2 q09 erf_supplement_final

EARNINGS RELEASE FINANCIAL SUPPLEMENT
SECOND QUARTER 2009

JPMORGAN CHASE & CO.
TABLE OF CONTENTS
Page

Consolidated Results
Consolidated Financial Highlights
Statements of Income
Consolidated Balance Sheets
Condensed Average Balance Sheets and Annualized Yields
Reconciliation from Reported to Managed Summary

2
3
4
5
6

Business Detail
Line of Business Financial Highlights - Managed Basis
Investment Bank
Retail Financial Services
Card Services - Managed Basis
Commercial Banking
Treasury & Securities Services
Asset Management
Corporate/Private Equity

7
8
11
17
20
22
24
27

Credit-Related Information

29

Market Risk-Related Information

34

Supplemental Detail
Capital, Intangible Assets and Deposits
Per Share-Related Information

35
36

Glossary of Terms

37

Page 1

CONSOLIDATED FINANCIAL HIGHLIGHTS
(in millions, except per share, ratio and headcount data)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
SELECTED INCOME STATEMENT DATA:
Reported Basis
Total net revenue
Total noninterest expense
Pre-provision profit
Provision for credit losses
Income (loss) before extraordinary gain
Extraordinary gain
NET INCOME
Managed Basis (a)
Total net revenue
Total noninterest expense
Pre-provision profit
Extraordinary gain
NET INCOME

1Q09

4Q08

3Q08

2Q08

1Q09

2Q08

2009

2009 Change
2008

2008

$

25,623
13,520
12,103
8,031
2,721
2,721

$

25,025
13,373
11,652
8,596
2,141
2,141

$

17,226
11,255
5,971
7,313
(623)
1,325
702

$

14,737
11,137
3,600
5,787
(54)
581
527

$

18,399
12,177
6,222
3,455
2,003
2,003

2 %
1
4
(7)
27
27

39 %
11
95
132
36
36

$

50,648
26,893
23,755
16,627
4,862
4,862

$

35,289
21,108
14,181
7,879
4,376
4,376

44 %
27
68
111
11
11

$

27,709
13,520
14,189
9,695
2,721
2,721

$

26,922
13,373
13,549
10,060
2,141
2,141

$

19,108
11,255
7,853
8,541
(623)
1,325
702

$

16,088
11,137
4,951
6,660
(54)
581
527

$

19,678
12,177
7,501
4,285
2,003
2,003

3
1
5
(4)
27
27

41
11
89
126
36
36

$

54,631
26,893
27,738
19,755
4,862
4,862

$

37,576
21,108
16,468
9,390
4,376
4,376

45
27
68
110
11
11

PER COMMON SHARE:
Basic Earnings (b)
Net income

0.28
0.28

0.40
0.40

(0.29)
0.06

(0.08)
0.09

0.54
0.54

(30)
(30)

(48)
(48)

0.68
0.68

1.21
1.21

(44)
(44)

Diluted Earnings (b) (c)
Net income

0.28
0.28

0.40
0.40

(0.29)
0.06

(0.08)
0.09

0.53
0.53

(30)
(30)

(47)
(47)

0.68
0.68

1.20
1.20

(43)
(43)

Cash dividends declared
Book value
Closing share price
Market capitalization

0.05
37.36
34.11
133,852

0.05
36.78
26.58
99,881

0.38
36.15
31.53
117,695

0.38
36.95
46.70
174,048

0.38
37.02
34.31
117,881

2
28
34

(87)
1
(1)
14

0.10
37.36
34.11
133,852

0.76
37.02
34.31
117,881

(87)
1
(1)
14

COMMON SHARES OUTSTANDING:
Weighted-average diluted shares outstanding (b)
Common shares outstanding at period-end

3,824.1
3,924.1

3,758.7
3,757.7

3,737.5
3,732.8

3,444.6
3,726.9

3,453.1
3,435.7

2
4

11
14

3,791.4
3,924.1

3,438.2
3,435.7

10
14

FINANCIAL RATIOS: (d)
Income (loss) before extraordinary gain:
Return on common equity ("ROE") (e)
Return on equity-goodwill ("ROE-GW") (e) (f)
Return on assets ("ROA")
Net income:
ROE (e)
ROE-GW (e) (f)
ROA

3 %
5
0.54

5 %
7
0.42

3
5
0.54

5
7
0.42

1
1
0.13

1
2
0.12

6
10
0.48

CAPITAL RATIOS:
Tier 1 capital ratio
Total capital ratio

9.7 (g)
13.3 (g)

11.4
15.2

10.9
14.8

8.9
12.6

9.2
13.4

SELECTED BALANCE SHEET DATA (Period-end)
Total assets
Wholesale loans
Consumer loans
Deposits
Common stockholders' equity
Total stockholders' equity

$

Headcount
LINE OF BUSINESS NET INCOME (LOSS)
Investment Bank
Card Services
Commercial Banking
Asset Management
Net income

2,026,642
231,625
448,976
866,477
146,614
154,766

$

220,255

$

$

1,471
15
(672)
368
379
352
808
2,721

2,079,188
242,284
465,959
906,969
138,201
170,194

(3) %
(5)
(0.11)

$

219,569

$

$

1,606
474
(547)
338
308
224
(262)
2,141

2,175,052
262,044
482,854
1,009,277
134,945
166,884

(1) %
(1)
(0.01)

$

224,961

$

$

(2,364)
624
(371)
480
533
255
1,545
702

2,251,469
288,445
472,936
969,783
137,691
145,843

6
10
0.48

$

228,452

$

$

882
64
292
312
406
351
(1,780)
527

1,775,670
229,359
308,670
722,905
127,176
133,176
195,594

$

$

394
503
250
355
425
395
(319)
2,003

%

4
6
0.48

%

7
11
0.54

4
6
0.48

(3)
(4)
(4)
(4)
6
(9)

14
1
45
20
15
16

-

13

(8)
(97)
(23)
9
23
57
NM
27

273
(97)
NM
4
(11)
(11)
NM
36

$

2,026,642
231,625
448,976
866,477
146,614
154,766

7
11
0.54

$

$

3,077
489
(1,219)
706
687
576
546
4,862

$

$

1,775,670
229,359
308,670
722,905
127,176
133,176

14
1
45
20
15
16

195,594

220,255

$

%

13

307
192
859
647
828
751
792
4,376

NM
155
NM
9
(17)
(23)
(31)
11

(a) For further discussion of managed basis, see Reconciliation from reported to managed summary on page 6.
(b) Effective January 1, 2009, the Firm adopted FSP EITF 03-6-1. Accordingly, prior period numbers have been revised as required. For further discussion of this FSP, see Per share-related information on page 36.
(c) The calculation of second quarter 2009 earnings per share includes a one-time, non-cash reduction of $1.1 billion, or $0.27 per share, resulting from repayment of TARP preferred capital.
(d) Ratios are based upon annualized amounts.
(e) The calculation of second quarter and year-to-date 2009 net income applicable to common equity includes a one-time, non-cash reduction of $1.1 billion resulting from repayment of TARP preferred capital. Excluding this reduction the
adjusted ROE and ROE-GW were 6% and 10% for the second quarter 2009 , respectively, and 6% and 9% for the year-to-date, respectively. The Firm views the adjusted ROE and ROE-GW, non-GAAP financial measures, as meaningful
because it increases the comparability to prior periods.
(f) Net income applicable to common equity 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 utilizes
this measure to facilitate comparisons to competitors.
(g) Estimated.

Page 2

STATEMENTS OF INCOME
(in millions, except per share and ratio data)
QUARTERLY TRENDS

YEAR-TO-DATE
2009 Change
2008

2Q09 Change
2Q09
REVENUE
Investment banking fees
Principal transactions
Lending & deposit-related fees
Asset management, administration and commissions
Securities gains
Mortgage fees and related income
Credit card income
Other income
Noninterest revenue

$

Interest income
Interest expense
Net interest income

1Q09

2,106
3,097
1,766
3,124
347
784
1,719
10
12,953

$

4Q08

1,386
2,001
1,688
2,897
198
1,601
1,837
50
11,658

$

3Q08

1,382
(7,885)
1,776
3,234
456
1,789
2,049
593
3,394

$

2Q08

1,316
(2,763)
1,168
3,485
424
457
1,771
(115)
5,743

$

1Q09

2Q08

2009

1,612
752
1,105
3,628
647
696
1,803
(138)
10,105

52 %
55
5
8
75
(51)
(6)
(80)
11

31 %
312
60
(14)
(46)
13
(5)
NM
28

(8)
(15)
(5)

$

(53)
53

2008

3,492
5,098
3,454
6,021
545
2,385
3,556
60
24,611

$

2,828
(51)
2,144
7,224
680
1,221
3,599
1,691
19,336

23 %
NM
61
(17)
(20)
95
(1)
(96)
27

34,475
8,438
26,037

34,061
18,108
15,953

1
(53)
63

16,549
3,879
12,670

17,926
4,559
13,367

21,631
7,799
13,832

17,326
8,332
8,994

16,529
8,235
8,294

TOTAL NET REVENUE

25,623

25,025

17,226

14,737

18,399

2

39

50,648

35,289

44


8,031

8,596

7,313

5,787

3,455

(7)

132

16,627

7,879

111

6,917
914
1,156
1,518
417
2,190
265
143
13,520

7,588
885
1,146
1,515
384
1,375
275
205
13,373

5,024
955
1,207
1,819
501
1,242
326
181
11,255

5,858
766
1,112
1,451
453
1,096
305
96
11,137

6,913
669
1,028
1,450
413
1,233
316
155
12,177

(9)
3
1
9
59
(4)
(30)
1

37
12
5
1
78
(16)
(8)
11

14,505
1,799
2,302
3,033
801
3,565
540
348
26,893

11,864
1,317
1,996
2,783
959
1,402
632
155
21,108

22
37
15
9
(16)
154
(15)
125
27

4,072
1,351
2,721
2,721

3,056
915
2,141
2,141

(1,342)
(719)
(623)
1,325
702

(2,187)
(2,133)
(54)
581
527

2,767
764
2,003
2,003

33
48
27
27

47
77
36
36

7,128
2,266
4,862
4,862

6,302
1,926
4,376
4,376

13
18
11
11

0.53
0.53

(30)
(30)

(47)
(47)

1.20
1.20

(43)
(43)

NONINTEREST EXPENSE
Compensation expense
Occupancy expense
Technology, communications and equipment expense
Professional & outside services
Marketing
Other expense (a)
Amortization of intangibles
Merger costs
TOTAL NONINTEREST EXPENSE
Income (loss) before income tax expense and extraordinary gain
Income tax expense (benefit) (b)
Extraordinary gain (c)
NET INCOME

DILUTED EARNINGS PER SHARE
Income (loss) before extraordinary gain (d)(e)
Extraordinary gain
NET INCOME (d)(e)

$

$
$

FINANCIAL RATIOS
Income (loss) before extraordinary gain:
ROE (f)
ROE-GW (f)
ROA
Net income:
ROE (f)
ROE-GW (f)
ROA
Effective income tax rate (b)
Overhead ratio

$

0.28
0.28

3
5
0.54

$
$

%

EXCLUDING IMPACT OF MERGER COSTS (g)
Merger costs (after-tax)
Income (loss) before extraordinary gain excluding merger costs

$

Diluted Per Share:
Income (loss) before extraordinary gain (d)(e)
Merger costs (after-tax)
Income (loss) before extraordinary gain excluding merger costs (d)(e)

$

$

$

0.40
0.40

5
7
0.42

3
5
0.54
33
53

$

$
$

%

$

$

0.28
0.02
0.30

$

$

$
$

(3) %
(5)
(0.11)

5
7
0.42
30
53

2,721
89
2,810

(0.29)
0.35
0.06

$

$

$

0.40
0.03
0.43

$

$

$
$

(1) %
(1)
(0.01)

1
1
0.13
54
65

2,141
127
2,268

(0.08)
0.17
0.09

$

6
10
0.48

1
2
0.12
98
76

(623)
112
(511)

$

$

(0.29)
0.03
(0.26)

$

$

$

$

0.68
0.68

$

%

4
6
0.48

6
10
0.48
28
66

(54)
60
6

$

$

(0.08)
0.02
(0.06)

$

$

$

$
$

%

7
11
0.54

4
6
0.48
32
53

2,003
96
2,099

27
(30)
24

36
(7)
34

$

$

0.53
0.03
0.56

(30)
(33)
(30)

(47)
(33)
(46)

$

7
11
0.54
31
60

4,862
216
5,078

$

0.68
0.05
0.73

$

$

%

$

$

4,376
96
4,472

11
125
14

1.20
0.03
1.23

(43)
67
(41)

(a) Second quarter 2009 includes a $675 million FDIC special assessment.
(b) The income tax benefit in the third quarter of 2008 includes the realization of a benefit from the release of deferred tax liabilities associated with the undistributed earnings of certain non-U.S. subsidiaries that were deemed to be reinvested
indefinitely.
(c) JPMorgan Chase acquired the banking operations of Washington Mutual Bank for $1.9 billion. The fair value of the net assets acquired exceeded the purchase price, which resulted in negative goodwill. In accordance with SFAS 141,
nonfinancial assets that are not held-for-sale were written down against that negative goodwill. The negative goodwill that remained after writing down nonfinancial assets was recognized as an extraordinary gain.
(d) Effective January 1, 2009, the Firm adopted FSP EITF 03-6-1. Accordingly, prior period numbers have been revised as required. For further discussion of this FSP, see Per share-related information on page 36.
(e) The calculation of second quarter 2009 earnings per share includes a one-time, non-cash reduction of $1.1 billion, or $0.27 per share, resulting from repayment of TARP preferred capital.
(f) The calculation of second quarter and year-to-date 2009 net income applicable to common equity includes a one-time, non-cash reduction of $1.1 billion resulting from repayment of TARP preferred capital. Excluding this reduction the
adjusted ROE and ROE-GW were 6% and 10% for the second quarter 2009 , respectively, and 6% and 9% for the year-to-date, respectively. The Firm views the adjusted ROE and ROE-GW, non-GAAP financial measures, as meaningful
because it increases the comparability to prior periods.
(g) Net income 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

