determinable fair values at cost less impairment (if any), plus or minus observable price changes from an identical or similar investment of the same issuer (the “measurement alternative”). The Firm elected the measurement alternative for its qualifying equity securities and the adoption of the guidance resulted in fair value gains of $505 million in other income in the first quarter of 2018. For additional information, see Notes 2 ~~and~~ 9.

~~Premium amortization on purchased callable debt securities~~

The adoption of this guidance requires that premiums be amortized to the earliest call date on certain debt securities. The adoption of this guidance resulted in a cumulative-effect adjustment to retained earnings and AOCI. For additional information, see the table below, and Notes 9 and 17.

~~Hedge accounting~~

The adoption of this guidance better aligns hedge accounting with the economics of the Firm’s risk management activities. As permitted by the guidance, the Firm also elected to transfer certain investment securities from HTM to AFS. The adoption of this guidance resulted in a cumulative-effect adjustment to retained earnings and AOCI as a result of the investment securities transfer and the revised guidance for excluded components. For additional information, see the table below, and Notes 4, 9

~~and 17.~~

~~Treatment of restricted cash on the statement of cash flows~~

The adoption of this guidance requires restricted cash to be combined with unrestricted cash when reconciling the beginning and ending cash balances on the Consolidated statements of cash flows. To align the Consolidated balance sheets with the Consolidated statements of cash flows, the Firm reclassified restricted cash into cash and due from banks or deposits with banks. In addition, for the Firm’s Consolidated statements of cash flows, cash is defined as those amounts included in cash and due from banks

~~and deposits with banks. This guidance was applied retrospectively and, accordingly, prior period amounts have been revised. For additional information, see the table below, and Note 18.~~

~~Presentation of net periodic pension cost and net periodic postretirement benefit cost~~

The adoption of this guidance requires the service cost component of net periodic pension cost to be reported separately in the Consolidated statements of income from the other components of pension cost. This change was adopted retrospectively and, accordingly, prior period amounts were revised, which resulted in an increase in compensation expense and a reduction in other expense. For additional information, see the table below, and Note 7.

Reclassification of certain tax effects from AOCI

~~The adoption~~Issued February 2018

• Permits reclassification of ~~this guidance permitted the Firm to reclassify~~ the income tax effects of the TCJA on items within AOCI to retained earnings so that the tax effects of items within AOCI reflect the appropriate tax rate.~~The adoption~~

• Adopted January 1, 2018.

• For further information, refer to Note 1.

FASB Standards Issued but not yet Adopted

Standard

Summary of ~~this~~guidance

Effects on financial statements

Leases

Issued February 2016

• Requires lessees to recognize all leases longer than twelve months on the Consolidated balance sheets as a lease liability with a corresponding right-of-use asset.

• Requires lessees and lessors to classify most leases using principles similar to existing lease accounting, but eliminates the “bright line” classification tests.

• Permits the Firm to generally account for its existing leases consistent with current guidance, ~~resulted in~~except for the incremental balance sheet recognition.

• Expands qualitative and quantitative leasing disclosures.

• May be adopted using a modified cumulative effect approach wherein the guidance is applied only to existing contracts as of the date of initial application, and to new contracts transacted after that date, or a cumulative-effect adjustment to retained earnings at the effective date without revising prior comparative periods.

• Required effective date: January 1, 2019.^(a)

• The Firm is in the final stages of its implementation which includes implementing a new lease accounting software solution for its real estate leases, and ~~AOCI. For additional information, see~~updating processes and internal controls for its leasing activities. As a lessee, the ~~table below, and Note 17.~~

~~The following tables present the prior period impact to the Consolidated statements of income and the Consolidated balance sheets from the retrospective adoption~~Firm is finalizing its estimate of the ~~new accounting standards in~~right-of-use asset and lease liability, which is based on the ~~first quarter~~present value of ~~2018:~~

Selected Consolidated statements of income data
Three months ended
March 31, 2017 (in millions)
Reported
Revisions^(a)
Revised
Revenue
Investment banking fees $ 1,817
$ 63
$ 1,880
Asset management, administration and commissions 3,677
200
3,877
Other income 770
1
771
Total net revenue 24,675
264
24,939

Noninterest expense
Compensation expense 8,201
55
8,256
Technology, communication and equipment expense 1,828
6
1,834
Professional and outside services 1,543
249
1,792
Other expense 1,773
(46 ) 1,727
Total noninterest expense $ 15,019
$ 264
$ 15,283


~~(a)~~	~~Revisions relate to revenue recognition and pension cost guidance.~~

Selected Consolidated balance sheets data
December 31, 2017
(in millions)

Reported
Revisions^(a)
Revised
Assets
Cash and due from banks $ 25,827
$ 71
$ 25,898
Deposits with banks 404,294
1,112
405,406
Other assets 114,770
(1,183 ) 113,587
Total assets $ 2,533,600
$ —
$ 2,533,600


~~(a)~~	~~Revisions relate to the reclassification of restricted cash.~~

lease payments. The ~~following table presents the adjustment~~Firm expects to ~~retained earnings~~recognize a lease liability and ~~AOCI as~~ a ~~result~~corresponding right-of-use asset (at their present value) related to predominantly all of the ~~new accounting standards~~$10 billion of future minimum payments required under operating leases as disclosed in ~~the first quarter of 2018:~~

Increase/(decrease) (in millions)
Retained earnings

AOCI
Premium amortization on purchased callable debt securities $ (505 ) $ 261
Hedge accounting 34
115
Reclassification of certain tax effects from AOCI 288
(288 )
Total $ (183 ) $ 88

Note ~~2 – Fair value measurement~~

~~For a discussion of the Firm’s valuation methodologies for assets, liabilities and lending-related commitments measured at fair value and the fair value hierarchy, see Note 2~~28 of JPMorgan Chase’s 2017 Annual Report. However, the population of contracts subject to balance sheet recognition and their initial measurement remains under evaluation; final financial statement impacts will depend on the lease portfolio at the time of adoption. The Firm does not expect material changes to the recognition of operating lease expense in its Consolidated statements of income.

• The Firm plans to adopt the new lease guidance on January 1, 2019 through a cumulative-effect adjustment without revising prior comparative periods and elect the available practical expedients, which will not require it to reassess whether an existing contract contains a lease or whether classification or unamortized initial lease costs would be different under the new lease guidance.

Financial instruments – credit losses

Issued June 2016

• Replaces existing incurred loss impairment guidance and establishes a single allowance framework for financial assets carried at amortized cost, which will reflect management’s estimate of credit losses over the full remaining expected life of the financial assets and will consider expected future changes in macroeconomic conditions.

• Eliminates existing guidance for PCI loans, and requires recognition of the nonaccretable difference as an increase to the allowance for expected credit losses on financial assets purchased with more than insignificant credit deterioration since origination, which will be offset by an increase in the carrying value of the related loans.

• Amends existing impairment guidance for AFS securities to incorporate an allowance, which will allow for reversals of credit impairments in the event that the credit of an issuer improves.

• Requires a cumulative-effect adjustment to retained earnings as of the beginning of the reporting period of adoption.

• Required effective date: January 1, 2020.^(a)

• The Firm has established a Firmwide, cross-discipline governance structure, which provides implementation oversight. The Firm continues to identify key interpretive issues, and is in the process of developing and implementing current expected credit loss models that satisfy the requirements of the new standard.

•

The Firm expects that the allowance related to the Firm’s loans and commitments will increase as it will cover credit losses over the full remaining expected life of the portfolios, with the most significant impact expected from the Firm’s credit card portfolio.

• The extent of the increase in the allowance is under evaluation, but will depend upon the nature and characteristics of the Firm’s portfolio at the adoption date, and the macroeconomic conditions and forecasts at that date.

•

The Firm plans to adopt the new guidance on January 1, 2020.

Goodwill

Issued January 2017

• Requires an impairment loss to be recognized when the estimated fair value of a reporting unit falls below its carrying value.

• Eliminates the second condition in the current guidance that requires an impairment loss to be recognized only if the estimated implied fair value of the goodwill is below its carrying value.

• Required effective date: January 1, 2020.^(a)

• Based on current impairment test results, the Firm does not expect a material effect on the Consolidated Financial Statements. However, the impact of the new accounting guidance will depend on the performance of the reporting units and the market conditions at the time of adoption.

• After adoption, the guidance may result in more frequent goodwill impairment losses due to the removal of the second condition.

• The Firm plans to adopt the new guidance on January 1, 2020.


(a)	Early adoption is permitted.



FORWARD-LOOKING STATEMENTS

From time to time, the Firm has made and will make forward-looking statements. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “anticipate,” “target,” “expect,” “estimate,” “intend,” “plan,” “goal,” “believe,” or other words of similar meaning. Forward-looking statements provide JPMorgan Chase’s current expectations or forecasts of future events, circumstances, results or aspirations. JPMorgan Chase’s disclosures in this Form 10-Q contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Firm also may make forward-looking statements in its other documents filed or furnished with the SEC. In addition, the Firm’s senior management may make forward-looking statements orally to investors, analysts, representatives of the media and others.

All forward-looking statements are, by their nature, subject to risks and uncertainties, many of which are beyond the Firm’s control. JPMorgan Chase’s actual future results may differ materially from those set forth in its forward-looking statements. While there is no assurance that any list of risks and uncertainties or risk factors is complete, below are certain factors which could cause actual results to differ from those in the forward-looking statements:

Local, regional and global business, economic and political conditions and geopolitical events;

Changes in laws and regulatory requirements, including capital and liquidity requirements affecting the Firm’s businesses, and the ability of the Firm to address those requirements;

Heightened regulatory and governmental oversight and scrutiny of JPMorgan Chase’s business practices, including dealings with retail customers;

Changes in trade, monetary and fiscal policies and laws;

Changes in income tax laws and regulations;

Securities and capital markets behavior, including changes in market liquidity and volatility;

Changes in investor sentiment or consumer spending or savings behavior;

Ability of the Firm to manage effectively its capital and liquidity, including approval of its capital plans by banking regulators;

Changes in credit ratings assigned to the Firm or its subsidiaries;

Damage to the Firm’s reputation;

Ability of the Firm to deal effectively with an economic slowdown or other economic or market disruption;

Technology changes instituted by the Firm, its counterparties or competitors;

The effectiveness of the Firm’s control agenda;

Ability of the Firm to develop or discontinue products and services, and the extent to which products or services previously sold by the Firm (including but not limited to mortgages and asset-backed securities) require the Firm to incur liabilities or absorb losses not contemplated at their initiation or origination;

Acceptance of the Firm’s new and existing products and services by the marketplace and the ability of the Firm to innovate and to increase market share;

Ability of the Firm to attract and retain qualified employees;

Ability of the Firm to control expenses;

Competitive pressures;

Changes in the credit quality of the Firm’s customers and counterparties;

Adequacy of the Firm’s risk management framework, disclosure controls and procedures and internal control over financial reporting;

Adverse judicial or regulatory proceedings;

Changes in applicable accounting policies, including the introduction of new accounting standards;

Ability of the Firm to determine accurate values of certain assets and liabilities;

Occurrence of natural or man-made disasters or calamities or conflicts and the Firm’s ability to deal effectively with disruptions caused by the foregoing;

Ability of the Firm to maintain the security of its financial, accounting, technology, data processing and other operational systems and facilities;

Ability of the Firm to withstand disruptions that may be caused by any failure of its operational systems or those of third parties;

Ability of the Firm to effectively defend itself against cyberattacks and other attempts by unauthorized parties to access information of the Firm or its customers or to disrupt the Firm’s systems; and

The other risks and uncertainties detailed in Part I,

Item 1A: Risk Factors in JPMorgan Chase’s 2017 Annual Report on Form 10-K for the year ended December 31, 2017.

Any forward-looking statements made by or on behalf of the Firm speak only as of the date they are made, and JPMorgan Chase does not undertake to update any forward-looking statements. The reader should, however, consult any further disclosures of a forward-looking nature the Firm may make in any subsequent Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, or Current Reports on Form 8-K.

JPMorgan Chase & Co.

Consolidated statements of income (unaudited)



	Three months ended September 30,						Nine months ended September 30,
(in millions, except per share data)	2018			2017			2018			2017
Revenue
Investment banking fees	$	1,832		$	1,868		$	5,736		$	5,594
Principal transactions	2,964			2,721			10,698			9,440
Lending- and deposit-related fees	1,542			1,497			4,514			4,427
Asset management, administration and commissions	4,310			4,072			12,923			11,996
Investment securities losses	(46		)	(1		)	(371		)	(38		)
Mortgage fees and related income	262			429			1,051			1,239
Card income	1,328			1,242			3,623			3,323
Other income	1,160			952			4,041			3,197
Noninterest revenue	13,352			12,780			42,215			39,178
Interest income	19,840			16,687			56,404			47,379
Interest expense	5,932			3,889			15,699			10,309
Net interest income	13,908			12,798			40,705			37,070
Total net revenue	27,260			25,578			82,920			76,248

Provision for credit losses	948			1,452			3,323			3,982

Noninterest expense
Compensation expense	8,108			7,697			25,308			23,710
Occupancy expense	1,014			930			2,883			2,803
Technology, communications and equipment expense	2,219			1,972			6,441			5,677
Professional and outside services	2,086			1,955			6,333			5,646
Marketing	798			710			2,396			2,179
Other expense	1,398			1,306			4,313			4,605
Total noninterest expense	15,623			14,570			47,674			44,620
Income before income tax expense	10,689			9,556			31,923			27,646
Income tax expense	2,309			2,824			6,515			7,437
Net income	$	8,380		$	6,732		$	25,408		$	20,209
Net income applicable to common stockholders	$	7,948		$	6,262		$	24,067		$	18,786
Net income per common share data
Basic earnings per share	$	2.35		$	1.77		$	7.04		$	5.26
Diluted earnings per share	2.34			1.76			7.00			5.22

Weighted-average basic shares	3,376.1			3,534.7			3,416.5			3,570.9
Weighted-average diluted shares	3,394.3			3,559.6			3,436.2			3,597.0
Cash dividends declared per common share	$	0.80		$	0.56		$	1.92		$	1.56

Effective January 1, 2018, the Firm adopted several new accounting standards. Certain of the new accounting standards were applied retrospectively and, accordingly, prior period amounts were revised. For additional information, refer to Note 1.

The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.

JPMorgan Chase & Co.

Consolidated statements of comprehensive income (unaudited)



	Three months ended September 30,						Nine months ended September 30,
(in millions)	2018			2017			2018			2017
Net income	$	8,380		$	6,732		$	25,408		$	20,209
Other comprehensive income/(loss), after–tax
Unrealized gains/(losses) on investment securities	(819		)	147			(2,280		)	842
Translation adjustments, net of hedges	(31		)	—			84			7
Fair value hedges	34			NA			(74		)	NA
Cash flow hedges	(88		)	26			(327		)	170
Defined benefit pension and OPEB plans	19			22			78			26
DVA on fair value option elected liabilities	(402		)	(112		)	125			(179		)
Total other comprehensive income/(loss), after–tax	(1,287		)	83			(2,394		)	866
Comprehensive income	$	7,093		$	6,815		$	23,014		$	21,075

Effective January 1, 2018, the Firm adopted several new accounting standards. For additional information, refer to Note 1.

The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.

JPMorgan Chase & Co.

Consolidated balance sheets (unaudited)



(in millions, except share data)	Sep 30, 2018			Dec 31, 2017
Assets
Cash and due from banks	$	23,225		$	25,898
Deposits with banks	395,872			405,406
Federal funds sold and securities purchased under resale agreements (included $12,226 and $14,732 at fair value)	217,632			198,422
Securities borrowed (included $4,528 and $3,049 at fair value)	122,434			105,112
Trading assets (included assets pledged of $114,850 and $109,887)	419,827			381,844
Investment securities (included $200,030 and $202,225 at fair value and assets pledged of $10,534 and $17,969)	231,398			249,958
Loans (included $2,987 and $2,508 at fair value)	954,318			930,697
Allowance for loan losses	(13,128		)	(13,604		)
Loans, net of allowance for loan losses	941,190			917,093
Accrued interest and accounts receivable	78,792			67,729
Premises and equipment	14,180			14,159
Goodwill, MSRs and other intangible assets	54,697			54,392
Other assets (included $12,479 and $16,128 at fair value and assets pledged of $5,334 and $7,980)	115,936			113,587
Total assets^(a)	$	2,615,183		$	2,533,600
Liabilities
Deposits (included $20,500 and $21,321 at fair value)	$	1,458,762		$	1,443,982
Federal funds purchased and securities loaned or sold under repurchase agreements (included $1,059 and $697 at fair value)	181,608			158,916
Short-term borrowings (included $7,885 and $9,191 at fair value)	64,635			51,802
Trading liabilities	151,150			123,663
Accounts payable and other liabilities (included $5,159 and $9,208 at fair value)	209,707			189,383
Beneficial interests issued by consolidated VIEs (included $17 and $45 at fair value)	20,241			26,081
Long-term debt (included $54,112 and $47,519 at fair value)	270,124			284,080
Total liabilities^(a)	2,356,227			2,277,907
Commitments and contingencies (refer to Notes 20, 21 and 22)
Stockholders’ equity
Preferred stock ($1 par value; authorized 200,000,000 shares; issued 2,776,375 and 2,606,750 shares)	27,764			26,068
Common stock ($1 par value; authorized 9,000,000,000 shares; issued 4,104,933,895 shares)	4,105			4,105
Additional paid-in capital	89,333			90,579
Retained earnings	195,180			177,676
Accumulated other comprehensive loss	(2,425		)	(119		)
Shares held in restricted stock units (“RSU”) Trust, at cost (472,953 shares)	(21		)	(21		)
Treasury stock, at cost (779,523,170 and 679,635,064 shares)	(54,980		)	(42,595		)
Total stockholders’ equity	258,956			255,693
Total liabilities and stockholders’ equity	$	2,615,183		$	2,533,600

(a)

The following table presents ~~the~~information on assets and liabilities ~~reported~~related to VIEs that are consolidated by the Firm at ~~fair value as~~September 30, 2018, and December 31, 2017. The assets of ~~March~~the consolidated VIEs are used to settle the liabilities of those entities. The holders of the beneficial interests generally do not have recourse to the general credit of JPMorgan Chase. The assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation. For a further discussion, refer to Note 13.



(in millions)	Sep 30, 2018		Dec 31, 2017
Assets
Trading assets	$	1,567	$	1,449
Loans	57,114		68,995
All other assets	2,407		2,674
Total assets	$	61,088	$	73,118
Liabilities
Beneficial interests issued by consolidated VIEs	$	20,241	$	26,081
All other liabilities	330		349
Total liabilities	$	20,571	$	26,430

The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.

JPMorgan Chase & Co.

Consolidated statements of changes in stockholders’ equity (unaudited)



	Nine months ended September 30,
(in millions, except per share data)	2018			2017

Preferred stock
Balance at January 1	$	26,068		$	26,068
Issuance	1,696			—
Balance at September 30	$	27,764		$	26,068

Common stock
Balance at January 1 and September 30	4,105			4,105

Additional paid-in capital
Balance at January 1	90,579			91,627
Shares issued and commitments to issue common stock for employee shared-based compensation awards, and related tax effects	(897		)	(680		)
Other	(349		)	(250		)
Balance at September 30	89,333			90,697

Retained earnings
Balance at January 1	177,676			162,440
Cumulative effect of changes in accounting principles	(183		)	—
Net income	25,408			20,209
Dividends declared:
Preferred stock	(1,167		)	(1,235		)
Common stock ($1.92 and $1.56 per share)	(6,554		)	(5,587		)
Balance at September 30	195,180			175,827

Accumulated other comprehensive income/(loss)
Balance at January 1	(119		)	(1,175		)
Cumulative effect of changes in accounting principles	88			—
Other comprehensive income/(loss)	(2,394		)	866
Balance at September 30	(2,425		)	(309		)

Shares held in RSU Trust, at cost
Balance at January 1 and September 30	(21		)	(21		)

Treasury stock, at cost
Balance at January 1	(42,595		)	(28,854		)
Repurchase	(14,055		)	(10,602		)
Reissuance	1,670			1,471
Balance at September 30	(54,980		)	(37,985		)

Total stockholders’ equity	$	258,956		$	258,382

Effective January 1, 2018, the Firm adopted several new accounting standards. For additional information, refer to Note 1.

The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.

JPMorgan Chase & Co.

Consolidated statements of cash flows (unaudited)



	Nine months ended September 30,
(in millions)	2018			2017
Operating activities
Net income	$	25,408		$	20,209
Adjustments to reconcile net income to net cash used in operating activities:
Provision for credit losses	3,323			3,982
Depreciation and amortization	5,716			4,547
Deferred tax (benefit)/expense	(323		)	(187		)
Other	2,179			1,655
Originations and purchases of loans held-for-sale	(68,235		)	(75,907		)
Proceeds from sales, securitizations and paydowns of loans held-for-sale	68,214			75,255
Net change in:
Trading assets	(44,427		)	(31,189		)
Securities borrowed	(17,344		)	(5,191		)
Accrued interest and accounts receivable	(11,335		)	(9,795		)
Other assets	2,909			18,668
Trading liabilities	21,580			(23,162		)
Accounts payable and other liabilities	26,677			(10,124		)
Other operating adjustments	(577		)	7,858
Net cash provided by/(used in) operating activities	13,765			(23,381		)
Investing activities
Net change in:
Federal funds sold and securities purchased under resale agreements	(19,259		)	44,463
Held-to-maturity securities:
Proceeds from paydowns and maturities	2,268			3,508
Purchases	(8,613		)	(594		)
Available-for-sale securities:
Proceeds from paydowns and maturities	29,618			43,536
Proceeds from sales	34,322			57,640
Purchases	(46,530		)	(73,717		)
Proceeds from sales and securitizations of loans held-for-investment	20,154			11,600
Other changes in loans, net	(49,755		)	(39,385		)
All other investing activities, net	(1,987		)	655
Net cash provided by/(used in) investing activities	(39,782		)	47,706
Financing activities
Net change in:
Deposits	15,274			51,352
Federal funds purchased and securities loaned or sold under repurchase agreements	22,719			3,731
Short-term borrowings	12,974			19,006
Beneficial interests issued by consolidated VIEs	975			(1,312		)
Proceeds from long-term borrowings	54,842			46,311
Payments of long-term borrowings	(69,636		)	(65,932		)
Proceeds from issuance of preferred stock	1,655			—
Treasury stock repurchased	(14,055		)	(10,602		)
Dividends paid	(6,989		)	(6,478		)
All other financing activities, net	(1,440		)	329
Net cash provided by financing activities	16,319			36,405
Effect of exchange rate changes on cash and due from banks and deposits with banks	(2,509		)	7,272
Net increase/(decrease) in cash and due from banks and deposits with banks	(12,207		)	68,002
Cash and due from banks and deposits with banks at the beginning of the period	431,304			391,154
Cash and due from banks and deposits with banks at the end of the period	$	419,097		$	459,156
Cash interest paid	$	15,144		$	10,294
Cash income taxes paid, net	2,197			3,238

The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.

Refer to the Glossary of Terms and Acronyms on pages 175–179 for definitions of terms and acronyms used throughout the Notes to Consolidated Financial Statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Note 1 – Basis of presentation

JPMorgan Chase & Co. (“JPMorgan Chase” or “the Firm”), a financial holding company incorporated under Delaware law in 1968, is a leading global financial services firm and one of the largest banking institutions in the U.S., with operations worldwide. The Firm is a leader in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing and asset management. For a further discussion of the Firm’s business segments, refer to Note 23.

The accounting and financial reporting policies of JPMorgan Chase and its subsidiaries conform to U.S. GAAP. Additionally, where applicable, the policies conform to the accounting and reporting guidelines prescribed by regulatory authorities.

The unaudited Consolidated Financial Statements prepared in conformity with U.S. GAAP require management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expense, and the disclosures of contingent assets and liabilities. Actual results could be different from these estimates. In the opinion of management, all normal, recurring adjustments have been included such that this interim financial information is fairly presented.

These unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements, and related notes thereto, included in JPMorgan Chase’s 2017 Annual Report.

Certain amounts reported in prior periods have been reclassified to conform with the current presentation.

Consolidation

The Consolidated Financial Statements include the accounts of JPMorgan Chase and other entities in which the Firm has a controlling financial interest. All material intercompany balances and transactions have been eliminated.

Assets held for clients in an agency or fiduciary capacity by the Firm are not assets of JPMorgan Chase and are not included on the Consolidated balance sheets.

The Firm determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a variable interest entity.

For a further description of JPMorgan Chase’s accounting policies regarding consolidation, refer to Notes1 and 14 of JPMorgan Chase’s 2017 Annual Report.

Offsetting assets and liabilities

U.S. GAAP permits entities to present derivative receivables and derivative payables with the same counterparty and the related cash collateral receivables and payables on a net basis on the Consolidated balance sheets when a legally enforceable master netting agreement exists. U.S. GAAP also permits securities financing activities to be presented on a net basis when specified conditions are met, including the existence of a legally enforceable master netting agreement. The Firm has elected to net such balances when the specified conditions are met. For further information on offsetting assets and liabilities, refer to Note1 of JPMorgan Chase’s 2017 Annual Report.

Application of U.S. GAAP related to the Tax Cuts and Jobs Act (“TCJA”) SEC Staff Accounting Bulletin No. 118

On December 22, 2017, the TCJA was signed into law and the Firm recorded the estimated impact of the deemed repatriation of the Firm’s unremitted non-U.S. earnings and the remeasurement of deferred taxes under the TCJA. These provisional amounts represent estimates under SEC guidance, which provides a one-year measurement period in which to refine the estimates based on new information or the issuance of interpretative guidance. Based on legislative guidance and adjustments to the 2017 federal tax return as filed, the Firm recorded a net tax benefit of $132 million in the third quarter for changes in the estimates to both the remeasurement of certain deferred taxes and the deemed repatriation tax on non-U.S. earnings. The year-to-date benefit recorded for changes in estimates was $305 million and the Firm may recognize additional adjustments during the fourth quarter as a result of the issuance of additional legislative and accounting guidance. The Firm considers any legislative or accounting guidance issued as of the balance sheet date when evaluating potential refinements to these estimates.

Accounting standards adopted January 1, 2018

The following table identifies the standards adopted, and the note where further information on the impact of the new guidance can be found:



Revenue recognition – revenue from contracts with customers	Note 5
Recognition and measurement of financial assets and financial liabilities	Notes 2 and 9
Treatment of restricted cash on the statement of cash flows	Note 18
Presentation of net periodic pension cost and net periodic postretirement benefit cost	Note 7
Premium amortization on purchased callable debt securities	Notes 9 and 17
Hedge accounting	Notes 4, 9 and 17
Reclassification of certain tax effects from AOCI	Note 17

Certain of the new accounting standards were applied retrospectively and prior period amounts were revised accordingly. The most significant of the new standards was revenue recognition, which requires gross presentation of certain costs that were previously offset against revenue. This change resulted in noninterest revenue and noninterest expense each increasing by $252 million and $777 million for the three and nine months ended September 30, 2017, respectively, with no impact to net income.

Upon adoption of the restricted cash guidance, to align the Consolidated balance sheets with the Consolidated statements of cash flows, the Firm reclassified restricted cash into cash and due from banks or deposits with banks. In addition, for the Firm’s Consolidated statements of cash flows, cash is defined as those amounts included in cash and due from banks and deposits with banks. This guidance was applied retrospectively and, accordingly, prior period amounts have been revised, resulting in cash and due from banks and deposits with banks increasing by $71 million and $1.1 billion, respectively, and other assets decreasing by $1.2 billion at December 31, 2017.

Business changes and developments

On October 30, 2018, the Firm redeemed $1.7 billion of its fixed-to-floating rate non-cumulative perpetual preferred stock, Series I. For additional information on the Firm’s preferred stock, refer to Note 20 of JPMorgan Chase’s 2017 Annual Report.

Note 2 – Fair value measurement

For a discussion of the Firm’s valuation methodologies for assets, liabilities and lending-related commitments measured at fair value and the fair value hierarchy, refer to Note2 of JPMorgan Chase’s 2017 Annual Report.

The following table presents the assets and liabilities reported at fair value as of September 30, 2018, and December 31, 2017, by major product category and fair value hierarchy.



Assets and liabilities measured at fair value on a recurring basis
	Fair value hierarchy						Derivative netting adjustments

September 30, 2018 (in millions)	Level 1		Level 2		Level 3					Total fair value
Federal funds sold and securities purchased under resale agreements	$	—	$	12,226	$	—	$	—		$	12,226
Securities borrowed	—		4,528		—		—			4,528
Trading assets:
Debt instruments:
Mortgage-backed securities:
U.S. government agencies^(a)	—		46,252		529		—			46,781
Residential – nonagency	—		1,681		77		—			1,758
Commercial – nonagency	—		1,420		13		—			1,433
Total mortgage-backed securities	—		49,353		619		—			49,972
U.S. Treasury and government agencies^(a)	40,815		7,443		—		—			48,258
Obligations of U.S. states and municipalities	—		8,785		699		—			9,484
Certificates of deposit, bankers’ acceptances and commercial paper	—		3,070		—		—			3,070
Non-U.S. government debt securities	26,824		28,875		164		—			55,863
Corporate debt securities	—		23,210		395		—			23,605
Loans^(b)	—		40,051		1,533		—			41,584
Asset-backed securities	—		2,779		76		—			2,855
Total debt instruments	67,639		163,566		3,486		—			234,691
Equity securities	104,701		405		329		—			105,435
Physical commodities^(c)	3,727		1,256		—		—			4,983
Other	—		14,188		413		—			14,601
Total debt and equity instruments^(d)	176,067		179,415		4,228		—			359,710
Derivative receivables:
Interest rate	715		258,744		2,000		(238,062		)	23,397
Credit	—		22,553		952		(22,923		)	582
Foreign exchange	734		187,377		773		(171,841		)	17,043
Equity	—		43,791		3,141		(36,828		)	10,104
Commodity	—		22,129		239		(13,432		)	8,936
Total derivative receivables^(e)	1,449		534,594		7,105		(483,086		)	60,062
Total trading assets^(f)	177,516		714,009		11,333		(483,086		)	419,772
Available-for-sale securities:
Mortgage-backed securities:
U.S. government agencies^(a)	—		63,110		—		—			63,110
Residential – nonagency	—		9,216		1		—			9,217
Commercial – nonagency	—		7,048		—		—			7,048
Total mortgage-backed securities	—		79,374		1		—			79,375
U.S. Treasury and government agencies	27,816		—		—		—			27,816
Obligations of U.S. states and municipalities	—		38,121		—		—			38,121
Certificates of deposit	—		75		—		—			75
Non-U.S. government debt securities	16,544		8,130		—		—			24,674
Corporate debt securities	—		2,056		—		—			2,056
Asset-backed securities:
Collateralized loan obligations	—		20,048		61		—			20,109
Other	—		7,804		—		—			7,804
Total available-for-sale securities	44,360		155,608		62		—			200,030
Loans	—		2,847		140		—			2,987
Mortgage servicing rights	—		—		6,433		—			6,433
Other assets^(f)(g)	10,684		20		1,063		—			11,767
Total assets measured at fair value on a recurring basis	$	232,560	$	889,238	$	19,031	$	(483,086	)	$	657,743
Deposits	$	—	$	16,060	$	4,440	$	—		$	20,500
Federal funds purchased and securities loaned or sold under repurchase agreements	—		1,059		—		—			1,059
Short-term borrowings	—		5,914		1,971		—			7,885
Trading liabilities:
Debt and equity instruments^(d)	84,958		24,403		96		—			109,457
Derivative payables:
Interest rate	310		232,614		1,309		(227,142		)	7,091
Credit			22,435		925		(21,908		)	1,452
Foreign exchange	880		175,664		1,075		(165,217		)	12,402
Equity	—		45,937		5,418		(39,377		)	11,978
Commodity	—		22,075		764		(14,069		)	8,770
Total derivative payables^(e)	1,190		498,725		9,491		(467,713		)	41,693
Total trading liabilities	86,148		523,128		9,587		(467,713		)	151,150
Accounts payable and other liabilities	5,127		20		12		—			5,159
Beneficial interests issued by consolidated VIEs	—		16		1		—			17
Long-term debt	—		34,074		20,038		—			54,112
Total liabilities measured at fair value on a recurring basis	$	91,275	$	580,271	$	36,049	$	(467,713	)	$	239,882



	Fair value hierarchy						Derivative netting adjustments

December 31, 2017 (in millions)	Level 1		Level 2		Level 3					Total fair value
Federal funds sold and securities purchased under resale agreements	$	—	$	14,732	$	—	$	—		$	14,732
Securities borrowed	—		3,049		—		—			3,049
Trading assets:
Debt instruments:
Mortgage-backed securities:
U.S. government agencies^(a)	—		41,515		307		—			41,822
Residential – nonagency	—		1,835		60		—			1,895
Commercial – nonagency	—		1,645		11		—			1,656
Total mortgage-backed securities	—		44,995		378		—			45,373
U.S. Treasury and government agencies^(a)	30,758		6,475		1		—			37,234
Obligations of U.S. states and municipalities	—		9,067		744		—			9,811
Certificates of deposit, bankers’ acceptances and commercial paper	—		226		—		—			226
Non-U.S. government debt securities	28,887		28,831		78		—			57,796
Corporate debt securities	—		24,146		312		—			24,458
Loans^(b)	—		35,242		2,719		—			37,961
Asset-backed securities	—		3,284		153		—			3,437
Total debt instruments	59,645		152,266		4,385		—			216,296
Equity securities	87,346		197		295		—			87,838
Physical commodities^(c)	4,924		1,322		—		—			6,246
Other	—		14,197		690		—			14,887
Total debt and equity instruments^(d)	151,915		167,982		5,370		—			325,267
Derivative receivables:
Interest rate	181		314,107		1,704		(291,319		)	24,673
Credit	—		21,995		1,209		(22,335		)	869
Foreign exchange	841		158,834		557		(144,081		)	16,151
Equity	—		37,722		2,318		(32,158		)	7,882
Commodity	—		19,875		210		(13,137		)	6,948
Total derivative receivables^(e)	1,022		552,533		5,998		(503,030		)	56,523
Total trading assets^(f)	152,937		720,515		11,368		(503,030		)	381,790
Available-for-sale securities:
Mortgage-backed securities:
U.S. government agencies^(a)	—		70,280		—		—			70,280
Residential – nonagency	—		11,366		1		—			11,367
Commercial – nonagency	—		5,025		—		—			5,025
Total mortgage-backed securities	—		86,671		1		—			86,672
U.S. Treasury and government agencies	22,745		—		—		—			22,745
Obligations of U.S. states and municipalities	—		32,338		—		—			32,338
Certificates of deposit	—		59		—		—			59
Non-U.S. government debt securities	18,140		9,154		—		—			27,294
Corporate debt securities	—		2,757		—		—			2,757
Asset-backed securities:
Collateralized loan obligations	—		20,720		276		—			20,996
Other	—		8,817		—		—			8,817
Equity securities^(g)	547		—		—		—			547
Total available-for-sale securities	41,432		160,516		277		—			202,225
Loans	—		2,232		276		—			2,508
Mortgage servicing rights	—		—		6,030		—			6,030
Other assets^(f)(g)	13,795		343		1,265		—			15,403
Total assets measured at fair value on a recurring basis	$	208,164	$	901,387	$	19,216	$	(503,030	)	$	625,737
Deposits	$	—	$	17,179	$	4,142	$	—		$	21,321
Federal funds purchased and securities loaned or sold under repurchase agreements	—		697		—		—			697
Short-term borrowings	—		7,526		1,665		—			9,191
Trading liabilities:
Debt and equity instruments^(d)	64,664		21,183		39		—			85,886
Derivative payables:
Interest rate	170		282,825		1,440		(277,306		)	7,129
Credit	—		22,009		1,244		(21,954		)	1,299
Foreign exchange	794		154,075		953		(143,349		)	12,473
Equity	—		39,668		5,727		(36,203		)	9,192
Commodity	—		21,017		884		(14,217		)	7,684
Total derivative payables^(e)	964		519,594		10,248		(493,029		)	37,777
Total trading liabilities	65,628		540,777		10,287		(493,029		)	123,663
Accounts payable and other liabilities	9,074		121		13		—			9,208
Beneficial interests issued by consolidated VIEs	—		6		39		—			45
Long-term debt	—		31,394		16,125		—			47,519
Total liabilities measured at fair value on a recurring basis	$	74,702	$	597,700	$	32,271	$	(493,029	)	$	211,644

(a)

At September 30, 2018, and December 31, 2017, ~~by major product category~~included total U.S. government-sponsored enterprise obligations of $77.3 billion and ~~fair value hierarchy.~~

Assets and liabilities measured at fair value on a recurring basis

Fair value hierarchy
Derivative
netting
adjustments

March 31, 2018 (in millions) Level 1 Level 2
Level 3
Total fair value
Federal funds sold and securities purchased under resale agreements $ —
$ 13,523

$ —

$ —
$ 13,523
Securities borrowed —
3,023

—

—
3,023
Trading assets:

Debt instruments:

Mortgage-backed securities:

U.S. government agencies^(a)
—
34,849

508

—
35,357
Residential – nonagency —
1,906

55

—
1,961
Commercial – nonagency —
1,825

14

—
1,839
Total mortgage-backed securities —
38,580

577

—
39,157
U.S. Treasury and government agencies^(a)
35,122
7,350

—

—
42,472
Obligations of U.S. states and municipalities —
9,004

704

—
9,708
Certificates of deposit, bankers’ acceptances and commercial paper —
2,281
—
—
2,281
Non-U.S. government debt securities 30,555
34,174
197
—
64,926
Corporate debt securities —
25,563
306
—
25,869
Loans^(b)
—
38,908
2,368
—
41,276
Asset-backed securities —
3,129
63
—
3,192
Total debt instruments 65,677
158,989
4,215
—
228,881
Equity securities 104,905
429
300
—
105,634
Physical commodities^(c)
3,893
1,585
—
—
5,478
Other —
14,626
698
—
15,324
Total debt and equity instruments^(d)
174,475
175,629
5,213
—
355,317
Derivative receivables:
Interest rate 562
301,549
1,761
(280,094 ) 23,778
Credit —
22,609
1,118
(22,665 ) 1,062
Foreign exchange 1,106
164,190
639
(149,332 ) 16,603
Equity —
41,424
2,564
(35,185 ) 8,803
Commodity —
16,955
165
(10,452 ) 6,668
Total derivative receivables^(e)(f)
1,668
546,727
6,247
(497,728 ) 56,914
Total trading assets^(g)
176,143
722,356
11,460
(497,728 ) 412,231
Available-for-sale debt securities:
Mortgage-backed securities:
U.S. government agencies^(a)
—
67,209
—
—
67,209
Residential – nonagency —
10,602
1
—
10,603
Commercial – nonagency —
9,140
—
—
9,140
Total mortgage-backed securities —
86,951
1
—
86,952
U.S. Treasury and government agencies 25,450
—
—
—
25,450
Obligations of U.S. states and municipalities —
39,491
—
—
39,491
Certificates of deposit —
60
—
—
60
Non-U.S. government debt securities 18,148
8,546
—
—
26,694
Corporate debt securities —
2,268
—
—
2,268
Asset-backed securities:
Collateralized loan obligations —
19,835
204
—
20,039
Other —
8,192
—
—
8,192
Total available-for-sale securities 43,598
165,343
205
—
209,146
Loans —
2,512
396
—
2,908
Mortgage servicing rights —
—
6,202
—
6,202
Other assets^(g)(h)
14,718
441
1,220
—
16,379
Total assets measured at fair value on a recurring basis $ 234,459
$ 907,198
$ 19,483
$ (497,728 ) $ 663,412
Deposits $ —
$ 16,153
$ 4,017
$ —
$ 20,170
Federal funds purchased and securities loaned or sold under repurchase agreements —
735
—
—
735
Short-term borrowings —
6,698
2,125
—
8,823
Trading liabilities:

Debt and equity instruments^(d)
75,154
24,384
50
—
99,588
Derivative payables:

Interest rate 579
271,996
1,289
(266,694 ) 7,170
Credit —
22,583
1,113
(21,983 ) 1,713
Foreign exchange 1,176
151,705
927
(143,011 ) 10,797
Equity —
43,162
5,076
(37,913 ) 10,325
Commodity —
17,544
684
(11,284 ) 6,944
Total derivative payables^(e)(f)
1,755
506,990
9,089
(480,885 ) 36,949
Total trading liabilities 76,909
531,374
9,139
(480,885 ) 136,537
Accounts payable and other liabilities 9,770
191
7
—
9,968
Beneficial interests issued by consolidated VIEs —
6
1
—
7
Long-term debt —
32,202
16,950
—
49,152
Total liabilities measured at fair value on a recurring basis $ 86,679
$ 587,359
$ 32,239
$ (480,885 ) $ 225,392

Fair value hierarchy
Derivative
netting
adjustments

December 31, 2017 (in millions) Level 1
Level 2

Level 3

Total fair value
Federal funds sold and securities purchased under resale agreements $ —
$ 14,732

$ —

$ —
$ 14,732
Securities borrowed —
3,049

—

—
3,049
Trading assets:

Debt instruments:

Mortgage-backed securities:

U.S. government agencies^(a)
—
41,515

307

—
41,822
Residential – nonagency —
1,835

60

—
1,895
Commercial – nonagency —
1,645

11

—
1,656
Total mortgage-backed securities —
44,995

378

—
45,373
U.S. Treasury and government agencies^(a)
30,758
6,475

1

—
37,234
Obligations of U.S. states and municipalities —
9,067

744

—
9,811
Certificates of deposit, bankers’ acceptances and commercial paper —
226

—

—
226
Non-U.S. government debt securities 28,887
28,831

78

—
57,796
Corporate debt securities —
24,146

312

—
24,458
Loans^(b)
—
35,242

2,719

—
37,961
Asset-backed securities —
3,284

153

—
3,437
Total debt instruments 59,645
152,266

4,385

—
216,296
Equity securities 87,346
197

295

—
87,838
Physical commodities^(c)
4,924
1,322

—

—
6,246
Other —
14,197

690

—
14,887
Total debt and equity instruments^(d)
151,915
167,982

5,370

—
325,267
Derivative receivables:

Interest rate 181
314,107

1,704

(291,319 ) 24,673
Credit —
21,995

1,209

(22,335 ) 869
Foreign exchange 841
158,834

557

(144,081 ) 16,151
Equity —
37,722

2,318

(32,158 ) 7,882
Commodity —
19,875

210

(13,137 ) 6,948
Total derivative receivables^(e)(f)
1,022
552,533

5,998

(503,030 ) 56,523
Total trading assets^(g)
152,937
720,515

11,368

(503,030 ) 381,790
Available-for-sale debt securities:

Mortgage-backed securities:

U.S. government agencies^(a)
—
70,280

—

—
70,280
Residential – nonagency —
11,366

1

—
11,367
Commercial – nonagency —
5,025

—

—
5,025
Total mortgage-backed securities —
86,671

1

—
86,672
U.S. Treasury and government agencies 22,745
—

—

—
22,745
Obligations of U.S. states and municipalities —
32,338

—

—
32,338
Certificates of deposit —
59

—

—
59
Non-U.S. government debt securities 18,140
9,154

—

—
27,294
Corporate debt securities —
2,757

—

—
2,757
Asset-backed securities:

Collateralized loan obligations —
20,720

276

—
20,996
Other —
8,817

—

—
8,817
Equity securities^(h)
547
—

—

—
547
Total available-for-sale securities 41,432
160,516

277

—
202,225
Loans —
2,232

276

—
2,508
Mortgage servicing rights —
—

6,030

—
6,030
Other assets^(g)(h)
13,795
343

1,265

—
15,403
Total assets measured at fair value on a recurring basis $ 208,164
$ 901,387

$ 19,216

$ (503,030 ) $ 625,737
Deposits $ —
$ 17,179

$ 4,142

$ —
$ 21,321
Federal funds purchased and securities loaned or sold under repurchase agreements —
697

—

—
697
Short-term borrowings —
7,526

1,665

—
9,191
Trading liabilities:

Debt and equity instruments^(d)
64,664
21,183

39

—
85,886
Derivative payables:

Interest rate 170
282,825

1,440

(277,306 ) 7,129
Credit —
22,009

1,244

(21,954 ) 1,299
Foreign exchange 794
154,075

953

(143,349 ) 12,473
Equity —
39,668

5,727

(36,203 ) 9,192
Commodity —
21,017

884

(14,217 ) 7,684
Total derivative payables^(e)(f)
964
519,594

10,248

(493,029 ) 37,777
Total trading liabilities 65,628
540,777

10,287

(493,029 ) 123,663
Accounts payable and other liabilities 9,074
121

13

—
9,208
Beneficial interests issued by consolidated VIEs —
6

39

—
45
Long-term debt —
31,394

16,125

—
47,519
Total liabilities measured at fair value on a recurring basis $ 74,702
$ 597,700

$ 32,271

$ (493,029 ) $ 211,644

$78.0 billion, respectively, which were predominantly mortgage-related.

~~(a)~~

~~At March 31, 2018, and December 31, 2017, included total U.S. government-sponsored enterprise obligations of $74.1 billion and $78.0 billion, respectively, which were predominantly mortgage-related.~~


~~(b)~~	At March 31, 2018, and December 31, 2017, included within trading loans were $12.9 billion and $11.4 billion, respectively, of residential first-lien mortgages, and $2.4 billion and $4.2 billion, respectively, of commercial first-lien mortgages. Residential mortgage loans include conforming mortgage loans originated with the intent to sell to U.S. government agencies of $7.9 billion and $5.7 billion, respectively, and reverse mortgages of $324 million
(b)	At September 30, 2018, and December 31, 2017, included within trading loans were $13.8 billion and $11.4 billion, respectively, of residential first-lien mortgages, and $2.6 billion and $4.2 billion, respectively, of commercial first-lien mortgages. Residential mortgage loans include conforming mortgage loans originated with the intent to sell to U.S. government agencies of $9.2 billion and $5.7 billion, respectively, and reverse mortgages of zero and $836 million respectively.

(c)

Physical commodities inventories are generally accounted for at the lower of cost or net realizable value. “Net realizable value” is a term defined in U.S. GAAP as not exceeding fair value less costs to sell (“transaction costs”). Transaction costs for the Firm’s physical commodities inventories are either not applicable or immaterial to the value of the inventory. Therefore, net realizable value approximates fair value for the Firm’s physical commodities inventories. When fair value hedging has been applied (or when net realizable value is below cost), the carrying

value of physical commodities approximates fair value, because under fair value hedge accounting, the cost basis is adjusted for changes in fair value. For a further discussion of the Firm’s hedge accounting relationships, refer to Note 4. To provide consistent fair value disclosure information, all physical commodities inventories have been included in each period presented.


(d)	Balances reflect the reduction of securities owned (long positions) by the amount of identical securities sold but not yet purchased (short positions).

