JPMORGAN CHASE & CO.

Red flags

• Total credit-loss reserves increased 16% year over year to $30.9 billion, while loan-loss reserves rose to $25.8 billion from $24.3 billion.
• Credit-card net charge-offs remained elevated at 3.31%, and credit-card loan-loss reserves were $15.6 billion; total consumer credit exposure was $1.871 trillion.
• Residential real-estate exposure is geographically concentrated: California accounted for $117.5 billion of $303.5 billion of retained residential real-estate loans, approximately 39%.
• The firm had $435.2 billion of long-term debt at year-end, including $253.0 billion at the parent company; funding and capital distributions remain sensitive to regulatory requirements and market conditions.
• Operational and control risk is material at this scale: management says controls were effective, but explicitly notes that deficiencies or material weaknesses could arise in the future.