CONSOLIDATED BALANCE SHEETS
(in millions)

Jun 30
2009
ASSETS
Cash and due from banks
Deposits with banks
Federal funds sold and securities purchased under resale agreements
Securities borrowed
Trading assets:
Debt and equity instruments
Derivative receivables
Securities
Loans
Less: allowance for loan losses
Loans, net of allowance for loan losses
Accrued interest and accounts receivable
Premises and equipment
Goodwill
Other intangible assets:
Mortgage servicing rights
Purchased credit card relationships
All other intangibles
Other assets (a)
TOTAL ASSETS
LIABILITIES
Deposits
Federal funds purchased and securities loaned or sold under
repurchase agreements
Commercial paper
Other borrowed funds (a)
Trading liabilities:
Debt and equity instruments
Derivative payables
Accounts payable and other liabilities
(including the allowance for lending-related commitments)
Beneficial interests issued by consolidated VIEs
Long-term debt
Junior subordinated deferrable interest debentures held by trusts that issued
guaranteed capital debt securities
TOTAL LIABILITIES
STOCKHOLDERS' EQUITY
Preferred stock
Common stock
Capital surplus
Retained earnings
Accumulated other comprehensive income (loss)
Shares held in RSU trust
Treasury stock, at cost
TOTAL STOCKHOLDERS' EQUITY
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

25,133
61,882
159,170
129,263

Mar 31
2009
$

26,681
89,865
157,237
127,928

Dec 31
2008
$

26,895
138,139
203,115
124,000

Sep 30
2008
$

54,350
34,372
233,668
152,050

Jun 30
2008
$

Jun 30, 2009
Change
Mar 31
Jun 30
2009
2008

32,255
17,150
176,287
142,854

(6) %
(31)
1
1

(22) %
261
(10)
(10)

298,135
97,491
345,563
680,601
29,072
651,529
61,302
10,668
48,288

298,453
131,247
333,861
708,243
27,381
680,862
52,168
10,336
48,201

347,357
162,626
205,943
744,898
23,164
721,734
60,987
10,045
48,027

401,609
118,648
150,779
761,381
19,052
742,329
104,232
9,962
46,121

409,608
122,389
119,173
538,029
13,246
524,783
64,294
10,333
45,993

(26)
4
(4)
6
(4)
18
3
-

(27)
(20)
190
26
119
24
(5)
3
5

$

14,600
1,431
3,651
118,536
2,026,642

$

10,634
1,528
3,821
106,366
2,079,188

$

9,403
1,649
3,932
111,200
2,175,052

$

17,048
1,827
3,653
180,821
2,251,469

$

11,617
1,984
3,675
93,275
1,775,670

37
(6)
(4)
11
(3)

26
(28)
(1)
27
14

$

866,477

$

906,969

$

1,009,277

$

969,783

$

722,905

(4)

20

300,931
42,713
73,968

192,546
37,845
132,400

224,075
54,480
167,827

194,724
50,151
22,594

8
29
(34)

55
(15)
227

56,021
67,197

53,786
86,020

45,274
121,604

76,213
85,816

87,841
95,749

4
(22)

(36)
(30)

171,685
20,945
254,226

165,521
9,674
243,569

187,978
10,561
252,094

260,563
11,437
238,034

171,004
20,071
260,192

4
117
4

4
(2)

17,713
1,871,876

$

279,837
33,085
112,257

18,276
1,908,994

18,589
2,008,168

17,398
2,105,626

17,263
1,642,494

(3)
(2)

3
14

8,152
4,105
97,662
56,355
(3,438)
(86)
(7,984)
154,766
2,026,642

31,993
3,942
91,469
55,487
(4,490)
(86)
(8,121)
170,194
2,079,188

31,939
3,942
92,143
54,013
(5,687)
(217)
(9,249)
166,884
2,175,052

8,152
3,942
90,535
55,217
(2,227)
(267)
(9,509)
145,843
2,251,469

6,000
3,658
78,870
56,313
(1,566)
(269)
(9,830)
133,176
1,775,670

(75)
4
7
2
23
2
(9)
(3)

36
12
24

$

$

$

$

(120)
68
19
16
14

(a) On September 19, 2008, the Federal Reserve established a special lending facility, the AML Facility, to provide liquidity to eligible money market mutual funds. The Firm participated in the AML Facility and had
ABCP investments totaling $14.5 billion, $6.0 billion, $11.2 billion, and $61.3 billion at June 30, 2009, March 31, 2009, December 31, 2008, and September 30, 2008, respectively. These ABCP investments were
recorded in other assets with the corresponding nonrecourse liability to the Federal Reserve Bank of Boston for the same amounts recorded in other borrowed funds.

Page 4

CONDENSED AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS
(in millions, except rates)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
AVERAGE BALANCES
ASSETS
Deposits with banks
Federal funds sold and securities purchased
under resale agreements
Securities borrowed
Trading assets - debt instruments
Securities
Loans
Other assets (a)
Total interest-earning assets
Trading assets - equity instruments
Goodwill
Other intangible assets:
Mortgage servicing rights
All other intangible assets
All other noninterest-earning assets
TOTAL ASSETS
LIABILITIES
Interest-bearing deposits
Federal funds purchased and securities loaned or sold under
repurchase agreements
Commercial paper
Other borrowings and liabilities (b)
Long-term debt
Total interest-bearing liabilities
Noninterest-bearing liabilities
TOTAL LIABILITIES
Preferred stock
Common stockholders' equity
TOTAL STOCKHOLDERS' EQUITY
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY

$

1Q09

68,001

$

4Q08

88,587

$

3Q08

106,156

$

2Q08

41,303

$

1Q09

38,813

2Q08

(23) %

2009

75 %

$

2009 Change
2008

2008

78,237

$

35,394

121 %

142,226
122,235
245,444
354,216
697,908
36,638
1,666,668
63,507
48,273

160,986
120,752
252,098
281,420
726,959
27,411
1,658,213
62,748
48,071

205,182
123,523
269,576
174,652
752,524
56,322
1,687,935
72,782
46,838

164,980
134,651
298,760
119,443
536,890
37,237
1,333,264
92,300
45,947

155,664
100,322
302,053
109,834
537,964
15,629
1,260,279
99,525
45,781

(12)
1
(3)
26
(4)
34
1
1
-

(9)
22
(19)
223
30
134
32
(36)
5

151,554
121,498
248,753
318,019
712,353
32,050
1,662,464
63,130
48,173

154,764
91,906
312,519
99,796
532,281
7,815
1,234,475
89,168
45,740

(2)
32
(20)
219
34
310
35
(29)
5

$

12,256
5,218
242,450
2,038,372

$

11,141
5,443
281,503
2,067,119

$

14,837
5,586
339,887
2,167,865

$

11,811
5,512
267,525
1,756,359

$

9,947
5,823
247,344
1,668,699

10
(4)
(14)
(1)

23
(10)
(2)
22

$

11,702
5,329
261,868
2,052,666

$

9,110
6,012
234,743
1,619,248

28
(11)
12
27

$

672,350

$

736,460

$

777,604

$

589,348

$

612,305

(9)

10

$

704,228

$

606,218

203,348
47,323
111,477
17,990
229,336
1,221,779
315,965
1,537,744
4,549
126,406
130,955

28
11
(12)
49
6
(6)
(2)
(11)
3
-

43
(21)
86
(19)
20
22
18
22
NM
11
29

1,668,699

(1)

22

289,971
37,371
207,489
14,493
274,323
1,495,997
373,172
1,869,169
28,338
140,865
169,203
$

226,110
33,694
236,673
9,757
258,732
1,501,426
397,243
1,898,669
31,957
136,493
168,450

2,038,372

$

203,568
40,486
264,236
9,440
248,125
1,543,459
460,894
2,004,353
24,755
138,757
163,512

2,067,119

$

200,032
47,579
161,821
11,431
261,385
1,271,596
351,023
1,622,619
7,100
126,640
133,740

2,167,865

$

1,756,359

$

258,217
35,543
221,999
12,138
266,571
1,498,696
385,141
1,883,837
30,138
138,691
168,829
$

16

191,622
47,453
109,515
16,036
214,846
1,185,690
305,790
1,491,480
2,275
125,493
127,768

2,052,666

$

35
(25)
103
(24)
24
26
26
26
NM
11
32

1,619,248

27

AVERAGE RATES
INTEREST-EARNING ASSETS
Deposits with banks
Federal funds sold and securities purchased
under resale agreements (c)
Trading assets - debt instruments
Securities
Loans
Other assets (a)
Total interest-earning assets
INTEREST-BEARING LIABILITIES
Interest-bearing deposits
Federal funds purchased and securities sold
under repurchase agreements
Commercial paper
Other borrowings and liabilities (b)
Long-term debt
Total interest-bearing liabilities
INTEREST RATE SPREAD
NET YIELD ON INTEREST-EARNING ASSETS
NET YIELD ON INTEREST-EARNING ASSETS
ADJUSTED FOR SECURITIZATIONS

1.45

%

2.03

%

3.34

%

3.04

%

3.87

%

1.78

%

4.03

0.41
4.91
3.64
5.65
0.80
4.00

1.06
5.27
4.16
5.87
2.44
4.41

2.14
6.18
5.14
6.44
3.06
5.12

3.00
6.06
5.09
6.31
3.29
5.22

3.23
5.59
5.27
6.36
3.97
5.34

0.74
5.09
3.87
5.76
1.50
4.20

3.46
5.67
5.36
6.72
3.97
5.60

0.70

0.93

1.53

2.26

2.36

0.82

2.72

0.23
0.24
1.32
1.59
2.60
1.04

0.36
0.47
1.46
1.57
2.73
1.23

0.95
1.17
2.56
3.79
3.87
2.01

2.63
2.05
2.84
2.87
3.31
2.61

2.73
2.17
3.77
2.24
3.27
2.71

0.29
0.35
1.39
1.58
2.67
1.14

3.00
2.79
4.39
2.92
3.52
3.07

2.96%
3.07%

3.18%
3.29%

3.11%
3.28%

2.61%
2.73%

2.63%
2.71%

3.06%
3.18%

2.53%
2.65%

3.37%

3.60%

3.55%

3.06%

3.06%

3.48%

%

3.00%

(a) Includes margin loans and the Firm's investment in asset-backed commercial paper under the Federal Reserve Bank of Boston's AML facility.
(b) Includes securities sold but not yet purchased, brokerage customer payables and advances from Federal Home Loan Banks.
(c) Includes securities borrowed.

Page 5

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 results and the results of lines of business 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 certain reclassifications that assume credit card loans securitized by Card Services remain on the balance sheet and presents revenue 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 37.
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
CREDIT CARD INCOME
Credit card income - reported
Impact of:
Credit card securitizations
Credit card income - managed
OTHER INCOME
Other income - reported
Impact of:
Tax-equivalent adjustments
Other income - managed
TOTAL NONINTEREST REVENUE
Total noninterest revenue - reported
Impact of:
Total noninterest revenue - managed
NET INTEREST INCOME
Net interest income - reported
Impact of:
Net interest income - managed
TOTAL NET REVENUE
Total net revenue - reported
Impact of:
Total net revenue - managed
PRE-PROVISION PROFIT
Total pre-provision profit - reported
Impact of:
Total pre-provision profit - managed
PROVISION FOR CREDIT LOSSES
Provision for credit losses - reported
Impact of:
Provision for credit losses - managed
INCOME TAX EXPENSE
Income tax expense (benefit) - reported
Impact of:
Income tax expense (benefit) - managed

1Q09

4Q08

3Q08

2Q08

$

1,719

$

1,837

$

2,049

$

1,771

$

$

(294)
1,425

$

(540)
1,297

$

(710)
1,339

$

(843)
928

$

1Q09

1,803

2Q08

2009

2008

2009 Change
2008

(6) %

(5) %

$

3,556

$

3,599

(1) %

(843)
960

46
10

65
48

$

(834)
2,722

$

(1,780)
1,819

53
50

NM

$

10

$

50

$

593

$

(115)

$

(138)

(80)

$

60

$

1,691

(96)

$

335
345

$

337
387

$

556
1,149

$

323
208

$

247
109

(1)
(11)

36
217

$

672
732

$

450
2,141

49
(66)

$

12,953

$

11,658

$

3,394

$

5,743

$

10,105

11

28

$

24,611

$

19,336

27

$

(294)
335
12,994

$

(540)
337
11,455

$

(710)
556
3,240

$

(843)
323
5,223

$

(843)
247
9,509

46
(1)
13

65
36
37

$

(834)
672
24,449

$

(1,780)
450
18,006

53
49
36

$

12,670

$

13,367

$

13,832

$

8,994

$

8,294

(5)

53

$

26,037

$

15,953

63

$

1,958
87
14,715

$

2,004
96
15,467

$

1,938
98
15,868

$

1,716
155
10,865

$

1,673
202
10,169

(2)
(9)
(5)