(e)

As permitted under U.S. GAAP, the Firm has elected to net derivative receivables and derivative payables and the related cash collateral received and paid when a legally enforceable master netting agreement exists. For purposes of the tables above, the Firm does not reduce derivative receivables and derivative payables balances for this netting adjustment, either within or across the levels of the fair value hierarchy, as such netting is not relevant to a presentation based on the transparency of inputs to the valuation of an asset or liability. The level 3 balances would be reduced if netting were applied, including the netting benefit associated with cash collateral.

(f)

Certain investments that are measured at fair value using the net asset value per share (or its equivalent) as a practical expedient are not required to be classified in the fair value hierarchy. At September 30, 2018, and December 31, 2017, the fair values of these investments, which include certain hedge funds, private equity funds, real estate and other funds, were $767 million and $779 million, respectively. Included in these balances at September 30, 2018, and December 31, 2017, were trading assets of $55 million and $54 million, respectively, and other assets of $712 million and $725 million, respectively.


(g)	Effective January 1, 2018, the Firm adopted the recognition and measurement guidance. Equity securities that were previously reported as AFS securities were reclassified to other assets upon adoption.

Transfers between levels for instruments carried at fair

value on a recurring basis

For both the three months ended September 30, 2018 and 2017 and the nine months ended September 30, 2017 there were no individually significant transfers.

For the nine months ended September 30, 2018, the only significant transfers were between levels 2 and 3.

Significant transfers from level 3 to level 2 included the following:

$1.2 billion of total debt and equity instruments, the majority of which were trading loans, driven by an increase in observability.

$1.0 billion of gross equity derivative receivables and $1.2 billion of gross equity derivative payables as a result of an increase in observability and a decrease in the significance of unobservable inputs.

Significant transfers from level 2 to level 3 included the following:

$1.0 billion of gross equity derivative payables as a result of a decrease in observability and an increase in the significance of unobservable inputs.

All transfers are based on changes in the observability of the valuation inputs and are assumed to occur at the beginning of the quarterly reporting period in which they occur.

Level 3 valuations

For further information on the Firm’s valuation process and a detailed discussion of the determination of fair value for individual financial instruments, refer to Note 2 of JPMorgan Chase’s 2017 Annual Report.

The following table presents the Firm’s primary level 3 financial instruments, the valuation techniques used to measure the fair value of those financial instruments, the significant unobservable inputs, the range of values for those inputs and, for certain instruments, the weighted averages of such inputs. While the determination to classify an instrument within level 3 is based on the significance of the unobservable inputs to the overall fair value measurement, level 3 financial instruments typically include observable components (that is, components that are actively quoted and can be validated to external sources) in addition to the unobservable components. The level 1 and/or level 2 inputs are not included in the table. In addition, the Firm manages the risk of the observable components of level 3 financial instruments using securities and derivative positions that are classified within levels 1 or 2 of the fair value hierarchy.

The range of values presented in the table is representative of the highest and lowest level input used to value the significant groups of instruments within a product/instrument classification. Where provided, the weighted averages of the input values presented in the table are calculated based on the fair value of the instruments that the input is being used to value.

In the Firm’s view, the input range and the weighted average value do not reflect the degree of input uncertainty or an assessment of the reasonableness of the Firm’s estimates and assumptions. Rather, they reflect the characteristics of the various instruments held by the Firm and the relative distribution of instruments within the range of characteristics. For example, two option contracts may have similar levels of market risk exposure and valuation uncertainty, but may have significantly different implied volatility levels because the option contracts have different underlyings, tenors, or strike prices. The input range and weighted average values will therefore vary from period-to-period and parameter-to-parameter based on the characteristics of the instruments held by the Firm at each balance sheet date.

For the Firm’s derivatives and structured notes positions classified within level 3 at September 30, 2018, interest rate correlation inputs used in estimating fair value were concentrated towards the upper end of the range; equity correlation, equity-FX, and equity-IR correlation inputs were

concentrated in the middle of the range; commodity correlation inputs were concentrated in the middle of the range; credit correlation inputs were concentrated towards the lower end of the range; and the interest rate-foreign exchange (“IR-FX”) correlation inputs were distributed across the range. In addition, the interest rate spread volatility inputs used in estimating fair value were distributed across the range; equity volatilities and commodity volatilities were concentrated towards the lower end of the range; and forward commodity prices used in estimating the fair value of commodity derivatives were concentrated towards the lower end of the range. Prepayment speed inputs used in estimating fair value of interest rate derivatives were concentrated towards the lower end of the range. Recovery rate, yield and prepayment speed inputs used in estimating fair value of credit derivatives were distributed across the range; credit spreads and conditional default rates were concentrated towards the lower end of the range; loss severity and price inputs were concentrated towards the upper end of the range.



Level 3 inputs^(a)
September 30, 2018
Product/Instrument	Fair value (in millions)			Principal valuation technique	Unobservable inputs^(g)	Range of input values							Weighted average
Residential mortgage-backed securities and loans^(b)	$	823		Discounted cash flows	Yield	0		%	–	28		%			6		%
					Prepayment speed	0		%	–	39		%			9		%
					Conditional default rate	0		%	–	6		%			1		%
					Loss severity	0		%	–	100		%			5		%
Commercial mortgage-backed securities and loans^(c)	439			Market comparables	Price	$	4		–	$	101				$	93
Obligations of U.S. states and municipalities	699			Market comparables	Price	$	60		–	$	100				$	97
Corporate debt securities	395			Market comparables	Price	$	3		–	$	110				$	80
Loans^(d)	1,031			Market comparables	Price	$	3		–	$	102				$	79
Asset-backed securities	61			Discounted cash flows	Credit spread	219						bps			219		bps
					Prepayment speed	20						%			20		%
					Conditional default rate	2						%			2		%
					Loss severity	30						%			30		%
	76			Market comparables	Price	$	0		–	$	100				$	51
Net interest rate derivatives	528			Option pricing	Interest rate spread volatility	16		bps	–	38				bps
					Interest rate correlation	(45		)%	–	97		%
					IR-FX correlation	55		%	–	60		%
	163			Discounted cash flows	Prepayment speed	0		%	–	30		%
Net credit derivatives	26			Discounted cash flows	Credit correlation	35		%	–	60		%
					Credit spread	6		bps	–	1,543		bps
					Recovery rate	20		%	–	70		%
					Yield	3		%	–	52		%
					Prepayment speed	5		%	–	17		%
					Conditional default rate	0		%	–	100		%
					Loss severity	0		%	–	100		%
	1			Market comparables	Price	$	10		–	$	98
Net foreign exchange derivatives	(121		)	Option pricing	IR-FX correlation	(45		)%	–	60		%
	(181		)	Discounted cash flows	Prepayment speed	8		%	–	9		%
Net equity derivatives	(2,277		)	Option pricing	Equity volatility	10		%	–	60		%
					Equity correlation	10		%	–	95		%
					Equity-FX correlation	(75		)%	–	60		%
					Equity-IR correlation	20		%	–	60		%
Net commodity derivatives	(525		)	Option pricing	Forward commodity price	$	61		–	$ 83 per barrel
					Commodity volatility	5		%	–	48		%
					Commodity correlation	(52		)%	–	95		%
MSRs	6,433			Discounted cash flows	Refer to Note 14
Other assets	322			Discounted cash flows	Credit spread	70						bps			70		bps
					Yield	8		%	–	10		%			8		%
	1,154			Market comparables	Price	$	34		–	$	106				$	45
					EBITDA multiple	3.0x			–	9.2x					8.4x
Long-term debt, short-term borrowings, and deposits^(e)	26,449			Option pricing	Interest rate spread volatility	16		bps	–	38				bps
					Interest rate correlation	(45		)%	–	97		%
					IR-FX correlation	(45		)%	–	60		%
					Equity correlation	10		%	–	95		%
					Equity-FX correlation	(75		)%	–	60		%
					Equity-IR correlation	20		%	–	60		%
Other level 3 assets and liabilities, net^(f)	384


(a)	The categories presented in the table have been aggregated based upon the product type, which may differ from their classification on the Consolidated balance sheets. Furthermore, the inputs presented for each valuation technique in the table are, in some cases, not applicable to every instrument valued using the technique as the characteristics of the instruments can differ.


(b)	Includes U.S. government agency securities of $502 million, nonagency securities of $78 million and trading loans of $243 million.


(c)	Includes U.S. government agency securities of $27 million, nonagency securities of $13 million, trading loans of $259 million and non-trading loans of $140 million.


(d)	Comprises trading loans.


(e)	Long-term debt, short-term borrowings and deposits include structured notes issued by the Firm that are financial instruments that typically contain embedded derivatives. The estimation of the fair value of structured notes includes the derivative features embedded within the instrument. The significant unobservable inputs are broadly consistent with those presented for derivative receivables.


(f)	Includes level 3 assets and liabilities that are insignificant both individually and in aggregate.


(g)	Price is a significant unobservable input for certain instruments. When quoted market prices are not readily available, reliance is generally placed on price-based internal valuation techniques. The price input is expressed assuming a par value of $100.

Changes in and ranges of unobservable inputs

For a discussion of the impact on fair value of changes in unobservable inputs and the relationships between unobservable inputs as well as a description of attributes of the underlying instruments and external market factors that affect the range of inputs used in the valuation of the Firm’s positions refer to Note 2 of JPMorgan Chase’s 2017 Annual Report.

Changes in level 3 recurring fair value measurements

The following tables include a rollforward of the Consolidated balance sheets amounts (including changes in fair value) for financial instruments classified by the Firm within level 3 of the fair value hierarchy for the three and nine months ended September 30, 2018 and 2017. When a determination is made to classify a financial instrument within level 3, the determination is based on the significance of the unobservable parameters to

the overall fair value measurement. However, level 3 financial instruments typically include, in addition to the unobservable or level 3 components, observable components (that is, components that are actively quoted and can be validated to external sources); accordingly, the gains and losses in the table below include changes in fair value due in part to observable factors that are part of the valuation methodology. Also, the Firm risk-manages the observable components of level 3 financial instruments using securities and derivative positions that are classified within level 1 or 2 of the fair value hierarchy; as these level 1 and level 2 risk management instruments are not included below, the gains or losses in the following tables do not reflect the effect of the Firm’s risk management activities related to such level 3 instruments.



	Fair value measurements using significant unobservable inputs
Three months ended September 30, 2018 (in millions)	Fair value at July 1, 2018			Total realized/unrealized gains/(losses)															Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2018				Change in unrealized gains/(losses) related to financial instruments held at September 30, 2018
								Purchases^(f)			Sales					Settlements^(g)
Assets:
Trading assets:
Debt instruments:
Mortgage-backed securities:
U.S. government agencies	$	478		$	2			$	14		$	(28	)			$	(17	)	$	83		$	(3	)		$	529		$	—
Residential – nonagency	87			1				—			(6		)			(3		)	18			(20		)		77			1
Commercial – nonagency	18			(1		)		—			—					—			9			(13		)		13			(1		)
Total mortgage-backed securities	583			2				14			(34		)			(20		)	110			(36		)		619			—
U.S. Treasury and government agencies	—			—				—			—					—			—			—				—			—
Obligations of U.S. states and municipalities	736			8				26			(70		)			(1		)	—			—				699			7
Non-U.S. government debt securities	183			(9		)		44			(29		)			(2		)	1			(24		)		164			(9		)
Corporate debt securities	274			(2		)		156			(87		)			(4		)	82			(24		)		395			(3		)
Loans	1,986			17				188			(146		)			(199		)	48			(361		)		1,533			3
Asset-backed securities	87			6				5			(7		)			(13		)	5			(7		)		76			3
Total debt instruments	3,849			22				433			(373		)			(239		)	246			(452		)		3,486			1
Equity securities	288			20				6			(48		)			—			82			(19		)		329			(18		)
Other	406			30				13			—					(37		)	2			(1		)		413			10
Total trading assets – debt and equity instruments	4,543			72			^(c)	452			(421		)			(276		)	330			(472		)		4,228			(7		)	^(c)
Net derivative receivables:^(a)
Interest rate	489			236				28			(22		)			(101		)	68			(7		)		691			216
Credit	(24		)	(19		)		1			—					47			6			16				27			(15		)
Foreign exchange	(245		)	(56		)		29			(7		)			(49		)	(2		)	28				(302		)	(54		)
Equity	(2,578		)	(94		)		643			(635		)			622			(251		)	16				(2,277		)	(121		)
Commodity	(752		)	318				—			—					(113		)	15			7				(525		)	138
Total net derivative receivables	(3,110		)	385			^(c)	701			(664		)			406			(164		)	60				(2,386		)	164			^(c)
Available-for-sale securities:
Asset-backed securities	147			—				—			—					(86		)	—			—				61			—
Other	1			—				—			—					—			—			—				1			—
Total available-for-sale securities	148			—				—			—					(86		)	—			—				62			—
Loans	159			(1		)	^(c)	1			—					(19		)	—			—				140			(1		)	^(c)
Mortgage servicing rights	6,241			98			^(e)	291			(2		)			(195		)	—			—				6,433			98			^(e)
Other assets	1,225			(160		)	^(c)	2			—					(7		)	3			—				1,063			(160		)	^(c)

	Fair value measurements using significant unobservable inputs
Three months ended September 30, 2018 (in millions)	Fair value at July 1, 2018			Total realized/unrealized (gains)/losses															Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2018				Change in unrealized (gains)/ losses related to financial instruments held at September 30, 2018
								Purchases			Sales			Issuances		Settlements^(g)
Liabilities:^(b)
Deposits	$	4,305		$	(84	)	^(c)(i)	$	—		$	—		$	517	$	(170	)	$	1		$	(129	)		$	4,440		$	(82	)	^(c)(i)
Short-term borrowings	2,209			(47		)	^(c)(i)	—			—			713		(885		)	6			(25		)		1,971			(31		)	^(c)(i)
Trading liabilities – debt and equity instruments	43			36			^(c)	(6		)	19			—		(2		)	7			(1		)		96			36			^(c)
Accounts payable and other liabilities	8			1				—			—			—		—			3			—				12			1
Beneficial interests issued by consolidated VIEs	1			—				—			—			—		—			—			—				1			—
Long-term debt	18,262			194			^(c)(i)	—			—			3,551		(1,809		)	59			(219		)		20,038			192			^(c)(i)



	Fair value measurements using significant unobservable inputs
Three months ended September 30, 2017 (in millions)	Fair value at July 1, 2017			Total realized/unrealized gains/(losses)																Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2017					Change in unrealized gains/(losses) related to financial instruments held at September 30, 2017
								Purchases^(f)			Sales						Settlements^(g)
Assets:
Trading assets:
Debt instruments:
Mortgage-backed securities:
U.S. government agencies	$	365		$	(2	)		$	—		$	(15	)				$	(20	)	$	10		$	(15	)		$	323			$	(2	)
Residential – nonagency	98			6				4			(4		)				(12		)	50			(35		)		107				5
Commercial – nonagency	65			3				10			(24		)				—			3			(30		)		27				3
Total mortgage-backed securities	528			7				14			(43		)				(32		)	63			(80		)		457				6
U.S. Treasury and government agencies	—			—				—			—						—			1			—				1				—
Obligations of U.S. states and municipalities	681			3				31			—						—			—			—				715				3
Non-U.S. government debt securities	37			—				252			(217		)				—			23			(15		)		80				—
Corporate debt securities	461			7				193			(327		)				(22		)	68			(19		)		361				8
Loans	4,488			131				564			(1,498		)				(421		)	246			(303		)		3,207				71
Asset-backed securities	83			5				170			(10		)				(8		)	36			(5		)		271				4
Total debt instruments	6,278			153				1,224			(2,095		)				(483		)	437			(422		)		5,092				92
Equity securities	284			6				29			(40		)				—			16			(7		)		288				7
Other	731			20				5			(38		)				(25		)	—			(2		)		691				16
Total trading assets – debt and equity instruments	7,293			179			^(c)	1,258			(2,173		)				(508		)	453			(431		)		6,071				115			^(c)
Net derivative receivables:^(a)
Interest rate	712			101				16			(23		)				(182		)	21			19				664				(7		)
Credit	(45		)	(32		)		—			(1		)				(2		)	40			4				(36		)		(22		)
Foreign exchange	(686		)	16				9			(2		)				68			(39		)	95				(539		)		37
Equity	(2,444		)	(10		)		355			(184		)				(132		)	(1		)	41				(2,375		)		82
Commodity	(58		)	(30		)		—			—						(3		)	(2		)	(7		)		(100		)		(51		)
Total net derivative receivables	(2,521		)	45			^(c)	380			(210		)				(251		)	19			152				(2,386		)		39			^(c)
Available-for-sale securities:
Asset-backed securities	547			2				—			—						(63		)	—			—				486				2
Other	1			—				—			—						—			—			—				1				—
Total available-for-sale securities	548			2			^(d)	—			—						(63		)	—			—				487				2			^(d)
Loans	305			8			^(c)	—			(26		)				(10		)	—			—				277				8			^(c)
Mortgage servicing rights	5,753			(66		)	^(e)	253			(2		)				(200		)	—			—				5,738				(66		)	^(e)
Other assets	1,934			18			^(c)	3			(2		)				(82		)	—			—				1,871				16			^(c)

	Fair value measurements using significant unobservable inputs
Three months ended September 30, 2017 (in millions)	Fair value at July 1, 2017			Total realized/unrealized (gains)/losses																Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2017					Change in unrealized (gains)/losses related to financial instruments held at September 30, 2017
								Purchases			Sales			Issuances			Settlements^(g)
Liabilities:^(b)
Deposits	$	2,131		$	33		^(c)	$	—		$	—		$	1,909		$	(58	)	$	—		$	(177	)		$	3,838			$	27		^(c)
Federal funds purchased and securities loaned or sold under repurchase agreements	—			—				—			—			—			—			1			—				1				—
Short-term borrowings	1,314			33			^(c)	—			—			818			(631		)	13			(76		)		1,471				21			^(c)
Trading liabilities – debt and equity instruments	36			2			^(c)	(23		)	28			—			—			—			—				43				3			^(c)
Accounts payable and other liabilities	10			—				—			—			—			(1		)	—			—				9				—
Beneficial interests issued by consolidated VIEs	1			—				—			39			—			—			78			—				118				—
Long-term debt	14,732			319			^(c)(j)	—			—			3,023		^(j)	(3,552		)	181			(209		)		14,494			^(j)	242			^(c)(j)



	Fair value measurements using significant unobservable inputs
Nine months ended September 30, 2018 (in millions)	Fair value at January 1, 2018			Total realized/unrealized gains/(losses)															Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2018				Change in unrealized gains/(losses) related to financial instruments held at September 30, 2018
								Purchases^(f)			Sales					Settlements^(g)
Assets:
Trading assets:
Debt instruments:
Mortgage-backed securities:
U.S. government agencies	$	307		$	5			$	348		$	(126	)			$	(56	)	$	92		$	(41	)		$	529		$	3
Residential – nonagency	60			1				45			(19		)			(6		)	58			(62		)		77			4
Commercial – nonagency	11			2				7			(8		)			(13		)	30			(16		)		13			(1		)
Total mortgage-backed securities	378			8				400			(153		)			(75		)	180			(119		)		619			6
U.S. Treasury and government agencies	1			—				—			—					—			—			(1		)		—			—
Obligations of U.S. states and municipalities	744			(3		)		107			(70		)			(79		)	—			—				699			(3		)
Non-U.S. government debt securities	78			(19		)		395			(213		)			(2		)	18			(93		)		164			(18		)
Corporate debt securities	312			(6		)		297			(227		)			(15		)	249			(215		)		395			(1		)
Loans	2,719			58				1,223			(1,680		)			(528		)	422			(681		)		1,533			(22		)
Asset-backed securities	153			15				64			(29		)			(53		)	18			(92		)		76			8
Total debt instruments	4,385			53				2,486			(2,372		)			(752		)	887			(1,201		)		3,486			(30		)
Equity securities	295			(1		)		99			(108		)			(1		)	86			(41		)		329			11
Other	690			(209		)		47			(40		)			(75		)	3			(3		)		413			(250		)
Total trading assets – debt and equity instruments	5,370			(157		)	^(c)	2,632			(2,520		)			(828		)	976			(1,245		)		4,228			(269		)	^(c)
Net derivative receivables:^(a)
Interest rate	264			576				83			(77		)			(234		)	40			39				691			498
Credit	(35		)	19				3			(7		)			22			5			20				27			7
Foreign exchange	(396		)	184				42			(15		)			(46		)	(114		)	43				(302		)	42
Equity	(3,409		)	688				1,467			(1,919		)			1,043			(324		)	177				(2,277		)	31
Commodity	(674		)	468				—			—					(287		)	7			(39		)		(525		)	158
Total net derivative receivables	(4,250		)	1,935			^(c)	1,595			(2,018		)			498			(386		)	240				(2,386		)	736			^(c)
Available-for-sale securities:
Asset-backed securities	276			1				—			—					(216		)	—			—				61			1
Other	1			—				—			—					—			—			—				1			—
Total available-for-sale securities	277			1			^(d)	—			—					(216		)	—			—				62			1			^(d)
Loans	276			(5		)	^(c)	123			—					(180		)	—			(74		)		140			(5		)	^(c)
Mortgage servicing rights	6,030			576			^(e)	770			(401		)			(542		)	—			—				6,433			576			^(e)
Other assets	1,265			(210		)	^(c)	49			(16		)			(28		)	4			(1		)		1,063			(217		)	^(c)

	Fair value measurements using significant unobservable inputs
Nine months ended September 30, 2018 (in millions)	Fair value at January 1, 2018			Total realized/unrealized (gains)/losses															Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2018				Change in unrealized (gains)/ losses related to financial instruments held at September 30, 2018
								Purchases			Sales			Issuances		Settlements^(g)
Liabilities:^(b)
Deposits	$	4,142		$	(125	)	^(c)(i)	$	—		$	—		$	1,272	$	(425	)	$	2		$	(426	)		$	4,440		$	(115	)	^(c)(i)
Short-term borrowings	1,665			(229		)	^(c)(i)	—			—			2,783		(2,245		)	61			(64		)		1,971			26			^(c)(i)
Trading liabilities – debt and equity instruments	39			28			^(c)	(68		)	95			—		(1		)	9			(6		)		96			11			^(c)
Accounts payable and other liabilities	13			—				(6		)	1			—		—			4			—				12			—
Beneficial interests issued by consolidated VIEs	39			—				—			—			—		(38		)	—			—				1			—
Long-term debt	16,125			(396		)	^(c)(i)	—			—			10,382		(6,155		)	653			(571		)		20,038			(576		)	^(c)(i)



	Fair value measurements using significant unobservable inputs
Nine months ended September 30, 2017 (in millions)	Fair value at January 1, 2017			Total realized/unrealized gains/(losses)																Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2017					Change in unrealized gains/(losses) related to financial instruments held at September 30, 2017
								Purchases^(f)			Sales						Settlements^(g)
Assets:
Trading assets:
Debt instruments:
Mortgage-backed securities:
U.S. government agencies	$	392		$	(9	)		$	161		$	(166	)				$	(55	)	$	37		$	(37	)		$	323			$	(17	)
Residential – nonagency	83			14				40			(24		)				(21		)	111			(96		)		107				2
Commercial – nonagency	17			5				27			(38		)				(5		)	63			(42		)		27				1
Total mortgage-backed securities	492			10				228			(228		)				(81		)	211			(175		)		457				(14		)
U.S. Treasury and government agencies	—			—				—			—						—			1			—				1				—
Obligations of U.S. states and municipalities	649			15				126			(70		)				(5		)	—			—				715				15
Non-U.S. government debt securities	46			3				426			(395		)				—			50			(50		)		80				—
Corporate debt securities	576			—				690			(473		)				(398		)	128			(162		)		361				11
Loans	4,837			309				2,055			(2,565		)				(1,186		)	564			(807		)		3,207				73
Asset-backed securities	302			27				279			(178		)				(44		)	50			(165		)		271				2
Total debt instruments	6,902			364				3,804			(3,909		)				(1,714		)	1,004			(1,359		)		5,092				87
Equity securities	231			40				142			(87		)				—			18			(56		)		288				34
Other	761			85				27			(45		)				(137		)	10			(10		)		691				46
Total trading assets – debt and equity instruments	7,894			489			^(c)	3,973			(4,041		)				(1,851		)	1,032			(1,425		)		6,071				167			^(c)
Net derivative receivables:^(a)
Interest rate	1,263			182				53			(76		)				(833		)	55			20				664				(184		)
Credit	98			(126		)		1			(4		)				(64		)	57			2				(36		)		(57		)
Foreign exchange	(1,384		)	86				13			(6		)				633			(16		)	135				(539		)		(12		)
Equity	(2,252		)	24				840			(312		)				(660		)	(182		)	167				(2,375		)		76
Commodity	(85		)	(34		)		—			—						22			2			(5		)		(100		)		27
Total net derivative receivables	(2,360		)	132			^(c)	907			(398		)				(902		)	(84		)	319				(2,386		)		(150		)	^(c)
Available-for-sale securities:
Asset-backed securities	663			14				—			(50		)				(141		)	—			—				486				12
Other	1			—				—			—						—			—			—				1				—
Total available-for-sale securities	664			14			^(d)	—			(50		)				(141		)	—			—				487				12			^(d)
Loans	570			32			^(c)	—			(26		)				(299		)	—			—				277				8			^(c)
Mortgage servicing rights	6,096			(223		)	^(e)	624			(140		)				(619		)	—			—				5,738				(224		)	^(e)
Other assets	2,223			248			^(c)	35			(157		)				(478		)	—			—				1,871				126			^(c)

	Fair value measurements using significant unobservable inputs
Nine months ended September 30, 2017 (in millions)	Fair value at January 1, 2017			Total realized/unrealized (gains)/losses																Transfers into level 3^(h)			Transfers (out of) level 3^(h)			Fair value at September 30, 2017					Change in unrealized (gains)/ losses related to financial instruments held at September 30, 2017
								Purchases			Sales			Issuances			Settlements^(g)
Liabilities:^(b)
Deposits	$	2,117		$	39		^(c)	$	—		$	—		$	2,510		$	(169	)	$	—		$	(659	)		$	3,838			$	140		^(c)
Federal funds purchased and securities loaned or sold under repurchase agreements	—			—				—			—			—			—			1			—				1				—
Short-term borrowings	1,134			80			^(c)	—						2,208			(1,873		)	53			(131		)		1,471				50			^(c)
Trading liabilities – debt and equity instruments	43			1			^(c)	(31		)	32			—			1			3			(6		)		43				1			^(c)
Accounts payable and other liabilities	13			—				(1		)	—			—			(3		)	—			—				9				—
Beneficial interests issued by consolidated VIEs	48			3				(44		)	39			—			(6		)	78			—				118				—
Long-term debt	12,850			918			^(c)(j)	—			—			9,756		^(j)	(8,637		)	269			(662		)		14,494			^(j)	996			^(c)(j)


(a)	All level 3 derivatives are presented on a net basis, irrespective of the underlying counterparty.


(b)	Level 3 liabilities as a percentage of total Firm liabilities accounted for at fair value (including liabilities measured at fair value on a nonrecurring basis) were 15% at both September 30, 2018 and December 31, 2017, respectively.


(c)	Predominantly reported in principal transactions revenue, except for changes in fair ~~value. For a further discussion of~~value for CCB mortgage loans and lending-related commitments originated with the ~~Firm’s~~intent to sell, and mortgage loan purchase commitments, which are reported in mortgage fees and related income.

(d)

Realized gains/(losses) on AFS securities, as well as other-than-temporary impairment (“OTTI”) losses that are recorded in earnings, are reported in investment securities losses. Unrealized gains/(losses) are reported in OCI. There were no realized gains/(losses) or foreign exchange hedge accounting ~~relationships, see Note 4. To provide consistent fair value disclosure information, all physical commodities inventories have been included~~adjustments recorded in ~~each period presented.~~


~~(d)~~	~~Balances reflect the reduction of securities owned (long positions) by the amount of identical securities sold but not yet purchased (short positions).~~

~~(e)~~

As permitted under U.S. GAAP, the Firm has elected to net derivative receivables and derivative payables and the related cash collateral received and paid when a legally enforceable master netting agreement exists. For purposes of the tables above, the Firm does not reduce derivative receivables and derivative payables balancesincome on AFS securities for the three and nine months ended September 30, 2018 and 2017, respectively. Unrealized gains/(losses) recorded on AFS securities in OCI were zero and $2 million for this netting adjustment, either within or across the levels of the fair value hierarchy, as such netting is not relevant to a presentation based on the transparency of inputs to the valuation of an asset or liability. The level 3 balances would be reduced if netting were applied, including the netting benefit associated with cash collateral.


~~(f)~~	~~Reflects the Firm’s adoption of rulebook changes made by two CCPs that require or allow the Firm to treat certain OTC-cleared derivative transactions as daily settled. For~~

~~further information, see Note 5 of JPMorgan Chase's 2017 Annual Report.~~

~~(g)~~

Certain investments that are measured at fair value using the net asset value per share (or its equivalent) as a practical expedient are not required to be classified in the fair value hierarchy. At March 31, 2018, and December 31, 2017, the fair values of these investments, which include certain hedge funds, private equity funds, real estate and other funds, were $796 million and $779 million, respectively. Included in these balances at March 31, 2018, and December 31, 2017, were trading assets of $51 million and $54 million, respectively, and other assets of $745 million and $725 million, respectively.


~~(h)~~	~~Effective January 1, 2018, the Firm adopted the recognition and measurement guidance. Equity securities that were previously reported as AFS securities were reclassified to other assets upon adoption.~~

~~Transfers between levels for instruments carried at fair~~

~~value on a recurring basis~~

~~For~~ the three months ended ~~March 31,~~September 30, 2018 and 2017, ~~there were no individually significant transfers.~~

respectively and $1 million and $14 million for the nine months ended September 30, 2018 and 2017, respectively.


(e)	Changes in fair value for CCB MSRs are reported in mortgage fees and related income.


(f)	Loan originations are included in purchases.


(g)	Includes financial assets and liabilities that have matured, been partially or fully repaid, impacts of modifications, deconsolidation associated with beneficial interests in VIEs and other items.


(h)	All transfers into and/or out of level 3 are based on changes in the observability of the valuation inputs and are assumed to occur at the beginning of the quarterly reporting period in which they occur. ~~Level 3 valuations~~ ~~For further information on the Firm’s valuation process and a detailed discussion of the determination of~~

(i)

Realized (gains)/losses due to DVA for fair value ~~for individual financial instruments, see Note~~ 2 ~~of JPMorgan Chase’s 2017 Annual Report.~~

The following table presents the Firm’s primary level 3 financial instruments, the valuation techniques used to measure the fair value of those financial instruments, the significant unobservable inputs, the range of values for those inputs and, for certain instruments, the weighted averages of such inputs. While the determination to classify an instrument within level 3 is based on the significance of the unobservable inputs to the overall fair value measurement, level 3 financial instruments typically include observable components (that is, components thatoption elected liabilities are ~~actively quoted and can be validated to external sources)~~reported in ~~addition to the unobservable components. The level 1 and/or level 2 inputs~~principal transactions revenue. Unrealized (gains)/losses are ~~not included~~reported in the table. In addition, the Firm manages the risk of the observable components of level 3 financial instruments using securities and derivative positions that are classified within levels 1 or 2 of the fair value hierarchy.

~~For the Firm’s~~ ~~derivatives and structured notes positions classified within level 3 at March 31, 2018, interest rate correlation inputs used in estimating fair value~~OCI. Unrealized (gains)/losses were concentrated towards the upper end of the range; equity correlation, equity-FX, and equity-IR correlation inputs were concentrated in the middle of the range; commodity correlation inputs were concentrated in the middle of the range; credit correlation inputs were concentrated towards the lower end of the range; and the interest rate-foreign exchange (“IR-FX”) correlation inputs were concentrated towards the lower end of the range. In addition, the interest rate spread volatility inputs used in estimating fair value were distributed across the range; equity volatilities and commodity volatilities were concentrated towards the lower end of the range; and forward commodity prices used in estimating the fair value of commodity derivatives were concentrated towards the lower end of the range. Recovery rate, yield and prepayment speed inputs used in estimating fair value of credit derivatives were distributed across the range; credit spreads and conditional default rates were concentrated towards the lower end of the range; loss severity and price inputs were concentrated towards the upper end of the range.

Level 3 inputs^(a)

March 31, 2018
Product/Instrument
Fair value
(in millions)
Principal valuation technique
Unobservable inputs^(g)
Range of input values Weighted average
Residential mortgage-backed securities and loans^(b)
$ 1,122
Discounted cash flows Yield 1 % – 32 % 7 %
Prepayment speed 0 % – 27 % 8 %
Conditional default rate 0 % – 41 % 1 %
Loss severity 0 % – 60 % 3 %
Commercial mortgage-backed securities and loans^(c)
766
Market comparables Price $ 12
– $ 100
$ 94
Obligations of U.S. states and municipalities 704
Market comparables Price $ 59
– $ 100
$ 98
Corporate debt securities 306
Market comparables Price $ 3
– $ 110
$ 83
Loans^(d)
1,454
Market comparables Price $ 4
– $ 106
$ 86
Asset-backed securities 204
Discounted cash flows Credit spread 201 bps 201 bps
Prepayment speed 20 % 20 %
Conditional default rate 2 % 2 %
Loss severity 30 % 30 %
63
Market comparables Price $ 1
– $ 104
$ 80
Net interest rate derivatives 257
Option pricing Interest rate spread volatility 27 bps – 38 bps
Interest rate correlation (50 )% – 98 %
IR-FX correlation 60 % – 70 %
215
Discounted cash flows Prepayment speed 0 % – 30 %
Net credit derivatives 1
Discounted cash flows Credit correlation 35 % – 70 %
Credit spread 5 bps – 1,463 bps ��
Recovery rate 20 % – 70 %
Yield 1 % – 36 %
Prepayment speed 3 % – 20 %
Conditional default rate 1 % – 86 %
Loss severity 11 % – 100 %
4
Market comparables Price $ 10
– $ 98

Net foreign exchange derivatives (106 ) Option pricing IR-FX correlation (50 )% – 70 %
(182 ) Discounted cash flows Prepayment speed 8 % – 9 %
Net equity derivatives (2,512 ) Option pricing Equity volatility 20 % – 60 %
Equity correlation 0 % – 85 %
Equity-FX correlation (70 )% – 30 %
Equity-IR correlation 20 % – 40 %
Net commodity derivatives (519 ) Option pricing Forward commodity price $ 52
– $ 71 per barrel
Commodity volatility 5 % – 45 %
Commodity correlation (52 )% – 88 %
MSRs 6,202
Discounted cash flows Refer to Note 14
Other assets 417
Discounted cash flows Credit spread 70 bps 70 bps
Yield 8 % – 10 % 8 %
1,501
Market comparables Price $ 70
– $ 71
$ 71

EBITDA multiple

4.1x
– 8.2x
7.8 x
Long-term debt, short-term borrowings, and deposits^(e)
23,092
Option pricing Interest rate spread volatility 27 bps – 38 bps
Interest rate correlation (50 )% – 98 %
IR-FX correlation (50 )% – 70 %
Equity correlation 0 % – 85 %
Equity-FX correlation (70 )% – 30 %
Equity-IR correlation 20 % – 40 %
Other level 3 assets and liabilities, net^(f)
439


~~(a)~~	The categories presented in the table have been aggregated based upon the product type, which may differ from their classification on the Consolidated balance sheets. Furthermore, the inputs presented for each valuation technique in the table are, in some cases, not applicable to every instrument valued using the technique as the characteristics of the instruments can differ.


~~(b)~~	~~Includes U.S. government agency securities of $504~~$123 million ~~nonagency securities of $56 million and trading loans of $562 million.~~


~~(c)~~	~~Includes U.S. government agency securities of $4 million, nonagency securities of $14 million, trading loans of $352 million and non-trading loans of $396 million.~~


~~(d)~~	~~Includes trading loans of $1.5 billion.~~


~~(e)~~	Long-term debt, short-term borrowings and deposits include structured notes issued by the Firm that are predominantly financial instruments containing embedded derivatives. The estimation of the fair value of structured notes includes the derivative features embedded within the instrument. The significant unobservable inputs are broadly consistent with those presented for derivative receivables.


~~(f)~~	~~Includes level 3 assets and liabilities that are insignificant both individually and in aggregate.~~


~~(g)~~	Price is a significant unobservable input for certain instruments. When quoted market prices are not readily available, reliance is generally placed on price-based internal valuation techniques. The price input is expressed assuming a par value of $100.

~~Changes in and ranges of unobservable inputs~~

For a discussion of the impact on fair value of changes in unobservable inputs and the relationships between unobservable inputs as well as a description of attributes of the underlying instruments and external market factors that affect the range of inputs used in the valuation of the Firm’s positions see Note 2 of JPMorgan Chase’s 2017 Annual Report.

~~Changes in level 3 recurring fair value measurements~~

The following tables include a rollforward of the Consolidated balance sheets amounts (including changes in fair value) for financial instruments classified by the Firm within level 3 of the fair value hierarchy for the three months ended ~~March 31,~~September 30, 2018 and ~~2017. When a determination is made to classify a financial instrument within level 3,~~unrealized (gains)/losses were not material for the ~~determination is based on~~nine months ended September 30, 2018. There were no material realized (gains)/losses for the ~~significance of the unobservable parameters to the overall~~

fair value measurement. However, level 3 financial instruments typically include, in addition to the unobservable or level 3 components, observable components (that is, components that are actively quotedthree and can be validated to external sources); accordingly, the gains and losses in the table below include changes in fair value due in part to observable factors that are part of the valuation methodology. Also, the Firm risk-manages the observable components of level 3 financial instruments using securities and derivative positions that are classified within level 1 or 2 of the fair value hierarchy; as these level 1 and level 2 risk management instruments are not included below, the gains or losses in the following tables do not reflect the effect of the Firm’s risk management activities related to such level 3 instruments.

Fair value measurements using significant unobservable inputs
Three months ended
March 31, 2018
(in millions) Fair
value at
Jan 1, 2018 Total realized/unrealized gains/(losses)
Transfers into
level 3^(h)
Transfers (out of) level 3^(h)
Fair value at
March 31, 2018 Change in unrealized gains/(losses) related
to financial instruments held at March 31, 2018
Purchases^(f)
Sales
Settlements^(g)
Assets:
Trading assets:
Debt instruments:
Mortgage-backed securities:
U.S. government agencies $ 307
$ 3
$ 329
$ (87 ) $ (20 ) $ 4
$ (28 ) $ 508
$ 1

Residential – nonagency 60
(2 ) —
(2 ) (2 ) 29
(28 ) 55
—

Commercial – nonagency 11
1
6
(7 ) (1 ) 4
—
14
—

Total mortgage-backed securities 378
2
335
(96 ) (23 ) 37
(56 ) 577
1

U.S. Treasury and government agencies

1
—
—
—
—
—
(1 ) —
—

Obligations of U.S. states and municipalities 744
(2 ) 39
—
(77 ) —
—
704
(2 )
Non-U.S. government debt securities 78
2
225
(92 ) —
17
(33 ) 197
3

Corporate debt securities 312
(1 ) 81
(100 ) (1 ) 131
(116 ) 306
(1 )
Loans 2,719
62
470
(728 ) (137 ) 123
(141 ) 2,368
30

Asset-backed securities 153
5
14
(13 ) (34 ) 11
(73 ) 63
—

Total debt instruments 4,385
68
1,164
(1,029 ) (272 ) 319
(420 ) 4,215
31

Equity securities 295
(8 ) 28
(10 ) —
4
(9 ) 300
(7 )
Other 690
15
18
(6 ) (20 ) 1
—
698
15

Total trading assets – debt and equity instruments 5,370
75
^(c)
1,210
(1,045 ) (292 ) 324
(429 ) 5,213
39
^(c)
Net derivative receivables:^(a)

Interest rate 264
53
17
(4 ) 46
26
70
472
131

Credit (35 ) 17
1
(2 ) 4
3
17
5
11

Foreign exchange (396 ) 146
—
(5 ) 11
(38 ) (6 ) (288 ) 156

Equity (3,409 ) 639
218
(242 ) 434
(111 ) (41 ) (2,512 ) 448

Commodity (674 ) 185
—
—
12
1
(43 ) (519 ) 227

Total net derivative receivables (4,250 ) 1,040
^(c)
236
(253 ) 507
(119 ) (3 ) (2,842 ) 973
^(c)
Available-for-sale securities:
Asset-backed securities 276
1
—
—
(73 ) —
—
204
1

Other 1
—
—
—
—
—
—
1
—

Total available-for-sale securities 277
1
^(d)
—
—
(73 ) —
—
205
1
^(d)
Loans 276
5
^(c)
122
—
(7 ) —
—
396
5
^(c)
Mortgage servicing rights 6,030
384
^(e)
243
(295 ) (160 ) —
—
6,202
384
^(e)
Other assets 1,265
(37 )
^(c)
23
(14 ) (16 ) —
(1 ) 1,220
(38 )
^(c)

Fair value measurements using significant unobservable inputs
Three months ended
March 31, 2018
(in millions) Fair
value at
Jan 1, 2018 Total realized/unrealized (gains)/losses
Transfers into
level 3^(h)
Transfers (out of) level 3^(h)
Fair value at
March 31, 2018 Change in unrealized (gains)/
losses related
to financial instruments held at March 31, 2018
Purchases Sales Issuances
Settlements^(g)
Liabilities:^(b)

Deposits $ 4,142
$ (90 )
^(c)(i)
$ —
$ —
$ 321
$ (198 ) $ —
$ (158 ) $ 4,017
$ (125 )
^(c)(i)
Federal funds purchased and securities loaned or sold under repurchase agreements —
—
—
—
—
—
—
—
—
—

Short-term borrowings 1,665
15
^(c)(i)
—
—
1,208
(746 ) 12
(29 ) 2,125
43
^(c)(i)
Trading liabilities – debt and equity instruments 39
3
^(c)
(37 ) 43
—
1
2
(1 ) 50
5
^(c)
Accounts payable and other liabilities 13
—
(6 ) —
—
—
—
—
7
—

Beneficial interests issued by consolidated VIEs 39
—

—
—
—
(38 ) —
—
1
—

Long-term debt 16,125
(246 )
^(c)(i)
—
—
3,091
(2,263 ) 375
(132 ) 16,950
(354 )
^(c)(i)

Fair value measurements using significant unobservable inputs

Three months ended
March 31, 2017
(in millions) Fair
value
at Jan 1, 2017 Total realized/unrealized gains/(losses)

Transfers into
level 3^(h)
Transfers (out of) level 3^(h)
Fair value at
March 31, 2017 Change in unrealized gains/(losses) related
to financial instruments held at March 31, 2017
Purchases^(f)
Sales

Settlements^(g)
Assets:

Trading assets:

Debt instruments:

Mortgage-backed securities:

U.S. government agencies $ 392
$ 4

$ 79
$ (97 )
$ (16 ) $ 7
$ (16 )
$ 353

$ (1 )
Residential – nonagency 83
9

5
(17 )
(4 ) 15
(56 )
35

1

Commercial – nonagency 17
3

7
(8 )
(3 ) 30
(1 )
45

(1 )
Total mortgage-backed securities 492
16

91
(122 )
(23 ) 52
(73 )
433

(1 )
Obligations of U.S. states and municipalities 649
8

85
(69 )
(5 ) —
—

668

8

Non-U.S. government debt securities 46
—

72
(83 )
—
26
(14 )
47

—

Corporate debt securities 576
(9 )
423
(108 )
(122 ) 33
(55 )
738

(9 )
Loans 4,837
110

762
(744 )
(375 ) 196
(198 )
4,588

61

Asset-backed securities 302
14

98
(138 )
(11 ) 8
(28 )
245

5

Total debt instruments 6,902
139

1,531
(1,264 )
(536 ) 315
(368 )
6,719

64

Equity securities 231
13

56
(6 )
—
1
(24 )
271

12

Other 761
22

19
—

(47 ) 8
—

763

31

Total trading assets – debt and equity instruments 7,894
174
^(c)
1,606
(1,270 )
(583 ) 324
(392 )
7,753

107
^(c)
Net derivative receivables:^(a)

Interest rate 1,263
44

16
(23 )
(303 ) 4
8

1,009

6

Credit 98
(46 )
—
(2 )
(42 ) 11
(2 )
17

(43 )
Foreign exchange (1,384 ) (24 )
—
(2 )
(91 ) 11
—

(1,490 )
(18 )
Equity (2,252 ) 69

336
(45 )
(24 ) (73 ) 93

(1,896 )
(89 )
Commodity (85 ) 18

—
—

2
6
3

(56 )
26

Total net derivative receivables (2,360 ) 61
^(c)
352
(72 )
(458 ) (41 ) 102

(2,416 )
(118 )
^(c)
Available-for-sale securities:

Asset-backed securities 663
10

—
(50 )
(1 ) —
—

622

8

Other 1
—

—
—

—
—
—

1

—

Total available-for-sale securities 664
10
^(d)
—
(50 )
(1 ) —
—

623

8
^(d)
Loans 570
6
^(c)
—
—

(172 ) —
—

404

6
^(c)
Mortgage servicing rights 6,096
43
^(e)
217
(71 )
(206 ) —
—

6,079

43
^(e)
Other assets 2,223
37
^(c)
3
(77 ) (109 ) —
—
2,077
33
^(c)

Fair value measurements using significant unobservable inputs

Three months ended
March 31, 2017
(in millions)
Fair
value
at Jan 1, 2017
Total realized/unrealized (gains)/losses

Transfers into
level 3^(h)
Transfers (out of) level 3^(h)
Fair value at
March 31, 2017 Change in unrealized (gains)/losses related
to financial instruments held at March 31, 2017
Purchases Sales Issuances
Settlements^(g)
Liabilities:^(b)

Deposits $ 2,117
$ (24 )
^(c)
$ —
$ —
$ 309
$ (80 ) $ —
$ (189 )
$ 2,133

$ (25 )
^(c)
Federal funds purchased and securities loaned or sold under repurchase agreements —
—
—
—
—
—
—
—
—
—

Short-term borrowings 1,134
1
^(c)
—
—
707
(585 ) 17
(13 )
1,261

2
^(c)
Trading liabilities – debt and equity instruments 43
—

(1 ) 2
—
1
2
(2 )
45

—

Accounts payable and other liabilities 13
—

—
—
—
(2 ) —
—

11

—

Beneficial interests issued by consolidated VIEs 48
3
^(c)
—
—
—
—
—
—

51

3
^(c)
Long-term debt 12,850
529
^(c)(j)
—
—
3,792
^(j)
(2,811 ) 35
(301 )
14,094
^(j)
524
^(c)(j)


~~(a)~~	~~All level 3 derivatives are presented on a net basis, irrespective of the underlying counterparty.~~


~~(b)~~	~~Level 3 liabilities as a percentage of total Firm liabilities accounted for at fair value (including liabilities measured at fair value on a nonrecurring basis) were 14% and 15% at March 31,~~nine months ended September 30, 2018, ~~and December 31, 2017,~~ respectively.


