JP Morgan reports a dramatic raise in Q2 profits

The largest US bank reported second-quarter profits jumped by 31% which beat estimates as we enter US earnings season. Second-quarter net income rose to $6.5 billion, or $1.60 a share, from $4.96 billion, or $1.21, in the same period last year, company said today in a statement. The average estimate of 30 analysts surveyed by Bloomberg agreed on earnings of $1.45 per share.

“We continue to see broad-based signs that the U.S. economy is improving and we are hopeful that, as jobs are added and confidence builds, the U.S. economy will strengthen over time,” Dimon the CEO of JP Morgan, said in the statement cited by Bloomberg.

Companys earnings from investment banking more than offset the dip in revenues from its consumer banking and commercial banking units. The banks investment banking division generated profits from trading and from corporate debt issuance and IPOs.

Profits for the six largest U.S. banks will rise by an average of 20% in the second quarter, according to estimates.

JP Morgan is cutting as many as 19,000 jobs in its mortgage and community-banking divisions through 2014 in order to diminish expenses, the firm said in February. Employing about 259,000 people at the end of December, JPMorgan will cut 13,000 to 15,000 jobs in its mortgage unit and 3,000 to 4,000 in community banking excluding home lending through the end of next year, the company said. The total number of personnel at the company will shrink by about 4,000 people this year.

The US largest bank by assets said today that its liquidity coverage ratio was 118%, which is topping the proposed minimum of 100%. The Basel Committee on Banking Supervision’s standard, scheduled to be phased in starting in two years, requires banks to hold enough high luquidity assets, mostly cash and government debt, to survive 30 days of stress. Chief Financial Officer Marianne Lake said in April that the firm fell short of the standard in the first quarter and vowed to be compliant by the end of this year.

The banks shares are up 25% this year.