17
(57)
45

$

3,962
183
30,182

$

3,291
326
19,570

20
(44)
54

$

25,623

$

25,025

$

17,226

$

14,737

$

18,399

2

39

$

50,648

$

35,289

44

$

1,664
422
27,709

$

1,464
433
26,922

$

1,228
654
19,108

$

873
478
16,088

$

830
449
19,678

14
(3)
3

100
(6)
41

$

3,128
855
54,631

$

1,511
776
37,576

107
10
45

$

12,103

$

11,652

$

5,971

$

3,600

$

6,222

4

95

$

23,755

$

14,181

68

$

1,664
422
14,189

$

1,464
433
13,549

$

1,228
654
7,853

$

873
478
4,951

$

830
449
7,501

14
(3)
5

100
(6)
89

$

3,128
855
27,738

$

1,511
776
16,468

107
10
68

$

8,031

$

8,596

$

7,313

$

5,787

$

3,455

(7)

132

$

16,627

$

7,879

111

$

1,664
9,695

$

1,464
10,060

$

1,228
8,541

$

873
6,660

$

830
4,285

14
(4)

100
126

$

3,128
19,755

$

1,511
9,390

107
110

$

1,351

$

915

$

(719)

$

(2,133)

$

764

48

77

$

2,266

$

1,926

18

$

422
1,773

$

433
1,348

$

654
(65)

$

478
(1,655)

$

449
1,213

(3)
32

(6)
46

$

855
3,121

$

776
2,702

10
16

Page 6

LINE OF BUSINESS FINANCIAL HIGHLIGHTS - MANAGED BASIS
(in millions, except ratio data)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
TOTAL NET REVENUE (FTE)
Investment Bank (a)
Card Services
Commercial Banking
Asset Management
Corporate/Private Equity (a)
TOTAL NET REVENUE
TOTAL PRE-PROVISION PROFIT
Investment Bank (a)
Card Services
Commercial Banking
Asset Management
Corporate/Private Equity (a)
TOTAL PRE-PROVISION PROFIT
NET INCOME (LOSS)
Investment Bank
Card Services
Commercial Banking
Asset Management
TOTAL NET INCOME
AVERAGE EQUITY (b)
Investment Bank
Card Services
Commercial Banking
Asset Management
TOTAL AVERAGE EQUITY
RETURN ON EQUITY (b)
Investment Bank
Card Services
Commercial Banking
Asset Management

$

$

$

$

$

$

$

$

1Q09

7,301
7,970
4,868
1,453
1,900
1,982
2,235
27,709

3,234
3,891
3,535
918
612
628
1,371
14,189

1,471
15
(672)
368
379
352
808
2,721

33,000
25,000
15,000
8,000
5,000
7,000
47,865
140,865

18 %
(18)
18
30
20

$

$

$

$

$

$

$

$

4Q08

8,371
8,835
5,129
1,402
1,821
1,703
(339)
26,922

3,597
4,664
3,783
849
502
405
(251)
13,549

1,606
474
(547)
338
308
224
(262)
2,141

33,000
25,000
15,000
8,000
5,000
7,000
43,493
136,493

20 %
8
(15)
17
25
13

$

$

$

$

$

$

$

$

3Q08

(272)
8,684
4,908
1,479
2,249
1,658
402
19,108

(3,013)
4,638
3,419
980
910
445
474
7,853

(2,364)
624
(371)
480
533
255
1,545
702

33,000
25,000
15,000
8,000
4,500
7,000
46,257
138,757

(28) %
10
(10)
24
47
14

$

$

$

$

$

$

$

$

2Q08

4,066
4,963
3,887
1,125
1,953
1,961
(1,867)
16,088

$

$

250
2,184
2,693
639
614
599
(2,028)
4,951

$

$

882
64
292
312
406
351
(1,780)
527

$

$

26,000
17,000
14,100
7,000
3,500
5,500
53,540
126,640

13
1
8
18
46
25

$

$

%

1Q09

5,500
5,110
3,775
1,106
2,019
2,064
104
19,678

2Q08

2009

(13) %
(10)
(5)
4
4
16
NM
3

33 %
56
29
31
(6)
(4)
NM
41

$

766
2,430
2,590
630
702
664
(281)
7,501

(10)
(17)
(7)
8
22
55
NM
5

322
60
36
46
(13)
(5)
NM
89

$

394
503
250
355
425
395
(319)
2,003

(8)
(97)
(23)
9
23
57
NM
27

273
(97)
NM
4
(11)
(11)
NM
36

10
3

42
47
6
14
43
38
(15)
11

23,319
17,000
14,100
7,000
3,500
5,066
56,421
126,406

7
12
7
20
49
31

%

$

$

$

$

$

$

2009 Change
2008

2008

15,672
16,805
9,997
2,855
3,721
3,685
1,896
54,631

6,831
8,555
7,318
1,767
1,114
1,033
1,120
27,738

3,077
489
(1,219)
706
687
576
546
4,862

33,000
25,000
15,000
8,000
5,000
7,000
45,691
138,691

19 %
4
(16)
18
28
17

$

$

$

$

$

$

$

$

8,541
9,873
7,679
2,173
3,932
3,965
1,413
37,576

83 %
70
30
31
(5)
(7)
34
45

1,254
4,621
5,222
1,212
1,387
1,242
1,530
16,468

445
85
40
46
(20)
(17)
(27)
68

307
192
859
647
828
751
792
4,376

NM
155
NM
9
(17)
(23)
(31)
11

22,659
17,000
14,100
7,000
3,500
5,033
56,201
125,493

46
47
6
14
43
39
(19)
11

3
2
12
19
48
30

%

(a) In the second quarter of 2009, Investment Bank ("IB") began reporting credit reimbursement from TSS as a component of total net revenue, whereas TSS continues to report its credit reimbursement to IB as a separate line item on its income statement
(not part of net revenue). Corporate/Private Equity includes an adjustment to offset IB's inclusion of the credit reimbursement in total net revenue. Prior periods have been revised for IB and Corporate/Private Equity to reflect this presentation.
(b) Each business segment is allocated capital by taking into consideration stand-alone peer comparisons, economic risk measures and regulatory capital requirements. The amount of capital assigned to each business is referred to as equity.

Page 7

INVESTMENT BANK
FINANCIAL HIGHLIGHTS
QUARTERLY TRENDS

YEAR-TO-DATE
2009 Change
2008

2Q09 Change
2Q09
INCOME STATEMENT
REVENUE
Investment banking fees
Principal transactions
All other income (a)
Noninterest revenue
Net interest income
TOTAL NET REVENUE (b)

$


REVENUE BY REGION (a)
Americas
Europe/Middle East/Africa
Asia/Pacific
Total net revenue

$

1,380
3,515
138
692
(56)
5,669
2,702
8,371

$

3Q08

1,373
(6,160)
138
764
139
(3,746)
3,474
(272)

$

2Q08

1,593
(922)
118
847
(248)
1,388
2,678
4,066

$

1Q09

1,735
838
105
709
(196)
3,191
2,309
5,500

2Q08

2009

62 %
(48)
21
4
(93)
(14)
(10)
(13)

29 %
120
59
1
45
52
6
33

$

2008

3,619
5,356
305
1,409
(164)
10,525
5,147
15,672

$

2,941
40
207
1,453
(232)
4,409
4,132
8,541

23 %
NM
47
(3)
29
139
25
83
105

$

1,210

765

234

398

(28)

119

2,081

1,016

2,677
1,390
4,067

FINANCIAL RATIOS
ROE
ROA
Overhead ratio
Compensation expense as a % of total net revenue
REVENUE BY BUSINESS
Investment banking fees:
Advisory
Equity underwriting
Debt underwriting
Total investment banking fees
Fixed income markets
Equity markets
Credit portfolio (a)
Total net revenue

2,239
1,841
167
717
(108)
4,856
2,445
7,301

4Q08

871

NONINTEREST EXPENSE
Noncompensation expense
Income (loss) before income tax expense
Income tax expense (benefit) (c)
NET INCOME (LOSS)

1Q09

3,330
1,444
4,774

1,166
1,575
2,741

2,162
1,654
3,816

3,132
1,602
4,734

(20)
(4)
(15)

(15)
(13)
(14)

6,007
2,834
8,841

4,373
2,914
7,287

(1)
14
(8)

NM
NM
273

2,363
892
1,471

$

18 %
0.83
56
37

$

$

$

$

393
1,103
743
2,239
4,929
708
(575)
7,301

4,177
2,235
889
7,301

2,387
781
1,606

$

20 %
0.89
57
40

$

$

$

$

479
308
593
1,380
4,889
1,773
329
8,371

4,800
2,595
976
8,371

(3,778)
(1,414)
(2,364)

$

(28) %
(1.08)
NM
NM

$

$

$

$

579
330
464
1,373
(1,671)
(94)
120
(272)

(2,203)
2,026
(95)
(272)

16
(866)
882

$

13 %
0.39
94
53

$

$

$

$

576
518
499
1,593
815
1,650
8
4,066

1,072
2,517
477
4,066

368
(26)
394

$

7 %
0.19
86
57

$

$

$

$

4,750
1,673
3,077

$

19 %
0.86
56
38

370
542
823
1,735
2,347
1,079
339
5,500

(18)
258
25
62
1
(60)
NM
(13)

6
104
(10)
29
110
(34)
NM
33

3,185
1,519
796
5,500

(13)
(14)
(9)
(13)

31
47
12
33

$

$

$

$

872
1,411
1,336
3,619
9,818
2,481
(246)
15,672

8,977
4,830
1,865
15,672

238
(69)
307

37
(3)
21
NM
NM
NM

3 %
0.08
85
51

$

$

$

$

853
901
1,187
2,941
2,813
2,055
732
8,541

2
57
13
23
249
21
NM
83

3,741
3,167
1,633
8,541

140
53
14
83

(a) Treasury & Securities Services ("TSS") was charged a credit reimbursement related to certain exposures managed within the Investment Bank credit portfolio on behalf of clients shared with TSS. IB recognizes this credit reimbursement
in its credit portfolio business in all other income. Prior periods have been revised to conform with the current presentation.
(b) Total net revenue included tax-equivalent adjustments, predominantly due to income tax credits related to affordable housing and alternative energy investments, as well as, tax-exempt income from municipal bond investments, of $334 million,
$365 million, $583 million, $427 million, and $404 million, for the quarters ended June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $699 million and $693 million for year-to-date 2009
and 2008, respectively.
(c) The income tax benefit in the third quarter of 2008 is predominantly the result of reduced deferred tax liabilities on overseas earnings.

Page 8

INVESTMENT BANK
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except headcount and ratio data)
QUARTERLY TRENDS

YEAR-TO-DATE
2009 Change
2008

2Q09 Change
2Q09
Loans:
Loans retained (a)
Loans held-for-sale & loans at fair value
Total loans
Equity
SELECTED BALANCE SHEET DATA (Average)
Total assets
Trading assets - debt and equity instruments
Trading assets - derivative receivables
Loans:
Loans retained (a)
Total loans
Adjusted assets (b)
Equity

Net charge-off (recovery) rate (a) (d)
Allowance for loan losses to period-end loans (a) (d)
Allowance for loan losses to average loans (a) (d) (e)
Allowance for loan losses to nonperforming loans (c)
Nonperforming loans to period-end loans
Nonperforming loans to average loans

4Q08

3Q08

2Q08

1Q09

$

64,500
6,814
71,314
33,000

$

66,506
10,993
77,499
33,000

$

71,357
13,660
85,017
33,000

$

73,347
16,667
90,014
33,000

$

70,690
19,699
90,389
26,000

$

710,825
265,336
100,536

$

733,166
272,998
125,021

$

869,159
306,168
153,875

$

890,040
360,821
105,462

$

2Q08

2009

2008

(3) %
(38)
(8)
-

(9) %
(65)
(21)
27

$

64,500
6,814
71,314
33,000

$

70,690
19,699
90,389
26,000

(9) %
(65)
(21)
27

814,860
367,184
99,395

(3)
(3)
(20)

(13)
(28)
1

$

721,934
269,146
112,711

$

785,344
368,320
94,814

(8)
(27)
19

68,224
8,934
77,158
531,632
33,000

$

70,041
12,402
82,443
589,163
33,000

73,110
16,378
89,488
685,242
33,000

69,022
17,612
86,634
694,459
26,000

76,239
20,440
96,679
676,777
23,319

(3)
(28)
(6)
(10)
-

(11)
(56)
(20)
(21)
42

69,128
10,658
79,786
560,239
33,000

75,173
20,026
95,199
669,598
22,659

(8)
(47)
(16)
(16)
46

25,783

Headcount
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs (recoveries)
Nonperforming assets:
Loans (c)
Derivative receivables
Assets acquired in loan satisfactions
Total nonperforming assets
Allowance for credit losses:
Allowance for loan losses
Allowance for lending-related commitments
Total allowance for credit losses

1Q09

26,142

27,938

30,993

37,057

(1)

(30)

25,783

37,057

(30)

NM

NM

5

NM

96
(30)
32
49

NM
NM
208
NM

3,519
704
311
4,534

313
76
101
490

NM
NM
208
NM

9
19
10

110
(25)
88

5,101
351
5,452

2,429
469
2,898

110
(25)
88

433

$

36

$

87

$

13

$

(8)

3,519
704
311
4,534

1,795
1,010
236
3,041

1,175
1,079
247
2,501

436
34
113
583

313
76
101
490

5,101
351
5,452

4,682
295
4,977

3,444
360
3,804

2,654
463
3,117

2,429
469
2,898

2.55 %
7.91
7.48
150
4.93
4.56

0.21 %
7.04
6.68
269
2.32
2.18

0.47 %
4.83
4.71
301
1.38
1.31

0.07 %
3.62
3.85
657
0.48
0.50

(0.04) %
3.44
3.19
843
0.35
0.32

$

469

$

1.37 %
7.91
7.38
150
4.93
4.41

0.01 %
3.44
3.23
843
0.35
0.33

(a) Loans retained included credit portfolio loans, leveraged leases and other accrual loans, and excluded loans held-for-sale and loans accounted for at fair value.
(b) 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; (4) goodwill and intangibles; (5) securities received as collateral; and (6) investments purchased under the Asset-Backed
Commercial Paper Money Market Mutual Fund Liquidity Facility. The amount of adjusted assets is presented to assist the reader in comparing the Investment Bank's ("IB") 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. IB believes an adjusted asset amount that excludes the assets discussed above, which were considered
to have a low risk profile, provides a more meaningful measure of balance sheet leverage in the securities industry.
(c) Nonperforming loans included loans held-for-sale and loans at fair value of $112 million, $57 million, $32 million, $32 million, and $25 million, at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008,
respectively, which were excluded from the allowance coverage ratios. Nonperforming loans excluded distressed loans held-for-sale that were purchased as part of IB's proprietary activities.
(d) Loans held-for-sale and loans at fair value were excluded when calculating the allowance coverage ratio and net charge-off (recovery) rate.
(e) Excluding the impact of a loan originated in March 2008 to Bear Stearns, the adjusted ratio would be 3.46% and 3.40% for the quarter ended June 30, 2008, and the six months ended June 30, 2008, respectively. The average balance of the
loan extended to Bear Stearns was $6.0 billion and $3.8 billion for the quarter ended June 30, 2008, and the six months ended June 30, 2008, respectively.

