Wells Fargo, JPMorgan Announce Multi-Billion Dollar Profits, Remind Everyone How Incredibly Wasteful the Trump Tax Cuts Are

WASHINGTON, D.C. — Wells Fargo and JPMorgan Chase have announced their quarterly profits…conveniently two days after the House Financial Services Committee held its ‘Holding Megabanks Accountable’ hearing. The champagne corks are surely popping in board rooms today with scandal-prone Wells Fargo reporting $5.86 billion in profits (up from $5.14 billion a year ago), while JPMorgan Profit announced both profits and revenue jumped 5 percent, up to $9.18 billion and $29.9 billion respectively. The reports came on the heels of JPMorgan CEO Jamie Dimon’s boasts this month that the Trump tax cuts padded company profits by of $3.7 billion and recent estimates that the Trump tax giveaway saved Wells Fargo $2.2 billion in 2018. Wells Fargo revealed their effective tax rate was only 13.7%at the end of 2018.

“Billions of dollars in lost tax revenue that could have been spent improving education or infrastructure instead padded these banks’ profits and went mostly towards stock buyback programs and bigger CEO bonuses. And all the American people got for it was a lousy Trump budget plan to cut Medicare and Social Security,” said Jeremy Funk, spokesman for Allied Progress.“The group of megabanks that testified before Congress this week probably had another takeaway: that if even Wells Fargo can stay profitable in the wake of the infamous phony accounts scandal and ongoing problems, there’s no incentive for them to rein in their own bad behavior voluntarily. It’s not like they’re under any pressure to do so from President Trump who has only rewarded their misdeeds with giant tax breaks and deregulation. That’s why we’ve seen the industry go back to engaging in incredibly risky behavior reminiscent of the lead up to the Great Recession, like shelling out huge corporate loans to companies that can’t hope to repay them if the economy goes south. It’s all on Congress now to hold the banks accountable.”

Ahead of this week’s Congressional hearing on banking accountability, Allied Progress launched a new digital ad, “Not Just Wells Fargo” and new website www.BigBankFacts.org detailing how the big banks have made out like bandits on the taxpayer dime despite ongoing and systemic problems that have harmed millions of consumers since the Great Recession — and that the Trump administration has ignored.

WHAT YOU NEED TO KNOW:

WELLS FARGO AND JPMORGAN MAKING BANK WITH HELP FROM TRUMP TAX CUTS

In The First Months Of 2019, Wells Fargo Held Approximately $4.5 Billion In Stock Buybacks And Gave $100 Million More To Shareholders Than It Earned In Income. The Bank Still Maintains That “Returning Excess Capital To Shareholders Remains A Priority” Despite Its Pledges To “Complete The Transformation” From Its Misconduct-Marred Past.

Wells Fargo Made $5.9 Billion In Profits This Quarter—$800 Million More Than They Made During The Same Period Last Year…

 Wells Fargo Earned $800 Million More In Profit The First Quarter Of This Year—A Total Of $5.9 Billion—Than They Did In The First Quarter Of Last Year. “Net income of $5.9 billion, compared with $5.1 billion in first quarter 2018.” [Press Release [PDF], Wells Fargo, 04/12/19]

…And They Gave $6 Billion Back—49% More Than Last Year—To Shareholders And Increased Their Dividends While Stating, “Returning Excess Capital To Shareholders Remains A Priority.”

Wells Fargo’s Stock Buybacks And Dividends Were $6 Billion, “Up 49% From $4.0 Billion” This Time Last Year. “Returned $6.0 billion to shareholders through common stock dividends and net share repurchases, up 49% from $4.0 billion in first quarter 2018.” [Press Release [PDF], Wells Fargo, 04/12/19]

  • Wells Fargo Stated, “Returning Excess Capital To Shareholders Remains A Priority.”[Press Release [PDF], Wells Fargo, 04/12/19]

Wells Fargo Increased The Dividend It Pays To Shareholders. Wells Fargo “increased its quarterly dividend to 45 cents per share, up from 43 cents in the fourth quarter of 2018.” [Fred Imbert, “Wells Fargo shares roll over after CFO’s tepid profit outlook,” CNBC, 04/12/19]

Wells Fargo’s Stock Buybacks In The First Quarter Of 2019 Were Worth Approximately $4.5 Billion As Of The Morning The Bank Held Its Shareholder Call.

