Bank earnings tell a story of 2 economies

America’s biggest banks are off to a steady but unspectacular start to earnings season.

Results on Tuesday from JPMorgan $JPM Chase, Wells Fargo $WFC, and BlackRock $BLK show, as expected, gains coming from trading activity and deal-making. At the same time, blowout numbers mostly failed to materialize. Consumers showed up in somewhat weaker lending margins, as spending stayed solid while showing some signs of deceleration.

All in all, it was a good quarter for the big banks by any normal measure — just not a spectacular one.

JPMorgan Chase

JPMorgan Chase reported third-quarter net income of $14.4 billion, up 12% from last year. Perhaps unsurprisingly, the bank’s markets division was the standout, with trading revenues jumping 25% to almost $9 billion, including a 33% rise from equities and 21% from fixed income. Investment banking fees climbed 16%, reflecting the stronger deal and underwriting activity that Wall Street widely expected.

On the consumer side, JPMorgan’s results painted a picture of American households that remain sturdy but are losing some steam. Credit and debit card spending stayed solid, delinquencies edged up only slightly, and consumer balance sheets appeared largely intact. Consumer banking revenue rose on steady loan growth and stable deposits, though borrowing demand — especially for mortgages and autos — showed some early signs of fatigue.

CEO Jamie Dimon said that while the U.S. economy “generally remained resilient,” the bank remains wary: “There continues to be a heightened degree of uncertainty stemming from complex geopolitical conditions, tariffs, and trade uncertainty, elevated asset prices and the risk of sticky inflation.”

Dimon’s essential message? Americans are still spending, but the pace is slowing, so watch this space.

Goldman Sachs

Goldman Sachs $GS quarter was powered by dealmaking and trading activity. Revenue rose 20% to $15.2 billion and net income rose to $4.1 billion, up 37% from a year earlier. Investment banking fees surged 42% to $2.7 billion, led by a sharp pickup in mergers and leveraged finance, while trading revenue climbed 17% on strength in fixed income and commodities.

Goldman’s asset and wealth management division also posted double-digit growth as client activity and private lending increased. Operating expenses rose 14% on higher compensation and legal costs, but all in all, the results mark Goldman’s best quarter in over a year, suggesting the bank’s core strengths—advisory, trading, wealth—are good businesses to be in, right about now.

Blackrock shows strong revenue growth, muted profit growth

For Blackrock, revenues are surging thanks to its unmatched scale, but profit growth looks muted because of acquisitions. Those acquisitions will drive future income, of course. They're just expensive upfront.

The world’s largest money manager reported adjusted earnings per share of $11.55, up just slightly from $11.46 a year ago, on revenue of $6.5 billion, a 25% increase over last year. Quarterly net inflows totaled $205 billion, driven by record demand for iShares ETF. Total assets under management climbed to a "new high" of $13.5 trillion, boosted by acquisitions of HPS Investment Partners and Preqin.

CEO Larry Fink said the results reflected “one of our strongest quarterly flows results." In sum, while GAAP earnings fell due to those acquisition-related costs, the ETF giant's underlying performance remains stable and inflows look impressive.

Wells Fargo

Wells Fargo posted third-quarter net income of $5.6 billion, up 9% from a year earlier. Revenue rose 5% to $21.4 billion. The bank performed well across its business lines, from higher net interest income and broad-based fee growth, to stronger investment banking and trading results, plus higher asset-based fees in wealth management. Loan growth was the strongest in more than several years, led by consumer and commercial lending.

CEO Charlie Scharf said spending on credit and debit cards continued to rise and that “the financial health of our clients and customers remains strong,” though he acknowledged lingering economic uncertainty.