~~(c)~~	Predominantly reported in principal transactions revenue, except for changes in fair value for CCB mortgage loans and lending-related commitments originated with the intent to sell, and mortgage loan purchase commitments, which are reported in mortgage fees and related income.

~~(d)~~

Realized gains/(losses) on AFS securities, as well as other-than-temporary impairment (“OTTI”) losses that are recorded in earnings, are reported in investment securities losses. Unrealized gains/(losses) are reported in OCI. There were no realized gains/(losses) or foreign exchange hedge accounting adjustments recorded in income on AFS securities for the three months ended March 31, 2018 and 2017, respectively. Unrealized gains/(losses) recorded on AFS securities in OCI were $1 million and $10 million for the three months ended March 31, 2018 and 2017, respectively.


~~(e)~~	~~Changes in fair value for CCB MSRs are reported in mortgage fees and related income.~~


~~(f)~~	~~Loan originations are included in purchases.~~


~~(g)~~	~~Includes financial assets and liabilities that have matured, been partially or fully repaid, impacts of modifications, deconsolidation associated with beneficial interests in VIEs and other items.~~


~~(h)~~	All transfers into and/or out of level 3 are based on changes in the observability of the valuation inputs and are assumed to occur at the beginning of the quarterly reporting period in which they occur.


~~(i)~~	Realized (gains)/losses due to DVA for fair value option elected liabilities are reported in principal transactions revenue. Unrealized (gains)/losses are reported in OCI. Unrealized losses were $52 million for the three months ended March 31, 2018. There were no realized gains for three months ended March 31, 2018.


(j)	The prior period amounts have been revised to conform with the current period presentation.

Level 3 analysis

Consolidated balance sheets changes

Level 3 assets (including assets measured at fair value on a nonrecurring basis) were 0.8% of total Firm assets at September 30, 2018. The following describes significant changes to level 3 assets since December 31, 2017, for those items measured at fair value on a recurring basis. For further information on changes impacting items measured at fair value on a nonrecurring basis, refer to Assets and liabilities measured at fair value on a nonrecurring basis onpage 105.

Three months ended September 30, 2018

Level 3 assets were $19.0 billion at September 30, 2018, reflecting a decrease of $272 million from June 30, 2018 with no movements that were individually significant.

Nine months ended September 30, 2018

Level 3 assets at September 30, 2018 decreased by $185 million from December 31, 2017 with no movements that were individually significant.

Gains and losses

The following describes significant components of total realized/unrealized gains/(losses) for instruments measured at fair value on a recurring basis for the periods indicated. For further information on these instruments, refer to Changes in level 3 recurring fair value measurements rollforward tables onpages 99–104.

Three months ended September 30, 2018

$394 million of net gains on assets and $100 million of net gains on liabilities, none of which were individually significant.

Three months ended September 30, 2017

$186 million of net gains on assets and $387 million of net losses on liabilities, none of which were individually significant.

Nine months ended September 30, 2018

$2.1 billion of net gains on assets predominantly driven by market movements in derivative receivables.

$722 million of net gains on liabilities, none of which were individually significant.

Nine months ended September 30, 2017

$692 million of of net gains on assets and $1.0 billion of net losses on liabilities, none of which were individually significant.

Credit and funding adjustments — derivatives

The following table provides the impact of credit and funding adjustments on principal transactions revenue in the respective periods, excluding the effect of any associated hedging activities. The FVA presented below includes the impact of the Firm’s own credit quality on the inception value of liabilities as well as the impact of changes in the Firm’s own credit quality over time.



	Three months ended September 30,					Nine months ended September 30,
(in millions)	2018		2017			2018		2017
Credit and funding adjustments:
Derivatives CVA	$	66	$	245		$	223	$	715
Derivatives FVA	88		(222		)	102		(289		)

For further information about both credit and funding adjustments, as well as information about valuation adjustments on fair value option elected liabilities, refer to Note 2 of JPMorgan Chase’s 2017 Annual Report.

Assets and liabilities measured at fair value on a nonrecurring basis

The following tables present the assets still held as of September 30, 2018 and 2017, respectively, for which a nonrecurring fair value adjustment was recorded during the nine months ended September 30, 2018 and 2017, respectively, by major product category and fair value hierarchy.



	Fair value hierarchy							Total fair value
September 30, 2018 (in millions)	Level 1		Level 2		Level 3			Total fair value
Loans	$	—	$	492	$	243	^(a)	$	735
Other assets^(b)	—		216		826			1,042
Total assets measured at fair value on a nonrecurring basis	$	—	$	708	$	1,069		$	1,777



	Fair value hierarchy						Total fair value
September 30, 2017 (in millions)	Level 1		Level 2		Level 3		Total fair value
Loans	$	—	$	338	$	542	$	880
Other assets	—		7		245		252
Total assets measured at fair value on a nonrecurring basis	$	—	$	345	$	787	$	1,132

(a)

Of the $243 million in level 3 assets measured at fair value on a nonrecurring ~~basis) were 0.8%~~basis as of ~~total Firm assets~~September 30, 2018, $200 million related to residential real estate loans carried at ~~March 31, 2018. The following describes significant changes to~~the net realizable value of the underlying collateral (e.g., collateral-dependent loans and other loans charged off in accordance with regulatory guidance). These amounts are classified as level 3 ~~assets since December 31, 2017, for those items measured at fair value on~~as they are valued using a ~~recurring basis. For further information on changes impacting items measured at fair value on a nonrecurring basis, see Assets~~broker’s price opinion and ~~liabilities measured at fair value on a nonrecurring basis on page 90.~~

~~Three months ended March 31, 2018~~

~~Level 3 assets were $19.5 billion at March 31, 2018, reflecting an increase of $267 million from December 31, 2017 with no movements that were individually significant.~~

~~Gains and losses~~

The following describes significant components of total realized/unrealized gains/(losses) for instruments measured at fair value on a recurring basis for the periods indicated. For further information on these instruments, see Changes in level 3 recurring fair value measurements rollforward tables on pages 86–89.

~~Three months ended March 31, 2018~~

~~$1.5 billion of net gains on assets and $318 million of net gains on liabilities, none of which were individually significant.~~

~~Three months ended March 31, 2017~~

~~$331 million of net gains on assets and $509 million of net losses on liabilities, none of which were individually significant.~~

~~Credit and funding adjustments — derivatives~~

The following table provides the impact of credit and funding adjustments on principal transactions revenue in the respective periods, excluding the effect of any associated hedging activities. The FVA presented below includes the impact ofdiscounted based upon the Firm’s ~~own credit quality on~~experience with actual liquidation values. These discounts to the ~~inception value~~broker price opinions ranged from 13% to 40% with a weighted average of ~~liabilities as well as the impact of changes in the Firm’s own credit quality over time.~~

Three months ended March 31, 2017
(in millions) 2018
2017
Credit and funding adjustments:
Derivatives CVA $ 84
$ 221
Derivatives FVA (83 ) (7 )

For further information about both credit and funding adjustments, as well as information about valuation adjustments on fair value option elected liabilities, see Note 2 of JPMorgan Chase’s 2017 Annual Report.

~~Assets and liabilities measured at fair value on a nonrecurring basis~~

The following tables present the assets still held as of the reporting date for which a nonrecurring fair value adjustment was recorded during the three months ended 2018 and 2017, respectively, by major product category and fair value hierarchy.

Fair value hierarchy Total fair value
March 31, 2018 (in millions) Level 1
Level 2
Level 3

Loans $ —
$ 690

$ 165
^(a)
$ 855
Other assets^(b)
—
236
572
808
Total assets measured at fair value on a nonrecurring basis $ —
$ 926
$ 737

$ 1,663

Fair value hierarchy Total fair value
March 31, 2017 (in millions) Level 1
Level 2
Level 3

Loans $ —
$ 6,530
$ 221
$ 6,751
Other assets —
4
243
247
Total assets measured at fair value on a nonrecurring basis $ —
$ 6,534
$ 464
$ 6,998

~~(a)~~

Of the $165 million in level 3 assets measured at fair value on a nonrecurring basis as of March 31, 2018, $89 million related to residential real estate loans carried at the net realizable value of the underlying collateral (e.g., collateral-dependent loans and other loans charged off in accordance with regulatory guidance). These amounts are classified as level 3 as they are valued using a broker’s price opinion and discounted based upon the Firm’s experience with actual liquidation values. These discounts to the broker price opinions ranged from 13% to 38% with a weighted average of 21%22%.

(b)

Primarily includes equity securities without readily determinable fair values that were adjusted based on observable price changes in orderly transactions from an identical or similar investment of the same issuer (measurement alternative) as a result of the adoption of the recognition and measurement guidance. Of the $572 million in level 3 assets measured at fair value on a nonrecurring basis as of March 31, 2018, $406 million related to such equity securities. These equity securities are classified as level 3 due to the infrequency of the observable prices and/or the restrictions on the shares.

~~There were no material liabilities measured at fair value on a nonrecurring basis at March 31, 2018 and March 31, 2017.~~

~~Nonrecurring fair value changes~~

The following table presents the total change in value of assets and liabilities for which a fair value adjustment has been recognized for the three months ended March 31, 2018 and 2017, related to financial instruments held at those dates.

Three months ended
March 31,
2018
2017
Loans $ (15 ) $ (322 )
Other assets 496
^(a)
(31 )
Total nonrecurring fair value gains/(losses) $ 481
$ (353 )


~~(a)~~	~~Included $505 million of fair value gains as a result of the measurement alternative. For additional information, see Note 1.~~

For further information about the measurement of impaired collateral-dependent loans, and other loans where the carrying value is based on the fair value of the underlying collateral (e.g., residential mortgage loans charged off in accordance with regulatory guidance), see Note 12 of JPMorgan Chase’s 2017 Annual Report.

~~Additional disclosures about the fair value of financial instruments that are not carried on the Consolidated balance sheets at fair value~~

The following table presents by fair value hierarchy classification the carrying values and estimated fair values at March 31, 2018, and December 31, 2017, of financial assets and liabilities, excluding financial instruments that are carried at fair value on a recurring basis, and their classification within the fair value hierarchy. For additional information regarding the financial instruments within the scope of this disclosure, and the methods and significant assumptions used to estimate their fair value,~~see Note 2 of JPMorgan Chase’s 2017 Annual Report.~~

March 31, 2018 December 31, 2017
Estimated fair value hierarchy Estimated fair value hierarchy
(in billions)
Carrying
value
Level 1 Level 2 Level 3
Total estimated
fair value

Carrying
value
Level 1 Level 2 Level 3
Total estimated
fair value
Financial assets
Cash and due from banks $ 24.8
$ 24.8
$ —
$ —
$ 24.8
$ 25.9
$ 25.9
$ —
$ —
$ 25.9
Deposits with banks 390.0
387.0
3.0
—
390.0
405.4
401.8
3.6
—
405.4
Accrued interest and accounts receivable 72.0
—
71.9
0.1
72.0
67.0
—
67.0
—
67.0
Federal funds sold and securities purchased under resale agreements 234.1
—
234.1
—
234.1
183.7
—
183.7
—
183.7
Securities borrowed 113.1
—
113.1
—
113.1
102.1
—
102.1
—
102.1
Securities, held-to-maturity 29.0
—
29.1
—
29.1
47.7
—
48.7
—
48.7
Loans, net of allowance for loan losses^(a)
918.1
—
217.0
703.5
920.5
914.6
—
213.2
707.1
920.3
Other^(b)
55.5
—
54.6
1.0
55.6
53.9
—
52.1
9.2
61.3
Financial liabilities
Deposits $ 1,466.8
$ —
$ 1,466.9
$ —
$ 1,466.9
$ 1,422.7
$ —
$ 1,422.7
$ —
$ 1,422.7
Federal funds purchased and securities loaned or sold under repurchase agreements 178.4
—
178.4
—
178.4
158.2
—
158.2
—
158.2
Short-term borrowings 53.9
—
53.6
0.2
53.8
42.6
—
42.4
0.2
42.6
Accounts payable and other liabilities 156.1
—
153.4
2.7
156.1
152.0
—
148.9
2.9
151.8
Beneficial interests issued by consolidated VIEs 21.6
—
21.6
—
21.6
26.0
—
26.0
—
26.0
Long-term debt and junior subordinated deferrable interest debentures 225.3
—
227.1
3.1
230.2
236.6
—
240.3
3.2
243.5

~~(a)~~

Fair value is typically estimated using a discounted cash flow model that incorporates the characteristics of the underlying loans (including principal, contractual interest rate and contractual fees) and other key inputs, including expected lifetime credit losses, interest rates, prepayment rates, and primary origination or secondary market spreads. For certain loans, the fair value is measured based on the value of the underlying collateral. The difference between the estimated fair value and carrying value of a financial asset or liability is the result of the different methodologies used to determine fair value as compared with carrying value. For example, credit losses are estimated for a financial asset’s remaining life in a fair value calculation but are estimated for a loss emergence period in the allowance for loan loss calculation; future loan income (interest and fees) is incorporated in a fair value calculation but is generally not considered in the allowance for loan losses. For a further discussion of the Firm’s methodologies for estimating the fair value of loans and lending-related commitments, see Valuation hierarchy on pages 156–159 of JPMorgan Chase’s 2017 Annual Report.


~~(b)~~	~~The prior period amounts have been revised to conform with the current period presentation.~~

The majority of the Firm’s lending-related commitments are not carried at fair value on a recurring basis on the Consolidated balance sheets. The carrying value of the wholesale allowance for lending-related commitments and the estimated fair value of these wholesale lending-related commitments were as follows for the periods indicated.

March 31, 2018 December 31, 2017
Estimated fair value hierarchy Estimated fair value hierarchy
(in billions)
Carrying value^(a)
Level 1 Level 2 Level 3 Total estimated fair value
Carrying value^(a)
Level 1 Level 2 Level 3 Total estimated fair value
Wholesale lending-related commitments $ 1.1
$ —
$ —
$ 1.5
$ 1.5
$ 1.1
$ —
$ —
$ 1.6
$ 1.6


~~(a)~~	~~Excludes the current carrying values of the guarantee liability and the offsetting asset, each of which is recognized at fair value at the inception of the guarantees.~~

The Firm does not estimate the fair value of consumer lending-related commitments. In many cases, the Firm can reduce or cancel these commitments by providing the borrower notice or, in some cases as permitted by law, without notice. For a further discussion of the valuation of lending-related commitments, see page 157 of JPMorgan Chase’s 2017 Annual Report.

~~Equity securities without readily determinable fair values~~

As a result of the adoption of the recognition and measurement ~~guidance~~guidance. Of the $826 million in level 3 assets measured at fair value on a nonrecurring basis as of September 30, 2018, $724 million related to such equity securities. These equity securities are classified as level 3 due to the infrequency of the observable prices and/or the restrictions on the shares.

There were no material liabilities measured at fair value on a nonrecurring basis at September 30, 2018 and at September 30, 2017.

Nonrecurring fair value changes

The following table presents the total change in value of assets and liabilities for which a fair value adjustment has been recognized for the three and nine months ended September 30, 2018 and 2017, related to financial instruments held at those dates.



	Three months ended September 30,							Nine months ended September 30,
(in millions)	2018				2017			2018				2017
Loans	$	(22	)		$	(52	)	$	(36	)		$	(157	)
Other assets	(117		)	^(a)	(11		)	383			^(a)	(44		)
Accounts payable and other liabilities	—				—			—				(1		)
Total nonrecurring fair value gains/(losses)	$	(139	)		$	(63	)	$	347			$	(202	)


(a)	Included $(113) million and $384 million for the ~~election~~three months and nine months ended September 30, 2018, respectively, of fair value gains/(losses) as a result of the measurement ~~alternative,~~alternative.

For further information about the measurement of impaired collateral-dependent loans, and other loans where the carrying value is based on the fair value of the underlying collateral (e.g., residential mortgage loans charged off in accordance with regulatory guidance), refer to Note 12 of JPMorgan Chase’s 2017 Annual Report.

Additional disclosures about the fair value of financial instruments that are not carried on the Consolidated balance sheets at fair value

The following table presents by fair value hierarchy classification the carrying values and estimated fair values at September 30, 2018, and December 31, 2017, of financial assets and liabilities, excluding financial instruments that are carried at fair value on a recurring basis, and their classification within the fair value hierarchy. For additional information regarding the financial instruments within the scope of this disclosure, and the methods and significant assumptions used to estimate their fair value, refer to Note2 of JPMorgan Chase’s 2017 Annual Report.



	September 30, 2018										December 31, 2017
			Estimated fair value hierarchy										Estimated fair value hierarchy
(in billions)	Carrying value		Level 1		Level 2		Level 3		Total estimated fair value		Carrying value		Level 1		Level 2		Level 3		Total estimated fair value
Financial assets
Cash and due from banks	$	23.2	$	23.2	$	—	$	—	$	23.2	$	25.9	$	25.9	$	—	$	—	$	25.9
Deposits with banks	395.9		392.2		3.7		—		395.9		405.4		401.8		3.6		—		405.4
Accrued interest and accounts receivable	77.7		—		77.6		0.1		77.7		67.0		—		67.0		—		67.0
Federal funds sold and securities purchased under resale agreements	205.4		—		205.4		—		205.4		183.7		—		183.7		—		183.7
Securities borrowed	117.9		—		117.9		—		117.9		102.1		—		102.1		—		102.1
Securities, held-to-maturity	31.4		—		30.9		—		30.9		47.7		—		48.7		—		48.7
Loans, net of allowance for loan losses^(a)	938.2		—		227.3		710.0		937.3		914.6		—		213.2		707.1		920.3
Other^(b)	55.0		—		54.1		1.0		55.1		53.9		—		52.1		9.2		61.3
Financial liabilities
Deposits	$	1,438.3	$	—	$	1,438.4	$	—	$	1,438.4	$	1,422.7	$	—	$	1,422.7	$	—	$	1,422.7
Federal funds purchased and securities loaned or sold under repurchase agreements	180.5		—		180.5		—		180.5		158.2		—		158.2		—		158.2
Short-term borrowings	56.7		—		56.7		—		56.7		42.6		—		42.4		0.2		42.6
Accounts payable and other liabilities	173.4		—		170.0		3.1		173.1		152.0		—		148.9		2.9		151.8
Beneficial interests issued by consolidated VIEs	20.2		—		20.2		—		20.2		26.0		—		26.0		—		26.0
Long-term debt and junior subordinated deferrable interest debentures	216.0		—		217.5		3.3		220.8		236.6		—		240.3		3.2		243.5

Effective January 1, 2018, the Firm adopted several new accounting standards. Certain of the new accounting standards were applied retrospectively and, accordingly, prior period amounts were revised.

(a)

Fair value is typically estimated using a discounted cash flow model that incorporates the ~~Firm measures equity securities without readily determinable fair values at cost less impairment (if any), plus or minus observable price changes from an identical or similar investment~~characteristics of the ~~same issuer, with such changes recognized in earnings.~~

~~In its determination~~underlying loans (including principal, contractual interest rate and contractual fees) and other key inputs, including expected lifetime credit losses, interest rates, prepayment rates, and primary origination or secondary market spreads. For certain loans, the fair value is measured based on the value of the ~~new carrying values upon observable price changes,~~underlying collateral. The difference between the ~~Firm may adjust the prices if deemed necessary to arrive at the Firm’s~~ estimated fair ~~values. Such adjustments may include adjustments to reflect~~value and carrying value of a financial asset or liability is the result of the different ~~rights and obligations of similar securities, and other adjustments that~~methodologies used to determine fair value as compared with carrying value. For example, credit losses are ~~consistent with the Firm’s valuation techniques~~estimated for ~~private equity direct investments.~~

~~The following table presents equity securities without readily determinable~~a financial asset’s remaining life in a fair ~~values that~~value calculation but are ~~measured under the measurement alternative and the related adjustments recorded during the~~estimated for a loss emergence period ~~for those securities with observable price changes. These securities are included~~ in the ~~nonrecurring~~allowance for loan loss calculation; future loan income (interest and fees) is incorporated in a fair value ~~tables when applicable price changes are observable.~~

As of or for three months ended March 31, 2018
(in millions)
Carrying value^(a)

Upward carrying
value changes
Other assets $1,429 $505

~~(a) The amount of downward carrying value changes and impairment was immaterial.~~

~~Included~~calculation but is generally not considered in ~~other assets above is~~ the Firm’s interest in approximately 40 million Visa Class B shares, recorded at a nominal carrying value. These shares are subject to certain transfer restrictions currently and will be converted into Visa Class A shares upon final resolution of certain litigation matters involving Visa. The conversion rate of Visa Class B shares into Visa Class A shares is 1.6483 at March 31, 2018, and may be adjusted by Visa depending on developments related to the litigation matters.

~~Note 3 – Fair value option~~

allowance for loan losses. For a further discussion of the ~~primary financial instruments~~Firm’s methodologies for ~~which~~estimating the fair value ~~option was elected, including the basis for those elections~~of loans and ~~the determination of instrument-specific credit risk, where relevant, see Note 3~~lending-related commitments, refer to Valuation hierarchy on pages 156–159 of JPMorgan Chase’s 2017 Annual Report.

~~Changes in fair value under~~


(b)	The prior period amounts have been revised to conform with the ~~fair value option election~~current period presentation.



	September 30, 2018					December 31, 2017
		Estimated fair value hierarchy					Estimated fair value hierarchy
(in billions)	Carrying value^(a)	Level 1	Level 2	Level 3	Total estimated fair value	Carrying value^(a)	Level 1	Level 2	Level 3	Total estimated fair value
Wholesale lending-related commitments	$1.1	$—	$—	$1.5	$1.5	$1.1	$—	$—	$1.6	$1.6

~~The following table presents~~

(a)

Excludes the ~~changes in fair value included in~~current carrying values of the ~~Consolidated statements~~guarantee liability and the offsetting asset, each of ~~income for the three months ended March 31, 2018 and 2017, for items for~~ which the fair value option was elected. The profit and loss information presented below only includes the financial instruments that were elected to be measured at fair value; related risk management instruments, which are required to be measuredis recognized at fair value ~~are not included in~~at the ~~table.~~

Three months ended March 31,

2018 2017
(in millions) Principal transactions
All other income
Total changes in fair
value recorded ^(e)
Principal transactions All other income
Total changes in fair value recorded ^(e)
Federal funds sold and securities purchased under resale agreements $ 7

$ —

$ 7

$ (21 ) $ —
$ (21 )
Securities borrowed (27 )
—

(27 )
77
—
77
Trading assets:

Debt and equity instruments, excluding loans (186 )
—

(186 )
361
—
361
Loans reported as trading assets:

Changes in instrument-specific credit risk 122

5
^(c)
127

174
6
^(c)
180
Other changes in fair value 41

(90 )
^(c)
(49 )
34
123
^(c)
157
Loans:

Changes in instrument-specific credit risk —

—

—

(1 ) —
(1 )
Other changes in fair value (1 )
—

(1 )
—
—
—
Other assets 2

(7 )
^(d)
(5 )
4
(6 )
^(d)
(2 )
Deposits^(a)
210

—

210

(159 ) —
(159 )
Federal funds purchased and securities loaned or sold under repurchase agreements 10

—

10

5
—
5
Short-term borrowings^(a)
273

—

273

(474 ) —
(474 )
Trading liabilities (7 )
—

(7 )
(1 ) —
(1 )
Beneficial interests issued by consolidated VIEs —

—

—

—
—
—
Long-term debt^(a)(b)
1,031

—

1,031

(753 ) —
(753 )
inception of the guarantees.

The Firm does not estimate the fair value of consumer lending-related commitments. In many cases, the Firm can reduce or cancel these commitments by providing the borrower notice or, in some cases as permitted by law, without notice. For a further discussion of the valuation of lending-related commitments, refer to page 157 of JPMorgan Chase’s 2017 Annual Report.

Equity securities without readily determinable fair values

As a result of the adoption of the recognition and measurement guidance and the election of the measurement alternative in the first quarter of 2018, the Firm measures equity securities without readily determinable fair values at cost less impairment (if any), plus or minus observable price changes from an identical or similar investment of the same issuer, with such changes recognized in earnings.

In its determination of the new carrying values upon observable price changes, the Firm may adjust the prices if deemed necessary to arrive at the Firm’s estimated fair values. Such adjustments may include adjustments to reflect the different rights and obligations of similar securities, and other adjustments that are consistent with the Firm’s valuation techniques for private equity direct investments.

The following table presents the carrying value of equity securities without readily determinable fair values still held as of September 30, 2018, that are measured under the measurement alternative and the related adjustments recorded during the periods presented for those securities with observable price changes. These securities are included in the nonrecurring fair value tables when applicable price changes are observable.



	As of or for the
(in millions)	Three months ended September 30, 2018			Nine months ended September 30, 2018
Other assets
Carrying value	$	1,801		$	1,801
Upward carrying value changes	14			540
Downward carrying value changes/impairment	(127		)	(156		)

Included in other assets above is the Firm’s interest in approximately 40 millionVisa Class B shares, recorded at a nominal carrying value. These shares are subject to certain transfer restrictions currently and will be convertible into Visa Class A shares upon final resolution of certain litigation matters involving Visa. The conversion rate of Visa Class B shares into Visa Class A shares is 1.6298 at September 30, 2018, and may be adjusted by Visa depending on developments related to the litigation matters.

Note 3 – Fair value option

For a discussion of the primary financial instruments for which the fair value option was elected, including the basis for those elections and the determination of instrument-specific credit risk, where relevant, refer to Note3 of JPMorgan Chase’s 2017 Annual Report.

Changes in fair value under the fair value option election

The followingtable presentsthe changes in fair value included in the Consolidated statements of income for the three months ended September 30, 2018 and 2017, for items for which the fair value option was elected. The profit and loss information presented below only includes the financial instruments that were elected to be measured at fair value; related risk management instruments, which are required to be measured at fair value, are not included in the table.



	Three months ended September 30,
	2018									2017
(in millions)	Principal transactions			All other income			Total changes in fair value recorded ^(e)			Principal transactions			All other income				Total changes in fair value recorded ^(e)
Federal funds sold and securities purchased under resale agreements	$	(23	)	$	—		$	(23	)	$	(17	)	$	—			$	(17	)
Securities borrowed	(24		)	—			(24		)	(10		)	—				(10		)
Trading assets:
Debt and equity instruments, excluding loans	(45		)	5		^(c)	(40		)	412			—				412
Loans reported as trading assets:
Changes in instrument-specific credit risk	122			1		^(c)	123			139			(2		)	^(c)	137
Other changes in fair value	(6		)	49		^(c)	43			111			249			^(c)	360
Loans:
Changes in instrument-specific credit risk	(1		)	—			(1		)	—			—				—
Other changes in fair value	1			—			1			3			—				3
Other assets	2			16		^(d)	18			3			(4		)	^(d)	(1		)
Deposits^(a)	32			—			32			(117		)	—				(117		)
Federal funds purchased and securities loaned or sold under repurchase agreements	8			—			8			2			—				2
Short-term borrowings^(a)	(25		)	—			(25		)	(54		)	—				(54		)
Trading liabilities	2			—			2			(3		)	—				(3		)
Long-term debt^(a)(b)	259			—			259			(793		)	—				(793		)



	Nine months ended September 30,
	2018									2017
(in millions)	Principal transactions			All other income			Total changes in fair value recorded^(e)			Principal transactions			All other income				Total changes in fair value recorded^(e)
Federal funds sold and securities purchased under resale agreements	$	(49	)	$	—		$	(49	)	$	(50	)	$	—			$	(50	)
Securities borrowed	(22		)	—			(22		)	80			—				80
Trading assets:				—
Debt and equity instruments, excluding loans	(490		)	6		^(c)	(484		)	1,107			2			^(c)	1,109
Loans reported as trading assets:				—
Changes in instrument-specific credit risk	458			5		^(c)	463			382			13			^(c)	395
Other changes in fair value	64			24		^(c)	88			188			601			^(c)	789
Loans:
Changes in instrument-specific credit risk	(2		)	—			(2		)	(1		)	—				(1		)
Other changes in fair value	(1		)				(1		)	4			3			^(c)	7
Other assets	4			6		^(d)	10			10			(26		)	^(d)	(16		)
Deposits^(a)	371			—			371			(362		)	—				(362		)
Federal funds purchased and securities loaned or sold under repurchase agreements	27			—			27			4			—				4
Other borrowed funds^(a)	86			—			86			(485		)	—				(485		)
Trading liabilities	1			—			1			(4		)	—				(4		)
Long-term debt^(a)(b)	1,486			—			1,486			(1,716		)	—				(1,716		)

(a)

Unrealized gains/(losses) due to instrument-specific credit risk (DVA) for liabilities for which the fair value option has been elected is recorded in OCI, while realized gains/(losses) are recorded in principal transactions revenue. Realized gains/(losses) due to instrument-specific credit risk recorded in principal transaction revenue were not material for the three months ended March 31, 2018 and 2017, respectively.


~~(b)~~	Long-term debt measured at fair value predominantly relates to structured notes. Although the risk associated with the structured notes is actively managed, the gains/(losses) reported in this table do not include the income statement impact of the risk management instruments used to manage such risk.


~~(c)~~	~~Reported in mortgage fees and related income.~~


~~(d)~~	~~Reported in other income.~~


~~(e)~~	Changes in fair value exclude contractual interest, which is included in interest income and interest expense for all instruments other than hybrid financial instruments. For further information regarding interest income and interest expense, see Note 6.

~~Difference between aggregate fair value and aggregate remaining contractual principal balance outstanding~~

The following table reflects the difference between the aggregate fair value and the aggregate remaining contractual principal balance outstanding as of March 31, 2018, and December 31, 2017, for loans, long-term debt and long-term beneficial interests for which the fair value option has been ~~elected.~~

March 31, 2018 December 31, 2017
(in millions) Contractual principal outstanding
Fair value Fair value over/(under) contractual principal outstanding Contractual principal outstanding Fair value Fair value over/(under) contractual principal outstanding
Loans^(a)

Nonaccrual loans

Loans reported as trading assets $ 4,368

$ 1,585
$ (2,783 ) $ 4,219
$ 1,371
$ (2,848 )
Loans —

—
—
39
—
(39 )
Subtotal 4,368

1,585
(2,783 ) 4,258
1,371
(2,887 )
All other performing loans

Loans reported as trading assets 41,599

39,691
(1,908 ) 38,157
36,590
(1,567 )
Loans 2,995

2,908
(87 ) 2,539
2,508
(31 )
Total loans $ 48,962

$ 44,184
$ (4,778 ) $ 44,954
$ 40,469
$ (4,485 )
Long-term debt

Principal-protected debt $ 28,378
^(c)
$ 24,923
$ (3,455 ) $ 26,297
^(c)
$ 23,848
$ (2,449 )
Nonprincipal-protected debt^(b)
NA

24,229
NA
NA
23,671
NA
Total long-term debt NA

$ 49,152
NA
NA
$ 47,519
NA
Long-term beneficial interests

Nonprincipal-protected debt NA

$ 7
NA
NA
$ 45
NA
Total long-term beneficial interests NA

$ 7
NA
NA
$ 45
NA

~~(a)~~

~~There were no performing loans that were ninety days or more past due as of March 31,~~elected is recorded in OCI, while realized gains/(losses) are recorded in principal transactions revenue. Realized gains/(losses) due to instrument-specific credit risk recorded in principal transactions revenue were not material for the three and nine months ended September 30, 2018 and ~~December 31,~~ 2017, respectively.


(b)	Long-term debt measured at fair value predominantly relates to structured notes. Although the risk associated with the structured notes is actively managed, the gains/(losses) reported in this table do not include the income statement impact of the risk management instruments used to manage such risk.


(c)	Reported in mortgage fees and related income.


(d)	Reported in other income.


(e)	Changes in fair value exclude contractual interest, which is included in interest income and interest expense for all instruments other than hybrid financial instruments. For further information regarding interest income and interest expense, refer to Note 6.

Difference between aggregate fair value and aggregate remaining contractual principal balance outstanding

The following table reflects the difference between the aggregate fair value and the aggregate remaining contractual principal balance outstanding as of September 30, 2018, and December 31, 2017, for loans, long-term debt and long-term beneficial interests for which the fair value option has been elected.



	September 30, 2018								December 31, 2017
(in millions)	Contractual principal outstanding			Fair value		Fair value over/(under) contractual principal outstanding			Contractual principal outstanding			Fair value		Fair value over/(under) contractual principal outstanding
Loans^(a)
Nonaccrual loans
Loans reported as trading assets	$	4,171		$	1,189	$	(2,982	)	$	4,219		$	1,371	$	(2,848	)
Loans	—			—		—			39			—		(39		)
Subtotal	4,171			1,189		(2,982		)	4,258			1,371		(2,887		)
All other performing loans
Loans reported as trading assets	41,986			40,395		(1,591		)	38,157			36,590		(1,567		)
Loans	3,039			2,987		(52		)	2,539			2,508		(31		)
Total loans	$	49,196		$	44,571	$	(4,625	)	$	44,954		$	40,469	$	(4,485	)
Long-term debt
Principal-protected debt	$	31,858	^(c)	$	27,518	$	(4,340	)	$	26,297	^(c)	$	23,848	$	(2,449	)
Nonprincipal-protected debt^(b)	NA			26,594		NA			NA			23,671		NA
Total long-term debt	NA			$	54,112	NA			NA			$	47,519	NA
Long-term beneficial interests
Nonprincipal-protected debt	NA			$	17	NA			NA			$	45	NA
Total long-term beneficial interests	NA			$	17	NA			NA			$	45	NA

~~(b)~~

Remaining contractual principal is not applicable to nonprincipal-protected notes. Unlike principal-protected structured notes, for which the Firm is obligated to return a stated amount of principal at the maturity of the note, nonprincipal-protected structured notes do not obligate the Firm to return a stated amount of principal at maturity, but to return an amount based on the performance of an underlying variable or derivative feature embedded in the note. However, investors are exposed to the credit risk of the Firm as issuer for both nonprincipal-protected and principal protected notes.


~~(c)~~	Where the Firm issues principal-protected zero-coupon or discount notes, the balance reflects the contractual principal payment at maturity or, if applicable, the contractual principal payment at the Firm’s next call date.

~~At March 31,~~

(a)

There were no performing loans that were ninety days or more past due as of September 30, 2018, and December 31, 2017, respectively.

(b)


(c)	Where the Firm issues principal-protected zero-coupon or discount notes, the balance reflects the contractual principal payment at maturity or, if applicable, the contractual principal payment at the Firm’s next call date.

At September 30, 2018, and December 31, 2017, the contractual amount of lending-related commitments for which the fair value option was elected was $9.1 billion and $7.4 billion, respectively,with a corresponding fair value of $(53) million and $(76) million, respectively. For further information regarding off-balance sheet lending-related financial instruments, refer to Note27 of JPMorgan Chase’s 2017 Annual Report, and Note 20 of this Form 10-Q.

Structured note products by balance sheet classification and risk component

The following table presents the fair value of the structured notes issued by the Firm, by balance sheet classification and the primary risk type.



	September 30, 2018								December 31, 2017
(in millions)	Long-term debt		Short-term borrowings		Deposits		Total		Long-term debt		Short-term borrowings		Deposits		Total
Risk exposure
Interest rate	$	23,333	$	616	$	9,269	$	33,218	$	22,056	$	69	$	8,058	$	30,183
Credit	3,771		483		—		4,254		4,329		1,312		—		5,641
Foreign exchange	2,930		96		37		3,063		2,841		147		38		3,026
Equity	21,950		6,258		7,330		35,538		17,581		7,106		6,548		31,235
Commodity	355		7		1,715		2,077		230		15		4,468		4,713
Total structured notes	$	52,339	$	7,460	$	18,351	$	78,150	$	47,037	$	8,649	$	19,112	$	74,798

Note 4 – Derivative instruments

JPMorgan Chase makes markets in derivatives for clients and also uses derivatives to hedge or manage its own risk exposures. For a further discussion of the Firm’s use of and accounting policies regarding derivative instruments, refer to Note5 of JPMorgan Chase’s 2017 Annual Report.

The Firm’s disclosures are based on the accounting treatment and purpose of these derivatives. A limited number of the Firm’s derivatives are designated in hedge accounting relationships and are disclosed according to the type of hedge (fair value hedge, cash flow hedge, or net investment hedge). Derivatives not designated in hedge accounting relationships include certain derivatives that are used to manage certain risks associated with specified assets or liabilities (“specified risk management” positions) as well as derivatives used in the Firm’s market-making businesses or for other purposes.

Derivatives designated as hedges

The adoption of the new hedge accounting guidance in the first quarter of 2018 better aligns hedge accounting with the economics of the Firm’s risk management activities. For additional information on the impact of the new guidance, refer to Note17.

To qualify for hedge accounting, a derivative must be highly effective at reducing the risk associated with the exposure being hedged. In addition, for a derivative to be designated as a hedge, the risk management objective and strategy must be documented. Hedge documentation must identify the derivative hedging instrument, the asset or liability or forecasted transaction and type of risk to be hedged, and how the effectiveness of the derivative is assessed prospectively and retrospectively. To assess effectiveness, the Firm uses statistical methods such as regression analysis, nonstatistical methods such as dollar-value comparisons of the change in the fair value of the derivative to the change in the fair value or cash flows of the hedged item, and qualitative comparisons of critical terms and the evaluation of any changes in those terms. The extent to which a derivative has been, and is expected to continue to be, highly effective at offsetting changes in the fair value or

cash flows of the hedged item must be assessed and documented at least quarterly. If it is determined that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued.

For qualifying fair value hedges, changes in the fair value of the derivative, and in the value of the hedged item for the risk being hedged, are recognized in earnings. Certain amounts excluded from the assessment of effectiveness are recorded in OCI and recognized in earnings through an amortization approach over the life of the derivative. If the hedge relationship is terminated, then the adjustment to the hedged item continues to be reported as part of the basis of the hedged item, and for benchmark interest rate hedges, is amortized to earnings as a yield adjustment. Derivative amounts affecting earnings are recognized consistent with the classification of the hedged item - primarily net interest income and principal transactions revenue.

For qualifying cash flow hedges, changes in the fair value of the derivative are recorded in OCI and recognized in earnings as the hedged item affects earnings. Derivative amounts affecting earnings are recognized consistent with the classification of the hedged item - primarily interest income, interest expense, noninterest revenue and compensation expense. If the hedge relationship is terminated, then the change in value of the derivative recorded in AOCI is recognized in earnings when the cash flows that were hedged affect earnings. For hedge relationships that are discontinued because a forecasted transaction is not expected to occur according to the original hedge forecast, any related derivative values recorded in AOCI are immediately recognized in earnings.

For qualifying net investment hedges, changes in the fair value of the derivatives due to changes in spot foreign exchange rates are recorded in OCI as translation adjustments. Amounts excluded from the assessment of effectiveness are recorded directly in earnings.

The following table outlines the Firm’s primary uses of derivatives and the related hedge accounting designation or disclosure category.



Type of Derivative	Use of Derivative	Designation and disclosure	Affected segment or unit	10-Q page reference
Manage specifically identified risk exposures in qualifying hedge accounting relationships:
• Interest rate	Hedge fixed rate assets and liabilities	Fair value hedge	Corporate	118-119
• Interest rate	Hedge floating-rate assets and liabilities	Cash flow hedge	Corporate	120
• Foreign exchange	Hedge foreign currency-denominated assets and liabilities	Fair value hedge	Corporate	118-119
• Foreign exchange	Hedge foreign currency-denominated forecasted revenue and expense	Cash flow hedge	Corporate	120
• Foreign exchange	Hedge the value of the Firm’s investments in non-U.S. dollar functional currency entities	Net investment hedge	Corporate	121
• Commodity	Hedge commodity inventory	Fair value hedge	CIB	118-119
Manage specifically identified risk exposures not designated in qualifying hedge accounting relationships:
• Interest rate	Manage the risk of the mortgage pipeline, warehouse loans and MSRs	Specified risk management	CCB	121
• Credit	Manage the credit risk of wholesale lending exposures	Specified risk management	CIB	121
• Interest rate and foreign exchange	Manage the risk of certain other specified assets and liabilities	Specified risk management	Corporate	121
Market-making derivatives and other activities:
• Various	Market-making and related risk management	Market-making and other	CIB	121
• Various	Other derivatives	Market-making and other	CIB, Corporate	121

Notional amount of derivative contracts

The following table summarizes the notional amount of derivative contracts outstanding as of September 30, 2018, and December 31, 2017.



	Notional amounts^(b)
(in billions)	September 30, 2018		December 31, 2017
Interest rate contracts
Swaps	$	25,236	$	21,043
Futures and forwards	7,326		4,904
Written options	4,718		3,576
Purchased options	5,233		3,987
Total interest rate contracts	42,513		33,510
Credit derivatives^(a)	1,603		1,522
Foreign exchange contracts
Cross-currency swaps	3,893		3,953
Spot, futures and forwards	6,812		5,923
Written options	961		786
Purchased options	956		776
Total foreign exchange contracts	12,622		11,438
Equity contracts
Swaps	402		367
Futures and forwards	106		90
Written options	596		531
Purchased options	543		453
Total equity contracts	1,647		1,441
Commodity contracts
Swaps	140		116
Spot, futures and forwards	164		168
Written options	157		98
Purchased options	134		93
Total commodity contracts	595		475
Total derivative notional amounts	$	58,980	$	48,386


(a)	For more information on volumes and types of credit derivative contracts, refer to the Credit derivatives discussion on page 122.


(b)	Represents the sum of gross long and gross short third-party notional derivative contracts.

While the notional amounts disclosed above give an indication of the volume of the Firm’s derivatives activity, the notional amounts significantly exceed, in the Firm’s view, the possible losses that could arise from such transactions. For most derivative transactions, the notional amount is not exchanged; it is used simply as a reference to calculate payments.

Impact of derivatives on the Consolidated balance sheets

The following table summarizes information on derivative receivables and payables (before and after netting adjustments) that are reflected on the Firm’s Consolidated balance sheets as of September 30, 2018, and December 31, 2017, by accounting designation (e.g., whether the derivatives were designated in qualifying hedge accounting relationships or not) and contract type.



Free-standing derivative receivables and payables^(a)
	Gross derivative receivables										Gross derivative payables
September 30, 2018 (in millions)	Not designated as hedges			Designated as hedges			Total derivative receivables		Net derivative receivables^(b)		Not designated as hedges			Designated as hedges			Total derivative payables		Net derivative payables^(b)
Trading assets and liabilities
Interest rate	$	260,636		$	823		$	261,459	$	23,397	$	234,232		$	1		$	234,233	$	7,091
Credit	23,505			—			23,505		582		23,360			—			23,360		1,452
Foreign exchange	188,261			623			188,884		17,043		176,771			848			177,619		12,402
Equity	46,932			—			46,932		10,104		51,355			—			51,355		11,978
Commodity	22,175			193			22,368		8,936		22,749			90			22,839		8,770
Total fair value of trading assets and liabilities	$	541,509		$	1,639		$	543,148	$	60,062	$	508,467		$	939		$	509,406	$	41,693

	Gross derivative receivables										Gross derivative payables
December 31, 2017 (in millions)	Not designated as hedges			Designated as hedges			Total derivative receivables		Net derivative receivables^(b)		Not designated as hedges			Designated as hedges			Total derivative payables		Net derivative payables^(b)
Trading assets and liabilities
Interest rate	$	314,962	^(c)	$	1,030	^(c)	$	315,992	$	24,673	$	284,433	^(c)	$	3	^(c)	$	284,436	$	7,129
Credit	23,205			—			23,205		869		23,252			—			23,252		1,299
Foreign exchange	159,740			491			160,231		16,151		154,601			1,221			155,822		12,473
Equity	40,040			—			40,040		7,882		45,395			—			45,395		9,192
Commodity	20,066			19			20,085		6,948		21,498			403			21,901		7,684
Total fair value of trading assets and liabilities	$	558,013	^(c)	$	1,540	^(c)	$	559,553	$	56,523	$	529,179	^(c)	$	1,627	^(c)	$	530,806	$	37,777

(a)

Balances exclude structured notes for which the fair value option was elected was $9.8 billion and $7.4 billion, respectively, with a corresponding fair value of $(584) million and $(76) million, respectively. For further information regarding off-balance sheet lending-related financial instruments, see Note 27 of JPMorgan Chase’s 2017 Annual Report, and Note 20 of this Form 10-Q.

~~Structured note products by balance sheet classification and risk component~~

~~The following table presents the fair value of the structured notes issued by the Firm, by balance sheet classification and the primary risk type.~~

March 31, 2018
December 31, 2017
(in millions) Long-term debt Short-term borrowings Deposits Total
Long-term debt Short-term borrowings Deposits Total
Risk exposure

Interest rate $ 22,793
$ 149
$ 7,961
$ 30,903

$ 22,056
$ 69
$ 8,058
$ 30,183
Credit 4,811
1,503
—
6,314

4,329
1,312
—
5,641
Foreign exchange 2,790
122
39
2,951

2,841
147
38
3,026
Equity 18,147
6,797
6,470
31,414

17,581
7,106
6,548
31,235
Commodity 215
14
3,530
3,759

230
15
4,468
4,713
Total structured notes $ 48,756
$ 8,585
$ 18,000
$ 75,341

$ 47,037
$ 8,649
$ 19,112
$ 74,798

~~Note 4 – Derivative instruments~~

JPMorgan Chase makes markets in derivatives for clients and also uses derivatives to hedge or manage its own risk exposures. For a further discussion of the Firm’s use of and accounting policies regarding derivative instruments, see Note 5 of JPMorgan Chase’s 2017 Annual Report.

