BY BUSINESS
Investment Banking Fees:
Advisory	$	482		$	436		$	352		$	389		$	341			11			41		$	1,659		$	1,263			31
Equity Underwriting		327			275			364			212			311			19			5			1,178			864			36
Debt Underwriting		771			708			652			569			509			9			51			2,700			1,969			37
Total Investment Banking Fees		1,580			1,419			1,368			1,170			1,161			11			36			5,537			4,096			35
Fixed Income Markets		1,969			2,370			2,037			1,993			1,112			(17	)		77			8,369			7,277			15
Equity Markets		909			612			528			1,215			458			49			98			3,264			1,799			81
Credit Portfolio		263			272			251			321			464			(3	)		(43	)		1,107			1,441			(23	)
Total Net Revenue	$	4,721		$	4,673		$	4,184		$	4,699		$	3,195			1			48		$	18,277		$	14,613			25
REVENUE BY REGION
Americas	$	2,450		$	2,700		$	2,010		$	2,067		$	1,484			(9	)		65		$	9,227		$	8,258			12
Europe/Middle East/Africa		1,848			1,678			1,747			2,047			1,266			10			46			7,320			4,627			58
Asia/Pacific		423			295			427			585			445			43			(5	)		1,730			1,728			—
Total Net Revenue	$	4,721		$	4,673		$	4,184		$	4,699		$	3,195			1			48		$	18,277		$	14,613			25

(a)	Total net revenue includes tax-equivalent adjustments, primarily due to tax-exempt income from municipal bond investments and income tax credits related to affordable housing investments, of $218 million, $197 million, $193 million, $194 million and $191 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006 and December 31, 2005, and $802 million and $752 million for full year 2006 and 2005, respectively.
(b)	TSS is charged a credit reimbursement related to certain exposures managed within the IB credit portfolio on behalf of clients shared with TSS.
(c)	Beginning in the quarter ended March 31, 2006, Compensation expense to Total net revenue ratio is adjusted to present this ratio as if SFAS 123R had always been in effect. IB management believes that adjusting the Compensation expense to Total net revenue ratio for the incremental impact of adopting SFAS 123R provides a more meaningful measure of IB’s Compensation expense to Total net revenue ratio.

Page 8

JPMORGAN CHASE & CO.
INVESTMENT BANK
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except headcount, ratio and rankings data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
SELECTED BALANCE SHEETS DATA (Average)
Total Assets	$	645,993		$	626,245		$	672,056		$	646,220		$	618,171			3	%		5	%	$	647,569		$	599,761			8	%
Trading Assets - Debt and Equity Instruments		295,317			283,915			268,091			252,415			232,032			4			27			275,077			231,303			19
Trading Assets - Derivative Receivables		59,802			53,184			55,692			49,388			48,741			12			23			54,541			55,239			(1	)
Loans:
Loans Retained (a)		60,947			61,623			59,026			53,678			48,438			(1	)		26			58,846			44,813			31
Loans Held-for-Sale (b)		23,743			24,030			19,920			19,212			15,368			(1	)		54			21,745			11,755			85
Total Loans		84,690			85,653			78,946			72,890			63,806			(1	)		33			80,591			56,568			42
Adjusted Assets (c)		548,628			539,278			530,057			492,304			459,532			2			19			527,753			456,920			16
Equity		21,000			21,000			21,000			20,000			20,000			—			5			20,753			20,000			4
Headcount		23,729			23,447			22,914			21,705			19,802			1			20			23,729			19,802			20
CREDIT DATA AND QUALITY STATISTICS
Net Charge-offs (Recoveries)	$	10		$	(8	)	$	(12	)	$	(21	)	$	(5	)		NM			NM		$	(31	)	$	(126	)		75
Nonperforming Assets:
- Nonperforming Loans (d)		231			420			488			434			594			(45	)		(61	)		231			594			(61	)
- Other Nonperforming Assets		38			36			37			50			51			6			(25	)		38			51			(25	)
Allowance for Loan Losses		1,052			1,010			1,038			1,117			907			4			16			1,052			907			16
Allowance for Lending-Related Commitments		305			292			249			220			226			4			35			305			226			35
Net Charge-off (Recovery) Rate (b)		0.07	%		(0.05	)%		(0.08	)%		(0.16	)%		(0.04	)%								(0.05	)%		(0.28	)%
Allowance for Loan Losses to Average Loans (b)		1.73			1.64			1.76			2.08			1.87									1.79			2.02
Allowance for Loan Losses to Nonperforming Loans (d)		461			253			248			305			187									461			187
Nonperforming Loans to Average Loans		0.27			0.49			0.62			0.60			0.93									0.29			1.05
MARKET RISK - AVERAGE TRADING AND CREDIT PORTFOLIO VAR
Trading Activities:
Fixed Income	$	51		$	63		$	52		$	60		$	69			(19	)		(26	)	$	56		$	67			(16	)
Foreign Exchange		20			24			25			20			23			(17	)		(13	)		22			23			(4	)
Equities		35			32			24			32			30			9			17			31			34			(9	)
Commodities and Other		35			46			52			47			35			(24	)		—			45			21			114
Diversification (e)		(58	)		(82	)		(74	)		(68	)		(64	)		29			9			(70	)		(59	)		(19	)
Total Trading VAR (f)		83			83			79			91			93			—			(11	)		84			86			(2	)
Credit Portfolio VAR (g)		15			14			14			14			15			7			—			15			14			7
Diversification (e)		(11	)		(8	)		(9	)		(11	)		(13	)		(38	)		15			(11	)		(12	)		8
Total Trading and Credit Portfolio VAR	$	87		$	89		$	84		$	94		$	95			(2	)		(8	)	$	88		$	88			—

	Full Year 2006					Full Year 2005
MARKET SHARES AND RANKINGS (h)	Market Share			Rankings		Market Share			Rankings
Global Debt, Equity and Equity-Related		7	%		# 2		7	%		# 2
Global Syndicated Loans		14	%		# 1		15	%		# 1
Global Long-Term Debt		6	%		# 3		6	%		# 4
Global Equity and Equity-Related		7	%		# 6		7	%		# 6
Global Announced M&A		23	%		# 4		23	%		# 3
U.S. Debt, Equity and Equity-Related		9	%		# 2		8	%		# 3
U.S. Syndicated Loans		26	%		# 1		28	%		# 1
U.S. Long-Term Debt		12	%		# 2		11	%		# 2
U.S. Equity and Equity-Related		8	%		# 6		9	%		# 6
U.S. Announced M&A		27	%		# 3		26	%		# 3

(a)	Loans retained include Credit Portfolio, Conduit loans, leveraged leases, bridge loans for underwriting and other accrual loans.
(b)	Loans held-for-sale, which include loan syndications, and warehouse loans held as part of the IB’s mortgage-backed, asset-backed and other securitization businesses, are excluded from Total loans for the allowance coverage ratio and net charge-off rate.
(c)	Adjusted assets, a non-GAAP financial measure, equals total assets minus (1) securities purchased under resale agreements and securities borrowed less securities sold, not yet purchased; (2) assets of variable interest entities (VIEs) consolidated under FIN 46R; (3) cash and securities segregated and on deposit for regulatory and other purposes; and (4) goodwill and intangibles. The amount of adjusted assets is presented to assist the reader in comparing the IB’s asset and capital levels to other investment banks in the securities industry. Asset-to-equity leverage ratios are commonly used as one measure to assess a company’s capital adequacy. The IB believes an adjusted asset amount, which excludes certain assets considered to have a low risk profile, provides a more meaningful measure of balance sheet leverage in the securities industry.
(d)	Nonperforming loans include loans held-for-sale of $3 million, $21 million, $70 million, $68 million and $109 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively, which are excluded from the allowance coverage ratios. Nonperforming loans exclude distressed HFS loans purchased as part of IB’s proprietary activities.
(e)	Average VARs are less than the sum of the VARs of its market risk components due to risk offsets resulting from portfolio diversification. The diversification effect reflects the fact that the risks are not perfectly correlated. The risk of a portfolio of positions is therefore usually less than the sum of the risks of the positions themselves.
(f)	Includes substantially all trading activities; however, particular risk parameters of certain products are not fully captured, for example, correlation risk.
(g)	Includes VAR on derivative credit valuation adjustments, credit valuation adjustment hedges and mark-to-market hedges of the accrual loan portfolio, which are all reported in Principal Transactions. This VAR does not include the accrual loan portfolio, which is not marked to market.
(h)	Source: Thomson Financial Securities data. Global announced M&A is based on rank value; all other rankings are based upon proceeds, with full credit to each book manager/equal if joint. Because of joint assignments, market share of all participants will add up to more than 100%.

Page 9

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS
(in millions, except ratio and headcount data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
INCOME STATEMENT
REVENUE
Lending & Deposit Related Fees	$	430		$	406		$	390		$	371		$	374			6	%		15	%	$	1,597		$	1,452			10	%
Asset Management, Administration and Commissions		293			326			366			437			365			(10	)		(20	)		1,422			1,498			(5	)
Securities Gains (Losses)		(5	)		(7	)		(39	)		(6	)		(1	)		29			(400	)		(57	)		9		NM
Mortgage Fees and Related Income		111			67			204			236			183			66			(39	)		618			1,104			(44	)
Credit Card Income		143			136			129			115			118			5			21			523			426			23
All Other Income		176			170			163			48			73			4			141			557			136			310
Noninterest Revenue		1,148			1,098			1,213			1,201			1,112			5			3			4,660			4,625			1
Net Interest Income		2,580			2,457			2,566			2,562			2,482			5			4			10,165			10,205			—
TOTAL NET REVENUE		3,728			3,555			3,779			3,763			3,594			5			4			14,825			14,830			—
Provision for Credit Losses		262			114			100			85			158			130			66			561			724			(23	)
NONINTEREST EXPENSE
Compensation Expense		950			886			901			920			853			7			11			3,657			3,337			10
Noncompensation Expense		1,211			1,142			1,246			1,207			1,163			6			4			4,806			4,748			1
Amortization of Intangibles		130			111			112			111			125			17			4			464			500			(7	)
TOTAL NONINTEREST EXPENSE		2,291			2,139			2,259			2,238			2,141			7			7			8,927			8,585			4
Income Before Income Tax Expense		1,175			1,302			1,420			1,440			1,295			(10	)		(9	)		5,337			5,521			(3	)
Income Tax Expense		457			556			552			559			492			(18	)		(7	)		2,124			2,094			1
NET INCOME	$	718		$	746		$	868		$	881		$	803			(4	)		(11	)	$	3,213		$	3,427			(6	)
FINANCIAL RATIOS
ROE		18	%		21	%		24	%		26	%		23	%								22	%		26	%
ROA		1.21			1.31			1.49			1.54			1.40									1.39			1.51
Overhead Ratio		61			60			60			59			60									60			58
Overhead Ratio Excluding Core Deposit Intangibles (a)		58			57			57			57			56									57			55
SELECTED BALANCE SHEETS (Ending)
Assets	$	237,887		$	227,056		$	233,748		$	235,127		$	224,801			5			6		$	237,887		$	224,801			6
Loans (b)		213,504			205,554			203,928			202,591			197,299			4			8			213,504			197,299			8
Deposits		214,081			198,260			198,273			200,154			191,415			8			12			214,081			191,415			12
SELECTED BALANCE SHEETS (Average)
Assets	$	235,301		$	225,307		$	234,097		$	231,587		$	226,866			4			4		$	231,566		$	226,368			2
Loans (c)		211,654			203,307			201,635			198,797			197,359			4			7			203,882			198,153			3
Deposits		211,915			198,967			199,075			194,382			189,113			7			12			201,127			186,811			8
Equity		16,000			14,300			14,300			13,896			13,700			12			17			14,629			13,383			9
Headcount		65,570			61,915			62,450			62,472			60,998			6			7			65,570			60,998			7
CREDIT DATA AND QUALITY STATISTICS
Net Charge-offs	$	214		$	128		$	113		$	121		$	162			67			32		$	576		$	572			1
Nonperforming Loans (d)		1,677			1,404			1,339			1,349			1,338			19			25			1,677			1,338			25
Nonperforming Assets		1,902			1,595			1,520			1,537			1,518			19			25			1,902			1,518			25
Allowance for Loan Losses		1,392			1,306			1,321			1,333			1,363			7			2			1,392			1,363			2
Net Charge-off Rate (c)		0.45	%		0.27	%		0.24	%		0.27	%		0.36	%								0.31	%		0.31	%
Allowance for Loan Losses to Ending Loans (b)		0.77			0.69			0.69			0.71			0.75									0.77			0.75
Allowance for Loan Losses to Nonperforming Loans (d)		89			95			99			100			104									89			104
Nonperforming Loans to Total Loans		0.79			0.68			0.66			0.67			0.68									0.79			0.68

(a)	Retail Financial Services uses the overhead ratio (excluding the amortization of core deposit intangibles (“CDI”)), a non-GAAP financial measure, to evaluate the underlying expense trends of the business. Including CDI amortization expense in the overhead ratio calculation results in a higher overhead ratio in the earlier years and a lower overhead ratio in later years; this would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio excludes Regional Banking’s core deposit intangible amortization expense related to the Bank of New York transaction and the Merger of $130 million, $109 million, $110 million, $109 million, and $124 million for the quarters ending December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, and $458 million and $496 million for full year 2006 and 2005, respectively.
(b)	Includes loans held-for-sale of $32,744 million, $17,005 million, $11,834 million, $14,343 million, and $16,598 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. These amounts are not included in the allowance coverage ratios.
(c)	Average loans include loans held-for-sale of $21,228 million, $13,994 million, $12,903 million, $16,362 million, and $16,505 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. The full year average loans held-for-sale were $16,129 million and $15,675 million for 2006 and 2005, respectively. These amounts are not included in the net charge-off rate.
(d)	Nonperforming loans include loans held-for-sale of $116 million, $24 million, $9 million, $16 million, and $27 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. These amounts are not included in the allowance coverage ratios.