Wells Fargo’s Stock Buybacks In 2019’s First Quarter Were Worth $4,504,750,000 As Of The Opening Bell On April 12, 2019.“In first quarter 2019, the Company repurchased 97.4 million shares of its common stock, which net of issuances reduced period-end common shares outstanding by 69.3 million.”[Press Release [PDF], Wells Fargo, 04/12/19]

  • Wells Fargo’s opening stock price was $46.25 per share on April 12, 2019.[“Wells Fargo & Co.,” MarketWatch, accessed 04/12/19]

This Has Occurred Despite Wells Fargo’s Claims That It Is Working To “Complete The Transformation” Of Its Culture In The Wake Of Former CEO Tim Sloan’s Failure To Deliver Promised Reform.

Wells Fargo Reiterated Its Intention To “Complete The Transformation At Wells Fargo” By Hiring A New CEO From Outside The Company Following Former CEO Tim Sloan’s Departure. Wells Fargo Board Chair Betsy Duke said upon former CEO Tim Sloan’s retirement announcement, “‘The Board has a continuous succession planning process through which we identify potential successors within the Company. Although we have many talented executives within the Company, the Board has concluded that seeking someone from the outside is the most effective way to complete the transformation at Wells Fargo.’“ [Press Release, Wells Fargo, 03/28/19]

Former Wells Fargo CEO Timothy Sloan Stepped Down After Failing To Address “The Bank’s Culture And Sales Practices” That Perpetuated Its Misconduct. “Mr. Sloan took over the top job in 2016 with a mandate to clean up the bank after his predecessor was forced to resign. […] But Mr. Sloan, who has been at the company for 31 years, could do little to stem renewed criticism about the bank’s culture and sales practices.” [Emily Flitter, Stacy Cowley, and David Enrich, “Wells Fargo C.E.O. Timothy Sloan Abruptly Steps Down,” The New York Times, 03/28/19]

Shortly Before Announcing His Retirement, Sloan Claimed, “‘Our Corporate Culture Has Substantially Improved.’” “‘Wells Fargo is a better bank than it was three years ago, and we are working every day to become even better,’ he said. ‘Our corporate culture has substantially improved.’” [Wayne Duggan, “Wells Fargo CEO Tim Sloan: Bank’s Culture Has ‘Substantially Improved,’” Yahoo! Finance, 03/13/19]

Wells Fargo Only Had A 13.7% Effective Tax Rate At The End Of 2018, And The Bank Expects Its Rate Through The Rest Of 2019 To Be Significantly Lower Than Donald Trump’s Already Low Corporate Tax Rates.

Wells Fargo Only Had A 13.7% Effective Tax Rate At The End Of 2018 And It Expects To Only Pay 18% Through 2019—Substantially Lower Than The Trump Tax Cuts’ Already Low 21% Corporate Rate.

Wells Fargo’s Effective Tax Rate At The End Of 2018 Was Only 13.7%. “The effective income tax rate in fourth quarter 2018 was 13.7% […]” [Press Release [PDF], Wells Fargo, 04/12/19]

Wells Fargo Expects Its Effective Tax Rate For 2019 To Be 18%. “The Company currently expects the effective income tax rate for the remainder of 2019 to be approximately 18%, excluding the impact of any unanticipated discrete items.” [Press Release [PDF], Wells Fargo, 04/12/19]

Donald Trump’s Tax Cuts Have Already Reduced The Corporate Rate From 35% To 21%. “The controversial Tax Cuts and Jobs Act, signed by President Donald Trump in December 2017, lowered the corporate tax rate to 21 percent from 35 percent, among other cuts.” [Kathryn Kranhold, “You Paid Taxes. These Corporations Didn’t,” Center for Public Integrity, 04/11/19]

JPMorgan Chase Made A Record $9.2 Billion Profit In The First Months Of 2019 And It Continues To Reap Extra Profits From Trump’s Corporate Tax Cut, Which Gifted The Bank $3.7 Billion In 2018

JPMorgan Chase Made A Record$9.2 Billion Profit In The First Months Of 2019—The Bank Rewarded Its Shareholders By Boosting Stock Buybacks By 8.1 Million Shares And Increasing Its Dividend Rate 30% Since Last Year.

JPMorgan Chase Made A Record $9.2 Billion Profit Just In The First Quarter Of 2019.

