US banks JP Morgan and Bank of America boost profits

JP Morgan has reported a rise in fourth-quarter profits on a busy day for US bank results.

America's biggest bank by assets said profit rose 24% to $6.73bn in the period, helped by more investor activity around the US election.

Bank of America, the country's second biggest bank, said income rose nearly 50%, but Wells Fargo reported its fifth straight decline in quarterly profit.

US banks are expected to benefit from last month's rise in interest rates.

Bank of America's chief financial officer, Paul Donofrio, said: "While the recent rise in interest rates came too late to impact fourth quarter results, we expect to see a significant increase in net interest income in the first quarter of 2017."

The US Federal Reserve raised its benchmark interest rate to a range of 0.5% to 0.75% on 14 December from the previous range of 0.25% to 0.5%, only the second increase in a decade.

A rate rise usually helps banks because it allows them to charge more for loans.

Bank of America, which is considered the most sensitive US bank to rate changes, cited cost cuts and improved trading for its profit rise in the fourth quarter.

Meanwhile, JP Morgan said its consumer and investment banking divisions grew in the three months to 31 December.

"We grew market share in virtually all of our businesses and showed expense discipline while continuing to invest for the future," said JP Morgan chief executive Jamie Dimon.

Mr Dimon, who had been a potential nominee for Treasury Secretary under President-elect Donald Trump, also said the US economy "may be building momentum".

"Looking ahead there is opportunity for good, rational and thoughtful policy decisions to be implemented, which would spur growth, create jobs for Americans across the income spectrum and help communities, and we are well positioned to play our part," he said.