~~Derivatives designated as hedges~~

~~The adoption of the new hedge accounting guidance better aligns hedge accounting with the economics of the Firm’s risk management activities. For additional information, see Notes 1 and 17.~~

To qualify for hedge accounting, a derivative must be highly effective at reducing the risk associated with the exposure being hedged. In addition, for a derivative to be designated as a hedge, the risk management objective and strategy must be documented. Hedge documentation must identify the derivative hedging instrument, the asset or liability or forecasted transaction and type of risk to be hedged, and how the effectiveness of the derivative is assessed prospectively and retrospectively. To assess effectiveness, the Firm uses statistical methods such as regression analysis, nonstatistical methods such as dollar-value comparisons of the change in the fair value of the derivative to the change in the fair value or cash flows of the hedged item, and qualitative comparisons of critical terms and the evaluation of any changes in those terms. The extent to which a derivative has been ~~and is expected~~elected. Refer to ~~continue to be, highly effective at offsetting changes in the fair value or~~

~~The following table outlines the Firm’s primary uses of derivatives and the related hedge accounting designation or disclosure category.~~



~~Type of Derivative~~	~~Use of Derivative~~	~~Designation and disclosure~~	~~Affected~~ ~~segment or unit~~	~~10-Q page reference~~
~~Manage specifically identified risk exposures in qualifying hedge accounting relationships:~~
~~◦ Interest rate~~	~~Hedge fixed rate assets and liabilities~~	~~Fair value hedge~~	~~Corporate~~	~~102~~
~~◦ Interest rate~~	~~Hedge floating-rate assets and liabilities~~	~~Cash flow hedge~~	~~Corporate~~	~~103~~
◦ ~~Foreign exchange~~	~~Hedge foreign currency-denominated assets and liabilities~~	~~Fair value hedge~~	~~Corporate~~	~~102~~
◦ ~~Foreign exchange~~	~~Hedge foreign currency-denominated forecasted revenue and expense~~	~~Cash flow hedge~~	~~Corporate~~	~~103~~
◦ ~~Foreign exchange~~	~~Hedge the value of the Firm’s investments in non-U.S. dollar functional currency entities~~	~~Net investment hedge~~	~~Corporate~~	~~104~~
◦ ~~Commodity~~	~~Hedge commodity inventory~~	~~Fair value hedge~~	~~CIB~~	~~102~~
~~Manage specifically identified risk exposures not designated in qualifying hedge accounting relationships:~~
◦ ~~Interest rate~~	~~Manage the risk of the mortgage pipeline, warehouse loans and MSRs~~	~~Specified risk management~~	~~CCB~~	~~104~~
◦ ~~Credit~~	~~Manage the credit risk of wholesale lending exposures~~	~~Specified risk management~~	~~CIB~~	~~104~~
◦ ~~Interest rate and foreign exchange~~	~~Manage the risk of certain other specified assets and liabilities~~	~~Specified risk management~~	~~Corporate~~	~~104~~
~~Market-making derivatives and other activities:~~
◦ ~~Various~~	~~Market-making and related risk management~~	~~Market-making and other~~	~~CIB~~	~~104~~
◦ ~~Various~~	~~Other derivatives~~	~~Market-making and other~~	~~CIB, Corporate~~	~~104~~

~~Notional amount of derivative contracts~~

~~The following table summarizes the notional amount of derivative contracts outstanding as of March 31, 2018, and December 31, 2017.~~

Notional amounts^(b)
(in billions) March 31, 2018
December 31, 2017
Interest rate contracts
Swaps $ 23,090
$ 21,043
Futures and forwards 7,216
4,904
Written options 4,058
3,576
Purchased options 4,380
3,987
Total interest rate contracts 38,744
33,510
Credit derivatives^(a)
1,605
1,522
Foreign exchange contracts
Cross-currency swaps 4,195
3,953
Spot, futures and forwards 7,016
5,923
Written options 873
786
Purchased options 878
776
Total foreign exchange contracts 12,962
11,438
Equity contracts
Swaps 377
367
Futures and forwards 97
90
Written options 594
531
Purchased options 516
453
Total equity contracts 1,584
1,441
Commodity contracts
Swaps 130
116
Spot, futures and forwards 179
168
Written options 112
98
Purchased options 102
93
Total commodity contracts 523
475
Total derivative notional amounts $ 55,418
$ 48,386


~~(a)~~	~~For more information on volumes and types of credit derivative contracts, see the Credit derivatives discussion on page 105.~~


~~(b)~~	~~Represents the sum of gross long and gross short third-party notional derivative contracts.~~

~~Impact of derivatives on the Consolidated balance sheets~~

The following table summarizes information on derivative receivables and payables (before and after netting adjustments) that are reflected on the Firm’s Consolidated balance sheets as of March 31, 2018, and December 31, 2017, by accounting designation (e.g., whether the derivatives were designated in qualifying hedge accounting relationships or not) and contract type.

Free-standing derivative receivables and payables^(a)

Gross derivative receivables Gross derivative payables
March 31, 2018
(in millions) Not designated as hedges Designated as hedges Total derivative receivables
Net derivative receivables^(b)
Not designated as hedges
Designated
as hedges
Total derivative payables
Net derivative payables^(b)
Trading assets and liabilities
Interest rate $ 301,480
$ 2,391
$ 303,871
$ 23,778
$ 271,093
$ 2,770
$ 273,863
$ 7,170
Credit 23,727
—
23,727
1,062
23,697
—
23,697
1,713
Foreign exchange 165,482
453
165,935
16,603
152,846
963
153,809
10,797
Equity 43,989
—
43,989
8,803
48,239
—
48,239
10,325
Commodity 16,927
193
17,120
6,668
18,144
82
18,226
6,944
Total fair value of trading assets and liabilities $ 551,605
$ 3,037
$ 554,642
$ 56,914
$ 514,019
$ 3,815
$ 517,834
$ 36,949

Gross derivative receivables Gross derivative payables
December 31, 2017
(in millions) Not designated as hedges Designated as hedges Total derivative receivables
Net derivative receivables^(b)
Not designated as hedges Designated
as hedges Total derivative payables
Net derivative payables^(b)
Trading assets and liabilities
Interest rate $ 313,276
$ 2,716
$ 315,992
$ 24,673
$ 283,092
$ 1,344
$ 284,436
$ 7,129
Credit 23,205
—
23,205
869
23,252
—
23,252
1,299
Foreign exchange 159,740
491
160,231
16,151
154,601
1,221
155,822
12,473
Equity 40,040
—
40,040
7,882
45,395
—
45,395
9,192
Commodity 20,066
19
20,085
6,948
21,498
403
21,901
7,684
Total fair value of trading assets and liabilities $ 556,327
$ 3,226
$ 559,553
$ 56,523
$ 527,838
$ 2,968
$ 530,806
$ 37,777


~~(a)~~	~~Balances exclude structured notes for which the fair value option has been elected. See~~ Note 3 for further information.


(b)	As permitted under U.S. GAAP, the Firm has elected to net derivative receivables and derivative payables and the related cash collateral receivables and payables when a legally enforceable master netting agreement exists.

~~Derivatives netting~~

(c)

The following tables present, as of March 31, 2018, and December 31, 2017, gross and net derivative receivables and payables by contract and settlement type. Derivative receivables and payables, as well as the related cash collateral from the same counterpartyprior period amounts have been ~~netted on the Consolidated balance sheets where the Firm has obtained an appropriate legal opinion with respect~~revised to the master netting agreement. Where such a legal opinion has not been either sought or obtained, amounts are not eligible for netting on the Consolidated balance sheets, and those derivative receivables and payables are shown separately in the tables below.

In addition to the cash collateral received and transferred that is presented on a net basis with derivative receivables and payables, the Firm receives and transfers additional collateral (financial instruments and cash). These amounts mitigate counterparty credit risk associatedconform with the ~~Firm’s derivative instruments, but are not eligible for net presentation:~~current period presentation.

Derivatives netting

The following tables present, as of September 30, 2018, and December 31, 2017, gross and net derivative receivables and payables by contract and settlement type. Derivative receivables and payables, as well as the related cash collateral from the same counterparty have been netted on the Consolidated balance sheets where the Firm has obtained an appropriate legal opinion with respect to the master netting agreement. Where such a legal opinion has not been either sought or obtained, amounts are not eligible for netting on the Consolidated balance sheets, and those derivative receivables and payables are shown separately in the tables below.

In addition to the cash collateral received and transferred that is presented on a net basis with derivative receivables and payables, the Firm receives and transfers additional collateral (financial instruments and cash). These amounts mitigate counterparty credit risk associated with the Firm’s derivative instruments, but are not eligible for net presentation:


•	collateral that consists of non-cash financial instruments (generally U.S. government and agency securities and other G7 government securities) and cash collateral held at third party custodians, which are shown separately as “Collateral not nettable on the Consolidated balance sheets” in the tables below, up to the fair value exposure amount.


•	the amount of collateral held or transferred that exceeds the fair value exposure at the individual counterparty level, as of the date presented, which is excluded from the tables below; and

•

collateral held or transferred that relates to derivative receivables or payables where an appropriate legal opinion has not been either sought or obtained with respect to the master netting agreement, which is excluded from the tables below.

March 31, 2018 December 31, 2017
(in millions) Gross derivative receivables Amounts netted on the Consolidated balance sheets Net derivative receivables Gross derivative receivables
Amounts netted
on the Consolidated balance sheets
Net derivative receivables
U.S. GAAP nettable derivative receivables
Interest rate contracts:
Over-the-counter (“OTC”) $ 291,712
$ (272,007 ) $ 19,705
$ 305,569
$ (284,917 ) $ 20,652
OTC–cleared 8,080
(7,930 ) 150
6,531
(6,318 ) 213
Exchange-traded^(a)
321
(157 ) 164
185
(84 ) 101
Total interest rate contracts 300,113
(280,094 ) 20,019
312,285
(291,319 ) 20,966
Credit contracts:
OTC 14,755
(14,520 ) 235
15,390
(15,165 ) 225
OTC–cleared 8,366
(8,145 ) 221
7,225
(7,170 ) 55
Total credit contracts 23,121
(22,665 ) 456
22,615
(22,335 ) 280
Foreign exchange contracts:
OTC 161,340
(148,205 ) 13,135
155,289
(142,420 ) 12,869
OTC–cleared 1,104
(1,097 ) 7
1,696
(1,654 ) 42
Exchange-traded^(a)
131
(30 ) 101
141
(7 ) 134
Total foreign exchange contracts 162,575
(149,332 ) 13,243
157,126
(144,081 ) 13,045
Equity contracts:
OTC 23,957
(21,172 ) 2,785
22,024
(19,917 ) 2,107
Exchange-traded^(a)
16,443
(14,013 ) 2,430
14,188
(12,241 ) 1,947
Total equity contracts 40,400
(35,185 ) 5,215
36,212
(32,158 ) 4,054
Commodity contracts:
OTC 9,701
(3,686 ) 6,015
10,903
(4,436 ) 6,467
Exchange-traded^(a)
7,063
(6,766 ) 297
8,854
(8,701 ) 153
Total commodity contracts 16,764
(10,452 ) 6,312
19,757
(13,137 ) 6,620
Derivative receivables with appropriate legal opinion 542,973
(497,728 )
^(b)
45,245
547,995
(503,030 )
^(b)
44,965
Derivative receivables where an appropriate legal opinion has not been either sought or obtained 11,669
11,669
11,558
11,558
Total derivative receivables recognized on the Consolidated balance sheets $ 554,642
$ 56,914
$ 559,553
$ 56,523
Collateral not nettable on the Consolidated balance sheets^(c)(d)
(13,101 ) (13,363 )
Net amounts $ 43,813
$ 43,160

March 31, 2018 December 31, 2017
(in millions) Gross derivative payables Amounts netted on the Consolidated balance sheets Net derivative payables Gross derivative payables
Amounts netted
on the Consolidated balance sheets
Net derivative payables
U.S. GAAP nettable derivative payables
Interest rate contracts:
OTC $ 264,684
$ (259,233 ) $ 5,451
$ 276,960
$ (271,294 ) $ 5,666
OTC–cleared 7,315
(7,305 ) 10
6,004
(5,928 ) 76
Exchange-traded^(a)
186
(156 ) 30
127
(84 ) 43
Total interest rate contracts 272,185
(266,694 ) 5,491
283,091
(277,306 ) 5,785
Credit contracts:
OTC 15,423
(14,247 ) 1,176
16,194
(15,170 ) 1,024
OTC–cleared 7,797
(7,736 ) 61
6,801
(6,784 ) 17
Total credit contracts 23,220
(21,983 ) 1,237
22,995
(21,954 ) 1,041
Foreign exchange contracts:
OTC 149,559
(142,008 ) 7,551
150,966
(141,789 ) 9,177
OTC–cleared 1,005
(997 ) 8
1,555
(1,553 ) 2
Exchange-traded^(a)
115
(6 ) 109
98
(7 ) 91
Total foreign exchange contracts 150,679
(143,011 ) 7,668
152,619
(143,349 ) 9,270
Equity contracts:
OTC 28,082
(23,802 ) 4,280
28,193
(23,969 ) 4,224
Exchange-traded^(a)
14,693
(14,111 ) 582
12,720
(12,234 ) 486
Total equity contracts 42,775
(37,913 ) 4,862
40,913
(36,203 ) 4,710
Commodity contracts:
OTC 10,661
(4,592 ) 6,069
12,645
(5,508 ) 7,137
Exchange-traded^(a)
6,796
(6,692 ) 104
8,870
(8,709 ) 161
Total commodity contracts 17,457
(11,284 ) 6,173
21,515
(14,217 ) 7,298
Derivative payables with appropriate legal opinion 506,316
(480,885 )
^(b)
25,431
521,133
(493,029 )
^(b)
28,104
Derivative payables where an appropriate legal opinion has not been either sought or obtained 11,518
11,518
9,673
9,673
Total derivative payables recognized on the Consolidated balance sheets $ 517,834
$ 36,949
$ 530,806
$ 37,777
Collateral not nettable on the Consolidated balance sheets^(c)(d)
(3,711 ) (4,180 )
Net amounts $ 33,238
$ 33,597


~~(a)~~	~~Exchange-traded derivative balances that relate to futures contracts are settled daily.~~



	September 30, 2018									December 31, 2017
(in millions)	Gross derivative receivables		Amounts netted on the Consolidated balance sheets				Net derivative receivables			Gross derivative receivables		Amounts netted on the Consolidated balance sheets				Net derivative receivables
U.S. GAAP nettable derivative receivables
Interest rate contracts:
Over-the-counter (“OTC”)	$	250,181	$	(230,533	)		$	19,648		$	305,569	$	(284,917	)		$	20,652
OTC–cleared	7,512		(7,374		)		138			6,531		(6,318		)		213
Exchange-traded^(a)	300		(155		)		145			185		(84		)		101
Total interest rate contracts	257,993		(238,062		)		19,931			312,285		(291,319		)		20,966
Credit contracts:
OTC	12,502		(12,153		)		349			15,390		(15,165		)		225
OTC–cleared	10,806		(10,770		)		36			7,225		(7,170		)		55
Total credit contracts	23,308		(22,923		)		385			22,615		(22,335		)		280
Foreign exchange contracts:
OTC	184,421		(171,163		)		13,258			155,289		(142,420		)		12,869
OTC–cleared	676		(659		)		17			1,696		(1,654		)		42
Exchange-traded^(a)	42		(19		)		23			141		(7		)		134
Total foreign exchange contracts	185,139		(171,841		)		13,298			157,126		(144,081		)		13,045
Equity contracts:
OTC	25,197		(22,380		)		2,817			22,024		(19,917		)		2,107
Exchange-traded^(a)	16,789		(14,448		)		2,341			14,188		(12,241		)		1,947
Total equity contracts	41,986		(36,828		)		5,158			36,212		(32,158		)		4,054
Commodity contracts:
OTC	12,497		(4,916		)		7,581			10,903		(4,436		)		6,467
Exchange-traded^(a)	9,198		(8,516		)		682			8,854		(8,701		)		153
Total commodity contracts	21,695		(13,432		)		8,263			19,757		(13,137		)		6,620
Derivative receivables with appropriate legal opinion	530,121		(483,086		)	^(b)	47,035			547,995		(503,030		)	^(b)	44,965
Derivative receivables where an appropriate legal opinion has not been either sought or obtained	13,027						13,027			11,558						11,558
Total derivative receivables recognized on the Consolidated balance sheets	$	543,148					$	60,062		$	559,553					$	56,523
Collateral not nettable on the Consolidated balance sheets^(c)(d)							(13,826		)							(13,363		)
Net amounts							$	46,236								$	43,160



	September 30, 2018									December 31, 2017
(in millions)	Gross derivative payables		Amounts netted on the Consolidated balance sheets				Net derivative payables			Gross derivative payables		Amounts netted on the Consolidated balance sheets				Net derivative payables
U.S. GAAP nettable derivative payables
Interest rate contracts:
OTC	$	225,999	$	(220,369	)		$	5,630		$	276,960	$	(271,294	)		$	5,666
OTC–cleared	6,650		(6,618		)		32			6,004		(5,928		)		76
Exchange-traded^(a)	172		(155		)		17			127		(84		)		43
Total interest rate contracts	232,821		(227,142		)		5,679			283,091		(277,306		)		5,785
Credit contracts:
OTC	13,133		(11,852		)		1,281			16,194		(15,170		)		1,024
OTC–cleared	10,062		(10,056		)		6			6,801		(6,784		)		17
Total credit contracts	23,195		(21,908		)		1,287			22,995		(21,954		)		1,041
Foreign exchange contracts:
OTC	173,389		(164,557		)		8,832			150,966		(141,789		)		9,177
OTC–cleared	679		(654		)		25			1,555		(1,553		)		2
Exchange-traded^(a)	25		(6		)		19			98		(7		)		91
Total foreign exchange contracts	174,093		(165,217		)		8,876			152,619		(143,349		)		9,270
Equity contracts:
OTC	28,618		(24,869		)		3,749			28,193		(23,969		)		4,224
Exchange-traded^(a)	16,234		(14,508		)		1,726			12,720		(12,234		)		486
Total equity contracts	44,852		(39,377		)		5,475			40,913		(36,203		)		4,710
Commodity contracts:
OTC	13,607		(5,600		)		8,007			12,645		(5,508		)		7,137
Exchange-traded^(a)	8,558		(8,469		)		89			8,870		(8,709		)		161
Total commodity contracts	22,165		(14,069		)		8,096			21,515		(14,217		)		7,298
Derivative payables with appropriate legal opinion	497,126		(467,713		)	^(b)	29,413			521,133		(493,029		)	^(b)	28,104
Derivative payables where an appropriate legal opinion has not been either sought or obtained	12,280						12,280			9,673						9,673
Total derivative payables recognized on the Consolidated balance sheets	$	509,406					$	41,693		$	530,806					$	37,777
Collateral not nettable on the Consolidated balance sheets^(c)(d)							(3,566		)							(4,180		)
Net amounts							$	38,127								$	33,597


(a)	Exchange-traded derivative balances that relate to futures contracts are settled daily.
~~(b)~~	Net derivatives receivable included cash collateral netted of $61.9 billion and $55.5 billion at March 31, 2018, and December 31, 2017, respectively. Net derivatives payable included cash collateral netted of $45.1


(b)	Net derivatives receivable included cash collateral netted of $55.5 billion at both September 30, 2018, and December 31, 2017, respectively. Net derivatives payable included cash collateral netted of $40.1 billion and $45.5 billion ~~related to OTC and OTC-cleared derivatives at March 31, 2018, and December 31, 2017, respectively.~~

~~(c)~~

Represents liquid security collateral as well as cash collateral held at third party custodians related to derivative instruments where an appropriate legal opinion has been obtained. For some counterparties, the collateral amounts of financial instruments may exceed the derivative receivables and derivative payables balances. Where this is the case, the total amount reported is limited to the net derivative receivables and net derivative payables balances with that counterparty.


~~(d)~~	~~Derivative collateral relates only to OTC and OTC-cleared derivative instruments.~~

~~Liquidity risk and credit-related contingent features~~

~~For a more detailed discussion of liquidity risk and credit-related contingent features related to the Firm’s derivative contracts, see Note 5 of JPMorgan Chase’s 2017 Annual Report.~~

~~The following table shows the aggregate fair value of net derivative payables~~ related to OTC and OTC-cleared derivatives ~~that contain contingent collateral or termination features that may be triggered upon a ratings downgrade, and the associated collateral the Firm has posted in the normal course of business,~~ at ~~March 31, 2018, and December 31, 2017.~~

OTC and OTC-cleared derivative payables containing downgrade triggers
(in millions) March 31, 2018
December 31, 2017
Aggregate fair value of net derivative payables $ 11,022
$ 11,916
Collateral posted 9,836
9,973

The following table shows the impact of a single-notch and two-notch downgrade of the long-term issuer ratings of JPMorgan Chase & Co. and its subsidiaries, predominantly JPMorgan Chase Bank, National Association (“JPMorgan Chase Bank, N.A.”),

~~at March 31,~~September 30, 2018, and December 31, 2017, respectively.

(c)


(d)	Derivative collateral relates only to OTC and OTC-cleared derivative instruments.

Liquidity risk and credit-related contingent features

For a more detailed discussion of liquidity risk and credit-related contingent features related to the Firm’s derivative contracts, refer to Note5of JPMorgan Chase’s 2017 Annual Report.

The following table shows the aggregate fair value of net derivative payables related to OTC and OTC-cleared derivatives that contain contingent collateral or termination features that may be triggered upon a ratings downgrade, and the associated collateral the Firm has posted in the normal course of business, at September 30, 2018, and

December 31, 2017.

at September 30, 2018, and December 31, 2017, related to OTC and OTC-cleared derivative contracts with contingent collateral or termination features that may be triggered upon a ratings downgrade. Derivatives contracts generally require additional collateral to be posted or terminations to be triggered when the predefined threshold rating is breached. A downgrade by a single rating agency that does not result in a rating lower than a preexisting corresponding rating provided by another major rating agency will generally not result in additional collateral, (except in certain instances in which additional initial margin may be required upon a ratings downgrade), nor in termination payments requirements. The liquidity impact in the table is calculated based upon a downgrade below the lowest current rating of the rating agencies referred to in the derivative contract.



Liquidity impact of downgrade triggers on OTC and OTC-cleared derivatives
	September 30, 2018				December 31, 2017
(in millions)	Single-notch downgrade		Two-notch downgrade		Single-notch downgrade		Two-notch downgrade
Amount of additional collateral to be posted upon downgrade^(a)	$	116	$	2,046	$	79	$	1,989
Amount required to settle contracts with termination triggers upon downgrade^(b)	317		861		320		650


(a)	Includes the additional collateral to be posted ~~or terminations to be triggered when the predefined threshold rating is breached. A downgrade by a single rating agency that does~~for initial margin.

(b)

Amounts represent fair values of derivative payables, and do not ~~result in a rating lower than a preexisting corresponding rating provided by another major rating agency will generally not result in additional~~reflect collateral (except in certain instances in which additional initial margin may be required upon a ratings downgrade), nor in termination payments requirements. The liquidity impact in the table is calculated based upon a downgrade below the lowest current rating of the rating agencies referred to in the derivative contract.

Liquidity impact of downgrade triggers on OTC and OTC-cleared derivatives
March 31, 2018 December 31, 2017
(in millions) Single-notch downgrade Two-notch downgrade Single-notch downgrade Two-notch downgrade
Amount of additional collateral to be posted upon downgrade^(a)
$ 80
$ 1,929
$ 79
$ 1,989
Amount required to settle contracts with termination triggers upon downgrade^(b)
344
679
320
650


~~(a)~~	~~Includes the additional collateral to be posted for initial margin.~~posted.


~~(b)~~	~~Amounts represent fair values of derivative payables, and do not reflect collateral posted.~~

~~Derivatives executed in contemplation of a sale of the underlying financial asset~~

In certain instances the Firm enters into transactions in which it transfers financial assets but maintains the economic exposure to the transferred assets by entering into a derivative with the same counterparty in contemplation of the initial transfer. The Firm generally accounts for such transfers as collateralized financing transactions as described in Note 10, but in limited circumstances they may qualify to be accounted for as a sale and a derivative under U.S. GAAP. The amount of such transfers accounted for as a sale where the associated derivative was outstanding at March 31, 2018 was not material, and there were no such transfers at December 31, 2017.

~~Impact of derivatives on the Consolidated statements of income~~

~~The following tables provide information related to gains and losses recorded on derivatives based on their hedge accounting designation or purpose.~~

~~Fair value hedge gains and losses~~

The following tables present derivative instruments, by contract type, used in fair value hedge accounting relationships, as well as pre-tax gains/(losses) recorded on such derivatives and the related hedged items for the three months ended March 31, 2018 and 2017, respectively. The Firm includes gains/(losses) on the hedging derivative in the same line item in the Consolidated statements of income as the related hedged item.

Gains/(losses) recorded in income
Income statement impact of
excluded components^(f)
OCI impact
Three months ended March 31, 2018
(in millions) Derivatives Hedged items Income statement impact Amortization approach Changes in fair value
Derivatives - Gains/(losses) recorded in OCI^(g)
Contract type
Interest rate^(a)(b)
$ (1,477 ) $ 1,629
$ 152
$ —
$ 147
$ —
Foreign exchange^(c)
144
(33 ) 111
(122 ) 111
(52 )
Commodity^(d)
184
(147 ) 37
—
18
—
Total $ (1,149 ) $ 1,449
$ 300
$ (122 ) $ 276
$ (52 )

Gains/(losses) recorded in income Income statement impact due to:
Three months ended March 31, 2017
(in millions) Derivatives Hedged items Income statement impact
Hedge ineffectiveness^(e)
Excluded components^(f)

Contract type
Interest rate^(a)(b)
$ (281 ) $ 531
$ 250
$ (1 ) $ 251

Foreign exchange^(c)
(775 ) 740
(35 ) —
(35 )
Commodity^(d)
(463 ) 464
1
16
(15 )
Total $ (1,519 ) $ 1,735
$ 216
$ 15
$ 201

Derivatives executed in contemplation of a sale of the underlying financial asset

In certain instances the Firm enters into transactions in which it transfers financial assets but maintains the economic exposure to the transferred assets by entering into a derivative with the same counterparty in contemplation of the initial transfer. The Firm generally accounts for such transfers as collateralized financing transactions as described in Note10, but in limited circumstances they may qualify to be accounted for as a sale and a derivative under U.S. GAAP. The amount of such transfers accounted for as a sale where the associated derivative was outstanding at September 30, 2018 was not material, and there were no such transfers at December 31, 2017.

Impact of derivatives on the Consolidated statements of income

The following tables provide information related to gains and losses recorded on derivatives based on their hedge accounting designation or purpose.

Fair value hedge gains and losses

The following tables present derivative instruments, by contract type, used in fair value hedge accounting relationships, as well as pre-tax gains/(losses) recorded on such derivatives and the related hedged items for thethree and nine months ended September 30, 2018 and 2017, respectively. The Firm includes gains/(losses) on the hedging derivative in the same line item in the Consolidated statements of income as the related hedged item.



	Gains/(losses) recorded in income									Income statement impact of excluded components^(f)						OCI impact
Three months ended September 30, 2018 (in millions)	Derivatives			Hedged items			Income statement impact			Amortization approach			Changes in fair value			Derivatives - Gains/(losses) recorded in OCI^(g)
Contract type
Interest rate^(a)(b)	$	(870	)	$	1,032		$	162		$	—		$	160		$	—
Foreign exchange^(c)	277			(165		)	112			(137		)	112			45
Commodity^(d)	454			(461		)	(7		)	—			(5		)	—
Total	$	(139	)	$	406		$	267		$	(137	)	$	267		$	45



	Gains/(losses) recorded in income							Income statement impact due to:
Three months ended September 30, 2017 (in millions)	Derivatives			Hedged items		Income statement impact		Hedge ineffectiveness^(e)			Excluded components^(f)
Contract type
Interest rate^(a)(b)	$	22		$	182	$	204	$	(2	)	$	206
Foreign exchange^(c)	(982		)	1,002		20		—			20
Commodity^(d)	(457		)	461		4		4			—
Total	$	(1,417	)	$	1,645	$	228	$	2		$	226



	Gains/(losses) recorded in income								Income statement impact of excluded components^(f)					OCI impact
Nine months ended September 30, 2018 (in millions)	Derivatives			Hedged items			Income statement impact		Amortization approach			Changes in fair value		Derivatives - Gains/(losses) recorded in OCI^(g)
Contract type
Interest rate^(a)(b)	$	(2,747	)	$	3,214		$	467	$	—		$	459	$	—
Foreign exchange^(c)	797			(452		)	345		(404		)	345		(96		)
Commodity^(d)	649			(626		)	23		—			29		—
Total	$	(1,301	)	$	2,136		$	835	$	(404	)	$	833	$	(96	)



	Gains/(losses) recorded in income								Income statement impact due to:
Nine months ended September 30, 2017 (in millions)	Derivatives			Hedged items		Income statement impact			Hedge ineffectiveness^(e)			Excluded components^(f)
Contract type
Interest rate^(a)(b)	$	(131	)	$	759	$	628		$	(16	)	$	644
Foreign exchange^(c)	(3,254		)	3,235		(19		)	—			(19		)
Commodity^(d)	(823		)	861		38			23			15
Total	$	(4,208	)	$	4,855	$	647		$	7		$	640


(a)	Primarily consists of hedges of the benchmark (e.g., London Interbank Offered Rate (“LIBOR”)) interest rate risk of fixed-rate long-term debt and AFS securities. Gains and losses were recorded in net interest income.


(b)	Excludes the amortization expense associated with the inception hedge accounting adjustment applied to the hedged item. This expense is recorded in net interest income and substantially offsets the income statement impact of the excluded components. Also excludes the accrual of interest on interest rate swaps and the related hedged items.


(c)	Primarily consists of hedges of the foreign currency risk of long-term debt and AFS securities for changes in spot foreign currency rates. Gains and losses related to the derivatives and the hedged items due to changes in foreign currency rates and the income statement impact of excluded components were recorded primarily in principal transactions revenue and net interest income.


(d)	Consists of overall fair value hedges of physical commodities inventories that are generally carried at the lower of cost or net realizable value (net realizable value approximates fair value). Gains and losses were recorded in principal transactions revenue.


(e)	Hedge ineffectiveness is the amount by which the gain or loss on the designated derivative instrument does not exactly offset the gain or loss on the hedged item attributable to the hedged risk.

(f)

The assessment of hedge effectiveness excludes certain components of the changes in fair values of the derivatives and hedged items such as forward points on foreign exchange forward contracts, time values and cross-currency basis spreads. Under the new hedge accounting guidance, the initial amount of the excluded components may be amortized into income over the life of the derivative, or changes in fair value may be recognized in current period earnings.


(g)	Represents the change in value of amounts excluded from the assessment of effectiveness under the amortization approach, predominantly cross-currency basis spreads. The amount excluded at inception of the hedge is recognized in earnings over the life of the derivative.

As of September 30, 2018, the following amounts were recorded on the Consolidated balance sheets related to certain cumulative fair value hedge basis adjustments that are expected to reverse through the income statement in future periods as an adjustment to yield.



	Carrying amount of the hedged items^(a)(b)			Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items:
September 30, 2018 (in millions)	Carrying amount of the hedged items^(a)(b)			Active hedging relationships			Discontinued hedging relationships^(d)			Total
Assets
Investment securities - AFS	$	47,896	^(c)	$	(2,292	)	$	438		$	(1,854	)
Liabilities
Long-term debt	$	135,239		$	(2,693	)	$	(5	)	$	(2,698	)
Beneficial interests issued by consolidated VIEs	6,976			—			(42		)	(42		)

(a)

Excludes physical commodities with a carrying value of $4.6 billion to which the Firm applies fair value hedge accounting. As a result of the application of hedge accounting, these inventories are carried at fair value, thus recognizing unrealized gains and losses in current periods. Given the Firm exits these positions at fair value, there is no incremental impact to net income in future periods.


(b)	Excludes hedged items where only foreign currency risk is the designated hedged risk, as basis adjustments related to foreign currency hedges will not reverse through the income statement in future periods. The carrying amount excluded for available-for-sale securities is $14.7 billion and for long-term debt is $7.2 billion.


(c)	Carrying amount represents the amortized cost.


(d)	Represents hedged items no longer designated in qualifying fair value hedging relationships for which an associated basis adjustment exists at the balance sheet date.

Cash flow hedge gains and losses

The following tables present derivative instruments, by contract type, used in cash flow hedge accounting relationships, and the pre-tax gains/(losses) recorded on such derivatives, for the three and nine months ended September 30, 2018 and 2017, respectively. The Firm includes the gain/(loss) on the hedging derivative in the same line item in the Consolidated statements of income as the change in cash flows on the related hedged item.



	Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Three months ended September 30, 2018 (in millions)	Amounts reclassified from AOCI to income			Amounts recorded in OCI			Total change in OCI for period
Contract type
Interest rate^(a)	$	10		$	(30	)	$	(40	)
Foreign exchange^(b)	(19		)	(92		)	(73		)
Total	$	(9	)	$	(122	)	$	(113	)

	Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Three months ended September 30, 2017 (in millions)	Amounts reclassified from AOCI to income			Amounts recorded in OCI^(c)			Total change in OCI for period
Contract type
Interest rate^(a)	$	1		$	(1	)	$	(2	)
Foreign exchange^(b)	(11		)	30			41
Total	$	(10	)	$	29		$	39



	Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Nine months ended September 30, 2018 (in millions)	Amounts reclassified from AOCI to income			Amounts recorded in OCI			Total change in OCI for period
Contract type
Interest rate^(a)	$	36		$	(141	)	$	(177	)
Foreign exchange^(b)	26			(224		)	(250		)
Total	$	62		$	(365	)	$	(427	)

	Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Nine months ended September 30, 2017 (in millions)	Amounts reclassified from AOCI to income			Amounts recorded in OCI^(c)			Total change in OCI for period
Contract type
Interest rate^(a)	$	(16	)	$	11		$	27
Foreign exchange^(b)	(144		)	100			244
Total	$	(160	)	$	111		$	271


(a)	Primarily consists of benchmark interest rate hedges of LIBOR-indexed floating-rate assets and floating-rate liabilities. Gains and losses were recorded in net interest income.


(b)	Primarily consists of hedges of the foreign currency risk of non-U.S. dollar-denominated revenue and expense. The income statement classification of gains and losses follows the hedged item – primarily noninterest revenue and compensation expense.

(c)

Represents the effective portion of changes in value of the related hedging derivative. Hedge ineffectiveness is the amount by which the cumulative gain or loss on the designated derivative instrument exceeds the present value of the cumulative expected change in cash flows on the hedged item attributable to the hedged risk. The Firm did not recognize any ineffectiveness on cash flow hedges during the three and nine months ended September 30, 2017.

The Firm did not experience any forecasted transactions that failed to occur for the three and nine months ended September 30, 2018 and 2017.

Over the next 12 months, the Firm expects that approximately $(118) million (after-tax) of net losses recorded in AOCI at September 30, 2018, related to cash flow hedges will be recognized in income. For terminated cash flow hedges, the maximum length of time over which

forecasted transactions are remaining is approximately six years.

For open cash flow hedges, the maximum length of time over which forecasted transactions are hedged is approximately six years. The Firm’s longer-dated forecasted transactions relate to core lending and borrowing activities.

Net investment hedge gains and losses

The following table presents hedging instruments, by contract type, that were used in net investment hedge accounting relationships, and the pre-tax gains/(losses) recorded on such instruments for the three and nine months ended September 30, 2018 and 2017.



	2018						2017
Three months ended September 30, (in millions)	Amounts recorded in income^(a)(c)				Amounts recorded in OCI		Amounts recorded in income^(a)(c)				Amounts recorded in OCI^(b)
Foreign exchange derivatives		$	2		$	311		$	(39	)	$	(286	)

	2018						2017
Nine months ended September 30, (in millions)	Amounts recorded in income^(a)(c)				Amounts recorded in OCI		Amounts recorded in income^(a)(c)				Amounts recorded in OCI^(b)
Foreign exchange derivatives		$	(5	)	$	1,126		$	(150	)	$	(1,161	)


(a)	Certain components of hedging derivatives are permitted to be excluded from the assessment of hedge effectiveness, such as forward points on foreign exchange forward contracts. The Firm elects to record changes in fair value of these amounts directly in other income.


(b)	Represents the effective portion of changes in value of the related hedging derivative. The Firm did not recognize any ineffectiveness on net investment hedges directly in income during the three and nine months ended September 30, 2017.


(c)	Excludes amounts reclassified from AOCI to income on the sale or liquidation of hedged entities. For additional information, refer to Note 17.

Gains and losses on derivatives used for specified risk management purposes

The following table presents pre-tax gains/(losses) recorded on a limited number of derivatives, not designated in hedge accounting relationships, that are used to manage risks associated with certain specified assets and liabilities, including certain risks arising from the mortgage pipeline, warehouse loans, MSRs, wholesale lending exposures, and foreign currency-denominated assets and liabilities.



	Derivatives gains/(losses) recorded in income
	Three months ended September 30,						Nine months ended September 30,
(in millions)	2018			2017			2018			2017
Contract type
Interest rate^(a)	$	(42	)	$	97		$	(277	)	$	318
Credit^(b)	(7		)	(18		)	(17		)	(70		)
Foreign exchange^(c)	52			(18		)	152			(52		)
Total	$	3		$	61		$	(142	)	$	196


(a)	Primarily represents interest rate derivatives used to hedge the interest rate risk inherent in the mortgage pipeline, warehouse loans and MSRs, as well as written commitments to originate warehouse loans. Gains and losses were recorded predominantly in mortgage fees and related income.

(b)

Relates to credit derivatives used to mitigate credit risk associated with lending exposures in the Firm’s wholesale businesses. These derivatives do not include credit derivatives used to mitigate counterparty credit risk arising from derivative receivables, which is included in gains and losses on derivatives related to market-making activities and other derivatives. Gains and losses were recorded in principal transactions revenue.


(c)	Primarily relates to derivatives used to mitigate foreign exchange risk of specified foreign currency-denominated assets and liabilities. Gains and losses were recorded in principal transactions revenue.


~~(e)~~	~~Hedge ineffectiveness is the amount by which the gain or loss on the designated derivative instrument does not exactly offset the gain or loss on the hedged item attributable to the hedged risk.~~

~~(f)~~


~~(g)~~	Represents the change in value of amounts excluded from the assessment of effectiveness under the amortization approach, predominantly cross-currency basis spreads. The amount excluded at inception of the hedge is recognized in earnings over the life of the derivative.

As of March 31, 2018, the following amounts were recorded on the Consolidated balance sheets related to certain cumulative fair value hedge basis adjustments that are expected to impact the income statement in future periods (e.g., as adjustments to yield or to securities gains/losses).

Carrying amount of the hedged items^(a)(b)

Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items:

March 31, 2018
(in millions) Active hedging relationships
Discontinued hedging relationships^(d)
Total
Assets
Available-for-sale debt securities

47,977
^(c)
(1,557 ) 555
(1,002 )
Liabilities
Long-term debt 131,268
(851 ) 85
(766 )
Beneficial interests issued by consolidated VIEs 8,752
(2 ) (61 ) (63 )

~~(a)~~

Excludes physical commodities with a carrying value of $5.2 billion to which the Firm applies fair value hedge accounting. As a result of the application of hedge accounting, these inventories are carried at fair value, thus recognizing unrealized gains and losses in current periods. Given the Firm exits these positions at fair value, there is no incremental impact to net income in future periods.


~~(b)~~	Excludes hedged items where only foreign currency risk is the designated hedged risk, as basis adjustments related to foreign currency hedges generally will not impact the income statement in future periods. The carrying amount excluded for available-for-sale debt securities is $15.8 billion and for long-term debt is $5.5 billion.


~~(c)~~	~~Carrying amount represents the amortized cost.~~


~~(d)~~	~~Represents hedged items no longer designated in qualifying fair value hedging relationships for which an associated basis adjustment exists at the balance sheet date.~~

~~Cash flow hedge gains and losses~~

The following tables present derivative instruments, by contract type, used in cash flow hedge accounting relationships, and the pre-tax gains/(losses) recorded on such derivatives, for the three months ended March 31, 2018 and 2017, respectively. The Firm includes the gain/(loss) on the hedging derivative in the same line item in the Consolidated statements of income as the change in cash flows on the related hedged item.

Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Three months ended March 31, 2018
(in millions) Amounts reclassified from AOCI to income Amounts recorded in OCI Total change
in OCI
for period
Contract type
Interest rate^(a)
$ 13
$ (78 ) $ (91 )
Foreign exchange^(b)
39
34
(5 )
Total $ 52
$ (44 ) $ (96 )

Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Three months ended March 31, 2017
(in millions) Amounts reclassified from AOCI to income
Amounts recorded in OCI^(c)
Total change
in OCI
for period
Contract type
Interest rate^(a)
$ (11 ) $ 11
$ 22
Foreign exchange^(b)
(74 ) 48
122
Total $ (85 ) $ 59
$ 144


~~(a)~~	~~Primarily consists of benchmark interest rate hedges of LIBOR-indexed floating-rate assets and floating-rate liabilities. Gains and losses were recorded in net interest income.~~


~~(b)~~	Primarily consists of hedges of the foreign currency risk of non-U.S. dollar-denominated revenue and expense. The income statement classification of gains and losses follows the hedged item – primarily noninterest revenue and compensation expense.

~~(c)~~

~~The Firm did not experience any forecasted transactions that failed to occur for the three months ended March 31, 2018 and 2017.~~

Over the next 12 months, the Firm expects that approximately $88 million (after-tax) of net gains recorded in AOCI at March 31, 2018, related to cash flow hedges will be recognized in income. For terminated cash flow hedges, the maximum length of time over which forecasted transactions are remaining is approximately five years.

For open cash flow hedges, the maximum length of time over which forecasted transactions are hedged is approximately seven years. The Firm’s longer-dated forecasted transactions relate to core lending and borrowing activities.

~~Net investment hedge gains and losses~~

2018 2017
Three months ended March 31, (in millions)
Amounts recorded in income^(a)
Amounts recorded in OCI
Amounts recorded in income^(a)
Amounts recorded in OCI^(b)
Foreign exchange derivatives $ (11 ) $ (389 ) $ (62 ) $ (556 )

Gains and losses on derivatives related to market-making activities and other derivatives


~~(a)~~	Certain components of hedging derivatives are permitted to be excluded from the assessment of hedge effectiveness, such as forward points on foreign exchange forward contracts. The Firm elects to record changes in fair value of these amounts directly in other income.


~~(b)~~	Represents the effective portion of changes in value of the related hedging derivative. The Firm did not recognize any ineffectiveness on net investment hedges directly in income during the three months ended March 31, 2017.

~~Gains and losses on derivatives used for specified risk management purposes~~

Derivatives gains/(losses)
recorded in income
Three months ended March 31,
(in millions) 2018 2017
Contract type
Interest rate^(a)
$ (210 ) $ (17 )
Credit^(b)
(7 ) (45 )
Foreign exchange^(c)
(30 ) (20 )
Total $ (247 ) $ (82 )

The Firm makes markets in derivatives in order to meet the needs of customers and uses derivatives to manage certain risks associated with net open risk positions from its market-making activities, including the counterparty credit risk arising from derivative receivables. All derivatives not included in the hedge accounting or specified risk management categories above are included in this category. Gains and losses on these derivatives are primarily recorded in principal transactions revenue. Refer to Note5for information on principal transactions revenue.


~~(a)~~	Primarily represents interest rate derivatives used to hedge the interest rate risk inherent in the mortgage pipeline, warehouse loans and MSRs, as well as written commitments to originate warehouse loans. Gains and losses were recorded predominantly in mortgage fees and related income.

~~(b)~~


~~(c)~~	Primarily relates to derivatives used to mitigate foreign exchange risk of specified foreign currency-denominated assets and liabilities. Gains and losses were recorded in principal transactions revenue.

~~Gains and losses on derivatives related to market-making activities and other derivatives~~

The Firm makes markets in derivatives in order to meet the needs of customers and uses derivatives to manage certain risks associated with net open risk positions from its market-making activities, including the counterparty credit risk arising from derivative receivables. All derivatives not included in the hedge accounting or specified risk management categories above are included in this category. Gains and losses on these derivatives are primarily recorded in principal transactions revenue. See Note 5 for information on principal transactions revenue.

~~Credit derivatives~~

~~For a more detailed discussion of credit derivatives, see Note~~

Credit derivatives

For a more detailed discussion of credit derivatives, refer to Note5 of JPMorgan Chase’s 2017 Annual Report. The Firm does not use notional amounts of credit derivatives as the primary measure of risk management for such derivatives, because the notional amount does not take into account the probability of the occurrence of a credit event, the recovery value of the reference obligation, or related cash instruments and economic hedges, each of which reduces, in the Firm’s view, the risks associated with such derivatives.

Total credit derivatives and credit-related notes



	Maximum payout/Notional amount
September 30, 2018 (in millions)	Protection sold			Protection purchased with identical underlyings^(b)			Net protection (sold)/purchased^(c)			Other protection purchased^(d)
Credit derivatives
Credit default swaps	$	(746,195	)		$	754,889	$	8,694		$	6,341
Other credit derivatives^(a)	(38,928		)		45,393		6,465			11,563
Total credit derivatives	(785,123		)		800,282		15,159			17,904
Credit-related notes	(18		)		—		(18		)	7,653
Total	$	(785,141	)		$	800,282	$	15,141		$	25,557

	Maximum payout/Notional amount
December 31, 2017 (in millions)	Protection sold			Protection purchased with identical underlyings^(b)			Net protection (sold)/purchased^(c)			Other protection purchased^(d)
Credit derivatives
Credit default swaps	$	(690,224	)		$	702,098	$	11,874		$	5,045
Other credit derivatives^(a)	(54,157		)		59,158		5,001			11,747
Total credit derivatives	(744,381		)		761,256		16,875			16,792
Credit-related notes	(18		)		—		(18		)	7,915
Total	$	(744,399	)		$	761,256	$	16,857		$	24,707


(a)	Other credit derivatives largely consists of credit swap options.


(b)	Represents the total notional amount of protection purchased where the underlying reference instrument is identical to the reference instrument on protection sold; the notional amount of protection purchased for each individual identical underlying reference instrument may be greater or lower than the notional amount of protection sold.

(c)

Does not take into account the ~~probability of the occurrence of a credit event, the recovery~~fair value of the reference obligation ~~or related cash instruments and economic hedges, each of which reduces, in the Firm’s view, the risks associated with such derivatives.~~

~~Total credit derivatives and credit-related notes~~

Maximum payout/Notional amount
March 31, 2018 (in millions) Protection sold
Protection
purchased with
identical underlyings^(b)
Net protection (sold)/purchased^(c)

Other protection purchased^(d)
Credit derivatives
Credit default swaps $ (731,898 ) $ 739,263
$ 7,365
$ 6,024
Other credit derivatives^(a)
(58,210 ) 58,466
256
11,409
Total credit derivatives (790,108 ) 797,729
7,621
17,433
Credit-related notes (18 ) —
(18 ) 9,098
Total $ (790,126 ) $ 797,729
$ 7,603
$ 26,531

Maximum payout/Notional amount
December 31, 2017 (in millions) Protection sold
Protection
purchased with
identical underlyings^(b)
Net protection (sold)/purchased^(c)

Other protection purchased^(d)
Credit derivatives
Credit default swaps $ (690,224 ) $ 702,098
$ 11,874
$ 5,045
Other credit derivatives^(a)
(54,157 ) 59,158
5,001
11,747
Total credit derivatives (744,381 ) 761,256
16,875
16,792
Credit-related notes (18 ) —
(18 ) 7,915
Total $ (744,399 ) $ 761,256
$ 16,857
$ 24,707


~~(a)~~	~~Other credit derivatives largely consists of credit swap options.~~


~~(b)~~	Represents the total notional amount of protection purchased where the underlying reference instrument is identical to the reference instrument on protection sold; the notional amount of protection purchased for each individual identical underlying reference instrument may be greater or lower than the notional amount of protection sold.