JPMorgan Chase Made A Record $9.2 Billion In Profits In The First Quarter Of 2019. “Jamie Dimon, Chairman and CEO, commented on the financial results: ‘In the first quarter of 2019, we had record revenue and net income, strong performance across each of our major businesses and a more constructive environment.’” [JPMorgan First Quarter 2019 Results, JPMorgan Chase & Co., 04/12/19

  • “JPMorgan Chase Reports Record Net Income Of $9.2 Billion, Or $2.65 Per Share, For The First Quarter Of 2019.”[JPMorgan First Quarter 2019 Results, JPMorgan Chase & Co., 04/12/19]

In 2019’s First Quarter, JPMorgan Paid $4.7 Billion For Stock Buybacks That Were Worth Approximately $5.4 Billion As Of The Morning The Bank Held Its Shareholder Call—Already A Profit Of $700 Million.

JPMorgan Chase Bought Back 49.5 Million Shares Of Stock In The First Quarter Of 2019, Up 8.1 Million From The 41.4 Million Stocks It Bought Back In The First Quarter Of 2018. [“Earnings Release Financial Supplement, First Quarter 2019,” JPMorgan Chase & Co., 04/12/19]

The Bank Claims That It Paid $4.7 Billion For The Stock Buybacks It Made In The First Quarter Of 2019.“$4.7 billion of net repurchases and common dividend of $0.80 per share.” [JPMorgan First Quarter 2019 Results, JPMorgan Chase & Co., 04/12/19]

JPMorgan Chase’s Opening Stock Price Was $109.44 Per Share On April 12, 2019.[“JPMorgan Chase & Co.,” MarketWatch, accessed 04/12/19]

It Appears That JPMorgan Chase Rewarded Shareholders With $2.7 Billion In Dividends In The First Quarter Of 2019 At A Rate 30% Higher Than The Bank Doled Out To Them In The First Quarter Of 2018.

JPMorgan Chase Gave $2.7 Billion To Shareholders In Dividends In The First Quarter Of 2019. “$7.4B distributed to shareholders in 1Q19, including $4.7B of net repurchases.” [“1Q19 Financial Results,” JPMorgan Chase & Co., 04/12/19]

JPMorgan’s Dividends To Shareholders In The First Quarter Of 2019 Is 30% Higher Than It Was In The First Quarter Of 2018. In the first quarter of 2019, JPMorgan valued its cash dividends at $.80 per share; in the first quarter of 2018, it valued its cash dividends at $.56 per share. [“Earnings Release Financial Supplement, First Quarter 2019,” JPMorgan Chase & Co., 04/12/19]

Just A Week After JPMorgan Chase Announced That It Profited $3.7 Billion From Trump’s Corporate Tax Cuts, The Bank Disclosed That Its Effective Tax Rate Is Significantly Lower Than Trump’s Already Low Corporate Rate.

JPMorgan Chase’s Effective Tax Rate Was Only 18.3% In The First Quarter Of 2019—Substantially Lower Than The Trump Tax Cuts’ Already Low 21% Corporate Rate.

JP Morgan Chase’s Effective Tax Rate In The First Quarter Of 2019 Was Only 18.3%. [“Earnings Release Financial Supplement, First Quarter 2019,” JPMorgan Chase & Co., 04/12/19]

Donald Trump’s Tax Cuts Have Already Reduced The Corporate Rate From 35% To 21%. “The controversial Tax Cuts and Jobs Act, signed by President Donald Trump in December 2017, lowered the corporate tax rate to 21 percent from 35 percent, among other cuts.” [Kathryn Kranhold, “You Paid Taxes. These Corporations Didn’t,” Center for Public Integrity, 04/11/19]

JPMorgan Chase Profited $3.7 Billion From Donald Trump’s Corporate Tax Cuts Last Year.

JPMorgan Chase CEO Jamie Dimon Said That The Trump Tax Cuts Gave The Bank An Extra $3.7 Billion In Profits In 2018. In his letter to shareholders accompanying JPMorgan Chase’s 2018 annual report, CEO Jamie Dimon wrote, “For JPMorgan Chase, all things being equal (which they are not), the new lower tax rates added $3.7 billion to net income.” [“Annual Report 2018,” JPMorgan Chase & Co., 2018]

Jamie Dimon Released The Shareholder Letter On April 4, 2019. “J.P. Morgan Chase CEO Jamie Dimon released his annual must-read letter to shareholders on Thursday, and bashing socialism, defended stock buybacks and talked about some potentially dangerous days ahead.” [Jeff Cox and John Melloy, “Jamie Dimon defends capitalism in annual letter: ‘Socialism inevitably produces stagnation, corruption and often worse,’” CNBC, 04/04/19]

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