Page 10

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
REGIONAL BANKING
Noninterest Revenue	$	678		$	855		$	851		$	820		$	701			(21	)%		(3	)%	$	3,204		$	3,138			2	%
Net Interest Income		2,229			2,107			2,212			2,220			2,101			6			6			8,768			8,531			3
Total Net Revenue		2,907			2,962			3,063			3,040			2,802			(2	)		4			11,972			11,669			3
Provision for Credit Losses		165			53			70			66			87			211			90			354			512			(31	)
Noninterest Expense		1,730			1,611			1,746			1,738			1,636			7			6			6,825			6,675			2
Income Before Income Tax Expense		1,012			1,298			1,247			1,236			1,079			(22	)		(6	)		4,793			4,482			7
Net Income		619			744			764			757			669			(17	)		(7	)		2,884			2,780			4
ROE		21	%		29	%		30	%		31	%		28	%								27	%		31	%
ROA		1.51			1.86			1.86			1.95			1.73									1.79			1.84
Overhead Ratio		60			54			57			57			58									57			57
Overhead Ratio Excluding Core Deposit Intangibles (a)		55			51			53			54			54									53			53
BUSINESS METRICS (in billions)
Home Equity Origination Volume	$	12.9		$	13.3		$	14.0		$	11.7		$	12.1			(3	)		7		$	51.9		$	54.1			(4	)
End of Period Loans Owned:
Home Equity	$	85.7		$	80.4		$	77.8		$	75.3		$	73.9			7			16		$	85.7		$	73.9			16
Mortgage		30.1			46.6			48.6			47.0			44.6			(35	)		(33	)		30.1			44.6			(33	)
Business Banking		14.1			13.1			13.0			12.8			12.8			8			10			14.1			12.8			10
Education		10.3			9.4			8.3			9.5			3.0			10			243			10.3			3.0			243
Other Loans (b)		2.7			2.2			2.6			2.7			2.6			23			4			2.7			2.6			4
Total End of Period Loans		142.9			151.7			150.3			147.3			136.9			(6	)		4			142.9			136.9			4
End of Period Deposits:
Checking	$	68.7		$	59.8		$	62.3		$	64.9		$	64.9			15			6		$	68.7		$	64.9			6
Savings		92.4			86.9			89.1			91.0			87.7			6			5			92.4			87.7			5
Time and Other		43.3			41.5			36.5			34.2			29.7			4			46			43.3			29.7			46
Total End of Period Deposits		204.4			188.2			187.9			190.1			182.3			9			12			204.4			182.3			12
Average Loans Owned:
Home Equity	$	84.2		$	78.8		$	76.2		$	74.1		$	72.7			7			16		$	78.3		$	69.9			12
Mortgage Loans		40.8			47.8			47.1			44.6			45.6			(15	)		(11	)		45.1			45.4			(1	)
Business Banking		14.0			13.0			13.0			12.8			12.6			8			11			13.2			12.6			5
Education		9.9			8.9			8.7			5.4			2.6			11			281			8.3			2.8			196
Other Loans (b)		2.7			2.2			2.6			3.0			2.7			23			—			2.6			3.1			(16	)
Total Average Loans (c)		151.6			150.7			147.6			139.9			136.2			1			11			147.5			133.8			10
Average Deposits:
Checking	$	65.5		$	60.3		$	62.6		$	63.0		$	61.7			9			6		$	62.8		$	61.7			2
Savings		92.2			88.1			89.8			89.3			87.8			5			5			89.9			87.5			3
Time and Other		43.0			39.0			35.4			32.4			28.1			10			53			37.5			26.1			44
Total Average Deposits		200.7			187.4			187.8			184.7			177.6			7			13			190.2			175.3			8
Average Assets		162.5			159.1			164.6			157.1			153.4			2			6			160.8			150.8			7
Average Equity		11.9			10.2			10.2			9.8			9.4			17			27			10.5			9.1			15

Page 11

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
REGIONAL BANKING (continued)
CREDIT DATA AND QUALITY STATISTICS
30+ Day Delinquency Rate (d) (e)		2.02	%		1.57	%		1.48	%		1.36	%		1.68	%								2.02	%		1.68	%
Net Charge-offs
Home Equity	$	51		$	29		$	30		$	33		$	42			66	%		14	%	$	143		$	141			(1	)%
Mortgage		21			14			9			12			5			71			380			56			25			136
Business Banking		38			19			16			18			32			100			19			91			101			(10	)
Other Loans		27			1			13			7			6		NM				350			48			28			71
Total Net Charge-offs		137			63			68			70			85			117			61			338			295			15
Net Charge-off Rate
Home Equity		0.24	%		0.15	%		0.16	%		0.18	%		0.23	%								0.18	%		0.20	%
Mortgage		0.20			0.12			0.08			0.11			0.04									0.12			0.06
Business Banking		1.08			0.58			0.49			0.57			1.01									0.69			0.80
Other Loans (c)		1.15			0.05			0.55			0.56			0.88									0.59			0.93
Total Net Charge-off Rate (c) (g)		0.37			0.17			0.19			0.21			0.25									0.23			0.23
Nonperforming Assets (f) (g) (h)	$	1,725		$	1,421		$	1,349		$	1,339		$	1,282			21			35		$	1,725		$	1,282			35
RETAIL BRANCH BUSINESS METRICS
Investment Sales Volume	$	4,101		$	3,536		$	3,692		$	3,553		$	2,622			16			56		$	14,882		$	11,144			34
Number of:
Branches		3,079			2,677			2,660			2,638			2,641			402	#		438	#		3,079			2,641			438	#
ATMs		8,506			7,825			7,753			7,400			7,312			681			1,194			8,506			7,312			1,194
Personal Bankers (i)		7,573			7,484			7,260			7,019			7,067			89			506			7,573			7,067			506
Sales Specialists		3,614			3,471			3,376			3,318			3,214			143			400			3,614			3,214			400
Active Online Customers (in thousands) (j)		5,715			5,340			5,072			5,030			4,231			375			1,484			5,715			4,231			1,484
Checking Accounts (in thousands)		9,995			9,270			9,072			8,936			8,793			725			1,202			9,995			8,793			1,202
MORTGAGE BANKING
Production Revenue	$	215		$	197		$	202		$	219		$	134			9	%		60	%	$	833		$	744			12	%
Net Mortgage Servicing Revenue:
Loan Servicing Revenue		598			579			563			560			546			3			10			2,300			2,115			9
Changes in MSR Asset Fair Value:
Due to Inputs or Assumptions in Model (k)		38			(1,075	)		491			711			157		NM				(76	)		165			770			(79	)
Other Changes in Fair Value (l)		(372	)		(327	)		(392	)		(349	)		(309	)		(14	)		(20	)		(1,440	)		(1,295	)		(11	)
Derivative Valuation Adjustments and Other		(69	)		824			(546	)		(753	)		(104	)	NM				34			(544	)		(494	)		(10	)
Total Net Mortgage Servicing Revenue		195			1			116			169			290		NM				(33	)		481			1,096			(56	)
Total Net Revenue		410			198			318			388			424			107			(3	)		1,314			1,840			(29	)
Noninterest Expense		354			334			329			324			325			6			9			1,341			1,239			8
Income (Loss) Before Income Tax Expense		56			(136	)		(11	)		64			99		NM				(43	)		(27	)		601		NM
Net Income (Loss)		34			(83	)		(7	)		39			63		NM				(46	)		(17	)		379		NM
ROE		8	%	NM			NM				9	%		16	%								NM			24	%
ROA		0.45		NM			NM				0.58			1.03									NM			1.69
Business Metrics (in billions)
Third Party Mortgage Loans Serviced (Ending)	$	526.7		$	510.7		$	497.4		$	484.1		$	467.5			3			13		$	526.7		$	467.5			13
MSR Net Carrying Value (Ending)		7.5			7.4			8.2			7.5			6.5			1			15			7.5			6.5			15
Average Mortgage Loans Held-for-Sale		17.9			10.5			9.8			13.0			13.1			70			37			12.8			12.1			6
Average Assets		29.8			22.4			23.9			27.1			24.2			33			23			25.8			22.4			15
Average Equity		1.7			1.7			1.7			1.7			1.6			—			6			1.7			1.6			6
Mortgage Origination Volume by Channel (in billions)
Retail	$	10.4		$	10.1		$	10.8		$	9.1		$	10.7			3			(3	)	$	40.4		$	46.3			(13	)
Wholesale		9.0			7.7			8.7			7.4			8.2			17			10			32.8			34.2			(4	)
Correspondent (Including Negotiated Transactions)		11.6			10.6			12.0			11.7			13.0			9			(11	)		45.9			48.5			(5	)
Total		31.0			28.4			31.5			28.2			31.9			9			(3	)		119.1			129.0			(8	)

Page 12

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
AUTO FINANCE
Noninterest Revenue	$	124		$	110		$	90		$	44		$	75			13	%		65	%	$	368		$	86			328	%
Net Interest Income		287			285			308			291			293			1			(2	)		1,171			1,235			(5	)
Total Net Revenue		411			395			398			335			368			4			12			1,539			1,321			17
Provision for Credit Losses		97			61			30			19			71			59			37			207			212			(2	)
Noninterest Expense		207			194			184			176			180			7			15			761			671			13
Income Before Income Tax Expense		107			140			184			140			117			(24	)		(9	)		571			438			30
Net Income		65			85			111			85			71			(24	)		(8	)		346			268			29
ROE		11	%		14	%		19	%		14	%		10	%								14	%		10	%
ROA		0.60			0.77			0.98			0.73			0.57									0.77			0.50
Business Metrics (in billions)
Auto Origination Volume	$	5.0		$	5.5		$	4.5		$	4.3		$	4.1			(9	)		22		$	19.3		$	18.1			7
End-of-Period Loans and Lease Related Assets
Loans Outstanding	$	39.3		$	38.1		$	39.4		$	41.0		$	41.7			3			(6	)	$	39.3		$	41.7			(6	)
Lease Financing Receivables		1.7			2.2			2.8			3.6			4.3			(23	)		(60	)		1.7			4.3			(60	)
Operating Lease Assets		1.6			1.5			1.3			1.1			0.9			7			78			1.6			0.9			78
Total End-of-Period Loans and Lease Related Assets		42.6			41.8			43.5			45.7			46.9			2			(9	)		42.6			46.9			(9	)
Average Loans and Lease Related Assets
Loans Outstanding (m)	$	38.7		$	38.9		$	40.3		$	41.2		$	42.6			(1	)		(9	)	$	39.8		$	45.5			(13	)
Lease Financing Receivables		1.9			2.5			3.2			4.0			4.7			(24	)		(60	)		2.9			6.2			(53	)
Operating Lease Assets		1.5			1.4			1.2			1.0			0.8			7			88			1.3			0.4			225
Total Average Loans and Lease Related Assets		42.1			42.8			44.7			46.2			48.1			(2	)		(12	)		44.0			52.1			(16	)
Average Assets		43.1			43.8			45.6			47.3			49.3			(2	)		(13	)		44.9			53.2			(16	)
Average Equity		2.4			2.4			2.4			2.4			2.7			—			(11	)		2.4			2.7			(11	)
Credit Quality Statistics
30+ Day Delinquency Rate		1.72	%		1.61	%		1.37	%		1.39	%		1.66	%								1.72	%		1.66	%
Net Charge-offs
Loans	$	76		$	63		$	44		$	48		$	72			21			6		$	231		$	257			(10	)
Lease Receivables		1			2			1			3			5			(50	)		(80	)		7			20			(65	)
Total Net Charge-offs		77			65			45			51			77			18			—			238			277			(14	)
Net Charge-off Rate
Loans (m)		0.78	%		0.66	%		0.45	%		0.47	%		0.68	%								0.59	%		0.57	%
Lease Receivables		0.21			0.32			0.13			0.30			0.42									0.24			0.32
Total Net Charge-off Rate (m)		0.75			0.64			0.43			0.46			0.66									0.56			0.54
Nonperforming Assets	$	177		$	174		$	171		$	198		$	236			2			(25	)	$	177		$	236			(25	)

