JPMorgan's Trading Rebound Isn't Enough to Get Jamie Dimon Excited

(Bloomberg) -- JPMorgan Chase & Co. sees trading revenue climbing 10% in the third quarter, but don’t expect a celebration.

“We’re not jumping for joy,” Chief Executive Officer Jamie Dimon said Tuesday at an investor conference in New York. The gain is compared with a weak third quarter in 2018, and the figure will probably decline about 10% versus the second quarter, Dimon said.

Still, a big increase from last year would stand out from JPMorgan’s competitors, which haven’t been as optimistic about their performance. Citigroup Inc.’s trading revenue is set to drop this quarter amid volatility that gripped markets for most of August, Chief Financial Officer Mark Mason said Monday. And Bank of America Corp.’s fixed-income trading revenue will likely be down “a little bit,” while equities trading has done well, Chief Operating Officer Tom Montag said.

JPMorgan’s predicted boost would bring the figure to about $4.88 billion and mark a reversal from last year’s 1.9% drop.

Wall Street trading desks have been struggling to revamp their businesses as a shift to passive investing, struggles among hedge funds and moves to cheaper electronic trading have made banks’ securities units less profitable. The five biggest U.S. banks saw a collective $5 billion drop in trading revenue in the first half of the year after an 8% slide in the second quarter and a 14% decline in the first three months of the year.

Dimon predicted margins will continue to come down across the industry as more trades move to electronic platforms.

“The battle is more in the tech world at this point than in having brilliant traders,” he said.

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