JPMorgan: bigger pie needed - FT.com Watching Jamie Dimon gobble humble pie two months ago was a historic moment on Wall Street. On Friday, many hoped that JPMorgan's first quarterly results since the trading embarrassment would force its chief executive to eat an even bigger slice. But not only were losses just a tad higher than expectations, JPMorgan blew overall net income estimates out of the oven. The bank's retail operation alone can make up the losses in under a year. Investors should forget about London whale spotting and refocus on JPMorgan's underlying business. What do the second-quarter numbers reveal? For a start investment banking remains tough going. Only one business line, equities, is making more money now than a year ago. Global investment banking revenues are lower across the board. Risk indicators are also worth watching. For example, despite fixed income revenues falling 17 per cent versus last year, value-at-risk (a measure of potential losses) for fixed income trading is almost 50 per cent higher. The story is much more positive for JPMorgan's retail bank. To be sure, the bottom line benefited from a whopping $1.4bn reduction in allowances for loan losses and net charge-offs - contributing more than half of total net income for retail. To be fair, delinquency trends are still heading downward in most areas, from mortgages to credit cards. Branch numbers and deposits are up. What seems to be happening is those banks willing to extend their balance sheets - such as JPMorgan and Wells Fargo - are cleaning up as other big domestic players remain cautious. The direction of the US economy will determine if retail bets pay off. For investment banking, though, the worry is that business will stay subdued even if confidence returns. Regulation and capital management are partly to blame. But many areas are overbanked. Humble or not, the pie is not big enough.