(a)	Regional Banking uses the overhead ratio (excluding the amortization of core deposit intangibles (“CDI”)), a non-GAAP financial measure, to evaluate the underlying expense trends of the business. Including CDI amortization expense in the overhead ratio calculation results in a higher overhead ratio in the earlier years and a lower overhead ratio in later years; this would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio excludes Regional Banking’s core deposit intangible amortization expense related to the Bank of New York transaction and the Merger of $130 million, $109 million, $110 million, $109 million, and $124 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, and $458 million and $496 million for years 2006 and 2005, respectively.
(b)	Includes commercial loans derived from community development activities and, prior to July 3, 2006, insurance policy loans.
(c)	Average loans include loans held-for-sale of $3.3 billion, $2.5 billion, $1.9 billion, $3.3 billion, and $2.6 billion for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. The average loans held-for-sale were $2.8 billion and $2.9 billion for full year 2006 and 2005, respectively. These amounts are not included in the net charge-off rate.
(d)	Excludes delinquencies related to loans eligible for repurchase as well as loans repurchased from GNMA pools that are insured by government agencies of $1.0 billion, $0.9 billion, $0.8 billion, $0.9 billion, and $0.9 billion at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. These amounts are excluded as reimbursement is proceeding normally.
(e)	Excludes delinquencies that are insured by government agencies under the Federal Family Education Loan Program of $0.5 billion, $0.5 billion, $0.4 billion and $0.4 billion at December 31, 2006, September 30, 2006, June 30, 2006 and March 31, 2006, respectively. Delinquencies were insignificant in the last quarter of 2005. These amounts are excluded as reimbursement is proceeding normally.
(f)	Excludes nonperforming assets related to loans eligible for repurchase as well as loans repurchased from GNMA pools that are insured by government agencies of $1.2 billion, $1.1 billion, $1.1 billion, $1.1 billion, and $1.1 billion at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. These amounts are excluded as reimbursement is proceeding normally.
(g)	Excludes loans that are 90 days past due and still accruing, which are insured by government agencies under the Federal Family Education Loan Program of $0.2 billion for each quarter of 2006. The Education loans past due 90 days were insignificant in the last quarter of 2005. These amounts are excluded as reimbursement is proceeding normally.
(h)	Includes nonperforming loans held-for-sale related to mortgage banking activities of $11 million, $3 million, $9 million, $16 million, and $27 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively.
(i)	Excludes employees acquired as part of the Bank of New York purchase. Mapping of the existing Bank of New York acquired employee base into Chase employment categories is expected to be completed over the next year.
(j)	Includes Mortgage and Auto online customers.
(k)	Represents MSR asset fair value adjustments due to changes in inputs, such as interest rates and volatility, as well as updates to assumptions used in the valuation model.
(l)	Includes changes in the MSR value due to servicing portfolio runoff (or time decay). Effective January 1, 2006, the Firm implemented SFAS 156, adopting fair value for the MSR asset. For the periods ending December 31, 2005, amounts represent MSR asset amortization expense calculated in accordance with SFAS 140.
(m)	Average loans include loans held-for-sale of $0.9 billion, $1.2 billion and $0.8 billion for the quarters ended September 30, 2006, June 30, 2006 and December 31, 2005, respectively. Average loans held-for-sale for the quarters ended December 31, 2006 and March 31, 2006 were insignificant. The average loans held-for-sale were $0.5 billion and $0.7 billion for full year 2006 and 2005, respectively. These amounts are not included in the net charge-off rate.

Page 13

JPMORGAN CHASE & CO.
CARD SERVICES — MANAGED BASIS
FINANCIAL HIGHLIGHTS
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005 (e)			2005
INCOME STATEMENT
REVENUE
Credit Card Income	$	697		$	636		$	653		$	601		$	772			10	%		(10	)%	$	2,587		$	3,351			(23	)%
All Other Income		111			126			49			71			99			(12	)		12			357			212			68
Noninterest Revenue		808			762			702			672			871			6			(7	)		2,944			3,563			(17	)
Net Interest Income		2,942			2,884			2,962			3,013			2,850			2			3			11,801			11,803			—
TOTAL NET REVENUE		3,750			3,646			3,664			3,685			3,721			3			1			14,745			15,366			(4	)
Provision for Credit Losses (a)		1,281			1,270			1,031			1,016			2,236			1			(43	)		4,598			7,346			(37	)
NONINTEREST EXPENSE
Compensation Expense		242			251			251			259			221			(4	)		10			1,003			1,081			(7	)
Noncompensation Expense		915			823			810			796			614			11			49			3,344			3,170			5
Amortization of Intangibles		184			179			188			188			182			3			1			739			748			(1	)
TOTAL NONINTEREST EXPENSE		1,341			1,253			1,249			1,243			1,017			7			32			5,086			4,999			2
Income Before Income Tax Expense		1,128			1,123			1,384			1,426			468			—			141			5,061			3,021			68
Income Tax Expense		409			412			509			525			166			(1	)		146			1,855			1,114			67
NET INCOME	$	719		$	711		$	875		$	901		$	302			1			138		$	3,206		$	1,907			68
Memo: Net Securitization Gains (Amortization)	$	32		$	48		$	(6	)	$	8		$	28			(33	)		14		$	82		$	56			46
FINANCIAL METRICS
ROE		20	%		20	%		25	%		26	%		10	%								23	%		16	%
Overhead Ratio		36			34			34			34			27									34			33
% of Average Managed Outstandings:
Net Interest Income		7.92			8.07			8.66			8.85			8.14									8.36			8.65
Provision for Credit Losses		3.45			3.56			3.01			2.99			6.39									3.26			5.39
Noninterest Revenue		2.17			2.13			2.05			1.97			2.49									2.09			2.61
Risk Adjusted Margin (b)		6.65			6.65			7.70			7.84			4.24									7.19			5.88
Noninterest Expense		3.61			3.51			3.65			3.65			2.91									3.60			3.67
Pretax Income (ROO)		3.04			3.14			4.05			4.19			1.34									3.59			2.21
Net Income		1.94			1.99			2.56			2.65			0.86									2.27			1.40
BUSINESS METRICS
Charge Volume (in billions)	$	93.4		$	87.5		$	84.4		$	74.3		$	79.6			7			17		$	339.6		$	301.9			12
Net Accounts Opened (in thousands) (c)		14,392			4,186			24,573			2,718			12,501			244			15			45,869			21,056			118
Credit Cards Issued (in thousands)		154,424			139,513			136,685			112,446			110,439			11			40			154,424			110,439			40
Number of Registered Internet Customers (in millions)		22.5			20.4			19.1			15.9			14.6			10			54			22.5			14.6			54
Merchant Acquiring Business (d)
Bank Card Volume (in billions)	$	177.9		$	168.7		$	166.3		$	147.7		$	153.4			5			16		$	660.6		$	563.1			17
Total Transactions (in millions)		4,968			4,597			4,476			4,130			4,315			8			15			18,171			15,499			17

(a)	Second quarter of 2006 includes a $90 million release of a $100 million special provision, originally recorded in the third quarter of 2005, related to Hurricane Katrina.
(b)	Represents Total Net Revenue less Provision for Credit Losses.
(c)	Fourth quarter of 2006 includes approximately 9 million accounts from the acquisition of the BP and Pier 1 Imports, Inc. private label portfolios. Second quarter of 2006 includes approximately 21 million accounts from the acquisition of the Kohl’s private label portfolio. Fourth quarter of 2005 includes approximately 10 million accounts from the acquisition of the Sears Canada portfolio.
(d)	Represents 100% of the merchant acquiring business.
(e)	As a result of the integration of Chase Merchant Services and Paymentech merchant processing businesses into a joint venture, beginning in the fourth quarter of 2005, Total Net Revenue, Total Noninterest Expense and Income Before Income Tax Expense have been reduced to reflect the deconsolidation of Paymentech. There is no impact to Net Income.

Page 14

JPMORGAN CHASE & CO.
CARD SERVICES - MANAGED BASIS
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except headcount and ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
SELECTED ENDING BALANCES
Loans:
Loans on Balance Sheets	$	85,881		$	78,587		$	72,961		$	64,691		$	71,738			9	%		20	%	$	85,881		$	71,738			20	%
Securitized Loans		66,950			65,245			66,349			69,580			70,527			3			(5	)		66,950			70,527			(5	)
Managed Loans	$	152,831		$	143,832		$	139,310		$	134,271		$	142,265			6			7		$	152,831		$	142,265			7
SELECTED AVERAGE BALANCES
Managed Assets	$	153,973		$	148,272		$	144,284		$	145,994		$	144,166			4			7		$	148,153		$	141,933			4
Loans:
Loans on Balance Sheets	$	81,489		$	76,655		$	68,185		$	68,455		$	69,038			6			18		$	73,740		$	67,334			10
Securitized Loans		65,898			65,061			69,005			69,571			69,840			1			(6	)		67,367			69,055			(2	)
Managed Loans	$	147,387		$	141,716		$	137,190		$	138,026		$	138,878			4			6		$	141,107		$	136,389			3
Equity		14,100			14,100			14,100			14,100			11,800			—			19			14,100			11,800			19
Headcount		18,639			18,696			18,753			18,801			18,629			—			—			18,639			18,629			—
CREDIT QUALITY STATISTICS
Net Charge-offs	$	1,281		$	1,280		$	1,121		$	1,016		$	2,236			—			(43	)	$	4,698		$	7,100			(34	)
Net Charge-off Rate		3.45	%		3.58	%		3.28	%		2.99	%		6.39	%								3.33	%		5.21	%
Delinquency ratios
30+ days		3.13	%		3.17	%		3.14	%		3.10	%		2.79	%								3.13	%		2.79	%
90+ days		1.50			1.48			1.52			1.39			1.27									1.50			1.27
Allowance for Loan Losses	$	3,176		$	3,176		$	3,186		$	3,274		$	3,274			—			(3	)	$	3,176		$	3,274			(3	)
Allowance for Loan Losses to Period-end Loans		3.70	%		4.04	%		4.37	%		5.06	%		4.56	%								3.70	%		4.56	%

Page 15

JPMORGAN CHASE & CO.
CARD RECONCILIATION OF REPORTED AND MANAGED DATA
(in millions)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
INCOME STATEMENT DATA (a)
Credit Card Income
Reported Data for the period	$	1,423		$	1,357		$	1,590		$	1,726		$	1,214			5	%		17	%	$	6,096		$	6,069			—	%
Securitization Adjustments		(726	)		(721	)		(937	)		(1,125	)		(442	)		(1	)		(64	)		(3,509	)		(2,718	)		(29	)
Managed Credit Card Income	$	697		$	636		$	653		$	601		$	772			10			(10	)	$	2,587		$	3,351			(23	)
Net Interest Income
Reported Data for the Period	$	1,623		$	1,556		$	1,464		$	1,439		$	1,346			4			21		$	6,082		$	5,309			15
Securitization Adjustments		1,319			1,328			1,498			1,574			1,504			(1	)		(12	)		5,719			6,494			(12	)
Managed Net Interest Income	$	2,942		$	2,884		$	2,962		$	3,013		$	2,850			2			3		$	11,801		$	11,803			—
Total Net Revenue
Reported Data for the Period	$	3,157		$	3,039		$	3,103		$	3,236		$	2,659			4			19		$	12,535		$	11,590			8
Securitization Adjustments		593			607			561			449			1,062			(2	)		(44	)		2,210			3,776			(41	)
Managed Total Net Revenue	$	3,750		$	3,646		$	3,664		$	3,685		$	3,721			3			1		$	14,745		$	15,366			(4	)
Provision for Credit Losses
Reported Data for the Period (b)	$	688		$	663		$	470		$	567		$	1,174			4			(41	)	$	2,388		$	3,570			(33	)
Securitization Adjustments		593			607			561			449			1,062			(2	)		(44	)		2,210			3,776			(41	)
Managed Provision for Credit Losses (b)	$	1,281		$	1,270		$	1,031		$	1,016		$	2,236			1			(43	)	$	4,598		$	7,346			(37	)
BALANCE SHEETS - AVERAGE BALANCES (a)
Total Average Assets
Reported Data for the Period	$	90,283		$	85,301		$	77,371		$	78,437		$	76,207			6			18		$	82,887		$	74,753			11
Securitization Adjustments		63,690			62,971			66,913			67,557			67,959			1			(6	)		65,266			67,180			(3	)
Managed Average Assets	$	153,973		$	148,272		$	144,284		$	145,994		$	144,166			4			7		$	148,153		$	141,933			4
CREDIT QUALITY STATISTICS (a)
Net Charge-offs
Reported Net Charge-offs Data for the period	$	688		$	673		$	560		$	567		$	1,174			2			(41	)	$	2,488		$	3,324			(25	)
Securitization Adjustments		593			607			561			449			1,062			(2	)		(44	)		2,210			3,776			(41	)
Managed Net Charge-offs	$	1,281		$	1,280		$	1,121		$	1,016		$	2,236			—			(43	)	$	4,698		$	7,100			(34	)

RECONCILIATION OF CARD SERVICES’ MANAGED RESULTS TO ADJUSTED RESULTS AS IF PAYMENTECH HAD NOT BEEN CONSOLIDATED

The financial information presented below is presented to illustrate the underlying trends of how Card Services’ results may have appeared had Paymentech been deconsolidated prior to the earliest date indicated.

	QUARTERLY TRENDS																FULL YEAR
											4Q06 Change											2006 Change
	4Q06		3Q06		2Q06		1Q06		4Q05		3Q06			4Q05			2006		2005			2005
Noninterest Revenue
Reported for the period	$	808	$	762	$	702	$	672	$	871		6	%		(7)	%	$	2,944	$	3,563			(17)	%
Adjustment for Paymentech		—		—		—		—		—		NM			NM			—		(422	)		NM
Adjusted Noninterest Revenue	$	808	$	762	$	702	$	672	$	871		6			(7	)	$	2,944	$	3,141			(6	)
Total Net Revenue
Reported for the period	$	3,750	$	3,646	$	3,664	$	3,685	$	3,721		3			1		$	14,745	$	15,366			(4	)
Adjustment for Paymentech		—		—		—		—		—		NM			NM			—		(435	)		NM
Adjusted Total Net Revenue	$	3,750	$	3,646	$	3,664	$	3,685	$	3,721		3			1		$	14,745	$	14,931			(1	)
Noninterest Expense
Reported for the period	$	1,341	$	1,253	$	1,249	$	1,243	$	1,017		7			32		$	5,086	$	4,999			2
Adjustment for Paymentech		—		—		—		—		—		NM			NM			—		(389	)		NM
Adjusted Total Noninterest Expense	$	1,341	$	1,253	$	1,249	$	1,243	$	1,017		7			32		$	5,086	$	4,610			10

(a)

JPMorgan Chase uses the concept of “managed receivables” to evaluate the credit performance and overall performance of the underlying credit card loans, both sold and not sold; as the same borrower is continuing to use the credit card for ongoing charges, a borrower’s credit performance will affect both the receivables sold under SFAS 140 and those not sold. Thus, in its disclosures regarding managed receivables, JPMorgan Chase treats the sold receivables as if they were still on the balance sheet in order to disclose the credit performance (such as net charge-off rates) of the entire managed credit card portfolio. Managed results exclude the impact of credit card securitizations on Total Net Revenue, the Provision for Credit Losses, Net Charge-Offs and Loan Receivables. Securitization does not change reported net income versus managed earnings; however, it does affect the classification of items on the Consolidated Statements of Income and Consolidated Balance Sheets.