Page 9

INVESTMENT BANK
(in millions, except ratio and rankings data)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09

1Q09

MARKET RISK - AVERAGE TRADING AND CREDIT PORTFOLIO
VAR - 99% CONFIDENCE LEVEL (a)
Trading activities:
Fixed income
$
Foreign exchange
Equities
Commodities and other
Diversification (b)
Total trading VaR (c)

249
26
77
34
(136)
250

Credit portfolio VaR (d)
Diversification (b)
Total trading and credit portfolio VaR

133
(116)
267

$

$

4Q08

218
40
162
28
(159)
289
182
(135)
336

$

June 30, 2009 YTD
MARKET SHARES AND RANKINGS (e)
Global debt, equity and equity-related
Global syndicated loans
Global long-term debt (f)
Global equity and equity-related (g)
Global announced M&A (h)
U.S. debt, equity and equity-related
U.S. syndicated loans
U.S. long-term debt (f)
U.S. equity and equity-related (g)
U.S. announced M&A (h)

Market Share
11%
10%
9%
16%
32%
15%
25%
15%
17%
48%

Rankings
#1
#1
#1
#1
#3
#1
#1
#1
#1
#3

$

$

3Q08

276
55
87
30
(146)
302
165
(140)
327

$

2Q08

183
20
80
41
(104)
220
47
(49)
218

$

$

$

1Q09

2Q08

155
26
30
31
(92)
150

14 %
(35)
(52)
21
14
(13)

35
(36)
149

(27)
14
(21)

2009

61 %
157
10
(48)
67
280
(222)
79

$

$

2009 Change
2008

2008

234
33
119
31
(148)
269
157
(125)
301

$

$

137
30
31
29
(91)
136
33
(34)
135

71 %
10
284
7
(63)
98
376
(268)
123

Full Year 2008
Market Share
10%
12%
9%
10%
27%
15%
25%
15%
11%
33%

Rankings
#1
#1
#3
#1
#2
#2
#1
#2
#1
#2

(a) Results for second quarter 2008 include one month of the combined Firm's results and two months of heritage JPMorgan Chase & Co. results.
(b) Average VaRs were less than the sum of the VaRs of their market risk components, which was due to risk offsets resulting from portfolio diversification. The diversification effect reflected the fact that the risks were not perfectly correlated.
The risk of a portfolio of positions is usually less than the sum of the risks of the positions themselves.
(c) Trading VaR includes predominantly all trading activities in IB; however, particular risk parameters of certain products are not fully captured, for example, correlation risk. Trading VaR does not include VaR related to held-for-sale funded loans
and unfunded commitments, nor the debit valuation adjustments ("DVA") taken on derivative and structured liabilities to reflect the credit quality of the Firm. Trading VaR also does not include the MSR portfolio or VaR related to other corporate
functions, such as Corporate/Private Equity. Beginning in the fourth quarter of 2008, trading VaR includes the estimated credit spread sensitivity of certain mortgage products.
(d) Included VaR on derivative credit valuation adjustments ("CVA"), hedges of the CVA and mark-to-market hedges of the retained loan portfolio, which are all reported in principal transactions revenue. This VaR does not include the retained
loan portfolio.
(e) Source: Thomson Reuters. Full year 2008 results are pro forma for the Bear Stearns merger.
(f) Includes asset-backed securities, mortgage-backed securities and municipal securities.
(g) Includes rights offerings; U.S. domiciled equity and equity-related transactions.
(h) Global announced M&A is based upon 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%.
Global and U.S. announced M&A market share and ranking for 2008 include transactions withdrawn since December 31, 2008. U.S. announced M&A represents any U.S. involvement ranking.

Page 10

RETAIL FINANCIAL SERVICES
(in millions, except ratio and headcount data)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
INCOME STATEMENT
REVENUE
Credit card income
Other income
Noninterest revenue
Net interest income
TOTAL NET REVENUE

$

1Q09

1,003
425
807
411
294
2,940
5,030
7,970

$

4Q08

948
435
1,633
367
214
3,597
5,238
8,835

$

3Q08

1,050
412
1,962
367
183
3,974
4,710
8,684

$

2Q08

538
346
438
204
206
1,732
3,231
4,963

$

1Q09

497
375
696
194
198
1,960
3,150
5,110

2Q08

6 %
(2)
(51)
12
37
(18)
(4)
(10)

2009

102 %
13
16
112
48
50
60
56

$

2009 Change
2008

2008

1,951
860
2,440
778
508
6,537
10,268
16,805

$

958
752
1,221
368
350
3,649
6,224
9,873

104 %
14
100
111
45
79
65
70


3,846

3,877

3,576

2,056

1,585

(1)

143

7,723

4,273

81

NONINTEREST EXPENSE

1,631
2,365
83
4,079

1,631
2,457
83
4,171

1,604
2,345
97
4,046

1,120
1,559
100
2,779

1,184
1,396
100
2,680

(4)
(2)

38
69
(17)
52

3,262
4,822
166
8,250

2,344
2,708
200
5,252

39
78
(17)
57

845
342
503

(94)
(90)
(97)

(95)
(91)
(97)

Income tax expense (benefit)
NET INCOME (LOSS)

$

FINANCIAL RATIOS
ROE
Overhead ratio
Overhead ratio excluding core deposit intangibles (a)
Assets
Loans:
Loans retained
Loans held-for-sale & loans at fair value (b)
Total loans
Deposits
Equity
Assets
Loans:
Loans retained
Loans held-for-sale & loans at fair value (b)
Total loans
Deposits
Equity
Headcount

45
30
15

$

%
51
50

$

399,916

410,228

$

8 %
47
46

$

353,934
13,192
367,126
371,241
25,000
$

787
313
474

412,505

423,472

$

10 %
47
45

$

364,220
12,529
376,749
380,140
25,000
$

1,062
438
624

419,831

423,699

$

1 %
56
54

$

368,786
9,996
378,782
360,451
25,000
$

128
64
64

426,435

12 %
52
51

$

265,367

$

832
343
489

348
156
192

$

4 %
49
48

265,845

(3)

50

223,047
16,282
239,329
223,121
17,000

371,153
10,223
381,376
353,660
25,000
$

$

(3)
5
(3)
(2)
-

59
(19)
53
66
47

267,808

(3)

53

$

399,916

2 %
53
51

$

416,813

$

265,845

50

223,047
16,282
239,329
223,121
17,000

353,934
13,192
367,126
371,241
25,000
$

139
120
155

59
(19)
53
66
47

263,911

58

359,372
19,043
378,415
377,259
25,000

366,925
16,526
383,451
370,278
25,000

369,172
13,848
383,020
358,523
25,000

222,640
16,037
238,677
222,180
17,000

221,132
20,492
241,624
226,487
17,000

(2)
15
(1)
2
-

63
(7)
57
67
47

363,127
17,792
380,919
373,788
25,000

217,859
19,167
237,026
226,021
17,000

67
(7)
61
65
47

103,733

100,677

102,007

101,826

69,550

3

49

103,733

69,550

49

(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 method would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio
excludes Retail Banking's core deposit intangibles amortization expense related to the 2006 Bank of New York transaction and the 2004 Bank One merger of $82 million, $83 million, $97 million, $99 million, and $99 million for the quarters
ending June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $165 million and $198 million for year-to-date 2009 and 2008, respectively.
(b) Loans at fair value consist of prime mortgages originated with the intent to sell that are accounted for at fair value and classified as trading assets on the Consolidated Balance Sheets. These loans totaled $11.3 billion, $8.9 billion, $8.0 billion,
$8.6 billion, and $14.1 billion at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively. Average balances of these loans totaled $16.2 billion, $13.4 billion, $12.0 billion, $14.5 billion, and
$16.9 billion for the quarters ended June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $14.9 billion and $15.2 billion for year-to-date 2009 and 2008, respectively.

Page 11

QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
Net charge-offs
Nonperforming loans (a) (b) (c)
Nonperforming assets (a) (b) (c)
Net charge-off rate (d)
Net charge-off rate excluding purchased credit-impaired loans (d) (e)
Allowance for loan losses to ending loans (d)
Allowance for loan losses to ending loans excluding purchased credit-impaired loans (d) (e)
Allowance for loan losses to nonperforming loans (a) (d)
Nonperforming loans to total loans
Nonperforming loans to total loans excluding purchased credit-impaired loans (a)

$

1Q09

2,649
8,995
10,554
11,832
2.96 %
3.89
3.34
4.41
135
2.45
3.19

$

4Q08

2,176
7,978
9,846
10,619
2.41 %
3.16
2.92
3.84
138
2.12
2.76

$

3Q08

1,701
6,784
9,077
8,918
1.83 %
2.41
2.42
3.19
136
1.79
2.34

$

2Q08

1,326
5,724
8,085
7,517
2.37 %
2.37
2.03
2.56
136
1.50
1.88

$

1Q09

1,025
4,574
5,333
5,062
1.86 %
1.86
2.27
2.27
115
1.91
1.91

2Q08

22 %
13
7
11

2009

158 %
97
98
134

$

2009 Change
2008

2008

4,825
8,995
10,554
11,832
2.68 %
3.53
3.34
4.41
135
2.45
3.19

$

1,850
4,574
5,333
5,062

161 %
97
98
134

1.71 %
1.71
2.27
2.27
115
1.91
1.91

(a) Excludes purchased credit-impaired loans accounted for under SOP 03-3 that were acquired as part of the Washington Mutual transaction. These loans are accounted for on a pool basis and the pools are considered to be performing under SOP 03-3.
(b) Nonperforming loans and assets included loans held-for-sale and loans accounted for at fair value of $203 million, $264 million, $236 million, $207 million, and $180 million at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and
June 30, 2008, respectively. Certain of these loans are classified as trading assets on the Consolidated Balance Sheets.
(c) Nonperforming loans and assets excluded: (1) loans eligible for repurchase, as well as loans repurchased from Government National Mortgage Association ("GNMA") pools that are insured by U.S. government agencies, of $4.7 billion, $4.6 billion,
$3.3 billion, $1.8 billion, and $1.9 billion at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively; and (2) student 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 $473 million, $433 million, $437 million, $405 million, and $394 million at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008,
respectively. These amounts for GNMA and student loans are excluded, as reimbursement is proceeding normally.
(d) Loans held-for-sale and loans accounted for at fair value were excluded when calculating the allowance coverage ratio and the net charge-off rate.
(e) Excludes the impact of purchased credit-impaired loans accounted for under SOP 03-3 that were acquired as part of the Washington Mutual transaction. These loans were accounted for at fair value on the acquisition date, which incorporated
management's estimate, as of that date, of credit losses over the remaining life of the portfolio. No allowance for loan losses has been recorded for these loans as of June 30, 2009, March 31, 2009, December 31, 2008, and September 30, 2008,
respectively.