~~(c)~~	~~Does not take into account the fair value of the reference obligation~~ at the time of settlement, which would generally reduce the amount ~~the seller of protection pays to the buyer of protection in determining settlement value.~~


~~(d)~~	~~Represents protection purchased by the Firm on referenced instruments (single-name, portfolio or index) where the Firm has not sold any protection on the identical reference instrument.~~

The following tables summarize the notional amounts by the ratings, maturity profile, and total fair value, of credit derivatives and credit-related notes as of March 31, 2018, and December 31, 2017, where JPMorgan Chase is the seller of protection pays to the buyer of protection in determining settlement value.


(d)	Represents protection purchased by the Firm on referenced instruments (single-name, portfolio or index) where the Firm has not sold any protection on the identical reference instrument.

The following tables summarize the notional amounts by the ratings, maturity profile, and total fair value, of credit derivatives and credit-related notes as of September 30, 2018, and December 31, 2017, where JPMorgan Chase is the seller of protection. The maturity profile is based on the remaining contractual maturity of the credit derivative contracts. The ratings profile is based on the rating of the reference entity on which the credit derivative contract is based. The ratings and maturity profile of credit derivatives and credit-related notes where JPMorgan Chase is the purchaser of protection are comparable to the profile reflected below.



Protection sold — credit derivatives and credit-related notes ratings^(a)/maturity profile
September 30, 2018 (in millions)	<1 year			1–5 years			>5 years			Total notional amount			Fair value of receivables^(b)		Fair value of payables^(b)			Net fair value
Risk rating of reference entity
Investment-grade	$	(116,930	)	$	(364,470	)	$	(71,226	)	$	(552,626	)	$	8,043	$	(1,859	)	$	6,184
Noninvestment-grade	(53,103		)	(147,117		)	(32,295		)	(232,515		)	8,337		(4,519		)	3,818
Total	$	(170,033	)	$	(511,587	)	$	(103,521	)	$	(785,141	)	$	16,380	$	(6,378	)	$	10,002



December 31, 2017 (in millions)	<1 year			1–5 years			>5 years			Total notional amount			Fair value of receivables^(b)		Fair value of payables^(b)			Net fair value
Risk rating of reference entity
Investment-grade	$	(159,286	)	$	(319,726	)	$	(39,429	)	$	(518,441	)	$	8,516	$	(1,134	)	$	7,382
Noninvestment-grade	(73,394		)	(134,125		)	(18,439		)	(225,958		)	7,407		(5,313		)	2,094
Total	$	(232,680	)	$	(453,851	)	$	(57,868	)	$	(744,399	)	$	15,923	$	(6,447	)	$	9,476

(a)

The ratings scale is primarily based on the remaining contractual maturity of the credit derivative contracts. The ratings profile is based on the rating of the reference entity on which the credit derivative contract is based. The ratings and maturity profile of credit derivatives and credit-related notes where JPMorgan Chase is the purchaser of protection are comparable to the profile reflected below.

Protection sold — credit derivatives and credit-related notes ratings^(a)/maturity profile

March 31, 2018
(in millions) <1 year 1–5 years >5 years
Total
notional amount

Fair value of receivables^(b)

Fair value of payables^(b)
Net fair value
Risk rating of reference entity
Investment-grade $ (160,144 ) $ (305,679 ) $ (71,789 ) $ (537,612 ) $ 8,231
$ (1,022 ) $ 7,209
Noninvestment-grade (75,170 ) (142,517 ) (34,827 ) (252,514 ) 8,160
(5,384 ) 2,776
Total $ (235,314 ) $ (448,196 ) $ (106,616 ) $ (790,126 ) $ 16,391
$ (6,406 ) $ 9,985

December 31, 2017
(in millions) <1 year 1–5 years >5 years
Total
notional amount

Fair value of receivables^(b)

Fair value of payables^(b)
Net fair value
Risk rating of reference entity
Investment-grade $ (159,286 ) $ (319,726 ) $ (39,429 ) $ (518,441 ) $ 8,516
$ (1,134 ) $ 7,382
Noninvestment-grade (73,394 ) (134,125 ) (18,439 ) (225,958 ) 7,407
(5,313 ) 2,094
Total $ (232,680 ) $ (453,851 ) $ (57,868 ) $ (744,399 ) $ 15,923
$ (6,447 ) $ 9,476


~~(a)~~	~~The ratings scale is primarily based on~~ external credit ratings defined by S&P and Moody’s.


(b)	Amounts are shown on a gross basis, before the benefit of legally enforceable master netting agreements and cash collateral received by the Firm.


~~(b)~~	~~Amounts are shown on a gross basis, before the benefit of legally enforceable master netting agreements and cash collateral received by the Firm.~~

~~Note 5 – Noninterest revenue and noninterest~~

~~expense~~

~~Noninterest revenue~~

~~For a discussion of the components of and accounting policies for the Firm’s noninterest revenue, see Note~~ 6 ~~of JPMorgan Chase’s 2017 Annual Report.~~

The adoption of the revenue recognition guidance requires gross presentation of certain costs previously offset against revenue, predominantly associated with certain distribution costs (previously offset against asset management, administration and commissions), with the remainder associated with certain underwriting costs (previously offset against investment banking fees). Adoption of the guidance did not result in any material changes in the timing of revenue recognition. This guidance was adopted retrospectively and, accordingly, prior period amounts were revised, which resulted in an increase in both noninterest revenue and noninterest expense. ~~For additional information, see Note 1.~~

~~Investment banking fees~~

~~The following table presents the components of investment banking fees.~~

Three months ended March 31,
(in millions) 2018
2017
Underwriting

Equity $ 352

$ 424
Debt 796

960
Total underwriting 1,148

1,384
Advisory 588

496
Total investment banking fees $ 1,736

$ 1,880

~~Principal transactions~~

Note 5 – Noninterest revenue and noninterest

expense

Noninterest revenue

For a discussion of the components of and accounting policies for the Firm’s noninterest revenue, refer to Note 6 of JPMorgan Chase’s 2017 Annual Report.

The adoption of the revenue recognition guidance in the first quarter of 2018, required gross presentation of certain costs previously offset against revenue, predominantly associated with certain distribution costs (previously offset against asset management, administration and commissions), with the remainder associated with certain underwriting costs (previously offset against investment banking fees). Adoption of the guidance did not result in any material changes in the timing of revenue recognition. This guidance was adopted retrospectively and, accordingly, prior period amounts were revised, which resulted in an increase in both noninterest revenue and noninterest expense. For additional information, refer to Note1.

Investment banking fees

The following table presents the components of investment banking fees.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Underwriting
Equity	$	417	$	302	$	1,342	$	1,105
Debt	836		945		2,596		2,873
Total underwriting	1,253		1,247		3,938		3,978
Advisory	579		621		1,798		1,616
Total investment banking fees	$	1,832	$	1,868	$	5,736	$	5,594

Principal transactions

The following table presents all realized and unrealized gains and losses recorded in principal transactions revenue. This table excludes interest income and interest expense on trading assets and liabilities, which are an integral part of the overall performance of the Firm’s client-driven market-making activities. Refer to Note 6 for further information on interest income and interest expense. Trading revenue is presented primarily by instrument type. The Firm’s client-driven market-making businesses generally utilize a variety of instrument types in connection with their market-making and related risk-management activities; accordingly, the trading revenue presented in the table below is not representative of the total revenue of any individual line of busi

ness.



	Three months ended September 30,						Nine months ended September 30,
(in millions)	2018			2017			2018			2017
Trading revenue by instrument type
Interest rate	$	338		$	649		$	1,784		$	2,032
Credit	202			330			1,230			1,288
Foreign exchange	937			681			2,706			2,363
Equity	1,363			915			4,376			3,153
Commodity	277			156			800			461
Total trading revenue	3,117			2,731			10,896			9,297
Private equity gains/(losses)^(a)	(153		)	(10		)	(198		)	143
Principal transactions	$	2,964		$	2,721		$	10,698		$	9,440


(a)	The third quarter of 2018 included markdowns of approximately $220 million on certain private equity investments in Corporate, with $170 million recorded within principal transactions revenue and $50 million in other income.

Lending- and deposit-related fees

The following table presents the components of lending- and deposit-related fees.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Lending-related fees	$	284	$	280	$	838	$	824
Deposit-related fees	1,258		1,217		3,676		3,603
Total lending- and deposit-related fees	$	1,542	$	1,497	$	4,514	$	4,427

Asset management, administration and commissions

The following table presents the components of Firmwide asset management, administration and commissions.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Asset management fees
Investment management fees^(a)	$	2,716	$	2,636	$	8,081	$	7,603
All other asset management fees^(b)	79		63		211		226
Total asset management fees	2,795		2,699		8,292		7,829

Total administration fees^(c)	533		514		1,651		1,500

Commission and other fees
Brokerage commissions	604		546		1,887		1,691
All other commissions and fees	378		313		1,093		976
Total commissions and fees	982		859		2,980		2,667
Total asset management, administration and commissions	$	4,310	$	4,072	$	12,923	$	11,996


(a)	Represents fees earned from managing assets on behalf of the Firm’s ~~client-driven market-making activities. See Note 6~~clients, including investors in Firm-sponsored funds and owners of separately managed investment accounts.


(b)	Represents fees for ~~further information~~services that are ancillary to investment management services, such as commissions earned on ~~interest income~~the sales or distribution of mutual funds to clients.


(c)	Predominantly includes fees for custody, securities lending, funds services and interest expense. Trading revenue is presented primarily by instrument type. The Firm’s client-driven market-making businesses generally utilize a variety of instrument types in connection with their market-makingsecurities clearance.

Card income

The following table presents the components of card income:



	Three months ended September 30,						Nine months ended September 30,
(in millions)	2018			2017			2018				2017
Interchange and merchant processing income	$	4,781		$	4,342		$	13,863			$	12,557
Rewards costs and partner payments	(3,276		)	(2,727		)	(9,687		)	^(b)	(7,941		)
Other card income^(a)	(177		)	(373		)	(553		)		(1,293		)
Total card income	$	1,328		$	1,242		$	3,623			$	3,323

(a)

Predominantly represents annual fees and ~~related risk-management activities; accordingly, the trading revenue presented in the table below is not representative of the total revenue of any individual line of business.~~

Three months ended March 31,
(in millions) 2018
2017
Trading revenue by instrument type
Interest rate $ 774
$ 795
Credit 380
680
Foreign exchange 1,024
781
Equity 1,627
1,120
Commodity 277
185
Total trading revenue 4,082
3,561
Private equity gains/(losses) (130 ) 21
Principal transactions $ 3,952
$ 3,582

~~Lending- and deposit-related fees~~

~~The following table presents the components of lending- and deposit-related fees.~~

Three months ended March 31,
(in millions) 2018
2017
Lending-related fees $ 274
$ 275
Deposit-related fees 1,203
1,173
Total lending- and deposit-related fees $ 1,477
$ 1,448

~~Asset management, administration and commissions~~

~~The following table presents the components of Firmwide asset management, administration and commissions.~~

Three months ended March 31,
(in millions) 2018
2017
Asset management fees
Investment management fees^(a)
$ 2,694
$ 2,416
All other asset management fees^(b)
66
79
Total asset management fees 2,760
2,495

Total administration fees^(c)
561
482

Commission and other fees
Brokerage commissions 652
578
All other commissions and fees 336
322
Total commissions and fees 988
900
Total asset management, administration and commissions^(a)
$ 4,309
$ 3,877


~~(a)~~	~~Represents fees earned from managing assets on behalf of the Firm’s clients, including investors in Firm-sponsored funds and owners of separately managed investment accounts.~~


~~(b)~~	~~Represents fees for services that are ancillary to investment management services, such as commissions earned on the sales or distribution of mutual funds to clients.~~


~~(c)~~	~~Predominantly includes fees for custody, securities lending, funds services and securities clearance.~~

~~Card income~~

~~The following table presents the components of card income:~~

Three months ended March 31,
(in millions) 2018
2017
Interchange and merchant processing income $ 4,359
$ 3,906
Reward costs and partner payments (2,884 ) (2,525 )
Other card income^(a)
(200 ) (467 )
Total card income $ 1,275
$ 914


~~(a)~~	~~Predominantly represents annual and other lending fees and~~new account origination costs, ~~(including new account origination costs),~~ which are deferred and recognized on a straight-line basis over a 12-month period.


(b)	Includes an adjustment to the credit card rewards liability of approximately $330 million, recorded in the second quarter of 2018.

Other income

Other income on the Firm’s Consolidated statements of income included the following:



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Operating lease income	$	1,157	$	928	$	3,316	$	2,625

Noninterest expense

Other expense

Other expense on the Firm’s Consolidated statements of income included the following:



	Three months ended September 30,					Nine months ended September 30,
(in millions)	2018		2017			2018		2017
Legal expense	$	20	$	(107	)	$	90	$	172
FDIC-related expense	349		353			1,100		1,110

Note 6 – Interest income and Interest expense

For a description of JPMorgan Chase’s accounting policies regarding interest income and interest expense, refer to Note7 of JPMorgan Chase’s 2017 Annual Report.

The following table presents the components of interest income and interest expense.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Interest income
Loans^(a)	$	12,207	$	10,519	$	34,915	$	30,265
Taxable securities	1,402		1,362		4,098		4,202
Non-taxable securities^(b)	394		456		1,199		1,393
Total investment securities^(a)	1,796		1,818		5,297		5,595
Trading assets	2,155		1,947		6,369		5,611
Federal funds sold and securities purchased under resale agreements	952		622		2,490		1,676
Securities borrowed^(c)	200		—		410		(65		)
Deposits with banks	1,585		1,259		4,449		3,002
All other interest-earning assets^(d)	945		522		2,474		1,295
Total interest income	19,840		16,687		56,404		47,379
Interest expense
Interest-bearing deposits	1,621		837		4,021		1,949
Federal funds purchased and securities loaned or sold under repurchase agreements	827		451		2,164		1,131
Short-term borrowings^(e)	288		149		757		318
Trading liabilities – debt and all other interest-bearing liabilities^(f)	1,018		570		2,579		1,490
Long-term debt	2,056		1,759		5,812		5,035
Beneficial interest issued by consolidated VIEs	122		123		366		386
Total interest expense	5,932		3,889		15,699		10,309
Net interest income	13,908		12,798		40,705		37,070
Provision for credit losses	948		1,452		3,323		3,982
Net interest income after provision for credit losses	$	12,960	$	11,346	$	37,382	$	33,088


(a)	Includes the amortization/accretion of unearned income ~~Other~~(e.g., purchase premiums/discounts, net deferred fees/costs, etc.).


(b)	Represents securities which are tax-exempt for U.S. federal income ontax purposes.

(c)

Negative interest income is related to client-driven demand for certain securities combined with the ~~Firm’s Consolidated statements~~impact of ~~income included~~low interest rates. This is matched book activity and the ~~following:~~

Three months ended March 31,
(in millions) 2018
2017
Operating lease income $ 1,047
$ 824

~~Noninterest expense~~

~~Other expense~~

~~Other~~negative interest expense on the ~~Firm’s~~corresponding securities loaned is recognized in interest expense.

(d)

Includes held-for-investment margin loans, which are classified in accrued interest and accounts receivable, and all other interest-earning assets included in other assets on the Consolidated ~~statements of income included the following:~~

Three months ended March 31,
(in millions) 2018
2017
Legal expense $ 70
$ 218
FDIC-related expense 383
381

~~Note 6 – Interest income and Interest expense~~

~~For a description of JPMorgan Chase’s accounting policies regarding interest income and interest expense, see Note 7 of JPMorgan Chase’s 2017 Annual Report.~~

~~The following table presents the components of interest income and interest expense.~~

Three months ended
March 31,
(in millions) 2018

2017
Interest income

Loans^(a)
$ 11,074

$ 9,751
Taxable securities 1,313

1,430
Non-taxable securities^(b)
410

458
Total investment securities^(a)
1,723

1,888
Trading assets 2,103

1,858
Federal funds sold and securities purchased under resale agreements 731

526
Securities borrowed^(c)
62

(44 )
Deposits with banks 1,321

725
All other interest-earning assets^(d)
681

338
Total interest income 17,695

15,042
Interest expense

Interest-bearing deposits 1,060

483
Federal funds purchased and securities loaned or sold under repurchase agreements 578

293
Short-term borrowings^(e)
209

73
Trading liabilities – debt and all other interest-bearing liabilities^(f)
660

405
Long-term debt 1,753
1,589
Beneficial interest issued by consolidated VIEs 123

135
Total interest expense 4,383

2,978
Net interest income 13,312

12,064
Provision for credit losses 1,165

1,315
Net interest income after provision for credit losses $ 12,147

$ 10,749

	balance sheets.
~~(a)~~	~~Includes the amortization/accretion of unearned income (e.g., purchase premiums/discounts, net deferred fees/costs, etc.).~~


(e)	Includes commercial paper.


(f)	Other interest-bearing liabilities include brokerage customer payables.


~~(b)~~	~~Represents securities which are tax-exempt for U.S. federal income tax purposes.~~


~~(c)~~	Negative interest income is related to client-driven demand for certain securities combined with the impact of low interest rates. This is matched book activity and the negative interest expense on the corresponding securities loaned is recognized in interest expense.


~~(d)~~	Includes held-for-investment margin loans, which are classified in accrued interest and accounts receivable, and all other interest-earning assets included in other assets on the Consolidated balance sheets.


~~(e)~~	~~Includes commercial paper.~~


~~(f)~~	~~Other interest-bearing liabilities include brokerage customer payables.~~

~~Note 7 – Pension and other postretirement employee benefit plans~~

~~For a discussion of JPMorgan Chase’s pension and OPEB plans, see Note 8 of JPMorgan Chase’s 2017 Annual Report.~~

Note 7 – Pension and other postretirement employee benefit plans

For a discussion of JPMorgan Chase’s pension and OPEB plans, refer to Note8 of JPMorgan Chase’s 2017 Annual Report.

The following table presents the components of net periodic benefit costs reported in the Consolidated statements of income for the Firm’s U.S. and non-U.S. defined benefit pension, defined contribution and OPEB plans.



(in millions)	Three months ended September 30,												Nine months ended September 30,
	2018			2017			2018			2017			2018			2017			2018			2017
	Defined benefit pension plans						OPEB plans						Defined benefit pension plans						OPEB plans
Components of net periodic benefit cost
Benefits earned during the period	$	88		$	83		$	—		$	—		$	267		$	247		$	—		$	—
Interest cost on benefit obligations	139			148			6			7			417			447			18			21
Expected return on plan assets	(246		)	(242		)	(25		)	(24		)	(741		)	(725		)	(77		)	(72		)
Amortization:
Net (gain)/loss	26			63			—			—			78			187			—			—
Prior service cost/(credit)	(7		)	(9		)	—			—			(19		)	(27		)	—			—
Settlement	—			—			—			—			—			(3		)	—			—
Net periodic defined benefit cost^(a)	—			43			(19		)	(17		)	2			126			(59		)	(51		)
Other defined benefit pension plans^(b)	6			6			NA			NA			21			16			NA			NA
Total defined benefit plans	6			49			(19		)	(17		)	23			142			(59		)	(51		)
Total defined contribution plans	229			221			NA			NA			661			617			NA			NA
Total pension and OPEB cost included in noninterest expense	$	235		$	270		$	(19	)	$	(17	)	$	684		$	759		$	(59	)	$	(51	)


(a)	Effective January 1, 2018, benefits earned during the period are reported in compensation expense; all other components of net periodic defined benefit costs are reported within other expense in the Consolidated statements of ~~income for the Firm’s U.S. and non-U.S.~~income.

(b)

Includes various defined benefit pension ~~defined contribution and OPEB plans.~~

Defined benefit pension plans OPEB plans

Three months ended March 31, (in millions) 2018
2017
2018
2017
Components of net periodic benefit cost
Benefits earned during the period $ 90
$ 82
$ —
$ —
Interest cost on benefit obligations 139
149
6
7
Expected return on plan assets (248 ) (241 ) (26 ) (24 )
Amortization:
Net (gain)/loss 26
62
—
—
Prior service cost/(credit) (6 ) (9 ) —
—
Settlement —
(3 ) —
—
Net periodic defined benefit cost^(a)
1
40
(20 ) (17 )
Other defined benefit pension plans^(b)
6
4
NA
NA
Total defined benefit plans 7
44
(20 ) (17 )
Total defined contribution plans 210
186
NA
NA
Total pension and OPEB cost included in noninterest expense $ 217
$ 230
$ (20 ) $ (17 )


~~(a)~~	Effective January 1, 2018, benefits earned during the period are reported in compensation expense; all other components of net periodic defined benefit costs are reported within other expense in the Consolidated statements of income. For additional information, see Note 1.


~~(b)~~	~~Includes various defined benefit pension~~ plans which are individually immaterial.

The following table presents the fair values of plan assets for the U.S. defined benefit pension and OPEB plans and for the material non-U.S. defined benefit pension plans.



(in billions)	September 30, 2018		December 31, 2017
Fair value of plan assets
Defined benefit pension plans	$	19.2	$	19.6
OPEB plans	2.8		2.8

There are no expected contributions to the U.S. defined benefit pension plan for 2018.

Note 8 – Employee share-based incentives

For a discussion of the accounting policies and other information relating to employee share-based incentives, refer to Note9 of JPMorgan Chase’s 2017 Annual Report.

The Firm recognized the following noncash compensation expense related to its various employee share-based incentive plans in its Consolidated statements of income.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Cost of prior grants of RSUs, stock appreciation rights (“SARs”) and performance share units (“PSUs”) that are amortized over their applicable vesting periods	$	282	$	267	$	956	$	867
Accrual of estimated costs of share-based awards to be granted in future periods including those to full-career eligible employees	240		224		852		750
Total noncash compensation expense related to employee share-based incentive plans	$	522	$	491	$	1,808	$	1,617

In the first quarter of 2018, in connection with its annual incentive grant for the 2017 performance year, the Firm granted 17 million RSUs and 516 thousand PSUswith weighted-average grant date fair values of $111.17 per RSU and $110.46 per PSU.

Note 9 – Investment securities

Investment securities consist of debt securities that are classified as AFS or HTM. Debt securities classified as trading assets are discussed in Note2. Predominantly all of the Firm’s AFS and HTM securities are held by Treasury and CIO in connection with its asset-liability management activities. At September 30, 2018, the investment securities portfolio consisted of debt securities with an average credit rating ofAA+(based upon external ratings where available, and where not available, based primarily upon internal ratings which correspond to ratings as defined by S&P and Moody’s). For additional information regarding the investment securities portfolio, refer to Note10 of JPMorgan Chase’s 2017 Annual Report.

As a result of the adoption of the premium amortization accounting guidance in the first quarter of 2018, premiums

on purchased callable debt securities must be amortized to the earliest call date for debt securities with call features that are explicit, noncontingent and callable at fixed prices and on preset dates. The guidance primarily impacts obligations of U.S. states and municipalities held in the Firm’s investment securities portfolio. For additional information, refer to Note17.

As permitted by the new hedge accounting guidance, the Firm also elected to transfer U.S. government agency MBS, commercial MBS, and obligations of U.S. states and municipalities with a carrying value of $22.4 billion from HTM to AFS in the first quarter of 2018. This transfer was a non-cash transaction. For additional information, refer to Note17.

The amortized costs and estimated fair values of the investment securities portfolio were as follows for the dates indicated.



	September 30, 2018								December 31, 2017
(in millions)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value		Amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
Available-for-sale securities
Mortgage-backed securities:
U.S. government agencies^(a)	$	64,229	$	389	$	1,508	$	63,110	$	69,879	$	736	$	335	$	70,280
Residential:
U.S.	6,396		127		36		6,487		8,193		185		14		8,364
Non-U.S.	2,639		94		3		2,730		2,882		122		1		3,003
Commercial	7,151		79		182		7,048		4,932		98		5		5,025
Total mortgage-backed securities	80,415		689		1,729		79,375		85,886		1,141		355		86,672
U.S. Treasury and government agencies	27,526		486		196		27,816		22,510		266		31		22,745
Obligations of U.S. states and municipalities	36,659		1,580		118		38,121		30,490		1,881		33		32,338
Certificates of deposit	75		—		—		75		59		—		—		59
Non-U.S. government debt securities	24,398		321		45		24,674		26,900		426		32		27,294
Corporate debt securities	1,993		64		1		2,056		2,657		101		1		2,757
Asset-backed securities:
Collateralized loan obligations	20,139		12		42		20,109		20,928		69		1		20,996
Other	7,761		70		27		7,804		8,764		77		24		8,817
Total available-for-sale debt securities	198,966		3,222		2,158		200,030		198,194		3,961		477		201,678
Available-for-sale equity securities^(b)	—		—		—		—		547		—		—		547
Total available-for-sale securities	198,966		3,222		2,158		200,030		198,741		3,961		477		202,225
Held-to-maturity securities
Mortgage-backed securities:
U.S. government agencies^(c)	26,537		5		493		26,049		27,577		558		40		28,095
Commercial	—		—		—		—		5,783		1		74		5,710
Total mortgage-backed securities	26,537		5		493		26,049		33,360		559		114		33,805
Obligations of U.S. states and municipalities	4,831		69		31		4,869		14,373		554		80		14,847
Total held-to-maturity securities	31,368		74		524		30,918		47,733		1,113		194		48,652
Total investment securities	$	230,334	$	3,296	$	2,682	$	230,948	$	246,474	$	5,074	$	671	$	250,877

(a)

Includes total U.S. government-sponsored enterprise obligations with fair values of ~~plan assets for the U.S. defined benefit pension~~$44.2 billion and ~~OPEB plans~~$45.8 billion at September 30, 2018, and ~~for the material non-U.S. defined benefit pension plans:~~

(in billions) March 31, 2018
December 31, 2017
Fair value of plan assets
Defined benefit pension plans $ 19.5
$ 19.6
OPEB plans 2.7
2.8

~~There are no expected contributions to the U.S. defined benefit pension plan for 2018.~~

~~Note 8 – Employee share-based incentives~~

~~For a discussion of the accounting policies and other information relating to employee share-based incentives, see Note 9 of JPMorgan Chase’s~~December 31, 2017, ~~Annual Report.~~

~~The Firm recognized the following noncash compensation expense related to its various employee share-based incentive plans in its Consolidated statements of income.~~

Three months ended
March 31,
(in millions) 2018
2017
Cost of prior grants of RSUs, stock appreciation rights (“SARs”) and performance share units (“PSUs”) that are amortized over their applicable vesting periods $ 398
$ 310
Accrual of estimated costs of share-based awards to be granted in future periods including those to full-career eligible employees 308
291
Total noncash compensation expense related to employee share-based incentive plans $ 706
$ 601

~~In the first quarter of~~respectively.

(b)

Effective January 1, 2018, ~~in connection with its annual incentive grant for the 2017 performance year,~~ the Firm ~~granted 17 million RSUs~~adopted the recognition and ~~516 thousand PSUs with weighted-average grant date fair value of $111.17 per RSU and $110.46 per PSU.~~

~~Note 9 – Investment securities~~

~~Investment securities consist of debt~~measurement guidance. Equity securities that ~~are classified~~were previously reported as AFS ~~or HTM. Debt~~ securities ~~classified as trading~~were reclassified to other assets ~~are discussed in Note 2. Predominantly all~~upon adoption.

(c)

Included total U.S. government-sponsored enterprise obligations with amortized cost of ~~the Firm’s AFS~~$20.6 billion and HTM securities are held by Treasury and CIO in connection with its asset-liability management activities. At March 31, 2018, the investment securities portfolio consisted of debt securities with an average credit rating of ~~AA+~~ (based upon external ratings where available, and where not available, based primarily upon internal ratings which correspond to ratings as defined by S&P and Moody’s). For additional information regarding the investment securities portfolio, see Note 10 of JPMorgan Chase’s 2017 Annual Report.

~~As a result of the adoption of the premium amortization accounting guidance, premiums on purchased callable debt securities must be amortized to the earliest call date for~~

~~debt securities with call features that are explicit, noncontingent and callable~~$22.0 billion at fixed prices and on preset dates. The guidance primarily impacts obligations of U.S. states and municipalities held in the Firm’s investment securities portfolio. For additional information, see Notes 1 and 17.

As permitted by the new hedge accounting guidance, the Firm also elected to transfer U.S. government agency MBS, commercial MBS, and obligations of U.S. states and municipalities with a carrying value of $22.4 billion from HTM to AFS. The transfer of these investment securities resulted in the recognition of a net pre-tax unrealized

~~gain of $221 million within AOCI. This transfer was a non-cash transaction. For additional information, see Notes 1 and 17.~~

~~The amortized costs and estimated fair values of the investment securities portfolio were as follows for the dates indicated.~~

March 31, 2018 December 31, 2017
(in millions) Amortized cost Gross unrealized gains Gross unrealized losses Fair value Amortized cost Gross unrealized gains Gross unrealized losses Fair value
Available-for-sale debt securities
Mortgage-backed securities:
U.S. government agencies^(a)
$ 67,614
$ 633
$ 1,038
$ 67,209
$ 69,879
$ 736
$ 335
$ 70,280
Residential:
U.S. 7,659
166
26
7,799
8,193
185
14
8,364
Non-U.S. 2,686
118
—
2,804
2,882
122
1
3,003
Commercial 9,262
84
206
9,140
4,932
98
5
5,025
Total mortgage-backed securities 87,221
1,001
1,270
86,952
85,886
1,141
355
86,672
U.S. Treasury and government agencies 25,164
408
122
25,450
22,510
266
31
22,745
Obligations of U.S. states and municipalities 37,573
1,982
64
39,491
30,490
1,881
33
32,338
Certificates of deposit 60
—
—
60
59
—
—
59
Non-U.S. government debt securities 26,348
380
34
26,694
26,900
426
32
27,294
Corporate debt securities 2,191
79
2
2,268
2,657
101
1
2,757
Asset-backed securities:
Collateralized loan obligations 19,989
51
1
20,039
20,928
69
1
20,996
Other 8,149
75
32
8,192
8,764
77
24
8,817
Total available-for-sale debt securities 206,695
3,976
1,525
209,146
198,194
3,961
477
201,678
Available-for-sale equity securities^(b)
—
—
—
—
547
—
—
547
Total available-for-sale securities 206,695
3,976
1,525
209,146
198,741
3,961
477
202,225
Held-to-maturity debt securities
Mortgage-backed securities:
U.S. government agencies^(c)
24,197
124
189
24,132
27,577
558
40
28,095
Commercial —
—
—
—
5,783
1
74
5,710
Total mortgage-backed securities 24,197
124
189
24,132
33,360
559
114
33,805
Obligations of U.S. states and municipalities 4,845
102
21
4,926
14,373
554
80
14,847
Total held-to-maturity debt securities 29,042
226
210
29,058
47,733
1,113
194
48,652
Total investment securities $ 235,737
$ 4,202
$ 1,735
$ 238,204
$ 246,474
$ 5,074
$ 671
$ 250,877


~~(a)~~	~~Includes total U.S. government-sponsored enterprise obligations with fair values of $45.9 billion and $45.8 billion at March 31,~~September 30, 2018, and December 31, 2017, respectively.

~~(b)~~

~~Effective January 1, 2018, the Firm adopted the recognition and measurement guidance. Equity securities that were previously reported as AFS securities were reclassified to other assets upon adoption.~~

Investment securities impairment

The following tables present the fair value and gross unrealized losses for investment securities by aging category at September 30, 2018, and December 31, 2017.



	Investment securities with gross unrealized losses
	Less than 12 months				12 months or more
September 30, 2018 (in millions)	Fair value		Gross unrealized losses		Fair value		Gross unrealized losses		Total fair value		Total gross unrealized losses
Available-for-sale securities
Mortgage-backed securities:
U.S. government agencies	$	37,109	$	988	$	10,492	$	520	$	47,601	$	1,508
Residential:
U.S.	1,343		20		860		16		2,203		36
Non-U.S.	635		2		180		1		815		3
Commercial	914		11		3,018		171		3,932		182
Total mortgage-backed securities	40,001		1,021		14,550		708		54,551		1,729
U.S. Treasury and government agencies	4,556		100		1,416		96		5,972		196
Obligations of U.S. states and municipalities	4,171		63		1,291		55		5,462		118
Certificates of deposit	—		—		—		—		—		—
Non-U.S. government debt securities	4,237		16		1,798		29		6,035		45
Corporate debt securities	—		—		38		1		38		1
Asset-backed securities:
Collateralized loan obligations	10,267		42		—		—		10,267		42
Other	2,018		6		2,545		21		4,563		27
Total available-for-sale securities	65,250		1,248		21,638		910		86,888		2,158
Held-to-maturity securities
Mortgage-backed securities
U.S. government agencies	22,131		356		2,595		137		24,726		493
Commercial	—		—		—		—		—		—
Total mortgage-backed securities	22,131		356		2,595		137		24,726		493
Obligations of U.S. states and municipalities	853		10		677		21		1,530		31
Total held-to-maturity securities	22,984		366		3,272		158		26,256		524
Total investment securities with gross unrealized losses	$	88,234	$	1,614	$	24,910	$	1,068	$	113,144	$	2,682



	Investment securities with gross unrealized losses
	Less than 12 months				12 months or more
December 31, 2017 (in millions)	Fair value		Gross unrealized losses		Fair value		Gross unrealized losses		Total fair value		Total gross unrealized losses
Available-for-sale securities
Mortgage-backed securities:
U.S. government agencies	$	36,037	$	139	$	7,711	$	196	$	43,748	$	335
Residential:
U.S.	1,112		5		596		9		$	1,708	14
Non-U.S.	—		—		266		1		266		1
Commercial	528		4		335		1		863		5
Total mortgage-backed securities	37,677		148		8,908		207		46,585		355
U.S. Treasury and government agencies	1,834		11		373		20		2,207		31
Obligations of U.S. states and municipalities	949		7		1,652		26		2,601		33
Certificates of deposit	—		—		—		—		—		—
Non-U.S. government debt securities	6,500		15		811		17		7,311		32
Corporate debt securities	—		—		52		1		52		1
Asset-backed securities:
Collateralized loan obligations	—		—		276		1		276		1
Other	3,521		20		720		4		4,241		24
Total available-for-sale securities	50,481		201		12,792		276		63,273		477
Held-to-maturity securities
Mortgage-backed securities
U.S. government agencies	4,070		38		205		2		4,275		40
Commercial	3,706		41		1,882		33		5,588		74
Total mortgage-backed securities	7,776		79		2,087		35		9,863		114
Obligations of U.S. states and municipalities	584		9		2,131		71		2,715		80
Total held-to-maturity securities	8,360		88		4,218		106		12,578		194
Total investment securities with gross unrealized losses	$	58,841	$	289	$	17,010	$	382	$	75,851	$	671

Gross unrealized losses

The Firm has recognized unrealized losses on investment securities that it intends to sell as OTTI. The Firm does not intend to sell any of the remaining investment securities with an unrealized loss in AOCI as of September 30, 2018, and it is not likely that the Firm will be required to sell these securities before recovery of their amortized cost basis. Except for the securities for which credit losses have been recognized in income, the Firm believes that the investment securities with an unrealized loss in AOCI as of September 30, 2018, are not other-than-temporarily impaired. For additional information on other-than-temporary impairment, refer to Note10 of the JPMorgan Chase’s 2017 Annual Report.

Investment securities gains and losses

The following table presents realized gains and losses and OTTI from AFS securities that were recognized in income.



	Three months ended September 30,						Nine months ended September 30,
(in millions)	2018			2017			2018			2017
Realized gains	$	58		$	122		$	137		$	664
Realized losses	(103		)	(123		)	(507		)	(696		)
OTTI losses	(1		)	—			(1		)	(6		)
Net investment securities losses	$	(46	)	$	(1	)	$	(371	)	$	(38	)

OTTI losses
Credit-related losses recognized in income	$	—		$	—		$	—		$	—
Investment securities the Firm intends to sell^(a)	(1		)	—			(1		)	(6		)
Total OTTI losses recognized in income	$	(1	)	$	—		$	(1	)	$	(6	)


(a)	Excludes realized losses on securities sold of $21 million and $6 million for the nine months ended September 30, 2018 and 2017 that had been previously reported as an OTTI loss due to the intention to sell the securities.

~~(c)~~

~~Included total U.S. government-sponsored enterprise obligations with amortized cost of $18.1~~

Changes in the credit loss component of credit-impaired debt securities

The cumulative credit loss component, including any changes therein, of OTTI losses that have been recognized in income related to AFS securities that the Firm does not intend to sell was not material as of and during the nine month periods ended September 30, 2018 and 2017.

Contractual maturities and yields

The following table presents the amortized cost and estimated fair value at September 30, 2018, of JPMorgan Chase’s investment securities portfolio by contractual maturity.



By remaining maturity September 30, 2018 (in millions)	Due in one year or less			Due after one year through five years			Due after five years through 10 years			Due after 10 years^(c)			Total
Available-for-sale securities
Mortgage-backed securities^(a)
Amortized cost	$	258		$	377		$	5,746		$	74,034		$	80,415
Fair value	260			379			5,827			72,909			79,375
Average yield^(b)	1.84		%	2.45		%	3.44		%	3.48		%	3.46		%
U.S. Treasury and government agencies
Amortized cost	$	84		$	8,565		$	13,644		$	5,233		$	27,526
Fair value	85			8,673			13,533			5,525			27,816
Average yield^(b)	2.12		%	2.70		%	2.53		%	2.91		%	2.66		%
Obligations of U.S. states and municipalities
Amortized cost	$	103		$	715		$	2,783		$	33,058		$	36,659
Fair value	104			728			2,872			34,417			38,121
Average yield^(b)	2.07		%	3.89		%	5.05		%	5.01		%	4.98		%
Certificates of deposit
Amortized cost	$	75		$	—		$	—		$	—		$	75
Fair value	75			—			—			—			75
Average yield^(b)	0.49		%	—		%	—		%	—		%	0.49		%
Non-U.S. government debt securities
Amortized cost	$	4,289		$	14,711		$	5,398		$	—		$	24,398
Fair value	4,289			14,886			5,499			—			24,674
Average yield^(b)	3.00		%	1.86		%	1.30		%	—		%	1.94		%
Corporate debt securities
Amortized cost	$	70		$	914		$	872		$	137		$	1,993
Fair value	70			936			905			145			2,056
Average yield^(b)	4.04		%	4.40		%	4.57		%	4.73		%	4.48		%
Asset-backed securities
Amortized cost	$	—		$	3,537		$	5,345		$	19,018		$	27,900
Fair value	—			3,515			5,347			19,051			27,913
Average yield^(b)	—		%	2.83		%	3.19		%	3.04		%	3.04		%
Total available-for-sale securities
Amortized cost	$	4,879		$	28,819		$	33,788		$	131,480		$	198,966
Fair value	4,883			29,117			33,983			132,047			200,030
Average yield^(b)	2.88		%	2.37		%	2.85		%	3.78		%	3.39		%
Held-to-maturity securities
Mortgage-backed securities^(a)
Amortized cost	$	—		$	—		$	2,765		$	23,772		$	26,537
Fair value	—			—			2,725			23,324			26,049
Average yield^(b)	—		%	—		%	3.52		%	3.33		%	3.35		%
Obligations of U.S. states and municipalities
Amortized cost	$	—		$	—		$	20		$	4,811		$	4,831
Fair value	—			—			20			4,849			4,869
Average yield^(b)	—		%	—		%	3.90		%	4.11		%	4.11		%
Total held-to-maturity securities
Amortized cost	$	—		$	—		$	2,785		$	28,583		$	31,368
Fair value	—			—			2,745			28,173			30,918
Average yield^(b)	—		%	—		%	3.53		%	3.46		%	3.47		%


(a)	As of September 30, 2018, mortgage-backed securities issued by Fannie Mae exceeded 10% of JPMorgan Chase’s total stockholders’ equity; the amortized cost and fair value of such securities was $51.2 billion and $50.6 billion, ~~and $22.0 billion at March 31, 2018, and December 31, 2017,~~ respectively.

~~Investment~~

(b)

Average yield is computed using the effective yield of each security owned at the end of the period, weighted based on the amortized cost of each security. The effective yield considers the contractual coupon, amortization of premiums and accretion of discounts, and the effect of related hedging derivatives. Taxable-equivalent amounts are used where applicable. The effective yield excludes unscheduled principal prepayments; and accordingly, actual maturities of securities ~~impairment~~

~~The following tables present the fair value and gross unrealized losses for~~may differ from their contractual or expected maturities as certain securities may be prepaid.

(c)

Includes investment securities ~~by aging category~~with no stated maturity. Substantially all of the Firm’s U.S. residential MBS and collateralized mortgage obligations are due in 10 years or more, based on contractual maturity. The estimated weighted-average life, which reflects anticipated future prepayments, is approximately 7 years for agency residential MBS, 3 years for agency residential collateralized mortgage obligations and 3 years for nonagency residential collateralized mortgage obligations.

Note 10 – Securities financing activities

For a discussion of accounting policies relating to securities financing activities, refer to Note 11 of JPMorgan Chase’s 2017 Annual Report. For further information regarding securities borrowed and securities lending agreements for which the fair value option has been elected, refer to Note 3. For further information regarding assets pledged and collateral received in securities financing agreements, refer to Note 21.

The table below summarizes the gross and net amounts of the Firm’s securities financing agreements as of September 30, 2018 and December 31, 2017. When the Firm has obtained an appropriate legal opinion with respect to the master netting agreement with a counterparty and where other relevant netting criteria under U.S. GAAP are met, the Firm nets, on the Consolidated balance sheets,

the balances outstanding under its securities financing agreements with the same counterparty. In addition, the Firm exchanges securities and/or cash collateral with its counterparties; this collateral also reduces the economic exposure with the Firm has an appropriate legal opinion with respect to the master netting agreement with the counterparty. Where a legal opinion has not been either sought or obtained, the securities financing balances are presented gross in the “Net amounts” below, and related collateral does not reduce the amounts presented.the Firm has an appropriate legal opinion with respect to the master netting agreement with the counterparty. Where a legal opinion has not been either sought or obtained, the securities financing balances are presented gross in the “Net amounts” below, and related collateral does not reduce the amounts presented.the counterparty. Such collateral, along with securities financing balances that do not meet all these relevant netting criteria under U.S. GAAP, is presented as “Amounts not nettable on the Consolidated balance sheets,” and reduces the “Net amounts” presented below, if the Firm has an appropriate legal opinion with respect to the master netting agreement with the counterparty. Where a legal opinion has not been either sought or obtained, the securities financing balances are presented gross in the “Net amounts” below, and related collateral does not reduce the amounts presented.