(b)

Second quarter of 2006 includes a $90 million release of a $100 million special provision, originally recorded in the third quarter of 2005, related to Hurricane Katrina.

Page 16

JPMORGAN CHASE & CO.
COMMERCIAL BANKING
FINANCIAL HIGHLIGHTS
(in millions, except ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
INCOME STATEMENT
REVENUE
Lending & Deposit Related Fees	$	155		$	145		$	147		$	142		$	143			7	%		8	%	$	589		$	572			3	%
Asset Management, Administration and Commissions		20			16			16			15			14			25			43			67			57			18
All Other Income (a)		135			95			111			76			97			42			39			417			357			17
Noninterest Revenue		310			256			274			233			254			21			22			1,073			986			9
Net Interest Income		708			677			675			667			662			5			7			2,727			2,502			9
TOTAL NET REVENUE		1,018			933			949			900			916			9			11			3,800			3,488			9
Provision for Credit Losses		111			54			(12	)		7			(17	)		106			NM			160			73			119
NONINTEREST EXPENSE
Compensation Expense		174			190			179			197			171			(8	)		2			740			654			13
Noncompensation Expense		296			296			302			285			289			—			2			1,179			1,137			4
Amortization of Intangibles		15			14			15			16			16			7			(6	)		60			65			(8	)
TOTAL NONINTEREST EXPENSE		485			500			496			498			476			(3	)		2			1,979			1,856			7
Income Before Income Tax Expense		422			379			465			395			457			11			(8	)		1,661			1,559			7
Income Tax Expense		166			148			182			155			178			12			(7	)		651			608			7
NET INCOME	$	256		$	231		$	283		$	240		$	279			11			(8	)	$	1,010		$	951			6
MEMO:
Revenue by Product:
Lending	$	359		$	335		$	331		$	319		$	310			7			16		$	1,344		$	1,215			11
Treasury Services		576			551			566			550			546			5			5			2,243			2,062			9
Investment Banking		87			60			66			40			56			45			55			253			206			23
Other		(4	)		(13	)		(14	)		(9	)		4			69			NM			(40	)		5			NM
Total Commercial Banking Revenue	$	1,018		$	933		$	949		$	900		$	916			9			11		$	3,800		$	3,488			9
IB Revenues, Gross (b)	$	246		$	170		$	186		$	114		$	150			45			64		$	716		$	552			30
Revenue by Business:
Middle Market Banking	$	661		$	617		$	634		$	623		$	608			7			9		$	2,535		$	2,358			8
Mid-Corporate Banking		198			160			161			137			148			24			34			656			551			19
Real Estate		120			119			114			105			122			1			(2	)		458			434			6
Other		39			37			40			35			38			5			3			151			145			4
Total Commercial Banking Revenue	$	1,018		$	933		$	949		$	900		$	916			9			11		$	3,800		$	3,488			9
FINANCIAL RATIOS
ROE		16	%		17	%		21	%		18	%		33	%								18	%		28	%
ROA		1.63			1.60			2.01			1.78			2.04									1.75			1.82
Overhead Ratio		48			54			52			55			52									52			53

(a)	IB-related and commercial card revenues are included in All Other Income.
(b)	Represents 100% of the revenue earned by Commercial Bank by selling Investment Banking products to Commercial clients.

Page 17

JPMORGAN CHASE & CO.
COMMERCIAL BANKING
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio and headcount data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
SELECTED BALANCE SHEETS DATA (Average)
Total Assets	$	62,227		$	57,378		$	56,561		$	54,771		$	54,205			8	%		15	%	$	57,754		$	52,358			10	%
Loans and Leases (a)		57,657			53,404			52,413			50,836			50,042			8			15			53,596			48,117			11
Liability Balances (b)		79,050			72,009			72,556			70,763			68,895			10			15			73,613			66,055			11
Equity		6,300			5,500			5,500			5,500			3,400			15			85			5,702			3,400			68
MEMO:
Loans by Business:
Middle Market Banking	$	35,618		$	32,890		$	32,492		$	31,861		$	32,014			8			11		$	33,225		$	31,193			7
Mid-Corporate Banking		9,898			8,756			8,269			7,577			7,055			13			40			8,632			6,388			35
Real Estate		7,745			7,564			7,515			7,436			7,350			2			5			7,566			6,909			10
Other		4,396			4,194			4,137			3,962			3,623			5			21			4,173			3,627			15
Total Commercial Banking Loans	$	57,657		$	53,404		$	52,413		$	50,836		$	50,042			8			15		$	53,596		$	48,117			11
Headcount		4,459			4,447			4,320			4,310			4,418			—			1			4,459			4,418			1
CREDIT DATA AND QUALITY STATISTICS
Net Charge-offs (Recoveries)	$	16		$	21		$	(3	)	$	(7	)	$	21			(24	)		(24	)	$	27		$	26			4
Nonperforming Loans		121			157			225			202			272			(23	)		(56	)		121			272			(56	)
Allowance for Loan Losses		1,519			1,431			1,394			1,415			1,392			6			9			1,519			1,392			9
Allowance for Lending-Related Commitments		187			156			157			145			154			20			21			187			154			21
Net Charge-off (Recovery) Rate (a)		0.11	%		0.16	%		(0.02	)%		(0.06	)%		0.17	%								0.05	%		0.05	%
Allowance for Loan Losses to Average Loans (a)		2.67			2.70			2.68			2.80			2.79									2.86			2.91
Allowance for Loan Losses to Nonperforming Loans		1,255			911			620			700			512									1,255			512
Nonperforming Loans to Average Loans		0.21			0.29			0.43			0.40			0.54									0.23			0.57

(a)

Average loans include loans held-for-sale of $804 million, $359 million, $334 million, $268 million, and $213 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. The average loans held-for-sale were $442 million and $283 million for full year 2006 and 2005, respectively. These amounts are not included in the net charge-off rate or allowance coverage ratios.

(b)

Liability balances include deposits and deposits that are swept to on-balance sheet liabilities.

Page 18

JPMORGAN CHASE & CO.
TREASURY & SECURITIES SERVICES (a)
FINANCIAL HIGHLIGHTS
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
INCOME STATEMENT
REVENUE
Lending & Deposit Related Fees	$	186		$	183		$	184		$	182		$	184			2	%		1	%	$	735		$	731			1	%
Asset Management, Administration and Commissions		717			642			683			650			629			12			14			2,692			2,409			12
All Other Income		133			155			178			146			134			(14	)		(1	)		612			519			18
Noninterest Revenue		1,036			980			1,045			978			947			6			9			4,039			3,659			10
Net Interest Income		501			519			543			507			489			(3	)		2			2,070			1,880			10
TOTAL NET REVENUE		1,537			1,499			1,588			1,485			1,436			3			7			6,109			5,539			10
Provision for Credit Losses		(2	)		1			4			(4	)		2			NM			NM			(1	)		—			NM
Credit Reimbursement to IB (b)		(31	)		(30	)		(30	)		(30	)		(40	)		(3	)		23			(121	)		(154	)		21
NONINTEREST EXPENSE
Compensation Expense		555			557			537			549			454			—			22			2,198			1,874			17
Noncompensation Expense		533			489			493			480			523			9			2			1,995			2,095			(5	)
Amortization of Intangibles		16			18			20			19			20			(11	)		(20	)		73			81			(10	)
TOTAL NONINTEREST EXPENSE		1,104			1,064			1,050			1,048			997			4			11			4,266			4,050			5
Income before Income Tax Expense		404			404			504			411			397			—			2			1,723			1,335			29
Income Tax Expense		148			148			188			149			143			—			3			633			472			34
NET INCOME	$	256		$	256		$	316		$	262		$	254			—			1		$	1,090		$	863			26
REVENUE BY BUSINESS
Treasury Services		700		$	697		$	702		$	693		$	687			—			2		$	2,792		$	2,695			4
Worldwide Securities Services		837			802			886			792			749			4			12			3,317			2,844			17
TOTAL NET REVENUE	$	1,537		$	1,499		$	1,588		$	1,485		$	1,436			3			7		$	6,109		$	5,539			10
FINANCIAL RATIOS
ROE		46	%		46	%		58	%		42	%		66	%								48	%		57	%
Overhead Ratio		72			71			66			71			69									70			73
Pretax Margin Ratio (c)		26			27			32			28			28									28			24
FIRMWIDE BUSINESS METRICS
Assets under Custody (in billions)	$	13,903		$	12,873		$	11,536		$	11,179		$	10,662			8			30		$	13,903		$	10,662			30
Number of:
US$ ACH transactions originated (in millions)		931			886			848			838			787			5			18			3,503			2,966			18
Total US$ Clearing Volume (in thousands)		26,906			26,252			26,506			25,182			24,902			2			8			104,846			95,713			10
International Electronic Funds Transfer Volume (in thousands) (d)		41,007			35,322			35,255			33,741			29,641			16			38			145,325			89,537			62
Wholesale Check Volume (in millions)		793			860			904			852			876			(8	)		(9	)		3,409			3,735			(9	)
Wholesale Cards Issued (in thousands) (e)		17,228			16,662			16,271			16,977			13,206			3			30			17,228			13,206			30

Page 19

JPMORGAN CHASE & CO.
TREASURY & SECURITIES SERVICES (a)
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except headcount and ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
SELECTED BALANCE SHEETS (Average)
Total Assets	$	35,422		$	30,558		$	31,774		$	29,230		$	29,280			16	%		21	%	$	31,760		$	28,206			13	%
Loans		19,030			15,231			14,993			12,940			13,826			25			38			15,564			12,349			26
Liability Balances (f)		193,129			192,518			194,181			178,133			161,976			—			19			189,540			154,731			22
Equity		2,200			2,200			2,200			2,545			1,525			—			44			2,285			1,525			50
Headcount		25,423			24,575			24,100			23,598			22,207			3			14			25,423			22,207			14
TSS FIRMWIDE METRICS
Treasury Services Firmwide Revenue (g)	$	1,333		$	1,300		$	1,318		$	1,291		$	1,280			3			4		$	5,242		$	4,937			6
Treasury & Securities Services Firmwide Revenue (g)		2,170			2,102			2,204			2,083			2,029			3			7			8,559			7,781			10
Treasury Services Firmwide Overhead Ratio (h)		56	%		57	%		56	%		56	%		57	%								56	%		58	%
Treasury & Securities Services Firmwide Overhead Ratio (h)		63			63			59			62			62									62			65
Treasury Services Firmwide Liability Balances (Average) (i)	$	168,321		$	162,326		$	161,866		$	155,422		$	146,266			4			15		$	162,020		$	139,579			16
Treasury & Securities Services Firmwide Liability Balances (Average) (i)		272,178			264,527			265,398			248,328			230,854			3			18			262,678			220,781			19

FOOTNOTES

(a)	On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses, including trustee, paying agent, loan agency and document management services, for the consumer, business banking and middle-market banking businesses of The Bank of New York. These corporate trust businesses, which were previously reported in Treasury & Securities Services, have been deemed discontinued operations. The related balance sheet and income statement activity were transferred to the Corporate segment commencing with the second quarter of 2006, and periods prior to the second quarter of 2006 have been revised to reflect this transfer.
(b)	Treasury & Securities Services (“TSS”) is charged a credit reimbursement related to certain exposures managed within the Investment Bank (“IB”) credit portfolio on behalf of clients shared with TSS.
(c)	Pretax margin represents Income before income tax expense divided by Total net revenue, which is a measure of pretax performance and another basis by which management evaluates its performance and that of its competitors.
(d)	International electronic funds transfer includes non-US$ ACH and clearing volume.
(e)	Wholesale cards issued include domestic commercial card, stored value card, prepaid card, and government electronic benefit card products.
(f)	Liability balances include deposits and deposits swept to on-balance sheet liabilities.

TSS FIRMWIDE METRICS

TSS firmwide metrics include certain TSS product revenues and liability balances reported in other lines of business for customers who are also customers of those lines of business. In order to capture the firmwide impact of Treasury Services (“TS”) and TSS products and revenues, management reviews firmwide metrics such as liability balances, revenues and overhead ratios in assessing financial performance for TSS. Firmwide metrics are necessary in order to understand the aggregate TSS business.

(g)	Firmwide revenue includes TS revenue recorded in the CB, Regional Banking and AM lines of business (see below) and exclude FX revenues recorded in the IB for TSS-related FX activity. TSS firmwide FX revenue, which includes FX revenue recorded in TSS and FX revenue associated with TSS customers who are FX customers of the IB, was $96 million for the quarter ended December 31, 2006 and $445 million for the full year 2006.
(h)	Overhead ratios have been calculated based on firmwide revenues and TSS and TS expenses, respectively, including those allocated to certain other lines of business. FX revenues and expenses recorded in the IB for TSS-related FX activity are not included in this ratio.
(i)	Firmwide liability balances include TS’ liability balances recorded in certain other lines of business. Liability balances associated with TS customers who are also customers of the CB line of business are not included in TS liability balances.