Page 12

(in millions, except ratio data and where otherwise noted)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09

1Q09

4Q08

3Q08

2Q08

1Q09

2Q08

2009

2009 Change
2008

2008

RETAIL BANKING
Noninterest revenue
Net interest income
Total net revenue
Noninterest expense
Income before income tax expense
Net income

$

$

Overhead ratio
Overhead ratio excluding core deposit intangibles (a)
BUSINESS METRICS (in billions)
Business banking origination volume
End-of-period loans owned
End-of-period deposits:
Checking
Savings
Time and other
Total end-of-period deposits
Average loans owned
Average deposits:
Checking
Savings
Time and other
Total average deposits
Deposit margin
Average assets
Net charge-offs
Net charge-off rate
Nonperforming assets

1,803
2,719
4,522
361
2,557
1,604
970

$

$

57 %
55

1,718
2,614
4,332
325
2,580
1,427
863

$

$

60 %
58

1,834
2,687
4,521
268
2,533
1,720
1,040

$

$

56 %
54

1,089
1,756
2,845
70
1,580
1,195
723

$

$

56 %
52

1,062
1,671
2,733
62
1,557
1,114
674

5 %
4
4
11
(1)
12
12

70 %
63
65
482
64
44
44

$

$

57 %
53

3,521
5,333
8,854
686
5,137
3,031
1,833

$

$

58 %
56

2,028
3,216
5,244
111
3,119
2,014
1,219

74 %
66
69
NM
65
50
50

59 %
56

$

0.6
17.8

$

0.5
18.2

$

0.8
18.4

$

1.2
18.6

$

1.7
16.5

20
(2)

(65)
8

$

1.1
17.8

$

3.5
16.5

(69)
8

$

114.1
150.4
78.9
343.4
18.0

$

113.9
152.4
86.5
352.8
18.4

$

109.2
144.0
89.1
342.3
18.2

$

106.7
146.4
85.8
338.9
16.6

$

69.1
105.8
37.0
211.9
16.2

(1)
(9)
(3)
(2)

65
42
113
62
11

$

114.1
150.4
78.9
343.4
18.2

$

69.1
105.8
37.0
211.9
16.0

65
42
113
62
14

$
$

$

$
$

$

$

$

$

$

114.2
$
151.2
82.7
348.1
2.92 %
29.1
$

109.4
$
148.2
88.2
345.8
2.85 %
30.2
$

105.8
$
145.3
88.7
339.8
2.94 %
28.7
$

68.0
$
105.4
36.7
210.1
3.06 %
25.6
$

68.4
105.9
39.6
213.9
2.88 %
25.7

4
2
(6)
1

67
43
109
63

$

(4)

13

$

211
$
4.70 %
686
$

175
$
3.86 %
579
$

168
$
3.67 %
424
$

68
$
1.63 %
380
$

61
1.51 %
337

21

246

$

18

104

$

20

2

$

$

111.8
$
149.6
85.6
347.0
2.89 %
29.6
$

67.3
103.1
43.6
214.0
2.76 %
25.5

66
45
96
62

386
$
4.28 %
686
$

110
1.38 %
337

251

16

104

RETAIL BRANCH BUSINESS METRICS
Investment sales volume
Number of:
Branches
ATMs
Personal bankers
Sales specialists
Active online customers (in thousands)
Checking accounts (in thousands)

$

5,292

5,203
14,144
15,959
5,485
13,930
25,252

$

4,398

5,186
14,159
15,544
5,454
12,882
24,984

$

3,956

5,474
14,568
15,825
5,661
11,710
24,499

$

4,389

5,423
14,389
15,491
5,899
11,682
24,490

$

5,211

3,157
9,310
9,995
4,116
7,180
11,336

3
1
8
1

65
52
60
33
94
123

9,690

$

5,203
14,144
15,959
5,485
13,930
25,252

9,295

4

3,157
9,310
9,995
4,116
7,180
11,336

65
52
60
33
94
123

(a) Retail 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 method would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio
excludes Retail Banking's core deposit intangibles amortization expense related to the 2006 Bank of New York transaction and the 2004 Bank One merger of $82 million, $83 million, $97 million, $99 million, and $99 million for the quarters
ending June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $165 million and $198 million for year-to-date 2009 and 2008, respectively.

Page 13

QUARTERLY TRENDS

YEAR-TO-DATE
2009 Change
2008

2Q09 Change
2Q09

1Q09

4Q08

3Q08

2Q08

1Q09

2Q08

2009

2008

CONSUMER LENDING
Noninterest revenue
Net interest income
Total net revenue
Noninterest expense
Net income (loss)

$

$

Overhead ratio
BUSINESS METRICS (in billions)
LOANS EXCLUDING PURCHASED CREDIT-IMPAIRED LOANS (a)
End-of-period loans owned:
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Student loans
Auto loans
Other
Total end-of-period loans
Average loans owned:
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Student loans
Auto loans
Other
Total average loans
PURCHASED CREDIT-IMPAIRED LOANS (a)
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Total average loans
TOTAL CONSUMER LENDING PORTFOLIO
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Student loans
Auto loans
Other
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Student loans
Auto loans
Other
Total average loans owned (b)

1,137
2,311
3,448
3,485
1,522
(1,559)
(955)

$

$

44 %

1,879
2,624
4,503
3,552
1,591
(640)
(389)

$

$

35 %

2,140
2,023
4,163
3,308
1,513
(658)
(416)

$

$

36 %

643
1,475
2,118
1,986
1,199
(1,067)
(659)

$

$

57 %

898
1,479
2,377
1,523
1,123
(269)
(171)

(39) %
(12)
(23)
(2)
(4)
(144)
(146)

27 %
56
45
129
36
(480)
(458)

$

$

47 %

3,016
4,935
7,951
7,037
3,113
(2,199)
(1,344)

$

$

39 %

1,621
3,008
4,629
4,162
2,133
(1,666)
(1,027)

86 %
64
72
69
46
(32)
(31)

46 %

$

108.2
62.1
13.8
9.0
15.6
42.9
1.0
252.6

$

111.7
65.4
14.6
9.0
17.3
43.1
1.0
262.1

$

114.3
65.2
15.3
9.0
15.9
42.6
1.3
263.6

$

116.8
63.0
18.1
19.0
15.3
43.3
1.0
276.5

$

95.1
40.1
14.8
13.0
44.9
0.9
208.8

(3)
(5)
(5)
(10)
(4)

14
55
(7)
NM
20
(4)
11
21

$

108.2
62.1
13.8
9.0
15.6
42.9
1.0
252.6

$

95.1
40.1
14.8
13.0
44.9
0.9
208.8

14
55
(7)
NM
20
(4)
11
21

$

110.1
63.3
14.3
9.1
16.7
43.1
1.0
257.6

$

113.4
65.4
14.9
8.8
17.0
42.5
1.5
263.5

$

114.6
65.0
15.7
9.0
15.6
42.9
1.5
264.3

$

94.8
39.7
14.2
14.1
43.9
0.9
207.6

$

95.1
39.3
15.5
12.7
44.9
1.0
208.5

(3)
(3)
(4)
3
(2)
1
(33)
(2)

16
61
(8)
NM
31
(4)
24

$

111.7
64.4
14.6
9.0
16.8
42.8
1.3
260.6

$

95.0
37.7
15.6
12.4
44.1
1.1
205.9

18
71
(6)
NM
35
(3)
18
27

$

27.7
20.8
6.4
30.5
85.4

$

28.4
21.4
6.6
31.2
87.6

$

28.6
21.8
6.8
31.6
88.8

$

26.5
24.7
3.9
22.6
77.7

$

-

(2)
(3)
(3)
(2)
(3)

NM
NM
NM
NM
NM

$

27.7
20.8
6.4
30.5
85.4

$

-

NM
NM
NM
NM
NM

$

28.0
21.0
6.5
31.0
86.5

$

28.4
21.6
6.7
31.4
88.1

$

28.2
21.9
6.8
31.6
88.5

$

-

$

-

(1)
(3)
(3)
(1)
(2)

NM
NM
NM
NM
NM

$

28.2
21.3
6.6
31.2
87.3

$

-

NM
NM
NM
NM
NM

$

135.9
82.9
20.2
39.5
15.6
42.9
1.0
338.0

$

140.1
86.8
21.2
40.2
17.3
43.1
1.0
349.7

$

142.9
87.0
22.1
40.6
15.9
42.6
1.3
352.4

$

143.3
87.7
22.0
41.6
15.3
43.3
1.0
354.2

$

95.1
40.1
14.8
13.0
44.9
0.9
208.8

(3)
(4)
(5)
(2)
(10)
(3)

43
107
36
NM
20
(4)
11
62

$

135.9
82.9
20.2
39.5
15.6
42.9
1.0
338.0

$

95.1
40.1
14.8
13.0
44.9
0.9
208.8

43
107
36
NM
20
(4)
11
62

$

138.1
84.3
20.8
40.1
16.7
43.1
1.0
344.1

$

141.8
87.0
21.6
40.2
17.0
42.5
1.5
351.6

$

142.8
86.9
22.5
40.6
15.6
42.9
1.5
352.8

$

94.8
39.7
14.2
14.1
43.9
0.9
207.6

$

95.1
39.3
15.5
12.7
44.9
1.0
208.5

(3)
(3)
(4)
(2)
1
(33)
(2)

45
115
34
NM
31
(4)
65

$

139.9
85.7
21.2
40.2
16.8
42.8
1.3
347.9

$

95.0
37.7
15.6
12.4
44.1
1.1
205.9

47
127
36
NM
35
(3)
18
69

(a) Purchased credit-impaired loans accounted for under SOP 03-3 represent loans acquired in the Washington Mutual transaction for which a deterioration in credit quality occurred between the origination date and JPMorgan Chase's acquisition
date. Under SOP 03-3, these loans were initially recorded at fair value and accrete interest income over the estimated life of the loan when cash flows are reasonably estimable, even if the underlying loans are contractually past due.
(b) Total average loans include loans held-for-sale of $2.8 billion, $3.1 billion, $1.8 billion, $1.5 billion, and $3.6 billion for the quarters ended June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively,
and $2.9 billion and $4.0 billion for year-to-date 2009 and 2008, respectively.
Page 14

QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09

1Q09

4Q08

3Q08

2Q08

1Q09

2Q08

2009

2009 Change
2008

2008

CONSUMER LENDING (continued)
Net charge-offs excluding purchased credit-impaired loans: (a)
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Auto loans
Other
Total net charge-offs
Net charge-off rate excluding purchased credit-impaired loans: (a)
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Auto loans
Other
Total net charge-off rate excluding purchased credit-impaired loans (b)
Net charge-off rate - reported:
Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Auto loans
Other
Total net charge-off rate - reported (b)
30+ day delinquency rate excluding purchased credit-impaired loans (c) (d) (e)
Nonperforming assets (f) (g)
Allowance for loan losses to ending loans
Allowance for loan losses to ending loans excluding purchased credit-impaired loans (a)

$

1,265
481
410
15
146
121
2,438

$

4.61 %
3.07
11.50
0.66
1.36
3.15
3.84
3.67
2.30
7.91
0.15
1.36
3.15
2.87
$

5.22
9,868
$
3.23 %
4.34

1,098
312
364
4
174
49
2,001

$

770
195
319
207
42
1,533

$

663
177
273
124
21
1,258

$

511
104
192
119
38
964

3.93 %
1.95
9.91
0.18
1.66
1.25
3.12

2.67 %
1.20
8.08
1.92
1.08
2.32

2.78 %
1.79
7.65
1.12
0.60
2.43

2.15
0.89
5.64
1.92
1.08
1.74

2.78
1.79
7.65
1.12
0.60
2.43

148 %
363
114
NM
23
218
153

$

2.16 %
1.08
4.98
1.07
1.44
1.89

3.14
1.46
6.83
0.04
1.66
1.25
2.33

15 %
54
13
275
(16)
147
22

2.16
1.08
4.98
1.07
1.44
1.89

4.73
9,267
$
2.83 %
3.79

4.21
8,653
$
2.36 %
3.16

3.16
7,705
$
1.95 %
2.50

3.88
4,996
2.33 %
2.33

2,363
793
774
19
320
170
4,439

$

4.27 %
2.50
10.69
0.43
1.51
2.18
3.47
3.41
1.88
7.36
0.10
1.51
2.18
2.59
6

98

$

5.22
9,868
$
3.23 %
4.34

958
154
341
237
50
1,740

147 %
415
127
NM
35
240
155

2.03 %
0.83
4.40
1.08
1.01
1.73
2.03
0.83
4.40
1.08
1.01
1.73
3.88
4,996
2.33 %
2.33

98

(a) Excludes the impact of purchased credit-impaired loans accounted for under SOP 03-3 that were acquired as part of the Washington Mutual transaction. These loans were accounted for at fair value on the acquisition date, which incorporated
management's estimate, as of that date, of credit losses over the remaining life of the portfolio. No allowance for loan losses and no charge-offs have been recorded for these loans as of June 30, 2009, March 31, 2009, December 31, 2008,
and September 30, 2008, respectively.
(b) Average loans held-for-sale of $2.8 billion, $3.1 billion, $1.8 billion, $1.5 billion, and $3.6 billion for the quarters ended June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $2.9 billion
and $4.0 billion for year-to-date 2009 and 2008, respectively, were excluded when calculating the net charge-off rate.
(c) Excluded loans eligible for repurchase, as well as loans repurchased from GNMA pools that are insured by U.S. government agencies, of $4.6 billion, $4.5 billion, $3.2 billion, $2.0 billion, and $1.5 billion at June 30, 2009, March 31, 2009,
December 31, 2008, September 30, 2008, and June 30, 2008, respectively. These amounts are excluded, as reimbursement is proceeding normally.
(d) Excluded loans that are 30 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program, of $854 million, $770 million, $824 million, $787 million, and $735 million at
June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively. These amounts are excluded as reimbursement is proceeding normally.
(e) The delinquency rate for purchased credit-impaired loans accounted for under SOP 03-3 was 23.37%, 21.36%, 17.89%, and 13.21% at June 30, 2009, March 31, 2009, December 31, 2008, and September 30, 2008, respectively. There were
no purchased credit-impaired loans at June 30, 2008.
(f) Nonperforming assets excluded: (1) loans eligible for repurchase, as well as loans repurchased from Governmental National Mortgage Association ("GNMA") pools that are insured by U.S. government agencies, of $4.7 billion, $4.6 billion,
$3.3 billion, $1.8 billion, and $1.9 billion at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively; and (2) student 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 $473 million, $433 million, $437 million, $405 million, and $394 million at June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and
June 30, 2008, respectively. These amounts for GNMA and student loans are excluded, as reimbursement is proceeding normally.
(g) Excludes purchased credit-impaired loans accounted for under SOP 03-3 that were acquired as part of the Washington Mutual transaction. These loans are accounted for on a pool basis and the pools are considered to be performing under
SOP 03-3.