	September 30, 2018
(in millions)	Gross amounts		Amounts netted on the Consolidated balance sheets			Amounts presented on the Consolidated balance sheets^(b)		Amounts not nettable on the Consolidated balance sheets^(c)			Net amounts^(d)
Assets
Securities purchased under resale agreements	$	521,732	$	(304,110	)	$	217,622	$	(205,345	)		$	12,277
Securities borrowed	143,644		(21,210		)	122,434		(89,771		)		32,663
Liabilities
Securities sold under repurchase agreements	$	472,560	$	(304,110	)	$	168,450	$	(154,335	)		$	14,115
Securities loaned and other^(a)	38,720		(21,210		)	17,510		(17,146		)		364



	December 31, 2017
(in millions)	Gross amounts		Amounts netted on the Consolidated balance sheets			Amounts presented on the Consolidated balance sheets^(b)		Amounts not nettable on the Consolidated balance sheets^(c)			Net amounts^(d)
Assets
Securities purchased under resale agreements	$	448,608	$	(250,505	)	$	198,103	$	(188,502	)		$	9,601
Securities borrowed	113,926		(8,814		)	105,112		(76,805		)		28,307
Liabilities
Securities sold under repurchase agreements	$	398,218	$	(250,505	)	$	147,713	$	(129,178	)		$	18,535
Securities loaned and other^(a)	27,228		(8,814		)	18,414		(18,151		)		263

(a)

Includes securities-for-securities lending transactions of $5.2 billion and $9.2 billion at ~~March 31,~~September 30, 2018 and December 31, ~~2017.~~

Investment securities with gross unrealized losses
Less than 12 months 12 months or more
March 31, 2018 (in millions) Fair value
Gross
unrealized losses
Fair value
Gross
unrealized losses
Total fair value Total gross unrealized losses
Available-for-sale debt securities
Mortgage-backed securities:
U.S. government agencies $ 34,422
$ 711
$ 7,033
$ 327
$ 41,455
$ 1,038
Residential:
U.S.
1,527
17
545
9
2,072
26
Non-U.S. —
—
—
—
—
—
Commercial 3,457
123
1,712
83
5,169
206
Total mortgage-backed securities 39,406
851
9,290
419
48,696
1,270
U.S. Treasury and government agencies 4,129
94
364
28
4,493
122
Obligations of U.S. states and municipalities 2,244
24
1,276
40
3,520
64
Certificates of deposit —
—
—
—
—
—
Non-U.S. government debt securities 4,953
12
1,196
22
6,149
34
Corporate debt securities 98
1
41
1
139
2
Asset-backed securities:
Collateralized loan obligations 907
1
—
—
907
1
Other 3,904
28
479
4
4,383
32
Total available-for-sale debt securities 55,641
1,011
12,646
514
68,287
1,525
Held-to-maturity securities
Mortgage-backed securities
U.S. government agencies 10,193
182
192
7
10,385
189
Commercial —
—
—
—
—
—
Total mortgage-backed securities 10,193
182
192
7
10,385
189
Obligations of U.S. states and municipalities 489
4
683
17
1,172
21
Total held-to-maturity securities 10,682
186
875
24
11,557
210
Total investment securities
with gross unrealized losses
$ 66,323
$ 1,197
$ 13,521
$ 538
$ 79,844
$ 1,735

Investment securities with gross unrealized losses
Less than 12 months 12 months or more
December 31, 2017 (in millions) Fair value
Gross
unrealized losses
Fair value
Gross
unrealized losses
Total fair value Total gross unrealized losses
Available-for-sale debt securities
Mortgage-backed securities:
U.S. government agencies $ 36,037
$ 139
$ 7,711
$ 196
$ 43,748
$ 335
Residential:
U.S. 1,112
5
596
9
$ 1,708
14
Non-U.S. —
—
266
1
266
1
Commercial 528
4
335
1
863
5
Total mortgage-backed securities 37,677
148
8,908
207
46,585
355
U.S. Treasury and government agencies 1,834
11
373
20
2,207
31
Obligations of U.S. states and municipalities 949
7
1,652
26
2,601
33
Certificates of deposit —
—
—
—
—
—
Non-U.S. government debt securities 6,500
15
811
17
7,311
32
Corporate debt securities —
—
52
1
52
1
Asset-backed securities:
Collateralized loan obligations —
—
276
1
276
1
Other 3,521
20
720
4
4,241
24
Total available-for-sale debt securities 50,481
201
12,792
276
63,273
477
Held-to-maturity debt securities
Mortgage-backed securities
U.S. government agencies 4,070
38
205
2
4,275
40
Commercial 3,706
41
1,882
33
5,588
74
Total mortgage-backed securities 7,776
79
2,087
35
9,863
114
Obligations of U.S. states and municipalities 584
9
2,131
71
2,715
80
Total held-to-maturity securities 8,360
88
4,218
106
12,578
194
Total investment securities with gross unrealized losses $ 58,841
$ 289
$ 17,010
$ 382
$ 75,851
$ 671

~~Gross unrealized losses~~

The Firm has recognized unrealized losses on investment securities that it intends to sell as OTTI. The Firm does not intend to sell any of the remaining investment securities with an unrealized loss in AOCI as of March 31, 2018, and it is not likely that2017, respectively, accounted for at fair value, where the Firm will be required to sell these securities before recovery of their amortized cost basis. Except for the securities for which credit losses have been recognized in income, the Firm believes that the investment securities with an unrealized loss in AOCIis acting as ~~of March 31, 2018,~~lender. These amounts are ~~not other-than-temporarily impaired. For additional information on other-than-temporary impairment, see Note10 of the JPMorgan Chase’s 2017 Annual Report.~~

~~Investment securities gains and losses~~

~~The following table presents realized gains and losses and OTTI from AFS securities that were recognized in income.~~

Three months ended March 31,
(in millions) 2018
2017
Realized gains $ 70
$ 149
Realized losses (295 ) (140 )
OTTI losses (20 ) (12 )
Net investment securities gains/(losses) $ (245 ) $ (3 )

OTTI losses
Credit-related losses recognized in income $ —
$ —
Investment securities the Firm intends to sell (20 ) (12 )
Total OTTI losses recognized in income $ (20 ) $ (12 )

~~Changes~~presented within other liabilities in the ~~credit loss component of credit-impaired debt securities~~

~~Contractual maturities and yields~~

~~The following table presents the amortized cost and estimated fair value at March 31, 2018, of JPMorgan Chase’s investment securities portfolio by contractual maturity.~~

By remaining maturity
March 31, 2018 (in millions)
Due in one
year or less
Due after one year through five years Due after five years through 10 years
Due after
10 years^(c)
Total
Available-for-sale debt securities
Mortgage-backed securities^(a)

Amortized cost 276
431
5,837
80,677
$ 87,221
Fair value 281
436
5,953
80,282
$ 86,952
Average yield^(b)
1.79 % 2.28 % 3.27 % 3.40 % 3.38 %
U.S. Treasury and government agencies

Amortized cost 55
—
19,552
5,557
$ 25,164
Fair value 55
—
19,631
5,764
$ 25,450
Average yield^(b)
1.46 % — % 2.34 % 2.26 % 2.32 %
Obligations of U.S. states and municipalities

Amortized cost 64
801
2,474
34,234
$ 37,573
Fair value 64
816
2,576
36,035
$ 39,491
Average yield^(b)
1.85 % 3.46 % 4.94 % 4.94 % 4.91 %
Certificates of deposit

Amortized cost 60
—
—
—
$ 60
Fair value 60
—
—
—
$ 60
Average yield^(b)
0.50 % — % — % — % 0.50 %
Non-U.S. government debt securities

Amortized cost 4,853
13,831
7,664
—
$ 26,348
Fair value 4,855
13,999
7,840
—
$ 26,694
Average yield^(b)
2.84 % 1.63 % 1.24 % — % 1.74 %
Corporate debt securities

Amortized cost 110
882
1,056
143
$ 2,191
Fair value 110
909
1,098
151
$ 2,268
Average yield^(b)
4.16 % 4.04 % 4.01 % 3.39 % 3.99 %
Asset-backed securities

Amortized cost —
3,109
10,038
14,991
$ 28,138
Fair value —
3,083
10,048
15,100
$ 28,231
Average yield^(b)
— % 2.12 % 2.79 % 2.53 % 2.58 %
Total available-for-sale debt securities

Amortized cost $ 5,418
$ 19,054
$ 46,621
$ 135,602
$ 206,695
Fair value $ 5,425
$ 19,243
$ 47,146
$ 137,332
$ 209,146
Average yield^(b)
2.76 % 1.92 % 2.55 % 3.65 % 3.22 %
Held-to-maturity debt securities

Mortgage-backed securities^(a)

Amortized cost —
—
282
23,915
$ 24,197
Fair value —
—
281
23,851
$ 24,132
Average yield^(b)
— % — % 3.30 % 3.32 % 3.32 %
Obligations of U.S. states and municipalities

Amortized cost —
—
—
4,845
$ 4,845
Fair value —
—
—
4,926
$ 4,926
Average yield^(b)
— % — % — % 4.11 % 4.11 %
Total held-to-maturity securities

Amortized cost $ —
$ —
$ 282
$ 28,760
$ 29,042
Fair value $ —
$ —
$ 281
$ 28,777
$ 29,058
Average yield^(b)
— % — % 3.30 % 3.45 % 3.45 %


~~(a)~~	As of March 31, 2018, mortgage-backed securities issued by Fannie Mae exceeded 10% of JPMorgan Chase’s total stockholders’ equity; the amortized cost and fair value of such securities was $51.7 billion and $51.8 billion, respectively.Consolidated balance sheets.

(b)

~~(c)~~

Includes investment securities with no stated maturity. Substantially all of the Firm’s U.S. residential MBS and collateralized mortgage obligations are due in 10 years or more, based on contractual maturity. The estimated weighted-average life, which reflects anticipated future prepayments, is approximately 7 years for agency residential MBS, 3 years for agency residential collateralized mortgage obligations and 3 years for nonagency residential collateralized mortgage obligations.

~~Note 10 – Securities financing activities~~

For a discussion of accounting policies relating to securities financing activities, see Note 11 of JPMorgan Chase’s 2017 Annual Report. For further information regarding securities borrowed and securities lending agreements for which the fair value option has been elected, see Note 3. For further information regarding assets pledged and collateral received in securities financing agreements ~~see Note 21.~~

~~The table below summarizes the gross and net amounts of the Firm’s securities financing agreements as of March 31,~~accounted for at fair value. At September 30, 2018 and December 31, ~~2017. When~~2017, included securities purchased under resale agreements of $12.2 billion and $14.7 billion, respectively and securities sold under agreements to repurchase of $1.1 billion and $697 million, respectively. There were $4.5 billion and $3.0 billion of securities borrowed at September 30, 2018 and December 31, 2017, respectively. There were no securities loaned accounted for at fair value in either period.


(c)	In some cases, collateral exchanged with a counterparty exceeds the ~~Firm has obtained~~net asset or liability balance with that counterparty. In such cases, the amounts reported in this column are limited to the related asset or liability with that counterparty.

(d)

Includes securities financing agreements that provide collateral rights, but where an appropriate legal opinion with respect to the master netting agreement with a counterparty and where other relevant netting criteria under U.S. GAAP are met, the Firm nets, on the Consolidated balance sheets, the balances outstanding under its securities financing agreements with the same counterparty. In addition, the Firm exchanges securities and/or cash collateral with its counterparties; this collateral also reduces the economic exposure withthe counterparty. Such collateral, along with securities financing balances that do not meet all these relevant netting criteria under U.S. GAAP, is presented as “Amounts not nettable on the Consolidated balance sheets,” and reduces the “Net amounts” presented below, if the Firm has an appropriate legal opinion with respect to the master netting agreement with the counterparty. Where a legal opinion has not been either sought or ~~obtained, the securities financing balances are presented gross in the “Net amounts” below, and related collateral does not reduce the amounts presented.~~

March 31, 2018
(in millions) Gross amounts Amounts netted on the Consolidated balance sheets
Amounts presented on the Consolidated balance sheets^(b)
Amounts not nettable on the Consolidated balance sheets^(c)
Net
amounts^(d)
Assets
Securities purchased under resale agreements $ 529,164
$ (281,634 ) $ 247,530
$ (238,149 ) $ 9,381
Securities borrowed 131,750
(15,618 ) 116,132
(85,976 ) 30,156
Liabilities
Securities sold under repurchase agreements $ 444,114
$ (281,634 ) $ 162,480
$ (147,387 ) $ 15,093
Securities loaned and other^(a)
40,974
(15,618 ) 25,356
(25,028 ) 328

December 31, 2017
(in millions) Gross amounts Amounts netted on the Consolidated balance sheets
Amounts presented on the Consolidated balance sheets^(b)
Amounts not nettable on the Consolidated balance sheets^(c)
Net
amounts^(d)
Assets
Securities purchased under resale agreements $ 448,608
$ (250,505 ) $ 198,103
$ (188,502 )
$ 9,601
Securities borrowed 113,926
(8,814 ) 105,112
(76,805 ) 28,307
Liabilities
Securities sold under repurchase agreements $ 398,218
$ (250,505 ) $ 147,713
$ (129,178 )
$ 18,535
Securities loaned and other^(a)
27,228
(8,814 ) 18,414
(18,151 ) 263


~~(a)~~	Includes securities-for-securities lending transactions of $10.0 billion and $9.2 billion at March 31, 2018 and December 31, 2017, respectively, accounted for at fair value, where the Firm is acting as lender. These amounts are presented within other liabilities in the Consolidated balance sheets.

~~(b)~~

Includes securities financing agreements accounted for at fair value. At March 31, 2018 and December 31, 2017, included securities purchased under resale agreements of $13.5 billion and $14.7 billion, respectively and securities sold under agreements to repurchase of $735 million and $697 million, respectively. There were $3.0 billion of securities borrowed at both March 31, 2018 and December 31, 2017. There were no securities loaned accounted for at fair value in either period.


~~(c)~~	In some cases, collateral exchanged with a counterparty exceeds the net asset or liability balance with that counterparty. In such cases, the amounts reported in this column are limited to the related asset or liability with that counterparty.

~~(d)~~

Includes securities financing agreements that provide collateral rights, but where an appropriate legal opinion with respect to the master netting agreement has not been either sought or obtained. At March 31, 2018 and December 31, 2017, included $7.3 billion and $7.5 billion, respectively, of securities purchased under resale agreements; $28.2 billion and $25.5 billion, respectively, of securities borrowed; $13.6 billion and $16.5 billion, respectively, of securities sold under agreements to repurchase; and $19 million and $29 million, respectively, of securities loaned and other.

~~The tables below present as of March 31,~~obtained. At September 30, 2018 and December 31, 2017, ~~the types~~included $6.4 billion and $7.5 billion, respectively, of ~~financial assets pledged in~~ securities ~~financing~~purchased under resale agreements; $29.7 billion and $25.5 billion, respectively, of securities borrowed; $13.2 billion and $16.5 billion, respectively, of securities sold under agreements to repurchase; and ~~the remaining contractual maturity~~$45 million and $29 million, respectively, of ~~the~~ securities ~~financing agreements.~~

Gross liability balance
March 31, 2018 December 31, 2017
(in millions) Securities sold under repurchase agreements
Securities loaned and other^(a)
Securities sold under repurchase agreements
Securities loaned and other^(a)
Mortgage-backed securities
U.S. government agencies 10,608
—
13,100
—
Residential - nonagency 1,932
—
2,972
—
Commercial - nonagency 1,224
—
1,594
—
U.S. Treasury and government agencies 200,550
46
177,581
14
Obligations of U.S. states and municipalities 1,397
—
1,557
—
Non-U.S. government debt 193,011
3,638
170,196
2,485
Corporate debt securities 14,847
418
14,231
287
Asset-backed securities 3,016
1
3,508
—
Equity securities 17,529
36,871
13,479
24,442
Total $ 444,114
$ 40,974
$ 398,218
$ 27,228

Remaining contractual maturity of the agreements
Overnight and continuous
Greater than
90 days

March 31, 2018 (in millions) Up to 30 days 30 – 90 days Total
Total securities sold under repurchase agreements $ 210,365
$ 154,243
$ 38,400
$ 41,106
$ 444,114
Total securities loaned and other^(a)
31,051
765
2,773
6,385
40,974

Remaining contractual maturity of the agreements
Overnight and continuous
Greater than
90 days

December 31, 2017 (in millions) Up to 30 days 30 – 90 days Total
Total securities sold under repurchase agreements $ 166,425
$ 156,434
$ 41,611
$ 33,748
$ 398,218
Total securities loaned and other^(a)
22,876
375
2,328
1,649
27,228

	loaned and other.
~~(a)~~	~~Includes securities-for-securities lending transactions of $10.0 billion and $9.2 billion at March~~

The tables below present as of September 30, 2018, and December 31, 2017 the types of financial assets pledged in securities financing agreements and the remaining contractual maturity of the securities financing agreements.



	Gross liability balance
	September 30, 2018				December 31, 2017
(in millions)	Securities sold under repurchase agreements		Securities loaned and other^(a)		Securities sold under repurchase agreements		Securities loaned and other^(a)
Mortgage-backed securities
U.S. government agencies	25,116		—		13,100		—
Residential - nonagency	1,861		—		2,972		—
Commercial - nonagency	1,431		—		1,594		—
U.S. Treasury and government agencies	236,939		14		177,581		14
Obligations of U.S. states and municipalities	1,161		—		1,557		—
Non-U.S. government debt	174,400		2,294		170,196		2,485
Corporate debt securities	15,474		216		14,231		287
Asset-backed securities	2,543		—		3,508		—
Equity securities	13,635		36,196		13,479		24,442
Total	$	472,560	$	38,720	$	398,218	$	27,228



	Remaining contractual maturity of the agreements
	Overnight and continuous						Greater than 90 days
September 30, 2018 (in millions)	Overnight and continuous		Up to 30 days		30 – 90 days		Greater than 90 days		Total
Total securities sold under repurchase agreements	$	195,713	$	166,754	$	46,511	$	63,582	$	472,560
Total securities loaned and other^(a)	29,415		138		1,805		7,362		38,720



	Remaining contractual maturity of the agreements
	Overnight and continuous								Greater than 90 days
December 31, 2017 (in millions)	Overnight and continuous			Up to 30 days			30 – 90 days		Greater than 90 days		Total
Total securities sold under repurchase agreements	$	142,185	^(b)	$	180,674	^(b)	$	41,611	$	33,748	$	398,218
Total securities loaned and other^(a)	22,876			375			2,328		1,649		27,228


(a)	Includes securities-for-securities lending transactions of $5.2 billion and $9.2 billion at September 30, 2018 and December 31, 2017, respectively, accounted for at fair value, where the Firm is acting as lender. These amounts are presented within other liabilities on the Consolidated balance sheets.

~~Transfers not qualifying for sale accounting~~

~~At both March 31, 2018, and December 31, 2017, the Firm held $1.5 billion of financial assets for which the rights~~


(b)	The prior period amounts have been ~~transferred~~revised to ~~third parties; however,~~conform with the current period presentation.

Transfers not qualifying for sale accounting

At September 30, 2018, and December 31, 2017, the Firm held $1.6 billion and $1.5 billion respectively, of financial assets for which the rights have been transferred to third parties; however, the transfers did not qualify as a sale in accordance with U.S. GAAP. These transfers have been recognized as collateralized financing transactions. The transferred assets are recorded in trading assets and loans, and the corresponding liabilities are recorded predominantly in short-term borrowings on the Consolidated balance sheets.

Note 11 – Loans

Loan accounting framework

The accounting for a loan depends on management’s strategy for the loan, and on whether the loan was credit-impaired at the date of acquisition. The Firm accounts for loans based on the following categories:


•	~~Note 11 – Loans~~ ~~Loan accounting framework~~ The accounting for a loan depends on management’s strategy for the loan, and on whether the loan was credit-impaired at the date of acquisition. The Firm accounts for loans based on the following categories: Originated or purchased loans held-for-investment (i.e., “retained”), other than PCI loans

Loans held-for-sale

Loans at fair value

PCI loans held-for-investment

For a detailed discussion of loans, including accounting policies, refer to Note12 of JPMorgan Chase’s 2017 Annual Report. Refer to Note3 of this Form 10-Q for further information on the Firm’s elections of fair value accounting under the fair value option. Refer to Note2 of this Form 10-Q for information on loans carried at fair value and classified as trading assets.

Loan portfolio

The Firm’s loan portfolio is divided into three portfolio segments, which are the same segments used by the Firm to determine the allowance for loan losses: Consumer, excluding credit card; Credit card; and Wholesale. Within each portfolio segment the Firm monitors and assesses the credit risk in the following classes of loans, based on the risk characteristics of each loan class.

~~Loans held-for-sale~~



Consumer, excluding ~~Loans at fair value~~credit card^(a)	Credit card	Wholesale^(f)
Residential real estate – excluding PCI • Residential mortgage^(b) • Home equity^(c) Other consumer loans^(d) • Auto • Consumer & Business Banking^(e) Residential real estate – PCI • Home equity • Prime mortgage • Subprime mortgage • Option ARMs	• Credit card loans	• Commercial and industrial • Real estate • Financial institutions • Government agencies • Other^(g)


(a)	Includes loans ~~held-for-investment~~ held in CCB, prime mortgage and home equity loans held in AWM and prime mortgage loans held in Corporate.


(b)	Predominantly includes prime (including option ARMs) and subprime loans.


(c)	Includes senior and junior lien home equity loans.


(d)	Includes certain business banking and auto dealer risk-rated loans that apply the wholesale methodology for determining the allowance for loan losses; these loans are managed by CCB, and therefore, for consistency in presentation, are included with the other consumer loan classes.


(e)	Predominantly includes Business Banking loans.


(f)	Includes loans held in CIB, CB, AWM and Corporate. Excludes prime mortgage and home equity loans held in AWM and prime mortgage loans held in Corporate. Classes are internally defined and may not align with regulatory definitions.


(g)	Includes loans to: individuals (predominantly Wealth Management clients within AWM), SPEs, and private education and civic organizations. For ~~a detailed discussion of loans, including accounting policies, see~~more information on SPEs, refer to Note 1214 of JPMorgan Chase’s 2017 Annual Report. ~~See Note 3~~

The following tables summarize the Firm’s loan balances by portfolio segment.



September 30, 2018	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
(in millions)	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
Retained	$	375,958	$	147,856	$	423,837	$	947,651	^(b)
Held-for-sale	104		25		3,551		3,680
At fair value	—		—		2,987		2,987
Total	$	376,062	$	147,881	$	430,375	$	954,318

December 31, 2017	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
(in millions)	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
Retained	$	372,553	$	149,387	$	402,898	$	924,838	^(b)
Held-for-sale	128		124		3,099		3,351
At fair value	—		—		2,508		2,508
Total	$	372,681	$	149,511	$	408,505	$	930,697


(a)	Includes accrued interest and fees net of ~~this Form 10-Q~~an allowance for ~~further information on~~ the ~~Firm’s elections~~uncollectible portion of ~~fair value accounting under~~accrued interest and fee income.


(b)	Loans (other than PCI loans and loans for which the fair value ~~option. See Note 2~~option has been elected) are presented net of ~~this Form 10-Q~~ unamortized discounts and premiums, and net deferred loan fees or costs. These amounts were not material as of September 30, 2018, and December 31, 2017.

The following tables provide information about the carrying value of retained loans purchased, sold and reclassified to held-for-sale during the periods indicated. Reclassifications of loans to held-for sale are non-cash transactions. The Firm manages its exposure to credit risk on an ongoing basis. Selling loans is one way that the Firm reduces its credit exposures.Loans that were reclassified to held-for-sale and sold in a subsequent period are excluded from the sales line of this table.



	2018									2017
Three months ended September 30, (in millions)	Consumer, excluding credit card			Credit card		Wholesale		Total		Consumer, excluding credit card			Credit card		Wholesale		Total
Purchases	$	561	^(a)(b)	$	—	$	285	$	846	$	711	^(a)(b)	$	—	$	479	$	1,190
Sales	1,789			—		4,197		5,986		672			—		3,342		4,014
Retained loans reclassified to held-for-sale	—			—		666		666		—			—		367		367

	2018									2017
Nine months ended September 30, (in millions)	Consumer, excluding credit card			Credit card		Wholesale		Total		Consumer, excluding credit card			Credit card		Wholesale		Total
Purchases	$	2,164	^(a)(b)	$	—	$	1,915	$	4,079	$	2,277	^(a)(b)	$	—	$	1,357	$	3,634
Sales	4,661			—		12,829		17,490		2,025			—		8,166		10,191
Retained loans reclassified to held-for-sale	36			—		1,926		1,962		6,340		^(c)	—		961		7,301

(a)

Purchases predominantly represent the Firm’s voluntary repurchase of certain delinquent loans from loan pools as permitted by Government National Mortgage Association (“Ginnie Mae”) guidelines. The Firm typically elects to repurchase these delinquent loans as it continues to service them and/or manage the foreclosure process in accordance with applicable requirements of Ginnie Mae, FHA, RHS, and/or VA.

(b)

Excludes purchases of retained loans sourced through the correspondent origination channel and underwritten in accordance with the Firm’s standards. Such purchases were $5.6 billionand $6.9 billionfor ~~information on loans carried at fair value~~ the three months ended September 30, 2018and ~~classified as trading assets.~~2017, respectively, and $14.5 billion and $18.2 billion for the nine months ended September 30, 2018 and 2017, respectively.

~~Loan portfolio~~

~~The~~


(c)	Includes the Firm’s student loan portfolio ~~is divided into three portfolio segments,~~which was sold in 2017.

Gains and losses on sales of loans

Gains and losses on sales of loans (including adjustments to record loans held-for-sale at the lower of cost or fair value) recognized in other income were not material to the Firm for the three and nine months ended September 30, 2018 and 2017. In addition, the sale of loans may also result in write downs, recoveries or changes in the allowance recognized in the provision for credit losses.

Consumer, excluding credit card loan portfolio

Consumer loans, excluding credit card loans, consist primarily of residential mortgages, home equity loans and lines of credit, auto loans and consumer and business banking loans, with a focus on serving the prime consumer credit market. The portfolio also includes home equity loans secured by junior liens, prime mortgage loans with an interest-only payment period, and certain payment-option loans that may result in negative amortization.

The following table provides information about retained consumer loans, excluding credit card, by class. In 2017, the Firm sold its student loan portfolio.



(in millions)	September 30, 2018		December 31, 2017
Residential real estate – excluding PCI
Residential mortgage	$	231,361	$	216,496
Home equity	29,318		33,450
Other consumer loans
Auto	63,619		66,242
Consumer & Business Banking	26,451		25,789
Residential real estate – PCI
Home equity	9,393		10,799
Prime mortgage	4,931		6,479
Subprime mortgage	2,072		2,609
Option ARMs	8,813		10,689
Total retained loans	$	375,958	$	372,553

For further information on consumer credit quality indicators, refer to Note12 of JPMorgan Chase’s 2017 Annual Report.

Residential real estate – excluding PCI loans

The following table provides information by class for retained residential real estate – excluding PCI loans.



Residential real estate – excluding PCI loans
(in millions, except ratios)	Residential mortgage						Home equity						Total residential real estate – excluding PCI
(in millions, except ratios)	Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017
Loan delinquency^(a)
Current	$	225,799		$	208,713		$	28,554		$	32,391		$	254,353		$	241,104
30–149 days past due	2,825			4,234			470			671			3,295			4,905
150 or more days past due	2,737			3,549			294			388			3,031			3,937
Total retained loans	$	231,361		$	216,496		$	29,318		$	33,450		$	260,679		$	249,946
% of 30+ days past due to total retained loans^(b)	0.51		%	0.77		%	2.61		%	3.17		%	0.75		%	1.09		%
90 or more days past due and government guaranteed^(c)	$	2,828		$	4,172		$	—		$	—		$	2,828		$	4,172
Nonaccrual loans	1,880			2,175			1,382			1,610			3,262			3,785
Current estimated LTV ratios^(d)(e)
Greater than 125% and refreshed FICO scores:
Equal to or greater than 660	$	28		$	37		$	6		$	10		$	34		$	47
Less than 660	30			19			1			3			31			22
101% to 125% and refreshed FICO scores:
Equal to or greater than 660	20			36			138			296			158			332
Less than 660	60			88			46			95			106			183
80% to 100% and refreshed FICO scores:
Equal to or greater than 660	3,606			4,369			1,059			1,676			4,665			6,045
Less than 660	314			483			359			569			673			1,052
Less than 80% and refreshed FICO scores:
Equal to or greater than 660	212,585			194,758			22,851			25,262			235,436			220,020
Less than 660	6,734			6,952			3,501			3,850			10,235			10,802
No FICO/LTV available	888			1,259			1,357			1,689			2,245			2,948
U.S. government-guaranteed	7,096			8,495			—			—			7,096			8,495
Total retained loans	$	231,361		$	216,496		$	29,318		$	33,450		$	260,679		$	249,946
Geographic region
California	$	74,324		$	68,855		$	5,852		$	6,582		$	80,176		$	75,437
New York	29,146			27,473			6,016			6,866			35,162			34,339
Illinois	15,242			14,501			2,208			2,521			17,450			17,022
Texas	13,926			12,508			1,843			2,021			15,769			14,529
Florida	10,624			9,598			1,619			1,847			12,243			11,445
New Jersey	7,448			7,142			1,702			1,957			9,150			9,099
Washington	8,057			6,962			904			1,026			8,961			7,988
Colorado	8,131			7,335			525			632			8,656			7,967
Massachusetts	6,545			6,323			246			295			6,791			6,618
Arizona	4,519			4,109			1,211			1,439			5,730			5,548
All other^(f)	53,399			51,690			7,192			8,264			60,591			59,954
Total retained loans	$	231,361		$	216,496		$	29,318		$	33,450		$	260,679		$	249,946


(a)	Individual delinquency classifications include mortgage loans insured by U.S. government agencies as follows: current included $2.7 billion and $2.4 billion; 30–149 days past due included $2.2 billion and $3.2 billion; and 150 or more days past due included $2.2 billion and $2.9 billion at September 30, 2018, and December 31, 2017, respectively.


(b)	At September 30, 2018, and December 31, 2017, residential mortgage loans excluded mortgage loans insured by U.S. government agencies of $4.4 billion and $6.1 billion, respectively, that are 30 or more days past due. These amounts have been excluded based upon the government guarantee.

(c)

These balances, which are 90 days or more past due, were excluded from nonaccrual loans as the ~~same segments used~~loans are guaranteed by U.S government agencies. Typically the ~~Firm~~principal balance of the loans is insured and interest is guaranteed at a specified reimbursement rate subject to ~~determine the allowance for loan losses: Consumer, excluding credit card; Credit card;~~meeting agreed-upon servicing guidelines. At September 30, 2018, and ~~Wholesale. Within each portfolio segment the Firm monitors~~December 31, 2017, these balances included $1.3 billion and ~~assesses the credit risk in the following classes~~$1.5 billion, respectively, of loans that are no longer accruing interest based on the ~~risk characteristics of each loan class.~~



~~Consumer, excluding~~ ~~credit card~~^(a)	~~Credit card~~	~~Wholesale~~^(f)
~~Residential real estate – excluding PCI~~ ~~• Residential mortgage~~^(b) ~~• Home equity~~^(c) ~~Other consumer loans~~^(d) ~~• Auto~~ ~~• Consumer & Business Banking~~^(e) ~~Residential real estate – PCI~~ ~~• Home equity~~ ~~• Prime mortgage~~ ~~• Subprime mortgage~~ ~~• Option ARMs~~	~~• Credit card loans~~	~~• Commercial and industrial~~ ~~• Real estate~~ ~~• Financial institutions~~ ~~• Government agencies~~ ~~• Other~~^(g)


~~(a)~~	~~Includes loans held in CCB, prime mortgage and home equity loans held in AWM and prime mortgage loans held in Corporate.~~


~~(b)~~	~~Predominantly includes prime (including option ARMs) and subprime loans.~~


~~(c)~~	~~Includes senior and junior lien home equity loans.~~


~~(d)~~	Includes certain business banking and auto dealer risk-rated loans that apply the wholesale methodology for determining the allowance for loan losses; these loans are managed by CCB, and therefore, for consistency in presentation, are included with the other consumer loan classes.


~~(e)~~	~~Predominantly includes Business Banking loans.~~


~~(f)~~	Includes loans held in CIB, CB, AWM and Corporate. Excludes prime mortgage and home equity loans held in AWM and prime mortgage loans held in Corporate. Classes are internally defined and may not align with regulatory definitions.


~~(g)~~	~~Includes loans to: individuals; SPEs; and private education and civic organizations.~~agreed-upon servicing guidelines. For ~~more information on SPEs, see Note 14 of JPMorgan Chase’s 2017 Annual Report.~~

~~The following tables summarize~~ the ~~Firm’s loan balances by portfolio segment.~~

March 31, 2018 Consumer, excluding credit card
Credit card^(a)
Wholesale Total
(in millions)
Retained $ 373,243
$ 140,348
$ 412,020
$ 925,611
^(b)
Held-for-sale 152
66
5,687
5,905

At fair value —
—
2,908
2,908

Total $ 373,395
$ 140,414
$ 420,615
$ 934,424

December 31, 2017 Consumer, excluding credit card
Credit card^(a)
Wholesale Total
(in millions)
Retained $ 372,553
$ 149,387
$ 402,898
$ 924,838
^(b)
Held-for-sale 128
124
3,099
3,351

At fair value —
—
2,508
2,508

Total $ 372,681
$ 149,511
$ 408,505
$ 930,697


~~(a)~~	~~Includes accrued interest and fees net of an allowance for the uncollectible portion of accrued interest and fee income.~~


~~(b)~~	Loans (other than PCI loans and loans for which the fair value option has been elected) are presented net of unamortized discounts and premiums, and net deferred loan fees or costs. These amounts were not material as of March 31, 2018, and December 31, 2017.

~~The following table provides information about~~remaining balance, interest is being accrued at the carrying value of retained loans purchased, sold and reclassified to held-for-sale during the periods indicated. Loans reclassified to held-for sale are non-cash transactions. The Firm manages its exposure to credit risk on an ongoing basis. Selling loans is one way that the Firm reduces its credit exposures. Loans sold out of the held-for-sale portfolio are excluded from this table.

2018 2017
Three months ended March 31, (in millions)
Consumer, excluding
credit card
Credit card Wholesale Total
Consumer, excluding
credit card
Credit card Wholesale Total
Purchases
$ 1,071
^(a)(b)
$ —
$ 1,098
$ 2,169
$ 940
^(a)(b)
$ —
$ 284
$ 1,224
Sales
481

—
3,689
4,170
590
—
2,447
3,037
Retained loans reclassified to held-for-sale
36
—
868
904
6,309
^(c)
—
461
6,770

~~(a)~~


~~(b)~~	~~Excludes purchases of retained loans sourced through the correspondent origination channel and underwritten in accordance with the Firm’s standards. Such purchases were $3.6 billionand $5.4 billionfor the three months ended March 31, 2018and 2017~~, ~~respectively.~~


~~(c)~~	~~Includes the Firm’s student loan portfolio which was sold in 2017.~~

~~The following table provides information about gains and losses on loan sales, including lower of cost or fair value adjustments, by portfolio segment.~~

Three months ended
March 31,
(in millions) 2018 2017
Net gains/(losses) on sales of loans (including lower of cost or fair value adjustments)^(a)

Consumer, excluding credit card $ 9
$ (226 )
^(b)
Credit card 19
1

Wholesale (2 ) 5

Total net gains on sales of loans (including lower of cost or fair value adjustments) $ 26
$ (220 )


~~(a)~~	~~Excludes sales related to loans accounted for at fair value.~~


~~(b)~~	~~Includes the amounts related to the Firm’s student loan portfolio which was sold in 2017.~~

~~Consumer, excluding credit card loan portfolio~~

~~The accompanying table provides information about retained consumer loans, excluding credit card,~~were not guaranteed by ~~class. In 2017, the Firm sold its student loan portfolio.~~

(in millions) March 31,
2018
December 31,
2017
Residential real estate – excluding PCI
Residential mortgage $ 220,048
$ 216,496
Home equity 31,792
33,450
Other consumer loans
Auto 66,042
66,242
Consumer & Business Banking 25,856
25,789
Residential real estate – PCI
Home equity 10,332
10,799
Prime mortgage 6,259
6,479
Subprime mortgage 2,549
2,609
Option ARMs 10,365
10,689
Total retained loans $ 373,243
$ 372,553

~~For further information on consumer credit quality indicators, see Note 12 of JPMorgan Chase’s 2017 Annual Report.~~

~~Residential real estate – excluding PCI loans~~

~~The following table provides information by class for residential real estate – excluding retained PCI loans.~~

Residential real estate – excluding PCI loans
(in millions, except ratios) Residential mortgage Home equity Total residential real estate – excluding PCI
Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017
Loan delinquency^(a)

Current $ 213,081
$ 208,713
$ 30,894
$ 32,391
$ 243,975
$ 241,104
30–149 days past due 3,176
4,234
498
671
3,674
4,905
150 or more days past due 3,791
3,549
400
388
4,191
3,937
Total retained loans $ 220,048
$ 216,496
$ 31,792
$ 33,450
$ 251,840
$ 249,946
% of 30+ days past due to total retained loans^(b)
0.62 % 0.77 % 2.82 % 3.17 % 0.90 % 1.09 %
90 or more days past due and government guaranteed^(c)
$ 3,873
$ 4,172
$ —
$ —
$ 3,873
$ 4,172
Nonaccrual loans 2,240
2,175
1,585
1,610
3,825
3,785
Current estimated LTV ratios^(d)(e)

Greater than 125% and refreshed FICO scores:

Equal to or greater than 660 $ 65
$ 37
$ 7
$ 10
$ 72
$ 47
Less than 660 18
19
2
3
20
22
101% to 125% and refreshed FICO scores:

Equal to or greater than 660 38
36
219
296
257
332
Less than 660 76
88
69
95
145
183
80% to 100% and refreshed FICO scores:

Equal to or greater than 660 3,477
4,369
1,410
1,676
4,887
6,045
Less than 660 410
483
476
569
886
1,052
Less than 80% and refreshed FICO scores:

Equal to or greater than 660 199,245
194,758
24,260
25,262
223,505
220,020
Less than 660 6,861
6,952
3,785
3,850
10,646
10,802
No FICO/LTV available 1,248
1,259
1,564
1,689
2,812
2,948
U.S. government-guaranteed 8,610
8,495
—
—
8,610
8,495
Total retained loans $ 220,048
$ 216,496
$ 31,792
$ 33,450
$ 251,840
$ 249,946
Geographic region
California $ 70,090
$ 68,855
$ 6,307
$ 6,582
$ 76,397
$ 75,437
New York 27,877
27,473
6,528
6,866
34,405
34,339
Illinois 14,644
14,501
2,396
2,521
17,040
17,022
Texas 12,848
12,508
1,946
2,021
14,794
14,529
Florida 9,797
9,598
1,750
1,847
11,547
11,445
New Jersey 7,166
7,142
1,850
1,957
9,016
9,099
Washington 7,175
6,962
975
1,026
8,150
7,988
Colorado 7,533
7,335
567
632
8,100
7,967
Massachusetts 6,310
6,323
279
295
6,589
6,618
Arizona 4,210
4,109
1,352
1,439
5,562
5,548
All other^(f)
52,398
51,690
7,842
8,264
60,240
59,954
Total retained loans $ 220,048
$ 216,496
$ 31,792
$ 33,450
$ 251,840
$ 249,946


~~(a)~~	~~Individual delinquency classifications include mortgage loans insured by~~ U.S. government agencies as follows: current included $3.0 billion and $2.4 billion; 30–149 days past due included $2.5 billion and $3.2 billion; and 150 or more days past due included $3.1 billion and $2.9 billion at March 31, 2018, and December 31, 2017, respectively.


~~(b)~~	~~At March 31, 2018 and December 31, 2017, residential mortgage loans excluded mortgage loans insured by U.S. government agencies of $5.6 billion and $6.1 billion, respectively,~~ that are 90 or more days past due and still accruing interest at September 30, ~~or more days past due. These amounts have been excluded based upon the government guarantee.~~

~~(c)~~

These balances, which are 90 days or more past due, were excluded from nonaccrual loans as the loans are guaranteed by U.S government agencies. Typically the principal balance of the loans is insured and interest is guaranteed at a specified reimbursement rate subject to meeting agreed-upon servicing guidelines. At March 31, 2018, and December 31, 2017, these balances included $1.4 billion and $1.5 billion, respectively, of loans that are no longer accruing interest based on the agreed-upon servicing guidelines. For the remaining balance, interest is being accrued at the guaranteed reimbursement rate. There were no loans that were not guaranteed by U.S. government agencies that are 90 or more days past due and still accruing interest at March 31, 2018, and December 31, 2017.

(d)

Represents the aggregate unpaid principal balance of loans divided by the estimated current property value. Current property values are estimated, at a minimum, quarterly, based on home valuation models using nationally recognized home price index valuation estimates incorporating actual data to the extent available and forecasted data where actual data is not available. These property values do not represent actual appraised loan level collateral values; as such, the resulting ratios are necessarily imprecise and should be viewed as estimates. Current estimated combined LTV for junior lien home equity loans considers all available lien positions, as well as unused lines, related to the property.


(e)	Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.


(f)	At September 30, 2018, and December 31, 2017, included mortgage loans insured by U.S. government agencies of $7.1 billion and $8.5 billion, respectively. These amounts have been excluded from the geographic regions presented based upon the government guarantee.

Approximately 37% of the home equity portfolio are senior lien loans; the remaining balance are junior lien HELOANs or HELOCs. The following table represents the Firm’s delinquency statistics for junior lien home equity loans and lines of credit as of September 30, 2018, and December 31, 2017.



	Total loans				Total 30+ day delinquency rate
(in millions, except ratios)	Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017
(in millions, except ratios)	Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017
HELOCs:^(a)
Within the revolving period^(b)	$	5,482	$	6,363	0.22	%	0.50	%
Beyond the revolving period	11,982		13,532		2.78		3.56
HELOANs	1,104		1,371		2.99		3.50
Total	$	18,568	$	21,266	2.04	%	2.64	%


(a)	These HELOCs are predominantly revolving loans for a 10-year period, after which time the HELOC converts to a loan with a 20-year amortization period, but also include HELOCs that allow interest-only payments beyond the revolving period.


(b)	The Firm manages the risk of HELOCs during their revolving period by closing or reducing the undrawn line to the extent permitted by law when borrowers are experiencing financial difficulty.

HELOCs beyond the revolving period and HELOANs have higher delinquency rates than HELOCs within the revolving period.That is primarily because the fully-amortizing payment that is generally required for thoseproducts is higher than the minimum payment optionsavailable for HELOCs within the revolving period. The higher delinquency rates associated with amortizing HELOCs and HELOANs are factored into the Firm’s allowance for loan losses.

Impaired loans

The table below sets forth information about the Firm’s residential real estate impaired loans, excluding PCI loans. These loans are considered to be impaired as they have been modified in a TDR. All impaired loans are evaluated for an asset-specific allowance as described in Note13 of JPMorgan Chase’s 2017 Annual Report.



(in millions)	Residential mortgage				Home equity				Total residential real estate – excluding PCI
(in millions)	Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017
Impaired loans
With an allowance	$	3,558	$	4,407	$	1,177	$	1,236	$	4,735	$	5,643
Without an allowance^(a)	1,164		1,213		879		882		2,043		2,095
Total impaired loans^(b)(c)	$	4,722	$	5,620	$	2,056	$	2,118	$	6,778	$	7,738
Allowance for loan losses related to impaired loans	$	97	$	62	$	42	$	111	$	139	$	173
Unpaid principal balance of impaired loans^(d)	6,439		7,741		3,537		3,701		9,976		11,442
Impaired loans on nonaccrual status^(e)	1,536		1,743		993		1,032		2,529		2,775

(a)

Represents collateral-dependent residential real estate loans that are charged off to the fair value of the underlying collateral less cost to sell. The Firm reports, in accordance with regulatory guidance, residential real estate loans that have been discharged under Chapter 7 bankruptcy and not reaffirmed by the borrower (“Chapter 7 loans”) as collateral-dependent nonaccrual TDRs, regardless of their delinquency status. At September 30, 2018, Chapter 7 residential real estate loans included approximately 13% of residential mortgages and 9% of home equity that were 30 days or more past due.

(b)

At September 30, 2018, and December 31, 2017, $4.0 billion and $3.8 billion, respectively, of loans modified subsequent to repurchase from Ginnie Mae in accordance with the standards of the appropriate government agency (i.e., FHA, VA, RHS) are not included in the table above. When such loans perform subsequent to modification in accordance with Ginnie Mae guidelines, they are generally sold back into Ginnie Mae loan pools. Modified loans that do not re-perform become subject to foreclosure.


(c)	Predominantly all residential real estate impaired loans, excluding PCI loans, are in the U.S.


(d)	Represents the contractual amount of principal owed at September 30, 2018, and December 31, 2017. The unpaid principal balance differs from the impaired loan balances due to various factors including charge-offs, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans.


(e)	At September 30, 2018 and December 31, 2017, nonaccrual loans included $2.0 billion and $2.2 billion, respectively, of TDRs for which the borrowers were less than 90 days past due. For additional information about loans modified in a TDR that are on nonaccrual status refer to the Loan accounting framework in Note 12 of JPMorgan Chase’s 2017 Annual Report.

The following tables present average impaired loans and the related interest income reported by the Firm.



Three months ended September 30, (in millions)	Average impaired loans				Interest income on impaired loans^(a)				Interest income on impaired loans on a cash basis^(a)
Three months ended September 30, (in millions)	2018		2017		2018		2017		2018		2017
Residential mortgage	$	4,872	$	5,743	$	61	$	71	$	19	$	19
Home equity	2,065		2,150		33		32		21		20
Total residential real estate – excluding PCI	$	6,937	$	7,893	$	94	$	103	$	40	$	39

Nine months ended September 30, 2018 (in millions)	Average impaired loans				Interest income on impaired loans^(a)				Interest income on impaired loans on a cash basis^(a)
Nine months ended September 30, 2018 (in millions)	2018		2017		2018		2017		2018		2017
Residential mortgage	$	5,242	$	5,861	$	197	$	217	$	58	$	57
Home equity	2,092		2,213		98		95		63		60
Total residential real estate – excluding PCI	$	7,334	$	8,074	$	295	$	312	$	121	$	117


(a)	Generally, interest income on loans modified in TDRs is recognized on a cash basis until the borrower has made a minimum of six payments under the new terms, unless the loan is deemed to be collateral-dependent.

Loan modifications

Modifications of residential real estate loans, excluding PCI loans, are generally accounted for and reported as TDRs. There were no additional commitments to lend to borrowers whose residential real estate loans, excluding PCI loans, have been modified in TDRs.

The following table presents new TDRs reported by the Firm.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Residential mortgage	$	67	$	57	$	314	$	225
Home equity	55		82		241		232
Total residential real estate – excluding PCI	$	122	$	139	$	555	$	457

Nature and extent of modifications

The U.S. Treasury’s Making Home Affordable programs, as well as the Firm’s proprietary modification programs, generally provide various concessions to financially troubled borrowers including, but not limited to, interest rate reductions, term or payment extensions and deferral of principal and/or interest payments that would otherwise have been required under the terms of the original agreement.

The following tables provide information about how residential real estate loans, excluding PCI loans, were modified under the Firm’sloss mitigation programs described above during the periods presented. These tables exclude Chapter 7 loans where the sole concession granted is the discharge of debt.



Three months ended September 30,									Total residential real estate – excluding PCI
	Residential mortgage				Home equity				Total residential real estate – excluding PCI
	2018		2017		2018		2017		2018		2017
Number of loans approved for a trial modification	513		206		586		536		1,099		742
Number of loans permanently modified	719		510		939		1,228		1,658		1,738
Concession granted:^(a)
Interest rate reduction	58	%	64	%	77	%	60	%	69	%	61	%
Term or payment extension	83		80		88		66		86		70
Principal and/or interest deferred	30		22		11		8		19		12
Principal forgiveness	9		17		7		19		8		19
Other^(b)	36		15		58		32		49		27

Nine months ended September 30,									Total residential real estate – excluding PCI
	Residential mortgage				Home equity				Total residential real estate – excluding PCI
	2018		2017		2018		2017		2018		2017
Number of loans approved for a trial modification	1,789		1,052		1,895		1,844		3,684		2,896
Number of loans permanently modified	2,374		1,952		4,005		4,028		6,379		5,980
Concession granted:^(a)
Interest rate reduction	36	%	73	%	57	%	68	%	49	%	69	%
Term or payment extension	49		84		62		78		57		80
Principal and/or interest deferred	47		16		22		12		31		13
Principal forgiveness	7		18		7		12		7		14
Other^(b)	40		24		58		19		52		21


(a)	Represents concessions granted in permanent modifications as a percentage of the number of loans permanently modified. The sum of the percentages exceeds 100% because predominantly all of the modifications include more than one type of concession. Concessions offered on trial modifications are generally consistent with those granted on permanent modifications.


(b)	Includes variable interest rate to fixed interest rate modifications for the three and nine months ended September 30, 2018 and 2017. Also includes forbearances that meet the definition of a TDR for the three and nine months ended September 30, 2018. Forbearances suspend or reduce monthly payments for a specific period of time to address a temporary hardship.

Financial effects of modifications and redefaults

The following tables provide information about the financial effects of the various concessions granted in modifications of residential real estate loans, excluding PCI loans, under the loss mitigation programs described above and about redefaults of certain loans modified in TDRs for the periods presented.The following tables present only the financial effects of permanent modifications and does not include temporary concessions offered through trial modifications. These tables also exclude Chapter 7 loans where the sole concession granted is the discharge of debt.



Three months ended September 30, (in millions, except weighted-average data)	Residential mortgage						Home equity						Total residential real estate – excluding PCI
	2018			2017			2018			2017			2018			2017
Weighted-average interest rate of loans with interest rate reductions – before TDR	6.13		%	4.92		%	5.69		%	5.26		%	5.89		%	5.06		%
Weighted-average interest rate of loans with interest rate reductions – after TDR	4.23			2.89			3.83			2.96			4.01			2.92
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR	22			24			18			18			21			22
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR	39			38			39			38			39			38
Charge-offs recognized upon permanent modification	$	—		$	—		$	—		$	—		$	—		$	—
Principal deferred	7			3			2			1			9			4
Principal forgiven	3			5			1			4			4			9
Balance of loans that redefaulted within one year of permanent modification^(a)	$	27		$	32		$	19		$	17		$	46		$	49

Nine months ended September 30, (in millions, except weighted-average)	Residential mortgage						Home equity						Total residential real estate – excluding PCI
	2018			2017			2018			2017			2018			2017
Weighted-average interest rate of loans with interest rate reductions – before TDR	5.45		%	5.16		%	5.34		%	4.92		%	5.39		%	5.06		%
Weighted-average interest rate of loans with interest rate reductions – after TDR	3.64			2.97			3.39			2.55			3.49			2.79
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR	24			24			18			22			22			23
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR	38			38			39			39			38			38
Charge-offs recognized upon permanent modification	$	—		$	1		$	1		$	1		$	1		$	2
Principal deferred	17			10			7			8			24			18
Principal forgiven	9			16			5			9			14			25
Balance of loans that redefaulted within one year of permanent modification^(a)	$	69		$	86		$	49		$	36		$	118		$	122

(a)

Represents loans permanently modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within one year of the modification. The dollar amounts presented represent the balance of such loans at the end of the reporting period in which such loans defaulted. For residential real estate loans modified in TDRs, payment default is deemed to occur when the loan becomes two contractual payments past due. In the event that a modified loan redefaults, it is probable that the loan will ultimately be liquidated through foreclosure or another similar type of liquidation transaction. Redefaults of loans modified within the last 12 months may not be representative of ultimate redefault levels.

