JP Morgan Chase Start Banking Sector Third Quarter Reporting
The fly in the ointment for JP Morgan Chase, and other US banks, is the investigation into whether foreclosures, which resulted in tens of thousands of Americans losing their homes, had been handled correctly. Of the estimated total of 1.8 million loans in foreclosure by American mortgage servicing business in the 23 US judicial states, and an additional 1.3 million pending in other states, JP Morgan Chase is reportedly reviewing around 115,000 of its foreclosure cases across 41 states. In order to deal with the investigation,JP Morgan Chase has added $1.3 billion to its reserves for legal costs, as well as $1 billion to its mortgage repurchase reserves.
While this was a mix of good and bad, but mostly good, news to start off third quarter reporting by the banking sector, investors appeared unimpressed, with JP Morgan Chase stock remaining flat in late morning trading Wednesday. Next week will see the release of reports by Citigroup, Bank of America, Goldman Sachs, Morgan Stanley and Wells Fargo.