Page 15

(in billions, except where otherwise noted)
QUARTERLY TRENDS

YEAR-TO-DATE
2009 Change
2008

2Q09 Change
2Q09

1Q09

4Q08

3Q08

2Q08

1Q09

2Q08

2009

2008

CONSUMER LENDING (continued)
Origination volume:
Mortgage origination volume by channel
Retail
Wholesale
Correspondent
CNT (negotiated transactions)
Total mortgage origination volume
Home equity
Student loans
Auto loans

$

Average mortgage loans held-for-sale & loans at fair value (a)
Average assets
Third-party mortgage loans serviced (ending)
MSR net carrying value (ending)
SUPPLEMENTAL MORTGAGE FEES AND RELATED INCOME
DETAILS (in millions)
Production revenue
Net mortgage servicing revenue:
Loan servicing revenue
Changes in MSR asset fair value:
Due to inputs or assumptions in model
Other changes in fair value
Total changes in MSR asset fair value
Derivative valuation adjustments and other
Total net mortgage servicing revenue

14.7
2.4
20.2
3.8
41.1
0.6
0.4
5.3

$

16.7
381.1
1,117.5
14.6

$

284

13.6
2.6
17.0
4.5
37.7
0.9
1.7
5.6

$

14.0
393.3
1,148.8
10.6

$

481

7.6
3.8
13.3
3.4
28.1
1.7
1.0
2.8

$

12.2
395.0
1,172.6
9.3

$

62

1,279

1,222

1,366

3,831
(837)
2,994

1,310
(1,073)
237

(6,950)
(843)
(7,793)

(3,750)
523
807

(307)
1,152
1,633

8,327
1,900
1,962

8.4
5.9
13.2
10.2
37.7
2.6
2.6
3.8

$

14.9
239.8
1,114.8
16.4

$

66
654
(786)
(390)
(1,176)
894
372
438

12.5
9.1
17.0
17.5
56.1
5.3
1.3
5.6

8 %
(8)
19
(16)
9
(33)
(76)
(5)

18 %
(74)
19
(78)
(27)
(89)
(69)
(5)

$

28.3
5.0
37.2
8.3
78.8
1.5
2.1
10.9

17.4
242.1
659.1
10.9

$

19
(3)
(3)
38

(4)
57
70
34

394

(41)

(28)

645

5

98

2,501

$

15.3
387.2
1,117.5
14.6

$

765

25.1
19.7
29.0
29.4
103.2
12.0
3.3
12.8

13 %
(75)
28
(72)
(24)
(88)
(36)
(15)

15.6
238.4
659.1
10.9

(2)
62
70
34

770

(1)

$

1,238

102

1,519
(394)
1,125

192
22
NM

152
(112)
166

5,141
(1,910)
3,231

887
(819)
68

480
(133)
NM

(1,468)
302
696

NM
(55)
(51)

(155)
73
16

(4,057)
1,675
2,440

(855)
451
1,221

(375)
271
100

(a) Loans at fair value consist of prime mortgages originated with the intent to sell that are accounted for at fair value and classified as trading assets on the Consolidated Balance Sheets. Average balances of these loans totaled $16.2 billion,
$13.4 billion, $12.0 billion, $14.5 billion, and $16.9 billion for the quarters ended June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $14.9 billion and $15.2 billion for year-to-date 2009
and 2008, respectively.

Page 16

CARD SERVICES - MANAGED BASIS
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
INCOME STATEMENT
REVENUE
Credit card income
All other income
Noninterest revenue
Net interest income
TOTAL NET REVENUE

$

1Q09

921
(364)
557
4,311
4,868

$

4Q08

844
(197)
647
4,482
5,129

$

3Q08

862
(272)
590
4,318
4,908

$

2Q08

633
13
646
3,241
3,887

$

1Q09

673
91
764
3,011
3,775

2Q08

9 %
(85)
(14)
(4)
(5)

2009

37 %
NM
(27)
43
29

$

2009 Change
2008

2008

1,765
(561)
1,204
8,793
9,997

$

1,273
210
1,483
6,196
7,679

39 %
NM
(19)
42
30


4,603

4,653

3,966

2,229

2,194

(1)

110

9,256

3,864

140

NONINTEREST EXPENSE

329
873
131
1,333

357
850
139
1,346

335
979
175
1,489

267
773
154
1,194

258
763
164
1,185

(8)
3
(6)
(1)

28
14
(20)
12

686
1,723
270
2,679

525
1,604
328
2,457

31
7
(18)
9

$

396
146
250

(23)
(23)
(23)

NM
NM
NM

$

(1,938)
(719)
(1,219)

$

1,358
499
859

NM
NM
NM

$

36

(49)

NM

$

(448)

$

106

NM

Income tax expense (benefit)
NET INCOME (LOSS)
Memo: Net securitization income (loss)

$

(1,068)
(396)
(672)

$

(268)

FINANCIAL METRICS
ROE
Overhead ratio
% of average managed outstandings:
Net interest income
Noninterest revenue
Risk adjusted margin (a)
Noninterest expense
Pretax income (loss) (ROO) (b)
Net income (loss)
BUSINESS METRICS
Charge volume (in billions)
Net accounts opened (in millions) (c)
Credit cards issued (in millions)
Number of registered internet customers (in millions)
Merchant acquiring business (d)
Bank card volume (in billions)
Total transactions (in billions)
(a)
(b)
(c)
(d)

$

(870)
(323)
(547)

$

(180)

(18) %
27

$

(547)
(176)
(371)

$

464
172
292

$

(261)

$

(28)

(15) %
26

9.93
10.60
1.28
0.61
3.07
(2.46)
(1.55)

(10) %
30

9.91
10.29
1.43
1.05
2.98
(1.92)
(1.21)

8 %
31

9.17
8.42
1.25
2.00
3.16
(1.16)
(0.79)

7 %
31

8.18
5.63
1.63
4.19
3.01
1.17
0.74

(16) %
27

7.92
5.77
2.01
4.16
3.12
1.04
0.66

12 %
32

9.92
10.44
1.36
0.84
3.02
(2.19)
(1.38)

8.13
5.07
1.95
5.01
3.23
1.78
1.13

$

82.8
2.4
151.9
30.5

$

76.0
2.2
159.0
33.8

$

96.0
4.3
168.7
35.6

$

93.9
16.6
171.9
34.3

$

93.6
3.6
157.6
28.0

9
9
(4)
(10)

(12)
(33)
(4)
9

$

158.8
4.6
151.9
30.5

$

179.0
7.0
157.6
28.0

(11)
(34)
(4)
9

$

101.4
4.5

$

94.4
4.1

$

135.1
4.9

$

197.1
5.7

$

199.3
5.6

7
10

(49)
(20)

$

195.8
8.6

$

381.7
10.8

(49)
(20)

Represents total net revenue less provision for credit losses.
Pretax return on average managed outstandings.
Third quarter of 2008 included approximately 13 million credit card accounts acquired by JPMorgan Chase in the Washington Mutual transaction.
The Chase Paymentech Solutions joint venture was dissolved effective November 1, 2008. JPMorgan Chase retained approximately 51% of the business and operates the business under the name Chase Paymentech Solutions. For
the period January 1, 2008, through October 31, 2008, the data presented represents activity for the Chase Paymentech Solutions joint venture and beyond that date, the data presented represents activity for Chase Paymentech Solutions.

Page 17

CARD SERVICES - MANAGED BASIS
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09

1Q09

4Q08

3Q08

2Q08

1Q09

2Q08

2009

Loans:
Loans on balance sheets
Securitized loans
Managed loans

$

85,736
85,790
171,526

$

$

92,881
93,664
186,545

$

$

104,746
85,571
190,317

$

$

90,911
85,220
176,131

$

$

$

76,278
79,120
155,398

(6) %
1
(3)

Equity

$

15,000

$

15,000

$

15,000

$

15,000

$

14,100

-

$

193,310

$

201,200

$

203,943

$

169,413

$

161,601

$

$

$

79,183
78,371
157,554

$

$

98,790
88,505
187,295

$

$

97,783
85,619
183,402

$

$

89,692
84,417
174,109

$

75,630
77,195
152,825

$

15,000

$

15,000

$

15,000

$

14,100

$

14,100
19,570

25

130

Managed assets
Loans:
Loans on balance sheets
Securitized loans
Managed average loans
Equity
Headcount
MANAGED CREDIT QUALITY STATISTICS
Net charge-offs
Net charge-off rate (a)

22,897

$

Managed delinquency rates
30+ day (a)
90+ day (a)
Allowance for loan losses (b)
Allowance for loan losses to period-end loans (b) (c)
KEY STATS - WASHINGTON MUTUAL ONLY (d)
Managed loans
Net interest income (e)
Risk adjusted margin (e) (f)
Net charge-off rate (g)
30+ day delinquency rate (g)
90+ day delinquency rate (g)
KEY STATS - EXCLUDING WASHINGTON MUTUAL
Managed loans
Net interest income (e)
Risk adjusted margin (e) (f)
Net charge-off rate
30+ day delinquency rate
90+ day delinquency rate

4,353
$
10.03 %

5.86 %
3.25

23,759

3,493
$
7.72 %

6.16 %
3.22

24,025

2,616
$
5.56 %

4.97 %
2.34

$

8,839
$
10.31 %

8,849
$
9.73 %

7,692
$
7.34 %

$

23,093
$
24,418
17.90 %
(3.89)
19.17
11.98
6.85

25,908
$
27,578
16.45 %
4.42
14.57
10.89
5.79

28,250
$
27,703
14.87 %
4.18
12.09
9.14
4.39

148,433
$
149,691
8.63 %
1.34
8.97
5.27
2.90

150,223
$
155,824
8.75 %
0.46
6.86
5.34
2.78

162,067
$
159,592
8.18 %
1.62
5.29
4.36
2.09

$

22,283

1,979
$
5.00 %

3.91 %
1.77
5,946
$
6.40 %

1,894
4.98 %

12 %
8
10

$

85,736
85,790
171,526

$

$

$

76,278
79,120
155,398

6

$

15,000

$

14,100

6

(4)

20

$

197,234

$

160,601

23

(8)
(1)
(5)

19
9
14

$

$

$

93,715
85,015
178,730

$

77,537
75,652
153,189

21
12
17

-

6

$

15,000

$

14,100

6

(4)

17

19,570

17

22,897

$

3.46 %
1.76
3,705
4.86 %

27,235

-

139

$

(11)
(11)

155,398
152,825
7.92 %
4.16
4.98
3.46
1.76

7,846
$
8.85 %

5.86 %
3.25

NM
NM

$

(1)
(4)

(4)
(2)

$

7.53 %
3.51

159,310
$
157,554
8.18 %
4.19
5.00
3.69
1.74

2009 Change
2008

2008

8,839
$
10.31 %

3,564
4.68 %

12 %
8
10

120

3.46 %
1.76
3,705
4.86 %

139

23,093
25,990
17.14 %
0.49
16.75
11.98
6.85

148,433
$
152,740
8.69 %
0.89
7.90
5.27
2.90

NM
NM

155,398
153,189
8.13 %
5.01
4.68
3.46
1.76

(4)
-

(a) Results for the quarters ended June 30, 2009, March 31, 2009, December 31, 2008, and September 30, 2008, reflect the impact of purchase accounting adjustments related to the
Washington Mutual transaction and the consolidation of the Washington Mutual Master Trust.
(b) Based on loans on balance sheets.
(c) Includes loans from the Washington Mutual Master Trust, which were consolidated onto the Card Services balance sheet at fair value during the second quarter of 2009. No allowance for loan losses was recorded for these
loans as of June 30, 2009. Excluding these loans, the allowance for loan losses to period-end loans was 10.95%.
(d) Statistics are only presented for periods after September 25, 2008, the date of the Washington Mutual transaction.
(e) As a percentage of average managed outstandings.
(f) Represents total net revenue less provision for credit losses.
(g) Excludes the impact of purchase accounting adjustments related to the Washington Mutual transaction and the consolidation of the Washington Mutual Master Trust.

Page 18

CARD RECONCILIATION OF REPORTED AND MANAGED DATA
(in millions)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
INCOME STATEMENT DATA (a)
Credit card income
Reported
Securitization adjustments
Managed credit card income
Net interest income
Reported
Managed net interest income
Total net revenue
Reported
Managed total net revenue

$
$

$
$

$
$

Reported
Managed provision for credit losses

$

BALANCE SHEETS - AVERAGE BALANCES (a)
Total average assets
Reported
Managed average assets

$

CREDIT QUALITY STATISTICS (a)
Net charge-offs
Reported
Managed net charge-offs

$

$

$
$

1Q09

1,215
(294)
921

$

2,353
1,958
4,311

$

$

$

3,204
1,664
4,868

$

2,939
1,664
4,603

$
$

111,722
81,588
193,310

$

2,689
1,664
4,353

$

$

$
$

4Q08

1,384
(540)
844

$

2,478
2,004
4,482

$

$

$

3,665
1,464
5,129

$

3,189
1,464
4,653

$
$

118,418
82,782
201,200

$

2,029
1,464
3,493

$

$

$
$

3Q08

1,553
(691)
862

$

2,408
1,910
4,318

$

$

$

3,689
1,219
4,908

$

2,747
1,219
3,966

$
$

118,290
85,653
203,943

$

1,397
1,219
2,616

$

$

$
$

2Q08

1,476
(843)
633

$

1,525
1,716
3,241

$

$

$

3,014
873
3,887

$

1,356
873
2,229

$
$

93,701
75,712
169,413

$

1,106
873
1,979

$

$

$
$

1Q09

2Q08

2009

1,516
(843)
673

(12) %
46
9

1,338
1,673
3,011

(5)
(2)
(4)

76
17
43

2,945
830
3,775

(13)
14
(5)

9
100
29

1,364
830
2,194

(8)
14
(1)

115
100
110

$

87,021
74,580
161,601

(6)
(1)
(4)

28
9
20

$

33
14
25

153
100
130

1,064
830
1,894

(20) %
65
37

$
$

$
$

$
$

$

$

$
$

2008

2,599
(834)
1,765

$

4,831
3,962
8,793

$

6,869
3,128
9,997

3,053
(1,780)
1,273

$

66
20
42

6,168
1,511
7,679

11
107
30

2,353
1,511
3,864

160
107
140

87,517
73,084
160,601

31
12
23

2,053
1,511
3,564

130
107
120

$
$

$

115,052
82,182
197,234

$

4,718
3,128
7,846

$

$

(15) %
53
39

2,905
3,291
6,196

$

6,128
3,128
9,256

2009 Change
2008

$
$

(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.