At September 30, 2018, the weighted-average estimated remaining lives of residential real estate loans, excluding PCI loans, permanently modified in TDRs were 10 years for residential mortgage and 9 years for home equity. The estimated remaining lives of these loans reflect estimated prepayments, both voluntary and involuntary (i.e., foreclosures and other forced liquidations).

Active and suspended foreclosure

At September 30, 2018, and December 31, 2017, the Firm had non-PCI residential real estate loans, excluding those insured by U.S. government agencies, with a carrying value of $719 million and $787 million, respectively, that were not included in REO, but were in the process of active or suspended foreclosure.

Other consumer loans

The table below provides information for other consumer retained loan classes, including auto and business banking loans.



(in millions, except ratios)	Auto						Consumer & Business Banking						Total other consumer
	Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017
Loan delinquency
Current	$	63,095		$	65,651		$	26,170		$	25,454		$	89,265		$	91,105
30–119 days past due	517			584			183			213			700			797
120 or more days past due	7			7			98			122			105			129
Total retained loans	$	63,619		$	66,242		$	26,451		$	25,789		$	90,070		$	92,031
% of 30+ days past due to total retained loans	0.82		%	0.89		%	1.06		%	1.30		%	0.89		%	1.01		%
Nonaccrual loans^(a)	137			141			237			283			374			424
Geographic region
California	$	8,382		$	8,445		$	5,375		$	5,032		$	13,757		$	13,477
Texas	6,497			7,013			3,002			2,916			9,499			9,929
New York	3,843			4,023			4,218			4,195			8,061			8,218
Illinois	3,667			3,916			2,045			2,017			5,712			5,933
Florida	3,332			3,350			1,484			1,424			4,816			4,774
Arizona	2,061			2,221			1,451			1,383			3,512			3,604
Ohio	1,987			2,105			1,346			1,380			3,333			3,485
New Jersey	1,990			2,044			738			721			2,728			2,765
Michigan	1,378			1,418			1,332			1,357			2,710			2,775
Louisiana	1,570			1,656			860			849			2,430			2,505
All other	28,912			30,051			4,600			4,515			33,512			34,566
Total retained loans	$	63,619		$	66,242		$	26,451		$	25,789		$	90,070		$	92,031
Loans by risk ratings^(b)
Noncriticized	$	14,193		$	15,604		$	18,644		$	17,938		$	32,837		$	33,542
Criticized performing	337			93			760			791			1,097			884
Criticized nonaccrual	3			9			195			213			198			222


(a)	There were no loans that were 90 or more days past due and still accruing interest at September 30, 2018, and December 31, 2017.


(b)	For risk-rated business banking and auto loans, the primary credit quality indicator is the risk rating of the loan, including whether the loans are considered to be criticized and/or nonaccrual.

Other consumer impaired loans and loan

modifications

The table below sets forth information about the Firm’s other consumer impaired loans, including risk-rated business banking and auto loans that have been placed on nonaccrual status, and loans that have been modified in TDRs.



(in millions)	September 30, 2018		December 31, 2017
Impaired loans
With an allowance	$	227	$	272
Without an allowance^(a)	41		26
Total impaired loans^(b)(c)	$	268	$	298
Allowance for loan losses related to impaired loans	$	65	$	73
Unpaid principal balance of impaired loans^(d)	372		402
Impaired loans on nonaccrual status	244		268


(a)	When discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged off and/or there have been interest payments received and applied to the loan balance.


(b)	Predominantly all other consumer impaired loans are in the U.S.

(c)

Other consumer average impaired loans were $271 million and $366 million for the three months ended September 30, 2018 and 2017, respectively, and $281 million and $459 million for the nine months ended September 30, 2018 and 2017, respectively. The related interest income on impaired loans, including those on a cash basis, was not material for the three and nine months ended September 30, 2018 and 2017.


(d)	Represents the contractual amount of principal owed at September 30, 2018, and December 31, 2017. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs, interest payments received and applied to the principal balance, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans.

Loan modifications

Certain other consumer loan modifications are considered to be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All of these TDRs are reported as impaired loans. Refer to Note12 of JPMorgan Chase’s 2017 Annual Report for further information on other consumer loans modified in TDRs.

At September 30, 2018 and December 31, 2017, other consumer loans modified in TDRs were $90 million and $102 million, respectively. The impact of these modifications, as well as new TDRs, were not material to the Firm for the three and nine months ended September 30, 2018 and 2017. Additional commitments to lend to borrowers whose loans have been modified in TDRs as of September 30, 2018 and December 31, 2017 were not material. TDRs on nonaccrual status were $66 million and $72 million at September 30, 2018 and December 31, 2017, respectively.

Purchased credit-impaired loans

For a detailed discussion of PCI loans, including the related accounting policies, refer to Note12 of JPMorgan Chase’s 2017 Annual Report.

Residential real estate – PCI loans

The table below sets forth information about the Firm’s consumer, excluding credit card, PCI loans.



(in millions, except ratios)	Home equity						Prime mortgage						Subprime mortgage						Option ARMs						Total PCI
(in millions, except ratios)	Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017
Carrying value^(a)	$	9,393		$	10,799		$	4,931		$	6,479		$	2,072		$	2,609		$	8,813		$	10,689		$	25,209		$	30,576
Loan delinquency (based on unpaid principal balance)
Current	$	9,047		$	10,272		$	4,429		$	5,839		$	2,152		$	2,640		$	7,904		$	9,662		$	23,532		$	28,413
30–149 days past due	257			356			269			336			297			381			427			547			1,250			1,620
150 or more days past due	263			392			257			327			143			176			526			689			1,189			1,584
Total loans	$	9,567		$	11,020		$	4,955		$	6,502		$	2,592		$	3,197		$	8,857		$	10,898		$	25,971		$	31,617
% of 30+ days past due to total loans	5.44		%	6.79		%	10.62		%	10.20		%	16.98		%	17.42		%	10.76		%	11.34		%	9.39		%	10.13		%
Current estimated LTV ratios (based on unpaid principal balance)^(b)(c)
Greater than 125% and refreshed FICO scores:
Equal to or greater than 660	$	17		$	33		$	1		$	4		$	—		$	2		$	3		$	6		$	21		$	45
Less than 660	15			21			10			16			12			20			8			9			45			66
101% to 125% and refreshed FICO scores:
Equal to or greater than 660	153			274			7			16			8			20			24			43			192			353
Less than 660	73			132			24			42			38			75			46			71			181			320
80% to 100% and refreshed FICO scores:
Equal to or greater than 660	846			1,195			92			221			62			119			145			316			1,145			1,851
Less than 660	394			559			132			230			192			309			220			371			938			1,469
Lower than 80% and refreshed FICO scores:
Equal to or greater than 660	5,627			6,134			2,791			3,551			753			895			5,235			6,113			14,406			16,693
Less than 660	1,940			2,095			1,649			2,103			1,403			1,608			2,792			3,499			7,784			9,305
No FICO/LTV available	502			577			249			319			124			149			384			470			1,259			1,515
Total unpaid principal balance	$	9,567		$	11,020		$	4,955		$	6,502		$	2,592		$	3,197		$	8,857		$	10,898		$	25,971		$	31,617
Geographic region (based on unpaid principal balance)
California	$	5,678		$	6,555		$	2,706		$	3,716		$	627		$	797		$	4,966		$	6,225		$	13,977		$	17,293
Florida	1,014			1,137			351			428			249			296			753			878			2,367			2,739
New York	543			607			383			457			282			330			538			628			1,746			2,022
Washington	442			532			103			135			46			61			185			238			776			966
Illinois	242			273			164			200			131			161			211			249			748			883
New Jersey	217			242			145			178			94			110			283			336			739			866
Massachusetts	67			79			118			149			78			98			252			307			515			633
Maryland	51			57			104			129			106			132			188			232			449			550
Virginia	56			66			94			123			39			51			234			280			423			520
Arizona	175			203			70			106			45			60			121			156			411			525
All other	1,082			1,269			717			881			895			1,101			1,126			1,369			3,820			4,620
Total unpaid principal balance	$	9,567		$	11,020		$	4,955		$	6,502		$	2,592		$	3,197		$	8,857		$	10,898		$	25,971		$	31,617


(a)	Carrying value includes the effect of fair value adjustments that were applied to the consumer PCI portfolio at the date of acquisition.

(b)


(c)	Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.

~~(f)~~

~~At March 31, 2018, and December 31, 2017, included mortgage loans insured by U.S. government agencies of $8.6 billion and $8.5 billion, respectively.~~

Approximately 25% of the PCI home equity portfolio are senior lien loans; the remaining balance are junior lien HELOANs or HELOCs.The following table represents the Firm’s delinquency statistics for PCI junior lien home equity loans and lines of credit based on the unpaid principal balance as of September 30, 2018, and December 31, 2017.



	Total loans				Total 30+ day delinquency rate
(in millions, except ratios)	Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017
(in millions, except ratios)	Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017
HELOCs:^(a)
Within the revolving period^(b)	$	6	$	51	—	%	1.96	%
Beyond the revolving period^(c)	6,837		7,875		3.79		4.63
HELOANs	296		360		3.38		5.28
Total	$	7,139	$	8,286	3.77	%	4.65	%


(a)	In general, these HELOCs are revolving loans for a 10-year period, after which time the HELOC converts to an interest-only loan with a balloon payment at the end of the loan’s term.

~~The following table represents the Firm’s delinquency statistics for junior lien home equity loans and lines as of March 31, 2018, and December 31, 2017.~~

Total loans Total 30+ day delinquency rate
(in millions, except ratios) Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017

HELOCs:^(a)

Within the revolving period^(b)
$ 5,645
$ 6,363
0.32 % 0.50 %
Beyond the revolving period 13,207
13,532
3.04
3.56
HELOANs 1,280
1,371
2.89
3.50
Total $ 20,132
$ 21,266
2.27 % 2.64 %


~~(a)~~	These HELOCs are predominantly revolving loans for a 10-year period, after which time the HELOC converts to a loan with a 20-year amortization period, but also include HELOCs that allow interest-only payments beyond the revolving period.


~~(b)~~	~~The Firm manages the risk of HELOCs during their revolving period by closing or reducing the~~
(b)	Substantially all undrawn ~~line to the extent permitted by law when borrowers are experiencing financial difficulty.~~

~~HELOCs beyond the revolving period and HELOANs have higher delinquency rates than~~ HELOCs within the revolving ~~period. That is primarily because~~period have been closed.


(c)	Includes loans modified into fixed rate amortizing loans.

The table below sets forth the accretable yield activity for the Firm’s PCI consumer loans for the three and nine months endedSeptember 30, 2018 and 2017, and represents the Firm’s estimate of gross interest income expected to be earned over the remaining life of the PCI loan portfolios. The table excludes the cost to fund the PCI portfolios, and therefore the accretable yield does not represent net interest income expected to be earned on these portfolios.



	Total PCI
(in millions, except ratios)	Three months ended September 30,						Nine months ended September 30,
(in millions, except ratios)	2018			2017			2018			2017
Beginning balance	$	8,722		$	12,639		$	11,159		$	11,768
Accretion into interest income	(303		)	(345		)	(958		)	(1,061		)
Changes in interest rates on variable-rate loans	37			51			(231		)	218
Other changes in expected cash flows^(a)	46			(1,333		)	(1,468		)	87
Balance at September 30	$	8,502		$	11,012		$	8,502		$	11,012
Accretable yield percentage	4.95		%	4.54		%	4.88		%	4.48		%

(a)

Other changes in expected cash flows may vary from period to period as the ~~fully-amortizing payment that is generally required~~Firm continues to refine its cash flow model, for ~~those products is higher than~~example cash flows expected to be collected due to the ~~minimum payment options available for HELOCs within the revolving period. The higher delinquency rates associated with amortizing HELOCs~~impact of modifications and ~~HELOANs are factored into the Firm’s allowance for loan losses.~~

~~Impaired loans~~

~~The table below sets forth information about the Firm’s~~changes in prepayment assumptions.

Active and suspended foreclosure

At September 30, 2018, and December 31, 2017, the Firm had PCI residential real estate loans with an unpaid principal balance of $1.1 billion and $1.3 billion, respectively,that were not included in REO, but were in the process of active or suspended foreclosure.

Credit card loan portfolio

For further information on the credit card loan portfolio, including credit quality indicators, refer to Note 12 of JPMorgan Chase’s 2017 Annual Report.

The table below sets forth information about the Firm’s credit card loans.



(in millions, except ratios)	September 30, 2018			December 31, 2017
Loan delinquency
Current and less than 30 days past due and still accruing	$	145,271		$	146,704
30–89 days past due and still accruing	1,323			1,305
90 or more days past due and still accruing	1,262			1,378
Total retained credit card loans	$	147,856		$	149,387
Loan delinquency ratios
% of 30+ days past due to total retained loans	1.75		%	1.80		%
% of 90+ days past due to total retained loans	0.85			0.92
Credit card loans by geographic region
California	$	22,166		$	22,245
Texas	14,171			14,200
New York	12,908			13,021
Florida	9,064			9,138
Illinois	8,482			8,585
New Jersey	6,345			6,506
Ohio	4,803			4,997
Pennsylvania	4,677			4,883
Colorado	4,090			4,006
Michigan	3,710			3,826
All other	57,440			57,980
Total retained credit card loans	$	147,856		$	149,387
Percentage of portfolio based on carrying value with estimated refreshed FICO scores
Equal to or greater than 660	83.7		%	84.0		%
Less than 660	14.9			14.6
No FICO available	1.4			1.4

Credit card impaired loans and loan modifications

For a detailed discussion of impaired credit card loans, including credit card loan modifications, refer to Note12 of JPMorgan Chase’s 2017 Annual Report.

The table below sets forth information about the Firm’s impaired credit card loans. All of these loans are considered to be impaired as they have been modified in TDRs.



(in millions)	September 30, 2018		December 31, 2017
Impaired credit card loans with an allowance^(a)(b)
Credit card loans with modified payment terms^(c)	$	1,228	$	1,135
Modified credit card loans that have reverted to pre-modification payment terms^(d)	56		80
Total impaired credit card loans^(e)	$	1,284	$	1,215
Allowance for loan losses related to impaired credit card loans	$	421	$	383


(a)	The carrying value and the unpaid principal balance are the same for credit card impaired loans.


(b)	There were no impaired loans ~~excluding PCI loans. These~~without an allowance.


(c)	Represents credit card loans ~~are considered~~outstanding to ~~be impaired~~borrowers enrolled in a credit card modification program as ~~they have been~~of the date presented.


(d)	Represents credit card loans that were modified in ~~a TDR. All~~TDRs but that have subsequently reverted back to the loans’ pre-modification payment terms.

At September 30, 2018, and December 31, 2017, $26 million and $43 million, respectively, of loans have reverted back to the pre-modification payment terms of the loans due to noncompliance with the terms of the modified loans. The remaining $30 million and $37 million at September 30, 2018, and December 31, 2017, respectively, of these loans are to borrowers who have successfully completed a short-term modification program. The Firm continues to report these loans as TDRs since the borrowers’ credit lines remain closed.

(e)

Predominantly all impaired ~~loans are evaluated for an asset-specific allowance as described in Note 13 of JPMorgan Chase’s 2017 Annual Report.~~

(in millions) Residential mortgage Home equity Total residential real estate – excluding PCI
Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017
Impaired loans
With an allowance $ 4,324
$ 4,407
$ 1,236
$ 1,236
$ 5,560
$ 5,643
Without an allowance^(a)
1,221
1,213
877
882
2,098
2,095
Total impaired loans^(b)(c)
$ 5,545
$ 5,620
$ 2,113
$ 2,118
$ 7,658
$ 7,738
Allowance for loan losses related to impaired loans $ 77
$ 62
$ 118
$ 111
$ 195
$ 173
Unpaid principal balance of impaired loans^(d)
7,618
7,741
3,656
3,701
11,274
11,442
Impaired loans on nonaccrual status^(e)
1,796
1,743
1,057
1,032
2,853
2,775

~~(a)~~

Represents collateral-dependent residential real estate loans that are charged off to the fair value of the underlying collateral less cost to sell. The Firm reports, in accordance with regulatory guidance, residential real estate loans that have been discharged under Chapter 7 bankruptcy and not reaffirmed by the borrower (“Chapter 7 loans”) as collateral-dependent nonaccrual TDRs, regardless of their delinquency status. At March 31, 2018, Chapter 7 residential real estate loans included approximately 14% of residential mortgages and 11% of home equity that were 30 days or more past due.

~~(b)~~

At March 31, 2018, and December 31, 2017, $4.2 billion and $3.8 billion, respectively, of loans modified subsequent to repurchase from Ginnie Mae in accordance with the standards of the appropriate government agency (i.e., FHA, VA, RHS) are not included in the table above. When such loans perform subsequent to modification in accordance with Ginnie Mae guidelines, they are generally sold back into Ginnie Mae loan pools. Modified loans that do not re-perform become subject to foreclosure.


~~(c)~~	~~Predominantly all residential real estate impaired loans, excluding PCI~~credit card loans are in the U.S.

~~(d)~~

Represents the contractual amount of principal owed at March 31, 2018, and December 31, 2017. The unpaid principal balance differs from the impaired loan balances due to various factors including charge-offs, net deferred loan fees or costs, and unamortized discounts or premiums on purchased

The following table presents average balances of impaired credit card loans and interest income recognized on those loans.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Average impaired credit card loans	$	1,267	$	1,205	$	1,245	$	1,215
Interest income on impaired credit card loans	17		15		48		44

Loan modifications

The Firm may offer one of a number of loan modification programs to credit card borrowers who are experiencing financial difficulty. Most of these loans have been modified under long-term programs for borrowers who are experiencing financial difficulties. Modifications under long-term programs involve placing the customer on a fixed payment plan, generally for 60 months. Substantially all modifications are considered to be TDRs. New enrollments in these loan modification programs were $215 million and $191 million for the three months ended September 30, 2018 and 2017, respectively, and $640 million and $552 million for the nine months ended September 30, 2018 and 2017, respectively. For all periods disclosed, new enrollments were less than 1% of total retained credit card loans.

For additional information about credit card loan modifications, refer to Note12 of JPMorgan Chase’s 2017 Annual Report.

Financial effects of modifications and redefaults

The following table provides information about the financial effects of the concessions granted on credit card loans modified in TDRs and redefaults for the periods presented.



(in millions, except weighted-average data)	Three months ended September 30,						Nine months ended September 30,
(in millions, except weighted-average data)	2018			2017			2018			2017
Weighted-average interest rate of loans – before TDR	18.25		%	16.84		%	17.82		%	16.52		%
Weighted-average interest rate of loans – after TDR	5.10			4.95			5.12			4.84
Loans that redefaulted within one year of modification^(a)	$	31		$	27		$	82		$	72


(a)	Represents loans modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within one year of the modification. The amounts presented represent the balance of such loans as of the end of the quarter in which they defaulted.

For credit card loans modified in TDRs, payment default is deemed to have occurred when the borrower misses two consecutive contractual payments. A substantial portion of these loans are expected to be charged-off in accordance with the Firm’s standard charge-off policy. Based on historical experience, the estimated weighted-average default rate for modified credit card loans was expected to be 32.78% and 31.54% as of September 30, 2018, and December 31, 2017, respectively.

Wholesale loan portfolio

Wholesale loans include loans made to a variety of clients, ranging from large corporate and institutional clients to high-net-worth individuals. The primary credit quality indicator for wholesale loans is the risk rating assigned to

each loan. For further information on these risk ratings, refer to Note12and Note13 of JPMorgan Chase’s 2017 Annual Report.

The table below provides information by class of receivable for the retained loans in the Wholesale portfolio segment.



	Commercial and industrial						Real estate						Financial institutions						Government agencies						Other^(d)						Total retained loans
(in millions, except ratios)	Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017
Loans by risk ratings
Investment-grade	$	66,968		$	68,071		$	100,036		$	98,467		$	31,194		$	26,791		$	14,435		$	15,140		$	111,710		$	103,212		$	324,343		$	311,681
Noninvestment-grade:
Noncriticized	51,758			46,558			14,526			14,335			14,374			13,071			168			369			13,288			9,988			94,114			84,321
Criticized performing	3,429			3,983			604			710			142			210			—			—			211			259			4,386			5,162
Criticized nonaccrual	696			1,357			130			136			2			2			—			—			166			239			994			1,734
Total noninvestment- grade	55,883			51,898			15,260			15,181			14,518			13,283			168			369			13,665			10,486			99,494			91,217
Total retained loans	$	122,851		$	119,969		$	115,296		$	113,648		$	45,712		$	40,074		$	14,603		$	15,509		$	125,375		$	113,698		$	423,837		$	402,898
% of total criticized exposure to total retained loans	3.36		%	4.45		%	0.64		%	0.74		%	0.32		%	0.53		%	—		%	—		%	0.30		%	0.44		%	1.27		%	1.71		%
% of criticized nonaccrual to total retained loans	0.57			1.13			0.11			0.12			—			—			—			—			0.13			0.21			0.23			0.43

Loans by geographic distribution^(a)
Total non-U.S.	$	30,435		$	28,470		$	2,741		$	3,101		$	17,748		$	16,790		$	2,973		$	2,906		$	49,030		$	44,112		$	102,927		$	95,379
Total U.S.	92,416			91,499			112,555			110,547			27,964			23,284			11,630			12,603			76,345			69,586			320,910			307,519
Total retained loans	$	122,851		$	119,969		$	115,296		$	113,648		$	45,712		$	40,074		$	14,603		$	15,509		$	125,375		$	113,698		$	423,837		$	402,898

Loan delinquency^(b)
Current and less than 30 days past due and still accruing	$	121,913		$	118,288		$	115,098		$	113,258		$	45,671		$	40,042		$	14,585		$	15,493		$	124,097		$	112,559		$	421,364		$	399,640
30–89 days past due and still accruing	211			216			52			242			38			15			15			12			1,110			898			1,426			1,383
90 or more days past due and still accruing^(c)	31			108			16			12			1			15			3			4			2			2			53			141
Criticized nonaccrual	696			1,357			130			136			2			2			—			—			166			239			994			1,734
Total retained loans	$	122,851		$	119,969		$	115,296		$	113,648		$	45,712		$	40,074		$	14,603		$	15,509		$	125,375		$	113,698		$	423,837		$	402,898


(a)	The U.S. and non-U.S. distribution is determined based predominantly on the domicile of the borrower.
~~(e)~~	As of March 31, 2018 and December 31, 2017, nonaccrual loans included $2.3 billion and $2.2 billion, respectively, of TDRs for which the borrowers were less than 90 days past due. For additional information about loans modified in a TDR that are on nonaccrual


(b)	The credit quality of wholesale loans is assessed primarily through ongoing review and monitoring of an obligor’s ability to meet contractual obligations rather than relying on the past due status, which is generally a lagging indicator of credit quality. For a further discussion, refer to ~~the Loan accounting framework in~~ Note 12 of JPMorgan Chase’s 2017 Annual Report.

~~The following table presents average impaired loans and the related interest income reported by the Firm.~~

Three months ended March 31,
(in millions)
Average impaired loans
Interest income on
impaired loans^(a)

Interest income on impaired
loans on a cash basis^(a)
2018
2017
2018
2017
2018
2017
Residential mortgage $ 5,608
$ 5,977
$ 70
$ 73
$ 19
$ 19
Home equity 2,123
2,250
32
31
21
20
Total residential real estate – excluding PCI $ 7,731
$ 8,227
$ 102
$ 104
$ 40
$ 39


~~(a)~~	Generally, interest income on loans modified in TDRs is recognized on a cash basis until such time as the borrower has made a minimum of six payments under the new terms, unless the loan is deemed to be collateral-dependent.

~~Loan modifications~~

~~The following table presents new TDRs reported by the Firm.~~

Three months ended March 31,
(in millions) 2018
2017
Residential mortgage $ 147
$ 72
Home equity 103
81
Total residential real estate – excluding PCI $ 250
$ 153

~~Nature and extent of modifications~~

~~The following table provides information about how residential real estate loans, excluding PCI loans, were modified under the Firm’sloss mitigation programs described above during the periods presented. These tables exclude Chapter 7 loans where the sole concession granted is the discharge of debt~~.

Three months ended March 31,
Total residential
real estate –
excluding PCI
Residential mortgage Home equity
2018
2017
2018
2017
2018
2017
Number of loans approved for a trial modification 299
456
460
743
759
1,199
Number of loans permanently modified 969
783
1,798
1,217
2,767
2,000
Concession granted:^(a)

Interest rate reduction 20 % 82 % 49 % 85 % 39 % 84 %
Term or payment extension 28
89
51
90
43
90
Principal and/or interest deferred 57
10
25
18
36
15
Principal forgiveness 6
19
5
9
5
13
Other^(b)
49
30
60
11
56
19


~~(a)~~
(c)	Represents concessions granted in permanent modifications as a percentage of the number of loans permanently modified. The sum of the percentages exceeds 100% because predominantly all of the modifications include more than one type of concession. A significant portion of trial modifications include interest rate reductions and/or term or payment extensions.


~~(b)~~	~~Predominantly represents variable interest rate to fixed interest rate modifications.~~

~~Financial effects of modifications and redefaults~~

The following table provides information about the financial effects of the various concessions granted in modifications of residential real estate loans, excluding PCI loans, under the loss mitigation programs described above and about redefaults of certain loans modified in TDRs for the periods presented. The following table presents only the financial effects of permanent modifications and does not include temporary concessions offered through trial modifications. This table also excludes Chapter 7 loans where the sole concession granted is the discharge of debt.

Three months ended March 31,
(in millions, except weighted-average data)
Residential mortgage Home equity Total residential real estate – excluding PCI
2018 2017 2018 2017 2018 2017
Weighted-average interest rate of loans with interest rate reductions – before TDR 5.11 % 5.36 % 5.11 % 4.63 % 5.11 % 5.03 %
Weighted-average interest rate of loans with interest rate reductions – after TDR 3.45
2.90
3.05
2.45
3.19
2.70
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR 24
24
19
20
21
22
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR 36
38
38
39
37
38
Charge-offs recognized upon permanent modification $ —
$ 1
$ 1
$ 1
$ 1
$ 2
Principal deferred 6
3
2
5
8
8
Principal forgiven 3
5
2
2
5
7
Balance of loans that redefaulted within one year of permanent modification^(a)
$ 23
$ 32
$ 15
$ 11
$ 38
$ 43

~~(a)~~

At March 31, 2018, the weighted-average estimated remaining lives of residential real estate loans, excluding PCI loans, permanently modified in TDRs were 9 years for residential mortgage and 8 years for home equity. The estimated remaining lives of these loans reflect estimated prepayments, both voluntary and involuntary (i.e., foreclosures and other forced liquidations).

~~Active and suspended foreclosure~~

At March 31, 2018, and December 31, 2017, the Firm had non-PCI residential real estate loans, excluding those insured by U.S. government agencies, with a carrying value of $822 million and $787 million, respectively, that were not included in REO, but were in the process of active or suspended foreclosure.

~~Other consumer loans~~

~~The table below provides information for other consumer retained loan classes, including auto and business banking loans.~~

(in millions, except ratios) Auto Consumer &
Business Banking Total other consumer
Mar 31, 2018
Dec 31, 2017
Mar 31, 2018
Dec 31, 2017
Mar 31, 2018
Dec 31, 2017
Loan delinquency
Current $ 65,574
$ 65,651
$ 25,570
$ 25,454
$ 91,144
$ 91,105
30–119 days past due 462
584
165
213
627
797
120 or more days past due 6
7
121
122
127
129
Total retained loans $ 66,042
$ 66,242
$ 25,856
$ 25,789
$ 91,898
$ 92,031
% of 30+ days past due to total retained loans 0.71 % 0.89 % 1.11 % 1.30 % 0.82 % 1.01 %
Nonaccrual loans^(a)
127
141
274
283
401
424
Geographic region
California $ 8,540
$ 8,445
$ 5,088
$ 5,032
$ 13,628
$ 13,477
Texas 6,866
7,013
2,955
2,916
9,821
9,929
New York 4,070
4,023
4,174
4,195
8,244
8,218
Illinois 3,888
3,916
2,014
2,017
5,902
5,933
Florida 3,386
3,350
1,391
1,424
4,777
4,774
Arizona 2,155
2,221
1,415
1,383
3,570
3,604
Ohio 2,095
2,105
1,357
1,380
3,452
3,485
Michigan 1,458
1,418
1,348
1,357
2,806
2,775
New Jersey 2,044
2,044
721
721
2,765
2,765
Louisiana 1,628
1,656
877
849
2,505
2,505
All other 29,912
30,051
4,516
4,515
34,428
34,566
Total retained loans $ 66,042
$ 66,242
$ 25,856
$ 25,789
$ 91,898
$ 92,031
Loans by risk ratings^(b)

Noncriticized $ 15,691
$ 15,604
$ 18,060
$ 17,938
$ 33,751
$ 33,542
Criticized performing 225
93
800
791
1,025
884
Criticized nonaccrual 8
9
210
213
218
222


~~(a)~~	~~There were no loans that were 90 or more days past due and still accruing interest at March 31, 2018, and December 31, 2017.~~


~~(b)~~	~~For risk-rated business banking and auto loans, the primary credit quality indicator is the risk rating of the loan, including whether the loans are considered to be criticized and/or nonaccrual.~~

~~Other consumer impaired loans and loan~~

~~modifications~~

~~The table below sets forth information about the Firm’s other consumer impaired loans, including risk-rated business banking and auto~~ loans that ~~have been placed on nonaccrual status, and loans that have been modified in TDRs.~~

(in millions) March 31,
2018
December 31,
2017
Impaired loans
With an allowance $ 269
$ 272
Without an allowance^(a)
26
26
Total impaired loans^(b)(c)
$ 295
$ 298
Allowance for loan losses related to impaired loans $ 71
$ 73
Unpaid principal balance of impaired loans^(d)
401
402
Impaired loans on nonaccrual status 266
268


~~(a)~~	When discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged off and/or there have been interest payments received and applied to the loan balance.


~~(b)~~	~~Predominantly all other consumer impaired loans are in the U.S.~~


~~(c)~~	Other consumer average impaired loans were $298 million and $650 million for the three months ended March 31, 2018 and 2017, respectively. The related interest income on impaired loans, including those on a cash basis, was not material for the three months ended March 31, 2018 and 2017.


~~(d)~~	Represents the contractual amount of principal owed at March 31, 2018, and December 31, 2017. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs, interest payments received and applied to the principal balance, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans.

~~Loan modifications~~

~~Certain other consumer loan modifications~~ are considered to be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All of these TDRs are reported as impaired loans. See Note 12 of JPMorgan Chase’s 2017 Annual Report for furtherwell-collateralized and therefore still accruing interest.

(d)

Other includes individuals (predominantly Wealth Management clients within AWM), SPEs, and private education and civic organizations. For more information on ~~other consumer loans modified in TDRs.~~

Other consumer loans modified in TDRs were $100 million and $102 million for the three months ended March 31, 2018 and December 31, 2017, respectively. New TDRs, as well as the impact of these modifications were not materialSPEs, refer to the Firm for the three months ended March 31, 2018 and 2017. Additional commitments to lend to borrowers whose loans have been modified in TDRs as of March 31, 2018 and December 31, 2017 were not material. TDRs on nonaccrual status were $71 million and $72 million for the three months ended March 31, 2018 and December 31, 2017, respectively.

~~Purchased credit-impaired loans~~

~~For a detailed discussion of PCI loans, including the related accounting policies, see~~ Note ~~12 of JPMorgan Chase’s 2017 Annual Report.~~

~~Residential real estate – PCI loans~~

~~The table below sets forth information about the Firm’s consumer, excluding credit card, PCI loans.~~

(in millions, except ratios) Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Total PCI
Mar 31,
2018
Dec 31,
2017

Mar 31,
2018
Dec 31,
2017

Mar 31,
2018
Dec 31,
2017

Mar 31,
2018
Dec 31,
2017

Mar 31,
2018
Dec 31,
2017
Carrying value^(a)
$ 10,332
$ 10,799

$ 6,259
$ 6,479

$ 2,549
$ 2,609

$ 10,365
$ 10,689

$ 29,505
$ 30,576
Loan delinquency (based on unpaid principal balance)

Current $ 9,882
$ 10,272

$ 5,662
$ 5,839

$ 2,630
$ 2,640

$ 9,409
$ 9,662

$ 27,583
$ 28,413
30–149 days past due 271
356

293
336

298
381

447
547

1,309
1,620
150 or more days past due 368
392

328
327

195
176

693
689

1,584
1,584
Total loans $ 10,521
$ 11,020

$ 6,283
$ 6,502

$ 3,123
$ 3,197

$ 10,549
$ 10,898

$ 30,476
$ 31,617
% of 30+ days past due to total loans 6.07 % 6.79 %
9.88 % 10.20 %
15.79 % 17.42 %
10.81 % 11.34 %
9.49 % 10.13 %
Current estimated LTV ratios (based on unpaid principal balance)^(b)(c)

Greater than 125% and refreshed FICO scores:

Equal to or greater than 660 $ 28
$ 33

$ 3
$ 4

$ 3
$ 2

$ 5
$ 6

$ 39
$ 45
Less than 660 16
21

12
16

18
20

8
9

54
66
101% to 125% and refreshed FICO scores:

Equal to or greater than 660 230
274

13
16

14
20

41
43

298
353
Less than 660 104
132

40
42

64
75

61
71

269
320
80% to 100% and refreshed FICO scores:

Equal to or greater than 660 1,065
1,195

177
221

106
119

249
316

1,597
1,851
Less than 660 493
559

193
230

273
309

323
371

1,282
1,469
Lower than 80% and refreshed FICO scores:

Equal to or greater than 660 5,980
6,134

3,478
3,551

893
895

6,027
6,113

16,378
16,693
Less than 660 2,054
2,095

2,063
2,103

1,608
1,608

3,391
3,499

9,116
9,305
No FICO/LTV available 551
577

304
319

144
149

444
470

1,443
1,515
Total unpaid principal balance $ 10,521
$ 11,020

$ 6,283
$ 6,502

$ 3,123
$ 3,197

$ 10,549
$ 10,898

$ 30,476
$ 31,617
Geographic region (based on unpaid principal balance)

California $ 6,256
$ 6,555

$ 3,599
$ 3,716

$ 778
$ 797

$ 6,022
$ 6,225

$ 16,655
$ 17,293
Florida 1,092
1,137

409
428

291
296

850
878

2,642
2,739
New York 586
607

445
457

326
330

609
628

1,966
2,022
Washington 500
532

128
135

59
61

229
238

916
966
Illinois 262
273

196
200

158
161

243
249

859
883
New Jersey 233
242

174
178

108
110

325
336

840
866
Massachusetts 74
79

143
149

95
98

300
307

612
633
Maryland 55
57

125
129

128
132

225
232

533
550
Virginia 63
66

118
123

50
51

273
280

504
520
Arizona 193
203

100
106

58
60

151
156

502
525
All other 1,207
1,269

846
881

1,072
1,101

1,322
1,369

4,447
4,620
Total unpaid principal balance $ 10,521
$ 11,020

$ 6,283
$ 6,502

$ 3,123
$ 3,197

$ 10,549
$ 10,898

$ 30,476
$ 31,617


~~(a)~~	~~Carrying value includes the effect of fair value adjustments that were applied to the consumer PCI portfolio at the date of acquisition.~~

~~(b)~~


~~(c)~~	~~Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.~~

Approximately 25% of the PCI home equity portfolio are senior lien loans; the remaining balance are junior lien HELOANs or HELOCs. The following table sets forth delinquency statistics for PCI junior lien home equity loans and lines of credit based on the unpaid principal balance as of March 31, 2018, and December 31, 2017.

Total loans Total 30+ day delinquency rate
(in millions, except ratios) Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017

HELOCs:^(a)

Within the revolving period^(b)
$ 10
$ 51
10.00 % 1.96 %
Beyond the revolving period^(c)
7,542
7,875
4.00
4.63
HELOANs 338
360
4.14
5.28
Total $ 7,890
$ 8,286
4.02 % 4.65 %


~~(a)~~	~~In general, these HELOCs are revolving loans for a 10-year period, after which time the HELOC converts to an interest-only loan with a balloon payment at the end of the loan’s term.~~


~~(b)~~	~~Substantially all undrawn HELOCs within the revolving period have been closed.~~


~~(c)~~	~~Includes loans modified into fixed rate amortizing loans.~~

The table below sets forth the accretable yield activity for the Firm’s PCI consumer loans for the three months ended March 31, 2018 and 2017, and represents the Firm’s estimate of gross interest income expected to be earned over the remaining life of the PCI loan portfolios. The table excludes the cost to fund the PCI portfolios, and therefore the accretable yield does not represent net interest income expected to be earned on these portfolios.

Total PCI
(in millions, except ratios) Three months ended March 31,
2018 2017
Beginning balance $ 11,159
$ 11,768
Accretion into interest income (328 ) (359 )
Changes in interest rates on variable-rate loans 280
116
Other changes in expected cash flows^(a)
(861 ) 1,597
Balance at March 31 $ 10,250
$ 13,122
Accretable yield percentage 4.78 % 4.36 %


~~(a)~~	Other changes in expected cash flows may vary from period to period as the Firm continues to refine its cash flow model, for example cash flows expected to be collected due to the impact of modifications and changes in prepayment assumptions.

~~Active and suspended foreclosure~~

At both March 31, 2018, and December 31, 2017, the Firm had PCI residential real estate loans with an unpaid principal balance of $1.3 billion that were not included in REO, but were in the process of active or suspended foreclosure.

~~Credit card loan portfolio~~

~~For further information on the credit card loan portfolio, including credit quality indicators, see Note 12 of JPMorgan Chase’s 2017 Annual Report.~~

~~The table below sets forth information about the Firm’s credit card loans.~~

(in millions, except ratios) March 31,
2018
December 31,
2017
Loan delinquency
Current and less than 30 days
past due and still accruing
$ 137,799
$ 146,704
30–89 days past due and still accruing 1,211
1,305
90 or more days past due and still accruing 1,338
1,378
Total retained credit card loans $ 140,348
$ 149,387
Loan delinquency ratios
% of 30+ days past due to total retained loans 1.82 % 1.80 %
% of 90+ days past due to total retained loans 0.95
0.92
Credit card loans by geographic region
California $ 20,974
$ 22,245
Texas 13,541
14,200
New York 12,258
13,021
Florida 8,674
9,138
Illinois 8,057
8,585
New Jersey 6,036
6,506
Ohio 4,631
4,997
Pennsylvania 4,511
4,883
Colorado 3,793
4,006
Michigan 3,546
3,826
All other 54,327
57,980
Total retained credit card loans $ 140,348
$ 149,387
Percentage of portfolio based on carrying value with estimated refreshed FICO scores
Equal to or greater than 660 83.5 % 84.0 %
Less than 660 15.6
14.6
No FICO available 0.9
1.4

~~Credit card impaired loans and loan modifications~~

~~For a detailed discussion of impaired credit card loans, including credit card loan modifications, see Note 12 of JPMorgan Chase’s 2017 Annual Report.~~

~~The table below sets forth information about the Firm’s impaired credit card loans. All of these loans are considered to be impaired as they have been modified in TDRs.~~

(in millions) March 31,
2018
December 31,
2017
Impaired credit card loans with an allowance^(a)(b)

Credit card loans with modified payment terms^(c)
$ 1,173
$ 1,135
Modified credit card loans that have reverted to pre-modification payment terms^(d)
68
80
Total impaired credit card loans^(e)
$ 1,241
$ 1,215
Allowance for loan losses related to impaired credit card loans $ 393
$ 383


~~(a)~~	~~The carrying value and the unpaid principal balance are the same for credit card impaired loans.~~


~~(b)~~	~~There were no impaired loans without an allowance.~~


~~(c)~~	~~Represents credit card loans outstanding to borrowers enrolled in a credit card modification program as of the date presented.~~


~~(d)~~	~~Represents credit card loans that were modified in TDRs but that have subsequently reverted back to the loans’ pre-modification payment terms.~~

At March 31, 2018, and December 31, 2017, $34 million and $43 million, respectively, of loans have reverted back to the pre-modification payment terms of the loans due to noncompliance with the terms of the modified loans. The remaining $34 million and $37 million at March 31, 2018, and December 31, 2017, respectively, of these loans are to borrowers who have successfully completed a short-term modification program. The Firm continues to report these loans as TDRs since the borrowers’ credit lines remain closed.


~~(e)~~	~~Predominantly all impaired credit card loans are in the U.S.~~

~~The following table presents average balances of impaired credit card loans and interest income recognized on those loans.~~

Three months ended March 31,
(in millions) 2018
2017
Average impaired credit card loans $ 1,224
$ 1,228
Interest income on impaired credit card loans 15
14

~~Loan modifications~~

The Firm may offer one of a number of loan modification programs to credit card borrowers who are experiencing financial difficulty. Most of these loans have been modified under long-term programs for borrowers who are experiencing financial difficulties. Modifications under long-term programs involve placing the customer on a fixed payment plan, generally for 60 months. Substantially all modifications are considered to be TDRs. New enrollments in these loan modification programs were $223 million and $185 million for the three months ended March 31, 2018 and 2017, respectively. For additional information about credit card loan modifications, see Note 12 of JPMorgan Chase’s 2017 Annual Report.

~~Financial effects of modifications and redefaults~~

~~The following table provides information about the financial effects of the concessions granted on credit card loans modified in TDRs and redefaults for the periods presented.~~

(in millions, except
weighted-average data)
Three months ended March 31,
2018
2017
Weighted-average interest rate of loans –
before TDR
17.25 % 16.16 %
Weighted-average interest rate of loans –
after TDR
5.20
4.77
Loans that redefaulted within one year of modification^(a)
$ 2
$ 21


~~(a)~~	Represents loans modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within one year of the modification. The amounts presented represent the balance of such loans as of the end of the quarter in which they defaulted.

For credit card loans modified in TDRs, a substantial portion of these loans are expected to be charged-off in accordance with the Firm’s standard charge-off policy. Based on historical experience, the estimated weighted-average default rate for modified credit card loans was expected to be 31.67% and 31.54% as of March 31, 2018, and December 31, 2017, respectively.

~~Wholesale loan portfolio~~

~~each loan. For further information on these risk ratings, see Note 12 and Note 13 of JPMorgan Chase’s 2017 Annual Report.~~

~~The table below provides information by class of receivable for the retained loans in the Wholesale portfolio segment.~~

Commercial
and industrial
Real estate Financial
institutions Government agencies
Other^(d)
Total
retained loans
(in millions,
except ratios)
Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017
Loans by risk ratings
Investment-grade $ 68,705
$ 68,071
$ 99,185
$ 98,467
$ 27,424
$ 26,791
$ 15,135
$ 15,140
$ 106,356
$ 103,212
$ 316,805
$ 311,681
Noninvestment-grade:
Noncriticized 49,917
46,558
14,094
14,335
13,781
13,071
332
369
11,360
9,988
89,484
84,321
Criticized performing 3,283
3,983
620
710
98
210
—
—
136
259
4,137
5,162
Criticized nonaccrual 1,249
1,357
144
136
2
2
—
—
199
239
1,594
1,734
Total noninvestment-
grade
54,449
51,898
14,858
15,181
13,881
13,283
332
369
11,695
10,486
95,215
91,217
Total retained loans $ 123,154
$ 119,969
$ 114,043
$ 113,648
$ 41,305
$ 40,074
$ 15,467
$ 15,509
$ 118,051
$ 113,698
$ 412,020
$ 402,898
% of total criticized exposure to
total retained loans
3.68 % 4.45 % 0.67 % 0.74 % 0.24 % 0.53 % — % — % 0.28 % 0.44 % 1.39 % 1.71 %
% of criticized nonaccrual
to total retained loans
1.01
1.13
0.13
0.12
—
—
—
—
0.17
0.21
0.39
0.43

Loans by geographic
distribution^(a)

Total non-U.S. $ 30,538
$ 28,470
$ 3,127
$ 3,101
$ 17,842
$ 16,790
$ 3,119
$ 2,906
$ 47,352
$ 44,112
$ 101,978
$ 95,379
Total U.S. 92,616
91,499
110,916
110,547
23,463
23,284
12,348
12,603
70,699
69,586
310,042
307,519
Total retained loans $ 123,154
$ 119,969
$ 114,043
$ 113,648
$ 41,305
$ 40,074
$ 15,467
$ 15,509
$ 118,051
$ 113,698
$ 412,020
$ 402,898

Loan
delinquency^(b)

Current and less than 30 days past due and still accruing $ 121,703
$ 118,288
$ 113,761
$ 113,258
$ 41,267
$ 40,042
$ 15,451
$ 15,493
$ 116,632
$ 112,559
$ 408,814
$ 399,640
30–89 days past due
and still accruing
178
216
131
242
32
15
13
12
1,220
898
1,574
1,383
90 or more days
past due and
still accruing^(c)
24
108
7
12
4
15
3
4
—
2
38
141
Criticized nonaccrual 1,249
1,357
144
136
2
2
—
—
199
239
1,594
1,734
Total
retained loans
$ 123,154
$ 119,969
$ 114,043
$ 113,648
$ 41,305
$ 40,074
$ 15,467
$ 15,509
$ 118,051
$ 113,698
$ 412,020
$ 402,898


~~(a)~~	~~The U.S. and non-U.S. distribution is determined based predominantly on the domicile of the borrower.~~


~~(b)~~	The credit quality of wholesale loans is assessed primarily through ongoing review and monitoring of an obligor’s ability to meet contractual obligations rather than relying on the past due status, which is generally a lagging indicator of credit quality. For a further discussion, see Note 1214 of JPMorgan Chase’s 2017 Annual Report.


~~(c)~~	~~Represents loans that are considered well-collateralized and therefore still accruing interest.~~


~~(d)~~	~~Other includes individuals, SPEs, holding companies, private education and civic organizations. For more information on SPEs, see Note 14 of JPMorgan Chase’s 2017 Annual Report.~~

The following table presents additional information on the real estate class of loans within the Wholesale portfolio for the periods indicated. For further information on real estate loans, refer to Note12 of JPMorgan Chase’s 2017 Annual Report.