	QUARTERLY TRENDS																FULL YEAR
											4Q06 Change										2006 Change
	4Q06		3Q06		2Q06		1Q06		4Q05		3Q06			4Q05			2006		2005		2005
TS Revenue Reported in CB	$	576	$	551	$	566	$	550	$	546		5	%		5	%	$	2,243	$	2,062		9	%
TS Revenue Reported in Other Lines of Business		57		52		50		48		47		10			21			207		180		15

Page 20

JPMORGAN CHASE & CO.
ASSET MANAGEMENT
FINANCIAL HIGHLIGHTS
(in millions, except ratio, ranking and headcount data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
INCOME STATEMENT
REVENUE
Asset Management, Administration and Commissions	$	1,509		$	1,285		$	1,279		$	1,222		$	1,155			17	%		31	%	$	5,295		$	4,189			26	%
All Other Income		192			120			93			116			98			60			96			521			394			32
Noninterest Revenue		1,701			1,405			1,372			1,338			1,253			21			36			5,816			4,583			27
Net Interest Income		246			231			248			246			258			6			(5	)		971			1,081			(10	)
TOTAL NET REVENUE		1,947			1,636			1,620			1,584			1,511			19			29			6,787			5,664			20
Provision for Credit Losses		14			(28	)		(7	)		(7	)		(10	)	NM			NM				(28	)		(56	)		50
NONINTEREST EXPENSE
Compensation Expense		750			676			669			682			578			11			30			2,777			2,179			27
Noncompensation Expense		512			417			390			394			431			23			19			1,713			1,582			8
Amortization of Intangibles		22			22			22			22			24			—			(8	)		88			99			(11	)
TOTAL NONINTEREST EXPENSE		1,284			1,115			1,081			1,098			1,033			15			24			4,578			3,860			19
Income Before Income Tax Expense		649			549			546			493			488			18			33			2,237			1,860			20
Income Tax Expense		242			203			203			180			146			19			66			828			644			29
NET INCOME	$	407		$	346		$	343		$	313		$	342			18			19		$	1,409		$	1,216			16
REVENUE BY CLIENT SEGMENT
Institutional	$	624		$	464		$	449		$	435		$	402			34			55		$	1,972		$	1,395			41
Retail		541			456			446			442			420			19			29			1,885			1,544			22
Private Bank		528			469			469			441			437			13			21			1,907			1,689			13
Private Client Services		254			247			256			266			252			3			1			1,023			1,036			(1	)
Total Net Revenue	$	1,947		$	1,636		$	1,620		$	1,584		$	1,511			19			29		$	6,787		$	5,664			20
FINANCIAL RATIOS
ROE		46	%		39	%		39	%		36	%		57	%								40	%		51	%
Overhead Ratio		66			68			67			69			68									67			68
Pretax Margin Ratio (a)		33			34			34			31			32									33			33
BUSINESS METRICS
Number of:
Client Advisors		1,506			1,489			1,486			1,499			1,484			1			1			1,506			1,484			1
Retirement Planning Services Participants		1,362,000			1,372,000			1,361,000			1,327,000			1,299,000			(1	)		5			1,362,000			1,299,000			5
% of Customer Assets in 4 & 5 Star Funds (b)		58	%		58	%		56	%		54	%		46	%		—			26			58	%		46	%		26
% of AUM in 1st and 2nd Quartiles: (c)
1 Year		83	%		79	%		71	%		72	%		69	%		5			20			83	%		69	%		20
3 Years		77	%		75	%		75	%		75	%		68	%		3			13			77	%		68	%		13
5 Years		79	%		80	%		81	%		75	%		74	%		(1	)		7			79	%		74	%		7
SELECTED BALANCE SHEETS DATA (Average)
Total Assets	$	46,716		$	43,524		$	43,228		$	41,012		$	42,213			7			11		$	43,635		$	41,599			5
Loans (d)		28,917			26,770			25,807			24,482			26,657			8			8			26,507			26,610			—
Deposits (d) (e)		51,341			51,395			51,583			48,066			44,205			—			16			50,607			42,123			20
Equity		3,500			3,500			3,500			3,500			2,400			—			46			3,500			2,400			46
Headcount		13,298			12,761			12,786			12,511			12,127			4			10			13,298			12,127			10
CREDIT DATA AND QUALITY STATISTICS
Net Charge-offs (Recoveries)	$	2		$	(24	)	$	(4	)	$	7		$	8		NM				(75	)	$	(19	)	$	23		NM
Nonperforming Loans		39			57			76			79			104			(32	)		(63	)		39			104			(63	)
Allowance for Loan Losses		121			112			117			119			132			8			(8	)		121			132			(8	)
Allowance for Lending Related Commitments		6			4			3			3			4			50			50			6			4			50
Net Charge-off (Recovery) Rate		0.03	%		(0.36	)%		(0.06	)%		0.12	%		0.12	%								(0.07	)%		0.09	%
Allowance for Loan Losses to Average Loans		0.42			0.42			0.45			0.49			0.50									0.46			0.50
Allowance for Loan Losses to Nonperforming Loans		310			196			154			151			127									310			127
Nonperforming Loans to Average Loans		0.13			0.21			0.29			0.32			0.39									0.15			0.39

(a)	Pretax margin represents Income Before Income Tax Expense divided by Total Net Revenue, which is a measure of pretax performance and another basis by which management evaluates its performance and that of its competitors.
(b)	Derived from Morningstar for the United States; Micropal for the United Kingdom, Luxembourg, Hong Kong and Taiwan; and Nomura for Japan.
(c)	Quartile rankings sourced from Lipper for the United States and Taiwan; Micropal for the United Kingdom, Luxembourg and Hong Kong; and Nomura for Japan.
(d)	The sale of BrownCo, which occurred on November 30, 2005, included $3.0 billion in both loans and deposits; the respective fourth quarter 2005 average balances were approximately $2.0 billion.
(e)	Reflects the transfer in 2005 of certain consumer deposits from RFS to AM.

Page 21

JPMORGAN CHASE & CO.
ASSET MANAGEMENT
FINANCIAL HIGHLIGHTS, CONTINUED
(in billions)

											Dec 31, 2006
											Change
	Dec 31		Sep 30		Jun 30		Mar 31		Dec 31		Sep 30			Dec 31
	2006		2006		2006		2006		2005		2006			2005
Assets by Asset Class
Liquidity (a)	$	311	$	281	$	247	$	236	$	238		11	%		31	%
Fixed Income		175		171		172		166		165		2			6
Equities & Balanced		427		392		393		397		370		9			15
Alternatives		100		91		86		74		74		10			35
TOTAL ASSETS UNDER MANAGEMENT		1,013		935		898		873		847		8			20
Custody / Brokerage / Administration / Deposits		334		330		315		324		302		1			11
TOTAL ASSETS UNDER SUPERVISION	$	1,347	$	1,265	$	1,213	$	1,197	$	1,149		6			17
Assets by Client Segment
Institutional (b)	$	538	$	503	$	484	$	468	$	481		7			12
Private Bank		159		150		143		137		145		6			10
Retail (b)		259		228		219		214		169		14			53
Private Client Services		57		54		52		54		52		6			10
TOTAL ASSETS UNDER MANAGEMENT	$	1,013	$	935	$	898	$	873	$	847		8			20
Institutional (b)	$	539	$	505	$	486	$	471	$	484		7			11
Private Bank		357		347		331		332		318		3			12
Retail (b)		343		309		295		291		245		11			40
Private Client Services		108		104		101		103		102		4			6
TOTAL ASSETS UNDER SUPERVISION	$	1,347	$	1,265	$	1,213	$	1,197	$	1,149		6			17
Assets by Geographic Region
U.S. / Canada	$	630	$	596	$	577	$	564	$	562		6			12
International		383		339		321		309		285		13			34
TOTAL ASSETS UNDER MANAGEMENT	$	1,013	$	935	$	898	$	873	$	847		8			20
U.S. / Canada	$	889	$	855	$	828	$	822	$	805		4			10
International		458		410		385		375		344		12			33
TOTAL ASSETS UNDER SUPERVISION	$	1,347	$	1,265	$	1,213	$	1,197	$	1,149		6			17
Mutual Funds Assets by Asset Class
Liquidity	$	255	$	221	$	178	$	167	$	182		15			40
Fixed Income		46		45		47		48		45		2			2
Equity		206		184		194		189		150		12			37
TOTAL MUTUAL FUND ASSETS	$	507	$	450	$	419	$	404	$	377		13			34

(a)	Third quarter 2006 data reflects the reclassification of $19 billion of assets under management into liquidity from other asset classes. Prior period data were not restated.
(b)	During the first quarter of 2006, assets under management of $22 billion from Retirement Planning Services has been reclassified from the Institutional client segment to the Retail client segment in order to be consistent with the revenue by client segment reporting.

Page 22

JPMORGAN CHASE & CO.
ASSET MANAGEMENT
FINANCIAL HIGHLIGHTS, CONTINUED
(in billions)

	QUARTERLY TRENDS													FULL YEAR
	4Q06		3Q06		2Q06			1Q06			4Q05			2006		2005
ASSETS UNDER SUPERVISION (continued)
Assets Under Management Rollforward
Beginning Balance	$	935	$	898	$	873		$	847		$	828		$	847	$	791
Flows:
Liquidity		24		15		10			(5	)		—			44		8
Fixed Income		1		4		6			—			2			11		—
Equities, Balanced & Alternatives		5		3		13			13			11			34		24
Market / Performance / Other Impacts		48		15		(4	)		18			6			77		24
TOTAL ASSETS UNDER MANAGEMENT	$	1,013	$	935	$	898		$	873		$	847		$	1,013	$	847
Assets Under Supervision Rollforward
Beginning Balance	$	1,265	$	1,213	$	1,197		$	1,149		$	1,153		$	1,149	$	1,106
Net Asset Flows		31		26		33			12			15			102		49
Acquisitions / Divestitures (a)		—		—		—			—			(33	)		—		(33	)
Market / Performance / Other Impacts		51		26		(17	)		36			14			96		27
TOTAL ASSETS UNDER SUPERVISION	$	1,347	$	1,265	$	1,213		$	1,197		$	1,149		$	1,347	$	1,149

(a) Reflects the sale of BrownCo in the fourth quarter of 2005 ($33 billion).

Page 23

JPMORGAN CHASE & CO.
CORPORATE
FINANCIAL HIGHLIGHTS
(in millions)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
INCOME STATEMENT
REVENUE
Principal Transactions	$	236		$	193		$	550		$	196		$	229			22	%		3	%	$	1,175		$	1,524			(23	)%
Securities Gains (Losses)		18			24			(492	)		(158	)		(547	)		(25	)		NM			(608	)		(1,487	)		59
All Other Income (a)		27			125			231			102			1,359			(78	)		(98	)		485			1,583			(69	)
Noninterest Revenue		281			342			289			140			1,041			(18	)		(73	)		1,052			1,620			(35	)
Net Interest Income		(87	)		(55	)		(355	)		(547	)		(655	)		(58	)		87			(1,044	)		(2,756	)		62
TOTAL NET REVENUE		194			287			(66	)		(407	)		386			(32	)		(50	)		8			(1,136	)		NM
Provision for Credit Losses		(2	)		1			—			—			—			NM			NM			(1	)		10			NM
NONINTEREST EXPENSE
Compensation Expense		434			737			770			685			864			(41	)		(50	)		2,626			3,148			(17	)
Noncompensation Expense (b)		678			729			335			609			765			(7	)		(11	)		2,351			5,962			(61	)
Merger Costs		100			48			86			71			77			108			30			305			722			(58	)
Subtotal		1,212			1,514			1,191			1,365			1,706			(20	)		(29	)		5,282			9,832			(46	)
Net Expenses Allocated to Other Businesses		(1,037	)		(1,035	)		(1,036	)		(1,033	)		(1,103	)		—			6			(4,141	)		(4,505	)		8
TOTAL NONINTEREST EXPENSE		175			479			155			332			603			(63	)		(71	)		1,141			5,327			(79	)
Income (Loss) from continuing operations before Income Tax Expense		21			(193	)		(221	)		(739	)		(217	)		NM			NM			(1,132	)		(6,473	)		83
Income Tax Expense (Benefit) (c)		(520	)		(159	)		(181	)		(319	)		(212	)		(227	)		(145	)		(1,179	)		(2,690	)		56
Income (Loss) from Continuing Operations	$	541		$	(34	)	$	(40	)	$	(420	)	$	(5	)		NM			NM		$	47		$	(3,783	)		NM
Income from Discontinued Operations (after-tax) (d)		620			65			56			54			56			NM			NM			795			229			247
NET INCOME (LOSS)	$	1,161		$	31		$	16		$	(366	)	$	51			NM			NM		$	842		$	(3,554	)		NM
MEMO:
TOTAL NET REVENUE
Private Equity	$	250		$	188		$	500		$	204		$	251			33			—		$	1,142		$	1,521			(25	)
Treasury		46			185			(562	)		(466	)		(986	)		(75	)		NM			(797	)		(3,278	)		76
Corporate Other (a)		(102	)		(86	)		(4	)		(145	)		1,121			(19	)		NM			(337	)		621			NM
TOTAL NET REVENUE	$	194		$	287		$	(66	)	$	(407	)	$	386			(32	)		(50	)	$	8		$	(1,136	)		NM
NET INCOME (LOSS)
Private Equity	$	136		$	95		$	293		$	103		$	121			43			12		$	627		$	821			(24	)
Treasury		(11	)		70			(347	)		(272	)		(575	)		NM			98			(560	)		(2,028	)		72
Corporate Other (a) (b) (c)		478			(169	)		67			(207	)		497			NM			(4	)		169			(2,128	)		NM
Merger Costs		(62	)		(30	)		(53	)		(44	)		(48	)		(107	)		(29	)		(189	)		(448	)		58
Income (Loss) from Continuing Operations	$	541		$	(34	)	$	(40	)	$	(420	)	$	(5	)		NM			NM		$	47		$	(3,783	)		NM
Income from Discontinued Operations (after-tax)		620			65			56			54			56			NM			NM			795			229			247
TOTAL NET INCOME (LOSS)	$	1,161		$	31		$	16		$	(366	)	$	51			NM			NM		$	842		$	(3,554	)		NM
Headcount		23,242			25,748			27,100			27,390			30,666			(10	)		(24	)		23,242			30,666			(24	)

(a)	Includes a gain of $103 million in the second quarter of 2006 related to the initial public offering of MasterCard, and the gain of $1,254 million on the sale of BrownCo in the fourth quarter of 2005.
(b)	Insurance recoveries related to settlement of the Enron and WorldCom class action litigations and for certain other material legal proceedings were $137 million, $17 million, $260 million, $98 million and $208 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006 and December 31, 2005, respectively. Full year 2006 includes related insurance recoveries of $512 million. Full year 2005 includes $208 million of insurance recoveries and litigation reserve charges of $2,772 million.
(c)	Includes tax benefit of $359 million related to audit resolutions in the fourth quarter of 2006.
(d)	On October 1, 2006, the Firm completed the exchange of selected corporate trust businesses, including trustee, paying agent, loan agency and document management services for the consumer, business banking and middle-market banking businesses of The Bank of New York. The results of operations of these corporate trust businesses are being reported as discontinued operations for each of the periods presented. Includes $622 million gain on sale in the fourth quarter of 2006.