Page 19

COMMERCIAL BANKING
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
INCOME STATEMENT
REVENUE
All other income (a)
Noninterest revenue
Net interest income
TOTAL NET REVENUE

$

1Q09

270
36
152
458
995
1,453

$

4Q08

263
34
125
422
980
1,402

$

3Q08

242
32
102
376
1,103
1,479

$

2Q08

212
29
147
388
737
1,125

$

1Q09

207
26
150
383
723
1,106

2Q08

3 %
6
22
9
2
4

2009

30 %
38
1
20
38
31

$

2009 Change
2008

2008

533
70
277
880
1,975
2,855

$

400
52
265
717
1,456
2,173

33 %
35
5
23
36
31


312

293

190

126

47

6

NM

605

148

309

NONINTEREST EXPENSE

197
327
11
535

200
342
11
553

164
324
11
499

177
298
11
486

173
290
13
476

(2)
(4)
(3)

14
13
(15)
12

397
669
22
1,088

351
584
26
961

13
15
(15)
13

Income tax expense
NET INCOME

606
238
368

556
218
338

790
310
480

513
201
312

583
228
355

9
9
9

4
4
4

1,162
456
706

1,064
417
647

9
9
9

3
5
56
NM
4

82
8
25
NM
31

79
6
18
NM
31

59

3
(2)
26
(47)
4

MEMO:
Revenue by product:
Lending
Treasury services
Investment banking
Other
Total Commercial Banking revenue
IB revenue, gross (b)
Revenue by business:
Middle Market Banking
Commercial Term Lending (c)
Mid-Corporate Banking
Real Estate Banking (c)
Other (c)
Total Commercial Banking revenue
FINANCIAL RATIOS
ROE
Overhead ratio

$

$

$

684
679
114
(24)
1,453

$

$

$

$

$

665
646
73
18
1,402

328

$

772
224
305
120
32
1,453

$

18
37

$

$

$

%

$

611
759
88
21
1,479

206

$

752
228
242
120
60
1,402

$

17
39

$

$

$

%

$

377
643
87
18
1,125

$

376
630
91
9
1,106

241

$

252

$

270

796
243
243
131
66
1,479

$

729
236
91
69
1,125

$

708
235
94
69
1,106

24
34

$

$

$

%

18
43

$

$

%

20
43

%

$

$

$

$

1,349
1,325
187
(6)
2,855

$

755
1,246
159
13
2,173

21

$

534

$

473

9
NM
30
28
(54)
31

$

1,524
452
547
240
92
2,855

$

1,414
442
191
126
2,173

$

18
38

$

$

%

19
44

13

8
NM
24
26
(27)
31

%

(a) Revenue from investment banking products sold to Commercial Banking ("CB") clients and commercial card revenue is included in all other income.
(b) Represents the total revenue related to investment banking products sold to CB clients.
(c) Includes total net revenue on net assets acquired in the Washington Mutual transaction starting in the period ending December 31, 2008.

Page 20

COMMERCIAL BANKING
(in millions, except ratio and headcount data)
QUARTERLY TRENDS

YEAR-TO-DATE
2009 Change
2008

2Q09 Change
2Q09
Loans:
Loans retained
Total loans
Equity
Total assets
Loans:
Loans retained
Total loans
Liability balances (a)
Equity
MEMO:
Loans by business:
Middle Market Banking
Commercial Term Lending (b)
Mid-Corporate Banking
Real Estate Banking (b)
Other (b)
Total Commercial Banking loans

Net charge-off rate (f)
Allowance for loan losses to period-end loans (d) (f)
Allowance for loan losses to average loans (d) (f)
Allowance for loan losses to nonperforming loans (c) (d)
Nonperforming loans to period-end loans (d)
Nonperforming loans to average loans (d)

4Q08

3Q08

2Q08

1Q09

105,556
296
105,852
8,000

$

71,105
306
71,411
7,000

103,469

(5)

33

$

140,771

$

102,724

37

70,682
379
71,061
99,404
7,000

(4)
(3)
(4)
(8)
-

54
(24)
53
6
14

69,096
450
69,546
99,441
7,000

61
(35)
60
11
14

42,879
15,357
7,500
5,325
71,061

(6)
(8)
(7)
(3)
(4)

(11)
NM
11
65
(15)
53

41,495
15,253
7,479
5,319
69,546

(5)
NM
16
71
(14)
60

4,028

(7)

5

4,028

5

130
486
510

142
334
342

1,843
170
2,013

65
60
64

110,923
272
111,195
8,000

$

115,130
295
115,425
8,000

$

117,316
313
117,629
8,000

$

71,105
306
71,411
7,000

$

137,283

$

144,298

$

149,815

$

101,681

$

$

$

38,193
36,963
17,012
12,347
4,523
109,038

$

$

4,228

$

40,728
36,814
18,416
13,264
4,643
113,865

$

$

4,545

181
2,111
2,255

$

3,034
272
3,306
0.67
2.87
2.79
145
1.99
1.94

117,351
329
117,680
114,113
8,000

134
1,531
1,651

0.48
2.65
2.59
192
1.38
1.34

$

$

5,206

$

2,945
240
3,185
%

71,901
397
72,298
99,410
7,000

42,613
37,039
18,169
13,529
6,330
117,680

118
1,026
1,142

0.40
2.45
2.41
275
0.89
0.87

$

$

5,298

$

2,826
206
3,032
%

43,155
16,491
7,513
5,139
72,298

40
844
923
2,698
191
2,889

%

0.22 %
2.30
2.32 (g)
320
0.72
0.72 (g)

2008

$

$

113,568
297
113,865
114,975
8,000

2009

48 %
(3)
48
14

105,556
296
105,852
8,000

108,750
288
109,038
105,829
8,000

2Q08

(5) %
9
(5)
-

$

Headcount
Net charge-offs
Nonperforming loans (c) (d)
Nonperforming assets
Allowance for credit losses:
Allowance for loan losses (e)
Total allowance for credit losses

1Q09

$

49
486
510

35
38
37

269
334
342

1,843
170
2,013

3
13
4

65
60
64

0.28 %
2.59
2.61
401
0.68
0.68

111,146
292
111,438
110,377
8,000

$

$

39,453
36,889
17,710
12,803
4,583
111,438

$

$

4,228

$

315
2,111
2,255

$

3,034
272
3,306
0.57 %
2.87
2.73
145
1.99
1.89

48 %
(3)
48
14

0.38 %
2.59
2.67
401
0.68
0.70

(a) Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities loaned or sold under repurchase agreements.
(b) Includes loans acquired in the Washington Mutual transaction starting in the period ended December 31, 2008.
(c) Nonperforming loans included loans held-for-sale and loans at fair value of $21 million and $26 million at June 30, 2009 and 2008, respectively. These amounts were excluded when calculating the allowance for loan losses to nonperforming
loans ratio. There were no nonperforming loans held-for-sale or held at fair value at March 31, 2009, December 31, 2008, and September 30, 2008.
(d) Purchased credit-impaired wholesale loans accounted for under SOP 03-3 that were acquired in the Washington Mutual transaction are considered nonperforming loans because the timing and amount of expected cash flows are not reasonably
estimable. These nonperforming loans were included when calculating the allowance coverage ratios, the allowance for loan losses-to-nonperforming loans ratio, and the nonperforming loans-to-average and period-end loans ratios.
The carrying amount of these purchased credit-impaired loans at June 30, 2009, March 31, 2009, December 31, 2008, and September 30, 2008, was $209 million, $210 million, $224 million and $272 million, respectively.
(e) The allowance for loan losses at September 30, 2008, and June 30, 2008, included amounts related to loans acquired in the Washington Mutual transaction and the merger with Bear Stearns, respectively.
(f) Loans held-for-sale and loans accounted for at fair value were excluded when calculating the allowance coverage ratios and the net charge-off rate.
(g) Average loans in the calculation of this ratio were adjusted to include $44.5 billion of loans acquired from Washington Mutual as if the transaction occurred on July 1, 2008. Excluding this adjustment, the unadjusted allowance for loan
losses-to-average loans and nonperforming loans-to-average loans ratios would have been 3.75% and 1.17%, respectively.

Page 21

TREASURY & SECURITIES SERVICES
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
INCOME STATEMENT
REVENUE
All other income
Noninterest revenue
Net interest income
TOTAL NET REVENUE

$

Credit reimbursement to IB (a)

1Q09

314
710
221
1,245
655
1,900

$

(5)
(30)

4Q08

325
626
197
1,148
673
1,821

$

(6)
(30)

3Q08

304
748
268
1,320
929
2,249

$

45
(30)

2Q08

290
719
221
1,230
723
1,953

$

18
(31)

1Q09

283
846
228
1,357
662
2,019
7
(30)

NONINTEREST EXPENSE

618
650
20
1,288

629
671
19
1,319

628
692
19
1,339

664
661
14
1,339

669
632
16
1,317

Income tax expense
NET INCOME

587
208
379

478
170
308

835
302
533

565
159
406

665
240
425

REVENUE BY BUSINESS
Treasury Services (b)
Worldwide Securities Services (b)
TOTAL NET REVENUE

$

$
$

FINANCIAL RATIOS
ROE
Overhead ratio
Pretax margin ratio (c)
Loans (d)
Equity
Total assets
Loans (d)
Liability balances (e)
Equity
Headcount

934
966
1,900

$

$
$

30 %
68
31

931
890
1,821

$

$
$

25 %
72
26

1,068
1,181
2,249

$

$
$

47 %
60
37

946
1,007
1,953

$

$
$

46 %
69
29

905
1,114
2,019

2Q08

2009

2009 Change
2008

2008

(3) %
13
12
8
(3)
4

11 %
(16)
(3)
(8)
(1)
(6)

17
-

NM
-

(2)
(3)
5
(2)

(8)
3
25
(2)

1,247
1,321
39
2,607

1,310
1,203
32
2,545

(5)
10
22
2

23
22
23

(12)
(13)
(11)

1,065
378
687

1,308
480
828

(19)
(21)
(17)

1,765
2,167
3,932

6
(14)
(5)

9
4

3
(13)
(6)

$

639
1,336
418
2,393
1,328
3,721

$

(11)
(60)

$

$
$

49 %
65
33

1,865
1,856
3,721

552
1,666
428
2,646
1,286
3,932

16 %
(20)
(2)
(10)
3
(5)

19
(60)

$

$
$

28 %
70
29

NM
-

48 %
65
33

$

17,929
5,000

$

18,529
5,000

$

24,508
4,500

$

40,675
4,500

$

26,348
3,500

(3)
-

(32)
43

$

17,929
5,000

$

26,348
3,500

(32)
43

$

35,520
17,524
234,163
5,000

$

38,682
20,140
276,486
5,000

$

55,515
31,283
336,277
4,500

$

49,386
26,650
259,992
3,500

$

56,192
23,822
268,293
3,500

(8)
(13)
(15)
-

(37)
(26)
(13)
43

$

37,092
18,825
255,208
5,000

$

56,698
23,454
261,331
3,500

(35)
(20)
(2)
43

27,232

1

27,232

-

27,252

26,998

27,070

27,592

-

27,252

(a) The Investment Bank credit portfolio group manages certain exposures on behalf of clients shared with TSS. TSS reimburses IB for a portion of the total cost of managing the credit portfolio. IB recognizes this credit
reimbursement as a component of noninterest revenue.
(b) Reflects an internal reorganization for escrow products, from Worldwide Securities Services to Treasury Services revenue of $46 million, $45 million, $75 million, $49 million, and $52 million, for the quarters ended June 30, 2009,
March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $91 million and $99 million for year-to-date 2009 and 2008, respectively.
(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) Loan balances include wholesale overdrafts, commercial card and trade finance loans.
(e) Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities loaned or sold under repurchase agreements.

