Shares of JPMorgan Chase (JPM) fell 4% in premarket trading on the news.

Nevertheless, CEO Jamie Dimon was optimistic about the results for the quarter and the full year 2021. The bank posted an annual profit of $48.3 billion.

“The economy continues to do well despite headwinds from the Omicron variant, inflation and supply chain bottlenecks,” Dimon said in a statement. “Credit continues to be healthy…and we remain optimistic about U.S. economic growth as the business climate is upbeat and consumers benefit from job and wage growth.”

JPMorgan Chase and other big banks are benefiting from rising interest rates, making their loans more profitable – and from an economy that has rebounded from the depths of the credit slump. Commercial lending rates have risen in anticipation of Fed rate hikes this year.

JPMorgan Chase also saw strong increases in advisory fees thanks to a booming environment for merger activity as well as strong IPO demand. JPMorgan Chase said global investment banking fees were up 37% from a year ago.

Bank stocks have rebounded strongly so far this year and have outperformed the market over the past six months.

But rising interest rates could slow the recovery. The Federal Reserve has hinted that it will raise rates three or even four times this year.

Dimon said in response to a question from CNN’s Matt Egan that the Fed needs to “thread the needle” to ensure it can keep inflation under control and not slow the economy too much.

Still, Dimon added in a follow-up question to CNN Business that the economy is in much better shape now than it was in March 2020 and that we should “count our blessings” on that.

Dimon said he wasn’t going to spend too much time worrying about what the Fed would do and when because it would be a “waste of time to do so.”

Wells Fargo exceeds forecasts

Rival Wells Fargo also reported strong results on Friday. Earnings and revenue beat analysts’ expectations. The bank has taken steps to repair its public image after a series of deadly scandals that damaged its reputation and made it the target of increased scrutiny and regulation in Washington.

“The changes we’ve made to the business and the continued strong economic growth outlook give us comfort in our positioning heading into 2022,” Wells Fargo CEO Charlie Scharf said in a statement. “But we also remain mindful that we still have a multi-year effort to meet our regulatory requirements – with setbacks likely to continue along the way – and we continue our work to put exposures related to our historical practices behind us.”

Shares of Wells Fargo (WFC) were up 1% at the start of the session.
Citigroup, which also reported better-than-expected earnings and revenue, continues to sell assets under new CEO Jane Fraser’s watch. Citi shares fell 4% in early trading.
Citi on Friday announced plans to sell its consumer banking businesses in Indonesia, Malaysia, Thailand and Vietnam to Singapore’s UOB Group for $3.7 billion. The deal comes just days after Citi announced plans to pull out of retail banking in Mexico.