Page 24

JPMORGAN CHASE & CO.
CORPORATE
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
SUPPLEMENTAL
TREASURY
Securities Gains (Losses) (a)	$	7		$	24		$	(492	)	$	(158	)	$	(547	)		(71)	%		NM	%	$	(619	)	$	(1,486	)		58	%
Investment Securities Portfolio (Average)		80,616			68,619			63,714			39,989			37,814			17			113			63,361			46,520			36
Investment Securities Portfolio (Ending)		82,091			77,116			61,990			46,093			30,741			6			167			82,091			30,741			167
														`
PRIVATE EQUITY
Private Equity Gains (Losses)
Direct Investments
Realized Gains	$	254		$	194		$	568		$	207		$	351			31			(28	)	$	1,223		$	1,969			(38	)
Write-ups / (Write-downs)		12			(21	)		(74	)		10			(74	)		NM			NM			(73	)		(72	)		(1	)
Mark-to-Market Gains (Losses)		(6	)		25			49			4			(32	)		NM			81			72			(338	)		NM
Total Direct Investments		260			198			543			221			245			31			6			1,222			1,559			(22	)
Third-Party Fund Investments		27			28			6			16			44			(4	)		(39	)		77			132			(42	)
Total Private Equity Gains (b)	$	287		$	226		$	549		$	237		$	289			27			(1	)	$	1,299		$	1,691			(23	)
Private Equity Portfolio Information
Direct Investments
Publicly-Held Securities
Carrying Value	$	587		$	696		$	589		$	501		$	479			(16	)		23
Cost		451			539			446			395			403			(16	)		12
Quoted Public Value		831			1,022			808			677			683			(19	)		22
Privately-Held Direct Securities
Carrying Value		4,692			4,241			4,321			5,077			5,028			11			(7	)
Cost		5,795			5,482			5,647			6,501			6,463			6			(10	)
Third-Party Fund Investments
Carrying Value		802			682			642			675			669			18			20
Cost		1,080			1,000			963			1,000			1,003			8			8
Total Private Equity Portfolio - Carrying Value	$	6,081		$	5,619		$	5,552		$	6,253		$	6,176			8			(2	)
Total Private Equity Portfolio - Cost	$	7,326		$	7,021		$	7,056		$	7,896		$	7,869			4			(7	)

(a)	Gains/losses reflect repositioning of the Treasury investment securities portfolio. Excludes gains/losses on securities used to manage risk associated with MSRs.
(b)	Included in Principal Transactions.

Page 25

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION
(in millions)

											Dec 31, 2006
											Change
	Dec 31		Sep 30		Jun 30		Mar 31		Dec 31		Sep 30			Dec 31
	2006		2006		2006		2006		2005		2006			2005
CREDIT EXPOSURE
WHOLESALE (a)
Loans — U.S.	$	118,686	$	123,791	$	125,870	$	118,501	$	112,065		(4)	%		6	%
Loans — Non-U.S.		65,056		55,612		52,345		46,298		38,046		17			71
TOTAL WHOLESALE LOANS — REPORTED		183,742		179,403		178,215		164,799		150,111		2			22
CONSUMER
Home Equity		85,730		80,399		77,826		75,241		73,866		7			16
Mortgage		59,668		60,075		60,014		57,690		58,959		(1	)		1
Auto Loans and Leases		41,009		40,310		42,184		44,600		46,081		2			(11	)
All Other Loans		27,097		24,770		23,904		25,060		18,393		9			47
Total Retail Financial Services		213,504		205,554		203,928		202,591		197,299		4			8
Credit Card Receivables — Reported		85,881		78,587		72,961		64,691		71,738		9			20
TOTAL CONSUMER LOANS — REPORTED		299,385		284,141		276,889		267,282		269,037		5			11
TOTAL LOANS — REPORTED		483,127		463,544		455,104		432,081		419,148		4			15
Credit Card Securitizations		66,950		65,245		66,349		69,580		70,527		3			(5	)
TOTAL LOANS — MANAGED		550,077		528,789		521,453		501,661		489,675		4			12
Derivative Receivables		55,601		58,265		54,075		52,750		49,787		(5	)		12
Interests in Purchased Receivables (b) (c)		—		—		—		29,029		29,740		NM			NM
TOTAL CREDIT-RELATED ASSETS		605,678		587,054		575,528		583,440		569,202		3			6
Wholesale Lending-Related Commitments (c)		391,424		374,417		366,914		322,575		321,109		5			22
TOTAL	$	997,102	$	961,471	$	942,442	$	906,015	$	890,311		4			12
Memo: Total by Category
Total Wholesale Exposure (d)	$	630,767	$	612,085	$	599,204	$	569,153	$	550,747		3			15
Total Consumer Managed Loans (e)		366,335		349,386		343,238		336,862		339,564		5			8
Total	$	997,102	$	961,471	$	942,442	$	906,015	$	890,311		4			12
Risk Profile of Wholesale Credit Exposure:
Investment-Grade (f)	$	491,001	$	481,249	$	464,982	$	445,848	$	432,648		2			13
Noninvestment-Grade: (f)
Noncriticized		113,049		106,831		105,383		98,354		95,375		6			19
Criticized Performing		4,599		4,169		3,431		4,325		4,222		10			9
Criticized Nonperforming		427		674		783		731		950		(37	)		(55	)
Total Noninvestment-Grade	$	118,075	$	111,674	$	109,597	$	103,410	$	100,547		6			17
Held-for-Sale:
Held-for-Sale Wholesale Loans	$	21,440	$	18,889	$	24,323	$	19,555	$	17,211		14			25
Purchased Nonperforming Held-for-Sale Wholesale Loans (g)		251		273		302		340		341		(8	)		(26	)
Total Held-for-Sale	$	21,691	$	19,162	$	24,625	$	19,895	$	17,552		13			24
Total Wholesale Exposure	$	630,767	$	612,085	$	599,204	$	569,153	$	550,747		3			15

(a)	Includes Investment Bank, Commercial Banking, Treasury & Securities Services and Asset Management.
(b)	These represent undivided interests in pools of receivables and similar types of assets.
(c)	As a result of restructuring certain multi-seller conduits the Firm administers, during the second quarter of 2006, JPMorgan Chase deconsolidated $29 billion of Interests in Purchased Receivables, $3 billion of Loans and $1 billion of Securities, and recorded $33 billion of Lending-Related Commitments.
(d)	Represents Total Wholesale Loans, Derivative Receivables, Interests in Purchased Receivables and Wholesale Lending-Related Commitments.
(e)	Represents Total Consumer Loans plus Credit Card Securitizations, excluding consumer lending-related commitments.
(f)	Excludes HFS loans.
(g)	Represents distressed HFS wholesale loans purchased as part of IB’s proprietary activities, which are excluded from nonperforming assets.

Note:	The risk profile is based on JPMorgan Chase’s internal risk ratings, which generally correspond to the following ratings as defined by Standard & Poor’s / Moody’s:
		Investment-Grade: AAA / Aaa to BBB- / Baa3
		Noninvestment-Grade: BB+ / Ba1 and below

Page 26

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions, except ratio data)

																Dec 31, 2006
																Change
	Dec 31			Sep 30			Jun 30			Mar 31			Dec 31			Sep 30			Dec 31
	2006			2006			2006			2006			2005			2006			2005
NONPERFORMING ASSETS AND RATIOS
WHOLESALE LOANS (a)
Loans — U.S.	$	309		$	486		$	663		$	572		$	819			(36)	%		(62	)%
Loans — Non-U.S.		82			170			148			165			173			(52	)		(53	)
TOTAL WHOLESALE LOANS-REPORTED (b)		391			656			811			737			992			(40	)		(61	)
CONSUMER LOANS (c)
Home Equity		454			400			403			451			422			14			8
Mortgage		769			588			503			451			442			31			74
Auto Loans and Leases		132			130			133			157			193			2			(32	)
All Other Loans		322			286			300			290			281			13			15
Total Retail Financial Services		1,677			1,404			1,339			1,349			1,338			19			25
Credit Card Receivables - Reported		9			10			11			12			13			(10	)		(31	)
TOTAL CONSUMER LOANS-REPORTED (d)		1,686			1,414			1,350			1,361			1,351			19			25
TOTAL LOANS REPORTED (b)		2,077			2,070			2,161			2,098			2,343			—			(11	)
Derivative Receivables		36			35			36			49			50			3			(28	)
Assets Acquired in Loan Satisfactions		228			195			187			201			197			17			16
TOTAL NONPERFORMING ASSETS (b)	$	2,341		$	2,300		$	2,384		$	2,348		$	2,590			2			(10	)
PURCHASED HELD-FOR-SALE WHOLESALE LOANS (e)	$	251		$	273		$	302		$	340		$	341			(8	)		(26	)
TOTAL NONPERFORMING LOANS TO TOTAL LOANS		0.43	%		0.45	%		0.47	%		0.49	%		0.56	%
NONPERFORMING ASSETS BY LOB
Investment Bank	$	269		$	456		$	525		$	484		$	645			(41	)		(58	)
Retail Financial Services		1,902			1,595			1,520			1,537			1,518			19			25
Card Services		9			10			11			12			13			(10	)		(31	)
Commercial Banking		122			160			230			214			288			(24	)		(58	)
Treasury & Securities Services		—			22			22			22			22			NM			NM
Asset Management		39			57			76			79			104			(32	)		(63	)
TOTAL	$	2,341		$	2,300		$	2,384		$	2,348		$	2,590			2			(10	)

(a)	Includes nonperforming HFS loans of $4 million, $21 million, $70 million, $68 million and $109 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively.
(b)	Excludes purchased HFS wholesale loans.
(c)	Includes nonperforming HFS loans of $116 million, $24 million, $9 million, $16 million, and $27 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively.
(d)	Excludes nonperforming assets related to (1) loans eligible for repurchase as well as loans repurchased from GNMA pools that are insured by U.S. government agencies and U.S. government-sponsored enterprises of $1.2 billion, $1.1 billion, $1.1 billion, $1.1 billion, and $1.1 billion at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively, and (2) education loans that are 90 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $0.2 billion at December 31, 2006. These amounts for GNMA and education loans are excluded, as reimbursement is proceeding normally.
(e)	Represents distressed HFS wholesale loans purchased as part of IB’s proprietary activities, which are excluded from nonperforming assets.