Page 22

TREASURY & SECURITIES SERVICES
TSS firmwide metrics include revenue recorded in the CB, Retail Banking and Asset Management ("AM") lines of business and excludes FX revenue recorded in the IB for TSS-related FX activity. In order to capture the firmwide impact of Treasury
Services ("TS") and TSS products and revenue, management reviews firmwide metrics such as liability balances, revenue and overhead ratios in assessing financial performance for TSS. Firmwide metrics are necessary in order to understand
the aggregate TSS business.
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
TSS FIRMWIDE DISCLOSURES
Treasury Services revenue - reported (a)
Treasury Services revenue reported in Commercial Banking
Treasury Services revenue reported in other lines of business
Treasury Services firmwide revenue (a) (b)
Worldwide Securities Services revenue (a)
Treasury & Securities Services firmwide revenue (b)
Treasury Services firmwide liability balances (average) (c) (d)
Treasury & Securities Services firmwide liability balances (average) (c)

$

$
$

TSS FIRMWIDE FINANCIAL RATIOS
Treasury Services firmwide overhead ratio (e)
Treasury & Securities Services firmwide overhead ratio (e)
FIRMWIDE BUSINESS METRICS
Assets under custody (in billions)

Net charge-off (recovery) rate
Allowance for loan losses to period-end loans
Allowance for loan losses to average loans
Allowance for loan losses to nonperforming loans

934
679
63
1,676
966
2,642

$

258,312
339,992

$

51
59

$

Number of:
US$ ACH transactions originated (in millions)
Total US$ clearing volume (in thousands)
International electronic funds transfer volume (in thousands) (f)
Wholesale check volume (in millions)
Wholesale cards issued (in thousands) (g)
Nonperforming loans

1Q09

$

%

13,748

$

$

289,645
391,461

$

$

%

13,532

$

%

$

1,068
759
82
1,909
1,181
3,090

$

312,559
450,390

$

$

%

13,205

$

%

$

946
643
76
1,665
1,007
2,672

$

248,075
359,401

$

$

%

14,417

$

%

$

905
630
72
1,607
1,114
2,721

2Q08
- %
5
2
2
9
4

252,625
367,670

(11)
(13)

2009
3 %
8
(13)
4
(13)
(3)
2
(8)

$

%

$

$
$

%

15,476

2

(11)

4
6
1
7

(2)
(3)
14
(7)
19

NM
(53)
(71)
19

NM
NM
(63)
179

(2)
40
33
(0.03) %
0.15
0.17
NM
-

$

1,865
1,325
125
3,315
1,856
5,171

$

273,892
365,584

$

$

%

13,748

$

6 %
6
(11)
5
(14)
(3)

247,897
360,758

10
1

%

$

%

15,476

(11)

1,997
57,119
81,471
1,241
19,917

19
14
15
92
0.20
0.08
0.08
107
0.08
0.07

1,765
1,246
141
3,152
2,167
5,319

53
58

1,956
55,379
91,461
1,140
23,744

$

2009 Change
2008

2008

52
61

993
29,063
41,432
618
19,917

47
45
0.12
0.18
NM
-

1Q09

53
58

997
29,277
41,831
595
21,858

30
74
63
0.30
0.24
247
0.12
0.10

2Q08

52
60

1,006
29,346
47,734
572
22,784

2
30
51
77
0.04
0.28
0.25
170
0.16
0.15

3Q08

44
52

978
27,186
44,365
568
22,233

17
14
15
92
0.39
0.08
0.09
107
0.08
0.08

931
646
62
1,639
890
2,529

53
63

978
28,193
47,096
572
23,744

$

4Q08

(2)
(3)
12
(8)
19

(2)
40
33

NM
NM
(63)
179

(0.02) %
0.15
0.17
NM
-

(a) Reflects an internal reorganization for escrow products, from Worldwide Securities Services to Treasury Services revenue, of $46 million, $45 million, $75 million, $49 million, and $52 million, for the quarters ended June 30, 2009, March 31, 2009,
December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $91 million and $99 million for year-to-date 2009 and 2008, respectively.
(b) TSS firmwide FX revenue includes FX revenue recorded in TSS and FX revenue associated with TSS customers who are FX customers of IB. FX revenue associated with TSS customers who are FX customers of IB was $191 million, $154 million,
$271 million, $196 million, and $222 million, for the quarters ended June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $345 million and $413 million for year-to-date 2009 and 2008, respectively.
These amounts are not included in TS and TSS firmwide revenue.
(c) Firmwide liability balances include liability balances recorded in Commercial Banking.
(d) Reflects an internal reorganization for escrow products, from Worldwide Securities Services to Treasury Services liability balances, of $14.9 billion, $18.2 billion, $22.3 billion, $20.3 billion, and $21.9 billion for the quarters ended
June 30, 2009, March 31, 2009, December 31, 2008, September 30, 2008, and June 30, 2008, respectively, and $16.5 billion and $21.7 billion for year-to-date 2009 and 2008, respectively.
(e) Overhead ratios have been calculated based upon firmwide revenue and TSS and TS expense, respectively, including those allocated to certain other lines of business. FX revenue and expense recorded in IB for TSS-related FX activity are
not included in this ratio.
(f) International electronic funds transfer includes non-US dollar ACH and clearing volume.
(g) Wholesale cards issued include domestic commercial card, stored value card, prepaid card and government electronic benefit card products.

Page 23

ASSET MANAGEMENT
(in millions, except ratio, ranking and headcount data)
QUARTERLY TRENDS

YEAR-TO-DATE
2Q09 Change

2Q09
INCOME STATEMENT
REVENUE
All other income
Noninterest revenue
Net interest income
TOTAL NET REVENUE

$


REVENUE BY CLIENT SEGMENT
Private Bank (a)
Institutional
Retail
Private Wealth Management (a)
Bear Stearns Private Client Services
Total net revenue

1,315
253
1,568
414
1,982

$

4Q08

1,231
69
1,300
403
1,703

$

3Q08

1,362
(170)
1,192
466
1,658

$

2Q08

1,538
43
1,581
380
1,961

$

1Q09

1,573
130
1,703
361
2,064

59

$
$

$

FINANCIAL RATIOS
ROE
Overhead ratio
Pretax margin ratio (b)

33

32

20

17

810
525
19
1,354

NONINTEREST EXPENSE
Income tax expense
NET INCOME

1Q09

800
479
19
1,298

689
504
20
1,213

816
525
21
1,362

886
494
20
1,400

569
217
352
640
487
411
334
110
1,982

$
$

$

20 %
68
29

BUSINESS METRICS
Number of:
Client advisors (c)
Retirement planning services participants
Bear Stearns brokers

372
148
224
583
460
253
312
95
1,703

$
$

$

13 %
76
22

1,785
1,595,000
362

413
158
255
630
327
265
330
106
1,658

$
$

$

14 %
73
25

1,833
1,628,000
359

579
228
351
631
486
399
352
93
1,961

$
$

$

25 %
69
30

1,795
1,531,000
324

2Q08

7 %
267
21
3
16
79

2009

(16) %
95
(8)
15
(4)

$

247

1
10
4
53
47
57

(12)
(14)
(11)

708
472
490
356
38
2,064

10
6
62
7
16
16

(10)
3
(16)
(6)
189
(4)

1,801
1,505,000
326

$

(18) %
70
(13)
22
(7)

$
$

$

33
1,711
971
41
2,723

(6)
3
(7)
(3)

1,209
458
751

(22)
(20)
(23)

1,304
962
956
705
38
3,965

(6)
(2)
(31)
(8)
439
(7)

941
365
576
1,223
947
664
646
205
3,685

$
$

$

17 %
72
26

(3)
(2)
1

3,104
189
3,293
672
3,965

1,610
1,004
38
2,652

31 %
68
31

1,769
1,492,000
323

2,546
322
2,868
817
3,685
92

(9)
6
(5)
(3)

647
252
395

2009 Change
2008

2008

(1)
6
11

179

30 %
69
30

1,785
1,595,000
362

1,801
1,505,000
326

(1)
6
11

% of customer assets in 4 & 5 Star Funds (d)

45 %

42 %

42 %

39 %

40 %

7

13

45 %

40 %

13

% of AUM in 1st and 2nd quartiles: (e)
1 year
3 years
5 years

62 %
69 %
80 %

54 %
62 %
66 %

54 %
65 %
76 %

49 %
67 %
77 %

51 %
70 %
76 %

15
11
21

22
(1)
5

62 %
69 %
80 %

51 %
70 %
76 %

22
(1)
5

Loans
Equity
Total assets
Loans
Deposits
Equity

$

35,474
7,000

$

33,944
7,000

$

36,188
7,000

$

39,720
7,000

$

41,536
5,200

5
-

(15)
35

$

35,474
7,000

$

41,536
5,200

(15)
35

$

59,334
34,292
75,355
7,000

$

58,227
34,585
81,749
7,000

$

65,648
36,851
76,911
7,000

$

71,189
39,750
65,621
5,500

$

65,015
39,264
69,975
5,066

2
(1)
(8)
-

(9)
(13)
8
38

$

58,783
34,438
78,534
7,000

$

62,651
37,946
69,079
5,033

(6)
(9)
14
39

15,840

(2)

(6)

15,840

(6)

2
68
147
5

142
4
5
-

NM
360
54
(20)

68
147
5

NM
360
54
(20)

Headcount
Nonperforming loans
Net charge-off (recovery) rate
Allowance for loan losses to period-end loans
Allowance for loan losses to average loans
Allowance for loan losses to nonperforming loans
(a)
(b)
(c)
(d)
(e)

14,840
$

46
313
226
4
0.54 %
0.64
0.66
72
0.88
0.91

15,109
$

19
301
215
4
0.22 %
0.63
0.62
71
0.89
0.87

15,339
$

12
147
191
5
0.13 %
0.53
0.52
130
0.41
0.40

15,493
$

(1)
121
170
5
(0.01) %
0.43
0.43
140
0.30
0.30

$

0.02 %
0.35
0.37
216
0.16
0.17

14,840
$

65
313
226
4
0.38 %
0.64
0.66
72
0.88
0.91

$

%
0.35
0.39
216
0.16
0.18

In the third quarter of 2008, certain clients were transferred from Private Bank to Private Wealth Management. Prior periods have been revised to conform with this change.
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.
Prior periods revised to conform with current methodology.
Derived from the following rating services: Morningstar for the United States; Micropal for the United Kingdom, Luxembourg, Hong Kong and Taiwan; and Nomura for Japan.
Derived from the following rating services: Lipper for the United States and Taiwan; Micropal for the United Kingdom, Luxembourg and Hong Kong; and Nomura for Japan.

Page 24

ASSET MANAGEMENT
(in billions)

Jun 30
2009
Assets by asset class
Liquidity
Fixed income
Equities & balanced
Alternatives
TOTAL ASSETS UNDER MANAGEMENT
Custody / brokerage / administration / deposits
TOTAL ASSETS UNDER SUPERVISION

Assets by client segment
Institutional
Private Bank (a)
Retail
Institutional
Private Bank (a)
Retail

Assets by geographic region
U.S. / Canada
International
U.S. / Canada
International

Mutual fund assets by asset class
Liquidity
Fixed income
Equities
Alternatives
TOTAL MUTUAL FUND ASSETS

$

$

$

$
$

$

$
$
$
$

$

$

617
194
264
96
1,171
372
1,543

Mar 31
2009
$

$

697
179
216
67
12
1,171

$

697
390
289
123
44
1,543

$

814
357
1,171

$

1,103
440
1,543

$

569
48
111
9
737

$

$

$

$

$

$

625
180
215
95
1,115
349
1,464

Dec 31
2008
$

$

668
181
184
68
14
1,115

$

669
375
250
120
50
1,464

$

789
326
1,115

$

1,066
398
1,464

$

570
42
85
8
705

$

$

$

$

$

$

613
180
240
100
1,133
363
1,496

681
181
194
71
6
1,133

Sep 30
2008
$

$

$

$

682
378
262
124
50
1,496

$

798
335
1,133

$

1,084
412
1,496

$

553
41
92
7
693

$

$

$

$

$

524
189
308
132
1,153
409
1,562

653
194
223
75
8
1,153

Jun 30
2008
$

$

$

$

653
417
303
134
55
1,562

$

785
368
1,153

$

1,100
462
1,562

$

470
44
127
7
648

$

$

$

$

$

478
199
378
130
1,185
426
1,611

Jun 30, 2009
Change
Mar 31
Jun 30
2009
2008
(1) %
8
23
1
5
7
5

29 %
(2)
(30)
(26)
(1)
(13)
(4)

645
181
276
75
8
1,185

4
(1)
17
(1)
(14)
5

8
(1)
(22)
(11)
50
(1)

646
415
357
133
60
1,611

4
4
16
2
(12)
5

8
(6)
(19)
(8)
(27)
(4)

771
414
1,185

3
10
5

6
(14)
(1)

1,093
518
1,611

3
11
5

1
(15)
(4)

14
31
13
5

37
2
(35)
13
15

416
47
171
8
642

(a) In the third quarter of 2008, certain clients were transferred from Private Bank to Private Wealth Management. Prior periods have been revised to conform with this change.

Page 25

ASSET MANAGEMENT
(in billions)
QUARTERLY TRENDS
2Q09
ASSETS UNDER SUPERVISION (continued)
Assets under management rollforward
Beginning balance
Net asset flows:
Liquidity
Fixed income
Equities, balanced & alternative
Market / performance / other impacts (a)
Assets under supervision rollforward
Beginning balance
Net asset flows
Market / performance / other impacts (a)

$

1,115

$

(7)
8
2
53
1,171

$

$

1,464
(9)
88
1,543

1Q09

$

1,133

$

19
1
(5)
(33)
1,115

$

$

1,496
25
(57)
1,464

YEAR-TO-DATE

4Q08

$

1,153

$

86
(7)
(18)
(81)
1,133

$

$

1,562
73
(139)
1,496

3Q08

$

1,185

$

55
(4)
(5)
(78)
1,153

$

$

1,611
61
(110)
1,562

2Q08

$

1,187

$

1
(1)
(3)
1
1,185

$

$

1,569
(5)
47
1,611

2009

$

1,133

$

12
9
(3)
20
1,171

$

$

1,496
16
31
1,543

2008

$

1,193

$

69
(1)
(24)
(52)
1,185

$

$

1,572
47
(8)
1,611

(a) Second quarter 2008 reflects $15 billion for assets under management and $68 billion for assets under supervision from the Bear Stearns merger on May 30, 2008.

Page 26

2 q09 erf_supplement_final

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