JP Morgan Slashes Loan Loss Reserves, Posts $4.8bn Q2 Income

"Although losses for the mortgage and home equity portfolios continued to be extremely high, the current-quarter provision reflected improved delinquency trends and reduced net charge-offs as compared to prior periods," the company said in the earnings statement.

JP Morgan experienced a 3.32% net charge-off rate in home equity loans — totaling $796m in the quarter — compared with 4.61% in the year-ago quarter. Subprime mortgage net charge-offs of $282m — or 8.63% — fell from $410m the same time last year. Prime mortgage net charge-offs of $264m — or 1.79% — also fell from $481m in the year-ago quarter.