Page 27

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions, except ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
GROSS CHARGE-OFFS
Wholesale Loans	$	76		$	48		$	23		$	39		$	123			58	%		(38)	%	$	186		$	255			(27)	%
Consumer (Excluding Card)		266			186			172			178			216			43			23			802			795			1
Credit Card Receivables - Reported		801			777			653			665			1,374			3			(42	)		2,896			3,819			(24	)
Total Loans - Reported		1,143			1,011			848			882			1,713			13			(33	)		3,884			4,869			(20	)
Credit Card Securitizations		694			702			656			527			1,243			(1	)		(44	)		2,579			4,336			(41	)
Total Loans - Managed		1,837			1,713			1,504			1,409			2,956			7			(38	)		6,463			9,205			(30	)
RECOVERIES
Wholesale Loans		48			59			42			59			99			(19	)		(52	)		208			332			(37	)
Consumer (Excluding Card)		52			58			59			57			54			(10	)		(4	)		226			223			1
Credit Card Receivables - Reported		113			104			93			98			200			9			(44	)		408			495			(18	)
Total Loans - Reported		213			221			194			214			353			(4	)		(40	)		842			1,050			(20	)
Credit Card Securitizations		101			95			95			78			181			6			(44	)		369			560			(34	)
Total Loans - Managed		314			316			289			292			534			(1	)		(41	)		1,211			1,610			(25	)
NET CHARGE-OFFS
Wholesale Loans		28			(11	)		(19	)		(20	)		24		NM				17			(22	)		(77	)		71
Consumer (Excluding Card)		214			128			113			121			162			67			32			576			572			1
Credit Card Receivables - Reported		688			673			560			567			1,174			2			(41	)		2,488			3,324			(25	)
Total Loans - Reported		930			790			654			668			1,360			18			(32	)		3,042			3,819			(20	)
Credit Card Securitizations		593			607			561			449			1,062			(2	)		(44	)		2,210			3,776			(41	)
Total Loans - Managed	$	1,523		$	1,397		$	1,215		$	1,117		$	2,422			9			(37	)	$	5,252		$	7,595			(31	)
NET CHARGE-OFF RATES - ANNUALIZED
Wholesale Loans (a)		0.07	%		(0.03)	%		(0.05)	%		(0.06)	%		0.07	%								(0.01)	%		(0.06)	%
Consumer (Excluding Card) (b)		0.45			0.27			0.24			0.27			0.36									0.31			0.31
Credit Card Receivables - Reported		3.35			3.48			3.29			3.36			6.75									3.37			4.94
Total Loans - Reported (a) (b)		0.84			0.74			0.64			0.69			1.39									0.73			1.00
Credit Card Securitizations		3.57			3.70			3.26			2.62			6.03									3.28			5.47
Total Loans - Managed (a) (b)		1.20			1.13			1.02			0.98			2.09									1.09			1.68
Memo: Credit Card - Managed		3.45			3.58			3.28			2.99			6.39									3.33			5.21

(a)

Average wholesale loans held-for-sale were $24,547 million, $24,389 million, $20,254 million, $19,480 million, and $15,581 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. The average loans held-for-sale were $22,187 million and $12,038 million for full year 2006 and 2005, respectively. These amounts are not included in the net charge-off rates.

(b)

Average consumer loans (excluding Card) held-for-sale were $21,228 million, $13,994 million, $12,903 million, $16,362 million, and $16,505 million for the quarters ended December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. The average loans held-for-sale were $16,129 million and $15,675 million for full year 2006 and 2005, respectively. These amounts are not included in the net charge-off rates.

Page 28

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions, except ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
SUMMARY OF CHANGES IN THE ALLOWANCE FOR LOAN LOSSES
Beginning Balance	$	7,056		$	7,076		$	7,275		$	7,090		$	7,220			—	%		(2	)  %	$	7,090		$	7,320			(3	)  %
Net Charge-Offs		(930	)		(790	)		(654	)		(668	)		(1,360	)		(18	)		32			(3,042	)		(3,819	)		20
Provision for Loan Losses		1,085			768			453			847			1,219			41			(11	)		3,153			3,575			(12	)
Other (a)		68			2			2			6			11		NM			NM				78			14			457
Ending Balance	$	7,279		$	7,056		$	7,076		$	7,275		$	7,090			3			3		$	7,279		$	7,090			3
SUMMARY OF CHANGES IN THE ALLOWANCE FOR LENDING-RELATED COMMITMENTS
Beginning Balance	$	468		$	424		$	384		$	400		$	395			10			18		$	400		$	492			(19	)
Provision for Lending-Related Commitments		49			44			40			(16	)		5			11		NM				117			(92	)	NM
Other (a)		7			—			—			—			—		NM			NM				7			—		NM
Ending Balance	$	524		$	468		$	424		$	384		$	400			12			31		$	524		$	400			31
ALLOWANCE COMPONENTS AND RATIOS
ALLOWANCE FOR LOAN LOSSES
Wholesale
Asset Specific	$	51		$	101		$	160		$	118		$	203			(50	)		(75	)
Formula - Based Statistical Calculation		1,757			1,653			1,639			1,713			1,629			6			8
Adjustments to the Statistical Calculation		903			820			770			837			621			10			45
Total Wholesale		2,711			2,574			2,569			2,668			2,453			5			11
Consumer
Formula - Based Statistical Calculation		3,398			3,258			3,217			3,288			3,422			4			(1	)
Adjustments to the Statistical Calculation		1,170			1,224			1,290			1,319			1,215			(4	)		(4	)
Total Consumer		4,568			4,482			4,507			4,607			4,637			2			(1	)
Total Allowance for Loan Losses		7,279			7,056			7,076			7,275			7,090			3			3
Allowance for Lending-Related Commitments		524			468			424			384			400			12			31
Total Allowance for Credit Losses	$	7,803		$	7,524		$	7,500		$	7,659		$	7,490			4			4
Wholesale Allowance for Loan Losses to Total Wholesale Loans (b)		1.67	%		1.61	%		1.67	%		1.84	%		1.85	%
Consumer Allowance for Loan Losses to Total Consumer Loans (c)		1.71			1.68			1.70			1.82			1.84
Allowance for Loan Losses to Total Loans (b) (c)		1.70			1.65			1.69			1.83			1.84
Allowance for Loan Losses to Total Nonperforming Loans (d)		372			348			340			361			321
ALLOWANCE FOR LOAN LOSSES BY LOB
Investment Bank	$	1,052		$	1,010		$	1,038		$	1,117		$	907			4			16
Retail Financial Services		1,392			1,306			1,321			1,333			1,363			7			2
Card Services		3,176			3,176			3,186			3,274			3,274			—			(3	)
Commercial Banking		1,519			1,431			1,394			1,415			1,392			6			9
Treasury & Securities Services		7			9			9			6			11			(22	)		(36	)
Asset Management		121			112			117			119			132			8			(8	)
Corporate		12			12			11			11			11			—			9
Total	$	7,279		$	7,056		$	7,076		$	7,275		$	7,090			3			3

(a)	Fourth quarter of 2006 reflects The Bank of New York transaction.
(b)	Wholesale loans held-for-sale were $21,691 million, $19,162 million, $24,625 million, $19,895 million, and $17,552 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. These amounts are not included in the allowance coverage ratios.
(c)	Consumer loans held-for-sale were $32,744 million, $17,005 million, $11,834 million, $14,343 million, and $16,598 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. These amounts are not included in the allowance coverage ratios.
(d)	Nonperforming loans held-for-sale were $120 million, $45 million, $79 million, $84 million, and $136 million at December 31, 2006, September 30, 2006, June 30, 2006, March 31, 2006, and December 31, 2005, respectively. These amounts are not included in the allowance coverage ratios.

Page 29

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions)

	QUARTERLY TRENDS																					FULL YEAR
																4Q06 Change												2006 Change
	4Q06			3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
PROVISION FOR CREDIT LOSSES
LOANS
Investment Bank	$	50		$	(36	)	$	(91	)	$	189		$	(98	)	NM		%	NM		%	$	112		$	(757	)	NM
Commercial Banking		86			55			(24	)		16			(10	)		56		NM				133			87			53	%
Treasury & Securities Services		(2	)		1			4			(4	)		3		NM			NM				(1	)		(1	)		—
Asset Management		12			(29	)		(7	)		(6	)		(8	)	NM			NM				(30	)		(55	)		45
Corporate		(2	)		1			—			—			—		NM			NM				(1	)		10		NM
Total Wholesale		144			(8	)		(118	)		195			(113	)	NM			NM				213			(716	)	NM
Retail Financial Services		253			113			101			85			158			124			60			552			721			(23	)
Card Services		688			663			470			567			1,174			4			(41	)		2,388			3,570			(33	)
Total Consumer		941			776			571			652			1,332			21			(29	)		2,940			4,291			(31	)
Total Provision for Loan Losses		1,085			768			453			847			1,219			41			(11	)		3,153			3,575			(12	)
LENDING-RELATED COMMITMENTS
Investment Bank		13		$	43		$	29		$	(6	)	$	15			(70	)		(13	)	$	79		$	(81	)	NM
Commercial Banking		25			(1	)		12			(9	)		(7	)	NM			NM				27			(14	)	NM
Treasury & Securities Services		—			—			—			—			(1	)	NM			NM				—			1		NM
Asset Management		2			1			—			(1	)		(2	)		100		NM				2			(1	)	NM
Corporate		—			—			—			—			—		NM			NM				—			—		NM
Total Wholesale		40			43			41			(16	)		5			(7	)	NM				108			(95	)	NM
Retail Financial Services		9			1			(1	)		—			—		NM			NM				9			3			200
Card Services		—			—			—			—			—		NM			NM				—			—		NM
Total Consumer		9			1			(1	)		—			—		NM			NM				9			3			200
Total Provision for Lending-Related Commitments		49			44			40			(16	)		5			11		NM				117			(92	)	NM
TOTAL PROVISION FOR CREDIT LOSSES
Investment Bank	$	63		$	7		$	(62	)	$	183		$	(83	)	NM			NM			$	191		$	(838	)	NM
Commercial Banking		111			54			(12	)		7			(17	)		106		NM				160			73			119
Treasury & Securities Services		(2	)		1			4			(4	)		2		NM			NM				(1	)		—		NM
Asset Management		14			(28	)		(7	)		(7	)		(10	)	NM			NM				(28	)		(56	)		50
Corporate		(2	)		1			—			—			—		NM			NM				(1	)		10		NM
Total Wholesale		184			35			(77	)		179			(108	)		426		NM				321			(811	)	NM
Retail Financial Services		262			114			100			85			158			130			66			561			724			(23	)
Card Services (a)		688			663			470			567			1,174			4			(41	)		2,388			3,570			(33	)
Total Consumer		950			777			570			652			1,332			22			(29	)		2,949			4,294			(31	)
Total Provision for Credit Losses		1,134			812			493			831			1,224			40			(7	)		3,270			3,483			(6	)
Securitized Credit Losses		593			607			561			449			1,062			(2	)		(44	)		2,210			3,776			(41	)
Managed Provision for Credit Losses	$	1,727		$	1,419		$	1,054		$	1,280		$	2,286			22			(24	)	$	5,480		$	7,259			(25	)

(a) Second quarter of 2006 includes a $90 million release of a $100 million special provision, originally recorded in the third quarter of 2005, related to Hurricane Katrina.

Page 30

JPMORGAN CHASE & CO. CAPITAL
(in millions, except per share and ratio data)

	QUARTERLY TRENDS																							FULL YEAR
																		4Q06 Change												2006 Change
	4Q06					3Q06			2Q06			1Q06			4Q05			3Q06			4Q05			2006			2005			2005
COMMON SHARES OUTSTANDING
Weighted-Average Basic Shares Outstanding		3,465.3					3,468.6			3,473.8			3,472.7			3,472.1			—	%		—	%		3,470.1			3,491.7			(1	) %
Weighted-Average Diluted Shares Outstanding		3,578.6					3,574.0			3,572.2			3,570.8			3,563.9			—			—			3,573.9			3,557.3			—
Common Shares Outstanding - at Period End		3,461.7					3,467.5			3,470.6			3,473.0			3,486.7			—			(1	)		3,461.7			3,486.7			(1	)
Cash Dividends Declared per Share	$	0.34				$	0.34		$	0.34		$	0.34		$	0.34			—			—		$	1.36		$	1.36			—
Book Value per Share		33.45					32.75			31.89			31.19			30.71			2			9			33.45			30.71			9
Dividend Payout (a)		27	%				37	%		35	%		39	%		44	%								34	%		57	%
NET INCOME	$	4,526				$	3,297		$	3,540		$	3,081		$	2,698			37			68		$	14,444		$	8,483			70
Preferred Dividends		—					—			—			4			2		NM			NM				4			13			(69	)
Net Income Applicable to Common Stock	$	4,526				$	3,297		$	3,540		$	3,077		$	2,696			37			68		$	14,440		$	8,470			70
INCOME PER SHARE
Basic Earnings per Share
Income from continuing operations	$	1.13				$	0.93		$	1.00		$	0.87		$	0.76			22			49		$	3.93		$	2.36			67
Net Income		1.31					0.95			1.02			0.89			0.78			38			68			4.16			2.43			71
Diluted Earnings per Share
Income from continuing operations	$	1.09				$	0.90		$	0.98		$	0.85		$	0.74			21			47		$	3.82		$	2.32			65
Net Income		1.26					0.92			0.99			0.86			0.76			37			66			4.04			2.38			70
SHARE PRICE
High	$	49.00				$	47.49		$	46.80		$	42.43		$	40.56			3			21		$	49.00		$	40.56			21
Low		45.51					40.40			39.33			37.88			32.92			13			38			37.88			32.92			15
Close		48.30					46.96			42.00			41.64			39.69			3			22			48.30			39.69			22
STOCK REPURCHASE PROGRAM (b) (c)
Aggregate Repurchases	$	1,000.3				$	900.0		$	745.5		$	1,290.3		$	1,000.0			11			—		$	3,936.1		$	3,409.3			15
Common Shares Repurchased		21.1					20.0			17.7			31.8			26.3			6			(20	)		90.7			93.5			(3	)
Average Purchase Price	$	47.33				$	44.88		$	42.24		$	40.54		$	38.05			5			24		$	43.41		$	36.46			19
CAPITAL RATIOS
Tier 1 Capital	$	81,055		(d	)	$	79,830		$	74,983		$	73,085		$	72,474			2			12
Total Capital		115,265		(d	)		111,670			106,283			103,800			102,437			3			13
Risk-Weighted Assets		935,307		(d	)		926,455			884,228			858,080			850,643			1			10
Adjusted Average Assets		1,308,699		(d	)		1,257,364			1,282,233			1,195,231			1,152,546			4			14
Tier 1 Capital Ratio		8.7	%	(d	)		8.6	%		8.5	%		8.5	%		8.5	%
Total Capital Ratio		12.3		(d	)		12.1			12.0			12.1			12.0
Tier 1 Leverage Ratio		6.2		(d	)		6.3			5.8			6.1			6.3
INTANGIBLE ASSETS (PERIOD-END)
Goodwill	$	45,186				$	43,372		$	43,498		$	43,899		$	43,621			4			4
Mortgage Servicing Rights		7,546					7,378			8,247			7,539			6,452			2			17
Purchased Credit Card Relationships		2,935					2,982			3,138			3,243			3,275			(2	)		(10	)
All Other Intangibles		4,371					4,078			4,231			4,832			4,832			7			(10	)
Total Intangibles	$	60,038				$	57,810		$	59,114		$	59,513		$	58,180			4			3

(a)	Based on Net income amounts.
(b)	On March 21, 2006, JPMorgan Chase announced that its Board of Directors had authorized the repurchase of up to $8 billion of the Firm’s common shares. The new authorization commenced immediately and replaced the Firm’s previous repurchase authorization. The authorization will be utilized at management’s discretion and the timing of purchases and the exact number of shares purchased will depend on market conditions and alternative investment opportunities.
(c)	Excludes commission costs.
(d)	Estimated.

