J.P. Morgan Chase reported this morning that second quarter credit card profits rose 61% from one-year ago to $875 million, however net income eased down from the first quarter’s record of $901 million. The high level of profits is driven by continued low bankruptcy losses. End-of-period managed credit card loans were flat at $139.3 billion due to higher customer payment rates. Chase notes that contributing to the higher payment rates are the new minimum payment rules and a higher proportion of customers in rewards-based programs. Second quarter charge volume was $84.4 billion, up 12% from the prior year. Net accounts opened during the second quarter were 24.6 million, including 21 million accounts from the Kohl’s acquisition. Chase also reported that branch sales of credit cards increased by 119% from the prior year and 60% from the prior quarter. Chase had 136.7 million cards issued at the end of the quarter. Merchant processing volume was up 18% to $166.3 billion, compared to 2Q/05. The managed net charge-off rate for the quarter decreased to 3.28%, down from 4.87% in the prior year and up from 2.99% in the prior quarter. The 30-day managed delinquency rate was 3.14%, down from 3.34% in the prior year and up from 3.10% in the prior quarter. For complete details on Chase’s second quarter performance, visit CardData ([www.carddata.com]).
JPM CHASE HISTORICAL ($billions)
2Q/05 3Q/05 4Q/05 1Q/06 2Q/06
EOP Outstandings: $137.3 137.6 142.3 134.3 139.3
Charge Volume: $ 75.6 76.4 79.6 74.3 84.4
Source: CardData (www.carddata.com)