Thursday, 21 Jan 2021

JPMorgan Chase Unit Fined $250 Mln Over Deficiencies In Internal Controls

U.S. Corporate Profits Surge at Record Pace, GDP Report Shows

U.S. corporate profits rebounded significantly in the third quarter as businesses reopened more broadly and demand accelerated from a pandemic-induced slump in the first half of the year.

The government’s first estimate of earnings for the period showed a record $495.3 billion annualized increase, or at a 27.1% annual rate, the Commerce Department’s report on gross domestic product showed Wednesday. The improvement followed a 10.3% decrease in the April-June period and a 12% decline in the first quarter that was the biggest since the end of 2008.

The figures show both the magnitude and speed of the Covid-19 pandemic’s hit to the bottom lines of American businesses, and how companies’ fortunes reversed due to a surge in third-quarter demand. The improvement in profits help explain a stock market rally that saw the Dow Jones Industrial Average close above 30,000 on Tuesday. The economy expanded at an unrevised 33.1% annual rate from July through September.

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The report also showed for the first time that gross domestic income, which measures all income earned in the production of goods and services, increased an annualized 25.5% in the third quarter after a record 32.6% plunge in the prior three months.

US economy grows at record 33.1%, according to second estimate

Negative interest rates not in best interest of economy: Glenn Hubbard

Columbia Graduate Business School dean emeritus Glenn Hubbard reacts to Fed Chairman Jerome Powell’s statement on coronavirus economic recovery.

The U.S. economy grew at a record pace during the third quarter, according to a second estimate released Wednesday by the Commerce Department.

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Gross domestic product increased 33.1% during the three months through September, unrevised from the first estimate and in-line with the expectations of analysts surveyed by Refintiiv.


The initial estimate released last month showed record growth as the U.S. economy battled back from its COVID-19-induced slowdown. The U.S. economy, the world's largest, contracted at a 32.9% annualized pace in the second quarter as lockdowns aimed at slowing the spread of the virus caused activity to grind to a halt.

The second estimate included upward revisions to nonresidential fixed investment, residential investment and exports. Those were offset by downward revisions to state and local government spending, private inventory investment and personal consumption expenditures. Imports, which reduce GDP, were revised higher.


A third estimate will be released on Dec. 22.

Israel Army Told to Ready in Case U.S. Strikes Iran, Axios Says

The Israeli government instructed the military to prepare for a possible military strike by the U.S. against Iran during the remainder of President Donald Trump’s term, Axios reported, citing unidentified Israeli officials.

The instructions were given because the officials anticipate “a very sensitive period” prior to the Jan. 20 inauguration of President-elect Joe Biden, and not because of any intelligence or assessment that the U.S. will order a strike, the report said.

US economy grew in Q3 but the crisis isn't over

New York (CNN Business)The recovery in the American job market is still painfully slow. Another 778,000 people filed for first-time unemployment benefits last week on a seasonally adjusted basis.

That was more than the 735,000 initial jobless claims that economists were expecting, and it’s also higher than last week’s revised number of 748,000. It’s the second straight week that first-time claims rose.
The latest unemployment benefits figures were released by the Labor Department on Wednesday, a day earlier than usual because of the Thanksgiving holiday.

    We're never going back to the old economy, Fed Chairman says
    The report also showed that continued jobless claims, which include people who have applied for benefits for at least two weeks in a row, was 6.1 million on a seasonally adjusted basis. That was down from the previous week.
    And 4.5 million more people had received Pandemic Emergency Unemployment Compensation benefits from the government as of the week of November 7. There is a two-week lag with PEUC data.

    Overall, more than 20.4 million Americans were still receiving some form of unemployment benefits as of November 7.

    JPMorgan Chase Unit Fined $250 Mln Over Deficiencies In Internal Controls

    JPMorgan Chase Bank, N.A., a unit of JPMorgan Chase & Co., has agreed to pay $250 million penalty over the bank’s failure to maintain adequate internal controls and internal audit over its fiduciary business.

    In a filing with the U.S. Securities and Exchange Commission, the company said JPMorgan Chase Bank has entered into a resolution with the Office of the Comptroller of the Currency or OCC regarding past deficiencies.

    According to OCC, the bank’s risk management practices were deficient and it lacked a sufficient framework to avoid conflicts of interest.

    In a statement, the OCC said, “These deficiencies constituted unsafe or unsound practices and resulted in a violation of 12 CFR 9.9, which requires a suitable audit over all significant fiduciary activities. The bank has remediated the deficiencies that led to this action.”

    In late September, JPMorgan Chase agreed to pay a total of $920 million in penalty to settle U.S. investigations into the company’s alleged manipulation of metal and treasuries markets. The settlement resolved investigations by the U.S. regulatory authorities for unfairly manipulating or “spoofing” the precious metals market.

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