Page 31

JPMORGAN CHASE & CO.
Glossary of Terms

ACH: Automated Clearing House

Average Managed Assets: Refers to total assets on the Firm’s balance sheet plus credit card receivables that have been securitized.

Beneficial interest issued by consolidated VIEs: Represents the interest of third-party holders of debt/equity securities, or other obligations, issued by VIEs JPMorgan Chase consolidates under FIN 46R. The underlying obligations of the VIEs consist of short-term borrowings, commercial paper and long-term debt. The related assets consist of trading assets, available-for-sale securities, loans and other assets.

Contractual Credit Card Charge-off: In accordance with the Federal Financial Institutions Examination Council policy, credit card loans are charged off by the end of the month in which the account becomes 180 days past due or within 60 days from receiving notification of the filing of bankruptcy, whichever is earlier.

Corporate: Includes Private Equity, Treasury and Corporate Other, which includes other centrally managed expenses and discontinued operations.

Credit Card Securitizations: Card Services’ managed results excludes the impact of credit card securitizations on total net revenue, the provision for credit losses, net charge-offs and loan receivables. Through securitization, the Firm transforms a portion of its credit card receivables into securities, which are sold to investors. The credit card receivables are removed from the Consolidated balance sheets through the transfer of the receivables to a trust, and the sale of undivided interests to investors that entitle the investors to specific cash flows generated from the credit card receivables. The Firm retains the remaining undivided interests as seller’s interests, which are recorded in Loans on the Consolidated balance sheets. A gain or loss on the sale of credit card receivables to investors is recorded in Other Income. Securitization also affects the Firm’s Consolidated statements of income as the aggregate amount of interest income, certain fee revenue and recoveries that is in excess of the aggregate amount of interest paid to the investors, gross credit losses and other trust expenses related to the securitized receivables are reclassified into credit card income.

Discontinued operations: A component of an entity that is classified as held-for-sale or that has been disposed of from ongoing operations in its entirety or piecemeal, and for which the entity will not have any significant continuing involvement. A discontinued operation may be a separate major business segment, a component of a major business segment or a geographical area of operations of the entity that can be separately distinguished operationally and for financial reporting purposes.

FIN 39: FASB Interpretation No. 39, “Offsetting of Amounts Related to Certain Contracts.”

FIN 46(R): FASB Interpretation No. 46 (revised December 2003), “Consolidation of Variable Interest Entities, an interpretation of Accounting Research Bulletin No. 51.”

Interests in Purchased Receivables: Represent an ownership interest in a percentage of cash flows of an underlying pool of receivables transferred by a third-party seller into a bankruptcy remote entity, generally a trust, and then financed through a commercial paper conduit.

Investment-grade: An indication of credit quality based upon JPMorgan Chase’s internal risk assessment system. “Investment-grade” generally represents a risk profile similar to a rating of a BBB-/Baa3 or better, as defined by independent rating agencies.

Managed Basis: Includes reclassifications related to credit card securitizations and taxable equivalents as described below. Management uses certain non-GAAP financial measures at the segment level because it believes these non-GAAP financial measures provide information to investors in understanding the underlying operational performance and trends of the particular business segment and facilitate a comparison of the business segment with the performance of competitors.

Managed Credit Card Receivables: Refers to credit card receivables on the Firm’s balance sheet plus credit card receivables that have been securitized.

Mark-to-market exposure: A measure, at a point in time, of the value of a derivative or foreign exchange contract in the open market. When the mark-to-market value is positive, it indicates the counterparty owes JPMorgan Chase and, therefore, creates a repayment risk for the Firm. When the mark-to-market value is negative, JPMorgan Chase owes the counterparty. In this situation, the Firm does not have repayment risk.

Master netting agreement: An agreement between two counterparties that have multiple derivative contracts with each other that provides for the net settlement of all contracts through a single payment, in a single currency, in the event of default on or termination of any one contract. See FIN 39.

Merger: The July 1, 2004, merger with Bank One Corporation.

MSR Risk Management Revenue: Includes changes in MSR asset fair value due to inputs or assumptions in model and derivative valuation adjustments and other.

NA: Data is not applicable or available for the period presented.

Net yield on interest-earning assets: The average rate for interest-earning assets less the average rate paid for all sources of funds.

NM: Not meaningful.

Overhead Ratio: Noninterest expense as a percentage of total net revenue.

Principal Transactions: Represents Trading revenue (which includes physical commodities carried at the lower of cost or fair value), primarily in the Investment Bank, plus Private equity gains (losses), primarily in the Private Equity business of Corporate.

Reported Basis: Financial statements prepared under accounting principles generally accepted in the United States of America (“U.S. GAAP”). The reported basis includes the impact of credit card securitizations, but excludes the impact of taxable equivalent adjustments.

SFAS: Statement of Financial Accounting Standards.

SFAS 123R: “Share-Based Payment.”

SFAS 140: “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities — a replacement of FASB Statement No. 125.”

SFAS 156: “Accounting for Servicing of Financial Assets — an amendment of FASB Statement No. 140.”

Tax-Equivalent Basis: Total net revenue for each of the business segments and the Firm is presented on a tax-equivalent basis. Accordingly, revenue from tax exempt securities and investments that receive tax credits is presented in the managed results on a basis comparable to taxable securities and investments. This non-GAAP financial measure allows management to assess the comparability of revenues arising from both taxable and tax-exempt sources. The corresponding income tax impact related to these items is recorded with income tax expense.

Unaudited: The financial statements and information included throughout this document are unaudited and have not been subjected to auditing procedures sufficient to permit an independent certified public accountant to express an opinion.

U.S. GAAP: Accounting principles generally accepted in the United States of America.

Value-at-Risk (“VAR”): A measure of the dollar amount of potential loss from adverse market moves in an ordinary market environment.

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JPMORGAN CHASE & CO.
Line of Business Metrics

Investment Banking

IB’S REVENUES COMPRISE THE FOLLOWING:

1. Investment banking fees includes advisory, equity underwriting, bond underwriting and loan syndication fees.

2. Fixed income markets includes client and portfolio management revenue related to both market-making and proprietary risk-taking across global fixed income markets, including government and corporate debt, foreign exchange, interest rate and commodities markets.

3. Equities markets includes client and portfolio management revenue related to market-making and proprietary risk-taking across global equity products, including cash instruments, derivatives and convertibles.

4. Credit portfolio revenue includes Net interest income, fees and loan sale activity for IB’s credit portfolio. Credit portfolio revenue also includes gains or losses on securities received as part of a loan restructuring, and changes in the credit valuation adjustment (“CVA”), which is the component of the fair value of a derivative that reflects the credit quality of the counterparty. Credit portfolio revenue also includes the results of risk management related to the Firm’s lending and derivative activities.

Retail Financial Services

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN REGIONAL BANKING:

1. Personal bankers - Retail branch office personnel who acquire, retain and expand new and existing customer relationships by assessing customer needs and recommending and selling appropriate banking products and services.

2. Sales specialists - Retail branch office personnel who specialize in the marketing of a single product, including mortgages, investments and business banking, by partnering with the personal bankers.

MORTGAGE BANKING REVENUES COMPRISE THE FOLLOWING:

1. Production revenue includes Mortgage Servicing Rights created from the sales of loans, net gains or losses on the sales of loans, and other production-related fees. Also includes revenue associated with originations of subprime mortgage loans.

2. Net mortgage servicing revenue

     a) Servicing revenue represents all gross income earned from servicing third-party mortgage loans including stated service fees, excess service fees, late fees, and other ancillary fees. Also includes income associated with the servicing of subprime mortgages.

     b) Changes in MSR asset fair value due to:

          — inputs or assumptions in the model include interest rates and other market-based factors. Also includes updates to assumptions used in the MSR valuation process and changes in the value of servicing assets associated with subprime loans.

          — other changes in fair value include any factors other than those noted in the definition above. The single largest component of this line item is the change in MSR value due to servicing portfolio runoff (or time decay). For periods prior to January 1, 2006, this amount represents MSR asset amortization expense under SFAS 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities — a replacement of FASB Statement No. 125. Includes the results of both prime and subprime servicing assets.

          — derivative valuation adjustments and other represents fair value adjustments to the derivatives and other instruments used to hedge the MSR asset.

Retail Financial Services (continued)

MORTGAGE BANKING’S ORIGINATION CHANNELS COMPRISE THE FOLLOWING:

1. Retail - Borrowers who are buying or refinancing a home are directly contacted by a mortgage banker employed by the Firm using a branch office, the Internet or by phone. Borrowers are frequently referred to a mortgage banker by real estate brokers, home builders or other third parties.

2. Wholesale – A third-party mortgage broker refers loan applications to a mortgage banker at the Firm. Brokers are independent loan originators that specialize in finding and counseling borrowers but do not provide funding for loans.

3. Correspondent (including negotiated transactions) – Correspondents are banks, thrifts, other mortgage banks and other financial institutions that sell closed loans to the Firm. Correspondent negotiated transactions exclude purchased bulk servicing transactions and occur when mid- to large-sized mortgage lenders, banks and bank-owned mortgage companies sell servicing to the Firm on an as-originated basis. These transactions supplement traditional production channels and provide growth opportunities in the servicing portfolio in stable and rising-rate periods.

Card Services

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN CARD SERVICES:

1. Charge volume - Represents the dollar amount of cardmember purchases, balance transfers and cash advance activity.

2. Net accounts opened - Includes originations, purchases and sales.

3. Merchant acquiring business - Represents an entity that processes payments for merchants. JPMorgan Chase is a partner in Chase Paymentech Solutions, LLC.

4. Bank card volume – Represents the dollar amount of transactions processed for the merchants.

5. Total transactions - Represents the number of transactions and authorizations processed for the merchants.

Commercial Banking

COMMERCIAL BANKING REVENUES COMPRISE THE FOLLOWING:

1. Lending includes a variety of financing alternatives, which are often provided on a basis secured by receivables, inventory, equipment, real estate or other assets. Products include term loans, revolving lines of credit, bridge financing, asset-backed structures, and leases.

2. Treasury services includes a broad range of products and services enabling clients to transfer, invest and manage the receipt and disbursement of funds, while providing the related information reporting. These products and services include U.S. dollar and multi-currency clearing, ACH, lockbox, disbursement and reconciliation services, check deposits, other check and currency-related services, trade finance and logistics solutions, commercial card, and deposit products, sweeps and money market mutual funds.

3. Investment banking products provide clients with sophisticated capital-raising alternatives, as well as balance sheet and risk management tools through loan syndications, investment-grade debt, asset-backed securities, private placements, high-yield bonds, equity underwriting, advisory, interest rate derivatives, and foreign exchange hedges.

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN COMMERCIAL BANKING:

1. Liability balances include deposits and deposits that are swept to on-balance sheet liabilities (e.g., commercial paper, Fed funds purchased, and repurchase agreements).

2. IB revenues, gross - Represents the revenue related to investment banking products sold to CB clients.

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JPMORGAN CHASE & CO.
Line of Business Metrics (continued)

Treasury & Securities Services

Treasury & Securities Services firmwide metrics include certain TSS product revenues and liability balances reported in other lines of business related to customers who are also customers of those other lines of business. In order to capture the firmwide impact of TS and TSS products and revenues, management reviews firmwide metrics such as liability balances, revenues and overhead ratios in assessing financial performance for TSS. Firmwide metrics are necessary, in management’s view, in order to understand the aggregate TSS business.

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN TREASURY & SECURITIES SERVICES:

Liability balances include deposits and deposits that are swept to on-balance sheet liabilities (e.g., commercial paper, Fed funds purchased, and repurchase agreements).

Asset Management

Assets Under Management: Represent assets actively managed by Asset Management on behalf of institutional, private banking, private client services and retail clients. Excludes assets managed by American Century Companies, Inc., in which the Firm has a 43% ownership interest.

Assets Under Supervision: Represents assets under management as well as custody, brokerage, administration and deposit accounts.

Alternative Assets: The following types of assets constitute alternative investments — hedge funds, currency, real estate and private equity.

AM’s CLIENT SEGMENTS COMPRISE THE FOLLOWING:

1. Institutional brings comprehensive global investment services — including asset management, pension analytics, asset-liability management and active risk budgeting strategies — to corporate and public institutions, endowments, foundations, not for profits and governments worldwide.

2. The Private Bank addresses every facet of wealth management for ultra-high-net-worth individuals and families worldwide, including investment management, capital markets and risk management, tax and estate planning, banking, capital raising and specialty-wealth advisory services.

3. Retail provides worldwide investment management services and retirement planning and administration through third-party and direct distribution of a full range of investment vehicles.

4. Private Client Services offers high-net-worth individuals, families and business owners comprehensive wealth management solutions, including financial planning, personal trust, investments and banking.

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