(in millions, except ratios)	Multifamily						Other commercial						Total real estate loans
(in millions, except ratios)	Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017			Sep 30, 2018			Dec 31, 2017
Real estate retained loans	$	79,112		$	77,597		$	36,184		$	36,051		$	115,296		$	113,648
Criticized exposure	383			491			351			355			734			846
% of total criticized exposure to total real estate retained loans	0.48		%	0.63		%	0.97		%	0.98		%	0.64		%	0.74		%
Criticized nonaccrual	$	47		$	44		$	83		$	92		$	130		$	136
% of criticized nonaccrual loans to total real estate retained loans	0.06		%	0.06		%	0.23		%	0.26		%	0.11		%	0.12		%

Wholesale impaired retained loans and loan modifications

Wholesale impaired retained loans consist of loans that have been placed on nonaccrual status and/or that have been modified in a TDR. All impaired loans are evaluated for an asset-specific allowance as described in Note13 of JPMorgan Chase’s 2017 Annual Report.

The table below sets forth information about the Firm’s wholesale impaired retained loans.



(in millions)	Commercial and industrial				Real estate				Financial institutions				Government agencies				Other				Total retained loans
(in millions)	Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017		Sep 30, 2018			Dec 31, 2017
Impaired loans
With an allowance	$	658	$	1,170	$	78	$	78	$	2	$	93	$	—	$	—	$	151	$	168	$	889		$	1,509
Without an allowance^(a)	84		228		53		60		—		—		—		—		25		70		162			358
Total impaired loans	$	742	$	1,398	$	131	$	138	$	2	$	93	$	—	$	—	$	176	$	238	$	1,051	^(c)	$	1,867	^(c)
Allowance for loan losses related to impaired loans	$	243	$	404	$	15	$	11	$	1	$	4	$	—	$	—	$	21	$	42	$	280		$	461
Unpaid principal balance of impaired loans^(b)	846		1,604		198		201		2		94		—		—		387		255		1,433			2,154


(a)	When the discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged-off and/or there have been interest payments received and applied to the loan balance.


(b)	Represents the contractual amount of principal owed at September 30, 2018, and December 31, 2017. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs; interest payments received and applied to the carrying value; net deferred loan fees or costs; and unamortized discount or premiums on purchased loans.


(c)	Based upon the domicile of the borrower, largely consists of loans ~~within~~in the ~~Wholesale portfolio for the periods indicated. For further information~~U.S.

The following table presents the Firm’s average impaired retained loans for the periods indicated.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Commercial and industrial	$	838	$	1,207	$	1,095	$	1,277
Real estate	134		167		138		175
Financial institutions	45		70		76		38
Government agencies	—		—		—		—
Other	202		231		214		246
Total^(a)(b)	$	1,219	$	1,675	$	1,523	$	1,736

(a)

The related interest income on ~~real estate loans, see Note 12 of JPMorgan Chase’s 2017 Annual Report.~~

(in millions, except ratios)
Multifamily Other commercial Total real estate loans
Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017
Real estate retained loans $ 77,846
$ 77,597
$ 36,197
$ 36,051
$ 114,043
$ 113,648
Criticized exposure 433
491
331
355
764
846
% of total criticized exposure to total real estate retained loans 0.56 % 0.63 % 0.91 % 0.98 % 0.67 % 0.74 %
Criticized nonaccrual $ 47
$ 44
$ 97
$ 92
$ 144
$ 136
% of criticized nonaccrual loans to total real estate retained loans 0.06 % 0.06 % 0.27 % 0.26 % 0.13 % 0.12 %

~~Wholesale~~accruing impaired loans and ~~loan modifications~~

~~Wholesale impaired loans consist of loans that have been placed~~interest income recognized on ~~nonaccrual status and/or that have been modified in~~ a ~~TDR. All impaired loans are evaluated for an asset-specific allowance as described in Note 13 of JPMorgan Chase’s 2017 Annual Report.~~

~~The table below sets forth information about the Firm’s wholesale impaired loans.~~

(in millions)
Commercial
and industrial
Real estate
Financial
institutions

Government
agencies
Other
Total
retained loans

Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017 Mar 31,
2018 Dec 31,
2017
Impaired loans
With an allowance $ 1,051
$ 1,170
$ 87
$ 78
$ 92
$ 93
$ —
$ —
$ 129
$ 168
$ 1,359
$ 1,509

Without an allowance^(a)
240
228
59
60
—
—
—
—
69
70
368
358

Total impaired loans
$ 1,291
$ 1,398
$ 146
$ 138
$ 92
$ 93
$ —
$ —
$ 198
$ 238
$ 1,727
^(c)
$ 1,867
^(c)
Allowance for loan losses related to impaired loans $ 407
$ 404
$ 16
$ 11
$ 4
$ 4
$ —
$ —
$ 47
$ 42
$ 474
$ 461

Unpaid principal balance of impaired loans^(b)
1,468
1,604
218
201
92
94
—
—
439
255
2,217
2,154


~~(a)~~	When the discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged-off and/or there have been interest payments received and applied to the loan balance.


~~(b)~~	Represents the contractual amount of principal owed at March 31, 2018, and December 31, 2017. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs; interest payments received and applied to the carrying value; net deferred loan fees or costs; and unamortized discount or premiums on purchased loans.


~~(c)~~	~~Based upon the domicile of the borrower, largely consists of loans in the U.S.~~

~~The following table presents the Firm’s average impaired loans~~cash basis were not material for the ~~periods indicated.~~

Three months ended March 31,
(in millions) 2018
2017
Commercial and industrial $ 1,050
$ 1,097
Real estate 135
172
Financial institutions 17
4
Government agencies —
—
Other 211
202
Total^(a)
$ 1,413
$ 1,475


~~(a)~~	~~The related interest income on accruing impaired loans and interest income recognized on a cash basis were not material for the three months ended March 31,~~three and nine months ended September 30, 2018 and 2017.

~~Certain loan modifications are considered~~

(b)

The prior period amounts have been revised to ~~be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All TDRs are reported as impaired loans in~~conform with the ~~tables above. TDRs were $913 million and $614 million as of March 31, 2018, and December 31, 2017, respectively.~~

~~Note 12 – Allowance for credit losses~~

~~For a detailed discussion of the allowance for credit losses and the related accounting policies, see Note~~ 13 of JPMorgan Chase’s 2017 Annual Report. During the second quarter of 2017, the Firm refined its loss estimates relating to the wholesale portfolio by incorporating the use of internal historical data versus external credit rating agency default statistics to estimate PD. In addition, an adjustment to the modeled loss estimates for wholesale lending-related commitments was incorporated similar to the adjustment applied for wholesale loans. The impacts of these refinements were not material to the allowance for credit losses.

~~Allowance for credit losses and related information~~

The table below summarizes information about the allowances for loan losses and lending-related commitments, and includes a breakdown of loans and lending-related commitments by impairment methodology.

2018 2017
Three months ended March 31,
(in millions)
Consumer, excluding
credit card
Credit card Wholesale Total Consumer, excluding credit card Credit card Wholesale Total
Allowance for loan losses
Beginning balance at January 1, $ 4,579
$ 4,884
$ 4,141
$ 13,604
5,198
$ 4,034
$ 4,544
$ 13,776

Gross charge-offs 284
1,291
65
1,640
847
1,086
26
1,959

Gross recoveries (138 ) (121 ) (46 ) (305 ) (159 ) (93 ) (53 ) (305 )
Net charge-offs 146
1,170
19
1,335
688
993
(27 ) 1,654

Write-offs of PCI loans^(a)
20
—
—
20
24
—
—
24

Provision for loan losses 146
1,170
(189 ) 1,127
442
993
(119 ) 1,316

Other 1
—
(2 ) (1 ) (2 ) —
1
(1 )
Ending balance at March 31, $ 4,560
$ 4,884
$ 3,931
$ 13,375
$ 4,926
$ 4,034
$ 4,453
$ 13,413

Allowance for loan losses by impairment methodology
Asset-specific^(b)
$ 266
$ 393
^(c)
$ 474
$ 1,133
$ 300
$ 373
^(c)
$ 249
$ 922

Formula-based 2,089
4,491
3,457
10,037
2,339
3,661
4,204
10,204

PCI 2,205
—
—
2,205
2,287
—
—
2,287

Total allowance for loan losses $ 4,560
$ 4,884
$ 3,931
$ 13,375
$ 4,926
$ 4,034
$ 4,453
$ 13,413

Loans by impairment methodology
Asset-specific $ 7,953
$ 1,241
$ 1,727
$ 10,921
$ 8,604
$ 1,219
$ 1,681
$ 11,504

Formula-based 335,785
139,107
410,290
885,182
317,594
133,698
384,686
835,978

PCI 29,505
—
3
29,508
34,385
—
3
34,388

Total retained loans $ 373,243
$ 140,348
$ 412,020
$ 925,611
$ 360,583
$ 134,917
$ 386,370
$ 881,870

Impaired collateral-dependent loans
Net charge-offs $ 12
$ —
$ —
$ 12
$ 31
$ —
$ 1
$ 32

Loans measured at fair value of collateral less cost to sell 2,135
—
262
2,397
2,345
—
264
2,609

Allowance for lending-related commitments
Beginning balance at January 1, $ 33
$ —
$ 1,035
$ 1,068
$ 26
$ —
$ 1,052
$ 1,078

Provision for lending-related commitments —
—
38
38
—
—
(1 ) (1 )
Other —
—
1
1
—
—
—
—

Ending balance at March 31, $ 33
$ —
$ 1,074
$ 1,107
$ 26
$ —
$ 1,051
$ 1,077

Allowance for lending-related commitments by impairment methodology
Asset-specific $ —
$ —
$ 167
$ 167
$ —
$ —
$ 228
$ 228

Formula-based 33
—
907
940
26
—
823
849

Total allowance for lending-related commitments $ 33
$ —
$ 1,074
$ 1,107
$ 26
$ —
$ 1,051
$ 1,077

Lending-related commitments by impairment methodology
Asset-specific $ —
$ —
$ 746
$ 746
$ —
$ —
$ 882
$ 882

Formula-based 49,516
588,232
383,529
1,021,277
51,806
^(d)
577,096
363,638
992,540
^(d)
Total lending-related commitments $ 49,516
$ 588,232
$ 384,275
$ 1,022,023
$ 51,806
^(d)
$ 577,096
$ 364,520
$ 993,422
^(d)
current period presentation.

Certain loan modifications are considered to be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All TDRs are reported as impaired loans in the tables above. TDRs were $517 million and $614 million as of September 30, 2018, and December 31, 2017, respectively.

Note 12 – Allowance for credit losses

For a detailed discussion of the allowance for credit losses and the related accounting policies, refer to Note 13 of JPMorgan Chase’s 2017 Annual Report.

Allowance for credit losses and related information



	2018													2017
Nine months ended September 30, (in millions)	Consumer, excluding credit card			Credit card				Wholesale			Total			Consumer, excluding credit card				Credit card				Wholesale			Total
Allowance for loan losses
Beginning balance at January 1,	$	4,579		$	4,884			$	4,141		$	13,604		$	5,198			$	4,034			$	4,544		$	13,776
Gross charge-offs	776			3,777				264			4,817			1,479				3,344				154			4,977
Gross recoveries	(681		)	(370		)		(146		)	(1,197		)	(478		)		(295		)		(81		)	(854		)
Net charge-offs	95			3,407				118			3,620			1,001				3,049				73			4,123
Write-offs of PCI loans^(a)	151			—				—			151			66				—				—			66
Provision for loan losses	(152		)	3,557				(111		)	3,294			653				3,699				(401		)	3,951
Other	1			—				—			1			(2		)		—				3			1
Ending balance at September 30,	$	4,182		$	5,034			$	3,912		$	13,128		$	4,782			$	4,684			$	4,073		$	13,539

Allowance for loan losses by impairment methodology
Asset-specific^(b)	$	204		$	421		^(c)	$	280		$	905		$	271			$	376		^(c)	$	363		$	1,010
Formula-based	2,154			4,613				3,632			10,399			2,266				4,308				3,710			10,284
PCI	1,824			—				—			1,824			2,245				—				—			2,245
Total allowance for loan losses	$	4,182		$	5,034			$	3,912		$	13,128		$	4,782			$	4,684			$	4,073		$	13,539

Loans by impairment methodology
Asset-specific	$	7,046		$	1,284			$	1,051		$	9,381		$	8,147			$	1,206			$	1,638		$	10,991
Formula-based	343,703			146,572				422,783			913,058			329,445				139,994				396,928			866,367
PCI	25,209			—				3			25,212			31,821				—				3			31,824
Total retained loans	$	375,958		$	147,856			$	423,837		$	947,651		$	369,413			$	141,200			$	398,569		$	909,182

Impaired collateral-dependent loans
Net charge-offs	$	15		$	—			$	—		$	15		$	47			$	—			$	30		$	77
Loans measured at fair value of collateral less cost to sell	2,077			—				258			2,335			2,198				—				250			2,448

Allowance for lending-related commitments
Beginning balance at January 1,	$	33		$	—			$	1,035		$	1,068		$	26			$	—			$	1,052		$	1,078
Provision for lending-related commitments	—			—				29			29			7				—				24			31
Other	—			—				—			—			—				—				—			—
Ending balance at September 30,	$	33		$	—			$	1,064		$	1,097		$	33			$	—			$	1,076		$	1,109

Allowance for lending-related commitments by impairment methodology
Asset-specific	$	—		$	—			$	71		$	71		$	—			$	—			$	220		$	220
Formula-based	33			—				993			1,026			33				—				856			889
Total allowance for lending-related commitments	$	33		$	—			$	1,064		$	1,097		$	33			$	—			$	1,076		$	1,109

Lending-related commitments by impairment methodology
Asset-specific	$	—		$	—			$	252		$	252		$	—			$	—			$	764		$	764
Formula-based	50,630			600,728				397,064			1,048,422			52,796			^(d)	574,641				371,616			999,053			^(d)
Total lending-related commitments	$	50,630		$	600,728			$	397,316		$	1,048,674		$	52,796		^(d)	$	574,641			$	372,380		$	999,817		^(d)


(a)	Write-offs of PCI loans are recorded against the allowance for loan losses when actual losses for a pool exceed estimated losses that were recorded as purchase accounting adjustments at the time of acquisition. A write-off of a PCI loan is recognized when the underlying loan is removed from a pool.


(b)	Includes risk-rated loans that have been placed on nonaccrual status and loans that have been modified in a TDR.


(c)	The asset-specific credit card allowance for loan losses is related to loans that have been modified in a TDR; such allowance is calculated based on the loans’ original contractual interest rates and does not consider any incremental penalty rates.


(d)	The prior period amounts have been revised to conform with the current period presentation.

Note 13 – Variable interest entities

For a further description of JPMorgan Chase’s accounting policies regarding consolidation of VIEs, refer to Note1of JPMorgan Chase’s 2017 Annual Report.

The following table summarizes the most significant types of Firm-sponsored VIEs by business segment.



Line of Business	Transaction Type	Activity	Form 10-Q page reference
CCB	Credit card securitization trusts	Securitization of originated credit card receivables	148
	Mortgage securitization trusts	Servicing and securitization of both originated and purchased residential mortgages	148-150
CIB	Mortgage and other securitization trusts	Securitization of both originated and purchased residential and commercial mortgages, and other consumer loans	148-150
	Multi-seller conduits	Assist clients in accessing the financial markets in a cost-efficient manner and structures transactions to meet investor needs	150
	Municipal bond vehicles	Financing of municipal bond investments	150

The Firm also invests in and provides financing and other services to VIEs sponsored by third parties. Refer to pages 151-152of this Note for more information on the VIEs sponsored by third parties.

Significant Firm-sponsored VIEs

Credit card securitizations

For a more detailed discussion of JPMorgan Chase’s involvement with credit card securitizations, refer to Note 14 of JPMorgan Chase’s 2017 Annual Report.

As a result of the Firm’s continuing involvement, the Firm is considered to be the primary beneficiary of its Firm-sponsored credit card securitization trusts, including its primary vehicle, the Chase Issuance Trust. Refer to the table on page 151 of this Note for further information on

consolidated VIE assets and liabilities.

Firm-sponsored mortgage and other securitization trusts

The Firm securitizes (or has securitized) originated and purchased residential mortgages, commercial mortgages and other consumer loansprimarily in its CCB and CIB businesses. Depending on the particular transaction, as well as the respective business involved, the Firm may act as the servicer of the loans and/or retain certain beneficial interests in the securitization trusts.

For a detailed discussion of the Firm’s involvement with Firm-sponsored mortgage and other securitization trusts, as well as the accounting treatment relating to such trusts, refer to Note14 of JPMorgan Chase’s 2017 Annual Report.

The following table presents the total unpaid principal amount of assets held in Firm-sponsored private-label securitization entities, including those in which the Firm has continuing involvement, and those that are consolidated by the Firm. Continuing involvement includes servicing the loans, holding senior interests or subordinated interests (including amounts required to be held pursuant to credit risk retention rules), recourse or guarantee arrangements, and derivative transactions. In certain instances, the Firm’s only continuing involvement is servicing the loans. Refer to Securitization activity onpage 152of this Note for further information regarding the Firm’s cash flows associated with and interests retained in nonconsolidated VIEs, andpages 152-153of this Note for information on the Firm’s loan sales to U.S. government agencies.



	Principal amount outstanding						JPMorgan Chase interest in securitized assets in nonconsolidated VIEs^(c)(d)(e)
September 30, 2018 (in millions)	Total assets held by securitization VIEs		Assets held in consolidated securitization VIEs		Assets held in nonconsolidated securitization VIEs with continuing involvement		Trading assets		Investment securities		Other financial assets		Total interests held by JPMorgan Chase
Securitization-related^(a)
Residential mortgage:
Prime/Alt-A and option ARMs	$	65,481	$	3,314	$	51,914	$	607	$	704	$	—	$	1,311
Subprime	17,278		19		15,950		55		—		—		55
Commercial and other^(b)	102,603		—		77,494		497		869		216		1,582
Total	$	185,362	$	3,333	$	145,358	$	1,159	$	1,573	$	216	$	2,948



	Principal amount outstanding						JPMorgan Chase interest in securitized assets in nonconsolidated VIEs^(c)(d)(e)
December 31, 2017 (in millions)	Total assets held by securitization VIEs		Assets held in consolidated securitization VIEs		Assets held in nonconsolidated securitization VIEs with continuing involvement		Trading assets		Investment securities		Other financial assets		Total interests held by JPMorgan Chase
Securitization-related^(a)
Residential mortgage:
Prime/Alt-A and option ARMs	$	68,874	$	3,615	$	52,280	$	410	$	943	$	—	$	1,353
Subprime	18,984		7		17,612		93		—		—		93
Commercial and other^(b)	94,905		63		63,411		745		1,133		157		2,035
Total	$	182,763	$	3,685	$	133,303	$	1,248	$	2,076	$	157	$	3,481


(a)	Excludes U.S. government agency securitizations and re-securitizations, which are not Firm-sponsored. Refer to pages 152-153 of this Note for information on the Firm’s loan sales to U.S. government agencies.


(b)	Consists of securities backed by commercial loans (predominantly real estate) and non-mortgage-related consumer receivables purchased from third parties.

(c)

Excludes the following: retained servicing (refer to Note 14 for a discussion of MSRs); securities retained from loan sales to U.S. government agencies; interest rate and foreign exchange derivatives primarily used to manage interest rate and foreign exchange risks of securitization entities (Refer to Note 4 for further information on derivatives); senior and subordinated securities of $75 million and $111 million, respectively, at September 30, 2018, and $88 million and $48 million, respectively, at December 31, 2017, which the Firm purchased in connection with CIB’s secondary market-making activities.


(d)	Includes interests held in re-securitization transactions.

(e)

As of September 30, 2018, and December 31, 2017, 66% and 61%, respectively, of the Firm’s retained securitization interests, which are predominantly carried at fair value and include amounts required to be held pursuant to credit risk retention rules, were risk-rated “A” or better, on an S&P-equivalent basis. The retained interests in prime residential mortgages consisted of $1.3 billion of investment-grade at both September 30, 2018 and December 31, 2017, and $34 million and $48 million of noninvestment-grade at September 30, 2018, and December 31, 2017, respectively. The retained interests in commercial and other securitizations trusts consisted of $1.2 billion and $1.6 billion of investment-grade and $410 million and $412 million of noninvestment-grade retained interests at September 30, 2018, and December 31, 2017, respectively.

Residential mortgage

The Firm securitizes residential mortgage loans originated by CCB, as well as residential mortgage loans purchased from third parties by either CCB or CIB. For a more detailed description of the Firm’s involvement with residential mortgage securitizations, refer to Note14 of JPMorgan Chase’s 2017 Annual Report. Refer to the table onpage 151of this Note for more information on the consolidated residential mortgage securitizations, and the table on the previous page of this Note for further information on interests held in nonconsolidated residential mortgage securitizations.

Commercial mortgages and other consumer securitizations

CIB originates and securitizes commercial mortgage loans, and engages in underwriting and trading activities involving the securities issued by securitization trusts. For a more detailed description of the Firm’s involvement with commercial mortgage and other consumer securitizations, refer to Note14 of JPMorgan Chase’s 2017 Annual Report. Refer to the table onpage 151of this Note for more information on the consolidated commercial mortgage securitizations, and the table on the previous page of this Note for further information on interests held in nonconsolidated securitizations.

Re-securitizations

For a more detailed description of JPMorgan Chase’s participation in certain re-securitization transactions, refer to Note 14 of JPMorgan Chase’s 2017 Annual Report.

The following table presents the principal amount of securities transferred to re-securitization VIEs.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Transfers of securities to VIEs
Agency	$	2,540	$	1,477	$	11,321	$	6,163

The following table presents information on nonconsolidated re-securitization VIEs.



	Nonconsolidated re-securitization VIEs
(in millions)	September 30, 2018		December 31, 2017
Firm-sponsored private-label
Assets held in VIEs with continuing involvement^(a)	$	198	$	783
Interest in VIEs	10		29
Agency
Interest in VIEs	2,263		2,250


(a)	Represents the principal amount and includes the notional amount of interest-only securities.

As of September 30, 2018, and December 31, 2017, the Firm did not consolidate any agency re-securitization VIEs

or any Firm-sponsored private-label re-securitization VIEs.

Multi-seller conduits

For a more detailed description of JPMorgan Chase’s principal involvement with Firm-administered multi-seller conduits, refer to Note14 of JPMorgan Chase’s 2017 Annual Report.

In the normal course of business, JPMorgan Chase makes markets in and invests in commercial paper issued by the Firm-administered multi-seller conduits. The Firm held $18.7 billion and $20.4 billionof the commercial paper issued by the Firm-administered multi-seller conduits atSeptember 30, 2018, and December 31, 2017, respectively, which have been eliminated in consolidation. The Firm’s investments reflect the Firm’s funding needs and capacity and were not driven by market illiquidity.Other than the amounts required to be held pursuant to credit risk retention rules, the Firm is not obligated under any agreement to purchase the commercial paper issued by the Firm-administered multi-seller conduits.

Deal-specific liquidity facilities, program-wide liquidity and credit enhancement provided by the Firm have been eliminated in consolidation. The Firm or the Firm-administered multi-seller conduits provide lending-related commitments to certain clients of the Firm-administered multi-seller conduits. The unfunded commitments were $9.2 billion and $8.8 billion at September 30, 2018, and December 31, 2017, respectively, and are reported as off-balance sheet lending-related commitments. For more information on off-balance sheet lending-related commitments, refer to Note20.

Municipal bond vehicles

Municipal bond vehicles or tender option bond (“TOB”) trusts allow institutions to finance their municipal bond investments at short-term rates. TOB transactions are known as Customer TOB trusts and Non-Customer TOB trusts. Customer TOB trusts are sponsored by a third party; refer topages 151-152of this Note for further information.

The Firm serves as sponsor for all Non-Customer TOB transactions. For a more detailed description of JPMorgan Chase’s Municipal bond vehicles, refer to Note14 of JPMorgan Chase’s 2017 Annual Report. The Firm had no exposure to nonconsolidated Firm-sponsored municipal bond vehicles at September 30, 2018 and December 31, 2017, respectively.

Refer topages 151-152of this Note for further information on consolidated municipal bond vehicles.

Consolidated VIE assets and liabilities

The following table presents information on assets and liabilities related to VIEs consolidated by the Firm as of September 30, 2018, and December 31, 2017.



	Assets								Liabilities
September 30, 2018 (in millions)	Trading assets		Loans		Other^(b)		Total assets^(c)		Beneficial interests in VIE assets^(d)		Other^(e)		Total liabilities
VIE program type
Firm-sponsored credit card trusts	$	—	$	30,949	$	504	$	31,453	$	14,142	$	12	$	14,154
Firm-administered multi-seller conduits	1		22,797		129		22,927		4,304		30		4,334
Municipal bond vehicles	1,370		—		4		1,374		1,344		2		1,346
Mortgage securitization entities^(a)	62		3,368		37		3,467		304		171		475
Other	134		—		1,733		1,867		147		115		262
Total	$	1,567	$	57,114	$	2,407	$	61,088	$	20,241	$	330	$	20,571

	Assets								Liabilities
December 31, 2017 (in millions)	Trading assets		Loans		Other^(b)		Total assets^(c)		Beneficial interests in VIE assets^(d)		Other^(e)		Total liabilities
VIE program type
Firm-sponsored credit card trusts	$	—	$	41,923	$	652	$	42,575	$	21,278	$	16	$	21,294
Firm-administered multi-seller conduits	—		23,411		48		23,459		3,045		28		3,073
Municipal bond vehicles	1,278		—		3		1,281		1,265		2		1,267
Mortgage securitization entities^(a)	66		3,661		55		3,782		359		199		558
Other	105		—		1,916		2,021		134		104		238
Total	$	1,449	$	68,995	$	2,674	$	73,118	$	26,081	$	349	$	26,430


(a)	Includes residential and commercial mortgage securitizations.


(b)	Includes assets classified as cash and other assets on the Consolidated balance sheets.


(c)	The assets of the consolidated VIEs included in the program types above are used to settle the liabilities of those entities. The assets and liabilities include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation.

(d)

The interest-bearing beneficial interest liabilities issued by consolidated VIEs are classified in the line item on the Consolidated balance sheets titled, “Beneficial interests issued by consolidated variable interest entities.” The holders of these beneficial interests generally do not have recourse to the general credit of JPMorgan Chase. For conduits program-wide credit enhancements, refer to note 14 of JPMorgan Chase’s 2017 Annual Report. Included in beneficial interests in VIE assets are long-term beneficial interests of $14.6 billion and $21.8 billion at September 30, 2018, and December 31, 2017, respectively.


(e)	Includes liabilities classified as accounts payable and other liabilities on the Consolidated balance sheets.

VIEs sponsored by third parties

The Firm enters into transactions with VIEs structured by other parties. These include, for example, acting as a derivative counterparty, liquidity provider, investor, underwriter, placement agent, remarketing agent, trustee or custodian. These transactions are conducted at arm’s-length, and individual credit decisions are based on the analysis of the specific VIE, taking into consideration the quality of the underlying assets. Where the Firm does not have the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, or a variable interest that could potentially be significant, the Firm generally does not consolidate the VIE, but it records and reports these positions on its Consolidated balance sheets in the same manner it would record and report positions in respect of any other third-party transaction.

Tax credit vehicles

The Firm holds investments in unconsolidated tax credit vehicles, which are limited partnerships and similar entities that construct, own and operate affordable housing, wind, solar and other alternative energy projects. These entities are primarily considered VIEs. A third party is typically the

general partner or managing member and has control over the significant activities of the tax credit vehicles, and accordingly the Firm does not consolidate tax credit vehicles. The Firm generally invests in these partnerships as a limited partner and earns a return primarily through the receipt of tax credits allocated to the projects. The maximum loss exposure, represented by equity investments and funding commitments, was $13.7 billion and $13.4 billion, of which $3.2 billion was unfunded at both September 30, 2018 and December 31, 2017, respectively. In order to reduce the risk of loss, the Firm assesses each project and withholds varying amounts of its capital investment until qualification of the project for tax credits. For further information on affordable housing tax credits, refer to Note24 of JPMorgan Chase’s 2017 Annual Report. For more information on off-balance sheet lending-related commitments, refer to Note20 of this Form 10-Q.

Customer municipal bond vehicles (TOB trusts)

The Firm may provide various services to Customer TOB trusts, including remarketing agent, liquidity or tender option provider. In certain Customer TOB transactions, the

Firm, as liquidity provider, has entered into a reimbursement agreement with the Residual holder.

In those transactions, upon the termination of the vehicle, the Firm has recourse to the third party Residual holders for any shortfall. The Firm does not have any intent to protect Residual holders from potential losses on any of the underlying municipal bonds. The Firm does not consolidate Customer TOB trusts, since the Firm does not have the power to make decisions that significantly impact the economic performance of the municipal bond vehicle.

The Firm’s maximum exposure as a liquidity provider to Customer TOB trusts at September 30, 2018 and

December 31, 2017 was $5.0 billion and $5.3 billion, respectively. The fair value of assets held by such VIEs at September 30, 2018 and December 31, 2017, was $8.0 billion and $9.2 million, respectively. For more information on off-balance sheet lending-related commitments, refer to Note20.

Loan securitizations

The Firm has securitized and sold a variety of loans, including residential mortgage, credit card, and commercial mortgage.For afurther description of the Firm’s accounting policies regarding securitizations, refer to Note14

of JPMorgan Chase’s 2017 Annual Report.

Securitization activity

The following table provides information related to the Firm’s securitization activities for the three and nine months ended September 30, 2018 and 2017, related to assets held in Firm-sponsored securitization entities that were not consolidated by the Firm, and where sale accounting was achieved at the time of the securitization.



	Three months ended September 30,								Nine months ended September 30,
	2018				2017				2018				2017
(in millions)	Residential mortgage^(e)		Commercial and other^(f)		Residential mortgage^(e)		Commercial and other^(f)		Residential mortgage^(e)		Commercial and other^(f)		Residential mortgage^(e)		Commercial and other^(f)
Principal securitized	$	1,513	$	3,533	$	1,017	$	4,411	$	5,972	$	8,705	$	3,066	$	7,723
All cash flows during the period^(a):
Proceeds received from loan sales as financial instruments^(b)	$	1,524	$	3,558	$	1,053	$	4,419	$	5,984	$	8,745	$	3,136	$	7,796
Servicing fees collected^(c)	43		1		49		1		134		1		151		3
Purchases of previously transferred financial assets (or the underlying collateral)^(d)	—		—		—		—		—		—		1		—
Cash flows received on interests	99		99		125		287		328		230		384		828


(a)	Excludes re-securitization transactions.


(b)	Predominantly includes Level 2 assets.


(c)	The prior period amounts have been revised to conform with the current period presentation.

~~Note 13~~


(d)	Includes cash paid by the Firm to reacquire assets from off–balance sheet, nonconsolidated entities – ~~Variable~~for example, loan repurchases due to representation and warranties and servicer “clean-up” calls.


(e)	Includes prime, Alt-A, subprime, and option ARMs. Excludes loan securitization transactions entered into with Ginnie Mae, Fannie Mae and Freddie Mac.


(f)	Includes commercial mortgage and other consumer loans.

Loans and excess MSRs sold to U.S. government-sponsored

enterprises, loans in securitization transactions pursuant to

Ginnie Mae guidelines, and other third-party-sponsored

securitization entities

In addition to the amounts reported in the securitization activity tables above, the Firm, in the normal course of business, sells originated and purchased mortgage loans and certain originated excess MSRs on a nonrecourse basis, predominantly to U.S. government-sponsored enterprises The Firm also sells loans into securitization transactions pursuant to Ginnie Mae guidelines; these loans are typically insured or guaranteed by another U.S. government agency. The Firm does not consolidate the securitization vehicles underlying these transactions as it is not the primary beneficiary. For a limited number of loan sales, the Firm is obligated to share a portion of the credit risk associated with the sold loans with the purchaser. Refer to Note 20 of this Form 10-Q, and Note 27 of JPMorgan Chase’s 2017 Annual Report for additional information aThe Firm also sells loans into securitization transactions pursuant to Ginnie Mae guidelines; these loans are typically insured or guaranteed by another U.S. government agency. The Firm does not consolidate the securitization vehicles underlying these transactions as it is not the primary beneficiary. For a limited number of loan sales, the Firm is obligated to share a portion of the credit risk associated with the sold loans with the purchaser. Refer to Note 20 of this Form 10-Q, and Note 27 of JPMorgan Chase’s 2017 Annual Report for additional information about the Firm’s loan sales- and securitization-related indemnifications. Refer to Note14for additional information about the impact of the Firm’s sale of certain excess MSRs. (“U.S. GSEs”). These loans and excess MSRs are sold primarily for the purpose of securitization by the U.S. GSEs, who provide certain guarantee provisions (e.g., credit enhancement of the loans). The Firm also sells loans into securitization transactions pursuant to Ginnie Mae guidelines; these loans are typically insured or guaranteed by another U.S. government agency. The Firm does not consolidate the securitization vehicles underlying these transactions as it is not the primary beneficiary. For a limited number of loan sales, the Firm is obligated to share a portion of the credit risk associated with the sold loans with the purchaser. Refer to Note 20 of this Form 10-Q, and Note 27 of JPMorgan Chase’s 2017 Annual Report for additional information

bout the Firm’s loan sales- and securitization-related indemnifications. Refer to Note14for additional information about the impact of the Firm’s sale of certain excess MSRs. about the Firm’s loan sales- and securitization-related indemnifications. Refer to Note14for additional information about the impact of the Firm’s sale of certain excess MSRs.

The following table summarizes the activities related to loans sold to the U.S. GSEs, loans in securitization transactions pursuant to Ginnie Mae guidelines, and other third-party-sponsored securitization entities.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2018		2017		2018		2017
Carrying value of loans sold	$	11,968	$	15,402	$	28,804	$	44,282
Proceeds received from loan sales as cash	1		104		1		117
Proceeds from loan sales as securities^(a)	11,713		15,093		28,291		43,682
Total proceeds received from loan sales^(b)	$	11,714	$	15,197	$	28,292	$	43,799
Gains on loan sales^(c)(d)	$	9	$	41	$	32	$	114


(a)	Predominantly includes securities from U.S. GSEs and Ginnie Mae that are generally sold shortly after receipt.


(b)	Excludes the value of MSRs retained upon the sale of loans.


(c)	Gains on loan sales include the value of MSRs.


(d)	The carrying value of the loans accounted for at fair value approximated the proceeds received upon loan sale.

Options to repurchase delinquent loans

agencies under certain arrangements. The Firm typically elects to repurchase delinquent loans from Ginnie Mae loan pools as it continues to service them and/or manage the foreclosure process in accordance with the applicable requirements, and such loans continue to be insured or guaranteed. When the Firm’s repurchase option becomes exercisable, such loans must be reported on the Consolidated balance sheets as a loan with a corresponding liability. For additional information, refer to Note 11.

The following table presents loans the Firm repurchased or had an option to repurchase, real estate owned, and foreclosed government-guaranteed residential mortgage loans recognized on the Firm’s Consolidated balance sheets as of September 30, 2018 and December 31, 2017. Substantially all of these loans and real estate are insured or guaranteed by U.S. government agencies.


(a)	Predominantly all of these amounts relate to loans that have been repurchased from Ginnie Mae loan pools.


(b)	Relates to voluntary repurchases of loans, which are included in accrued interest ~~entities~~and accounts receivable.

Loan delinquencies and liquidation losses

The table below includes information about components of nonconsolidated securitized financial assets held in Firm-sponsored private-label securitization entities, in which the Firm has continuing involvement, and delinquencies as of September 30, 2018, and December 31, 2017.



									Net liquidation losses^(a)
	Securitized assets				90 days past due				Three months ended September 30,				Nine months ended September 30,
(in millions)	Sep 30, 2018		Dec 31, 2017		Sep 30, 2018		Dec 31, 2017		2018		2017		2018			2017
Securitized loans
Residential mortgage:
Prime / Alt-A & option ARMs	$	51,914	$	52,280	$	3,612	$	4,870	$	182	$	184	$	453		$	622
Subprime	15,950		17,612		2,637		3,276		155		153		(307		)	529
Commercial and other	77,494		63,411		526		957		71		2		119			59
Total loans securitized	$	145,358	$	133,303	$	6,775	$	9,103	$	408	$	339	$	265		$	1,210


(a)	Includes liquidation gains as a result of private label mortgage settlement payments during the first quarter of 2018, which were reflected as asset recoveries by trustees.

Note14 – Goodwill and Mortgage servicing rights

For a discussion of the accounting policies related to goodwill and mortgage servicing rights, refer to Note15 of JPMorgan Chase’s 2017 Annual Report.

Goodwill

The following table presents goodwill attributed to the business segments.



(in millions)	September 30, 2018		December 31, 2017
Consumer & Community Banking	$	30,995	$	31,013
Corporate & Investment Bank	6,771		6,776
Commercial Banking	2,860		2,860
Asset & Wealth Management	6,857		6,858
Total goodwill	$	47,483	$	47,507

The following table presents changes in the carrying amount of goodwill.



	Three months ended September 30,					Nine months ended September 30,
(in millions)	2018			2017		2018			2017
Balance at beginning of period	$	47,488		$	47,300	$	47,507		$	47,288
Changes during the period from:
Other^(a)	(5		)	9		(24		)	21
Balance at September 30,	$	47,483		$	47,309	$	47,483		$	47,309


(a)	Includes foreign currency remeasurement and other adjustments.

Goodwill Impairment testing

For a further description of the Firm’s goodwill impairment testing, including the primary method used to estimate the fair value of the reporting units, and the assumptions used in the goodwill impairment test, refer to Impairment testing on pages 244–245 of JPMorgan Chase’s 2017 Annual Report.

Goodwill was not impaired at September 30, 2018, or December 31, 2017, nor was goodwill written off due to impairment during the nine months ended September 30, 2018 or 2017.

Declines in business performance, increases in credit losses, increases in equity capital requirements, as well as deterioration in economic or market conditions, adverse regulatory or legislative changes or increases in the estimated market cost of equity, could cause the estimated fair values of the Firm’s reporting units or their associated goodwill to decline in the future, which could result in a material impairment charge to earnings in a future period related to some portion of the associated goodwill.

Mortgage servicing rights

MSRs represent the fair value of expected future cash flows for performing servicing activities for others. The fair value considers estimated future servicing fees and ancillary revenue, offset by estimated costs to service the loans, and generally declines over time as net servicing cash flows are received, effectively amortizing the MSR asset against contractual servicing and ancillary fee income. MSRs are either purchased from third parties or recognized upon sale or securitization of mortgage loans if servicing is retained. For a further description of the MSR asset, interest rate risk management, and the valuation of MSRs, refer to Notes 2 and 15 of JPMorgan Chase’s 2017 Annual Report.

The following table summarizes MSR activity for the three and nine months endedSeptember 30, 2018 and 2017.



	As of or for the three months ended September 30,						As of or for the nine months ended September 30,
(in millions, except where otherwise noted)	2018			2017			2018			2017
Fair value at beginning of period	$	6,241		$	5,753		$	6,030		$	6,096
MSR activity:
Originations of MSRs	278			253			611			624
Purchase of MSRs	13			—			159			—
Disposition of MSRs^(a)	(2		)	(2		)	(401		)	(140		)
Net additions/(dispositions)	289			251			369			484

Changes due to collection/realization of expected cash flows	(195		)	(200		)	(542		)	(619		)

Changes in valuation due to inputs and assumptions:
Changes due to market interest rates and other^(b)	150			(67		)	635			(188		)
Changes in valuation due to other inputs and assumptions:
Projected cash flows (e.g., cost to service)	14			(116		)	14			(102		)
Discount rates	—			—			24			(19		)
Prepayment model changes and other^(c)	(66		)	117			(97		)	86
Total changes in valuation due to other inputs and assumptions	(52		)	1			(59		)	(35		)
Total changes in valuation due to inputs and assumptions	98			(66		)	576			(223		)
Fair value at September 30,	$	6,433		$	5,738		$	6,433		$	5,738

Change in unrealized gains/(losses) included in income related to MSRs held at September 30,	$	98		$	(66	)	$	576		$	(223	)
Contractual service fees, late fees and other ancillary fees included in income	428			463			1,339			1,427
Third-party mortgage loans serviced at September 30, (in billions)	528			558			528			558
Net servicer advances at September 30, (in billions)^(d)	3.1			3.9			3.1			3.9


(a)	Includes excess MSRs transferred to agency-sponsored trusts in exchange for stripped mortgage backed securities (“SMBS”). In each transaction, a portion of the SMBS was acquired by third parties at the transaction date; the Firm acquired the remaining balance of those SMBS as trading securities.


(b)	Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments.


(c)	Represents changes in prepayments other than those attributable to changes in market interest rates.

(d)

Represents amounts the Firm pays as the servicer (e.g., scheduled principal and interest, taxes and insurance), which will generally be reimbursed within a short period of time after the advance from future cash flows from the trust or the underlying loans. The Firm’s credit risk associated with these servicer advances is minimal because reimbursement of the advances is typically senior to all cash payments to investors. In addition, the Firm maintains the right to stop payment to investors if the collateral is insufficient to cover the advance. However, certain of these servicer advances may not be recoverable if they were not made in accordance with applicable rules and agreements.

The following table presents the components of mortgage fees and related income (including the impact of MSR risk management activities) for the three and nine months ended September 30, 2018 and 2017.



	Three months ended September 30,						Nine months ended September 30,
(in millions)	2018			2017			2018			2017
CCB mortgage fees and related income

Net production revenue	$	108		$	158		$	296		$	451

Net mortgage servicing revenue:
Operating revenue:
Loan servicing revenue	435			493			1,389			1,533
Changes in MSR asset fair value due to collection/realization of expected cash flows	(195		)	(200		)	(542		)	(617		)
Total operating revenue	240			293			847			916
Risk management:
Changes in MSR asset fair value due to market interest rates and other^(a)	150			(67		)	636			(188		)
Other changes in MSR asset fair value due to other inputs and assumptions in model^(b)	(52		)	1			(59		)	(35		)
Change in derivative fair value and other	(186		)	43			(671		)	91
Total risk management	(88		)	(23		)	(94		)	(132		)
Total net mortgage servicing revenue	152			270			753			784

Total CCB mortgage fees and related income	260			428			1,049			1,235

All other	2			1			2			4
Mortgage fees and related income	$	262		$	429		$	1,051		$	1,239


(a)	Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments.


(b)	Represents the aggregate impact of changes in model inputs and assumptions such as projected cash flows (e.g., cost to service), discount rates and changes in prepayments other than those attributable to changes in market interest rates (e.g., changes in prepayments due to changes in home prices).

The table below outlines the key economic assumptions used to determine the fair value of the Firm’s MSRs at September 30, 2018, and December 31, 2017, and outlines hypothetical sensitivities of those fair values to immediate adverse changes in those assumptions, as defined below.



(in millions, except rates)	Sep 30, 2018			Dec 31, 2017
Weighted-average prepayment speed assumption (“CPR”)	8.40		%	9.35		%
Impact on fair value of 10% adverse change	$	(194	)	$	(221	)
Impact on fair value of 20% adverse change	(376		)	(427		)
Weighted-average option adjusted spread	8.65		%	9.04		%
Impact on fair value of a 100 basis point adverse change	$	(251	)	$	(250	)
Impact on fair value of a 200 basis point adverse change	(483		)	(481		)

CPR: Constant prepayment rate.

Changes in fair value based on variation in assumptions generally cannot be easily extrapolated, because the relationship of the change in the assumptions to the change in fair value are often highly interrelated and may not be linear. In this table, the effect that a change in a particular assumption may have on the fair value is calculated without changing any other assumption. In reality, changes in one factor may result in changes in another, which would either magnify or counteract the impact of the initial change.

Note 15 – Deposits

For further information on deposits, refer to Note17 of JPMorgan Chase’s 2017 Annual Report.

At September 30, 2018, and December 31, 2017, noninterest-bearing and interest-bearing deposits were as follows.



(in millions)	September 30, 2018		December 31, 2017
U.S. offices
Noninterest-bearing	$	374,603	$	393,645
Interest-bearing (included $16,526 and $14,947 at fair value)^(a)	814,988		793,618
Total deposits in U.S. offices	1,189,591		1,187,263
Non-U.S. offices
Noninterest-bearing	19,127		15,576
Interest-bearing (included $3,974 and $6,374 at fair value)^(a)	250,044		241,143
Total deposits in non-U.S. offices	269,171		256,719
Total deposits	$	1,458,762	$	1,443,982


(a)	Includes structured notes classified as deposits for which the fair value option has been elected. For a further ~~description of JPMorgan Chase’s accounting policies regarding consolidation of VIEs, see~~discussion, refer to Note 13 of JPMorgan Chase’s 2017 Annual Report.

Note 16 – Earnings per share

For a discussion of the computation of basic and diluted earnings per share (“EPS”), refer to Note 22 of JPMorgan Chase’s 2017 Annual Report. The following table presents the calculation of basic and diluted EPS for the three and nine months ended September 30, 2018 and 2017.



(in millions, except per share amounts)	Three months ended September 30,				Nine months ended September 30,
(in millions, except per share amounts)	2018		2017		2018		2017
Basic earnings per share
Net income	$	8,380	$	6,732	$	25,408	$	20,209
Less: Preferred stock dividends	379		412		1,167		1,235
Net income applicable to common equity	8,001		6,320		24,241		18,974
Less: Dividends and undistributed earnings allocated to participating securities	53		58		174		188
Net income applicable to common stockholders	$	7,948	$	6,262	$	24,067	$	18,786

Total weighted-average basic shares outstanding	3,376.1		3,534.7		3,416.5		3,570.9
Net income per share	$	2.35	$	1.77	$	7.04	$	5.26

Diluted earnings per share
Net income applicable to common stockholders	$	7,948	$	6,262	$	24,067	$	18,786
Total weighted-average basic shares outstanding	3,376.1		3,534.7		3,416.5		3,570.9
Add: Employee stock options, SARs, warrants and unvested PSUs	18.2		24.9		19.7		26.1
Total weighted-average diluted shares outstanding	3,394.3		3,559.6		3,436.2		3,597.0
Net income per share	$	2.34	$	1.76	$	7.00	$	5.22

Note 17 – Accumulated other comprehensive income/(loss)

AOCI includes the after-tax change in unrealized gains and losses on investment securities, foreign currency translation adjustments (including the impact of related derivatives), fair value changes of excluded components on fair value hedges, cash flow hedging activities, net loss and prior service costs/(credit) related to the Firm’s defined benefit pension and OPEB plans.



As of or for the three months ended September 30, 2018 (in millions)	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges^(b)			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges^(b)			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
Balance at July 1, 2018		$	1,599			$	(632	)	$	(162	)		$	(147	)		$	(1,876	)		$	80			$	(1,138	)
Net change		(819		)		(31		)	34				(88		)		19				(402		)		(1,287		)
Balance at September 30, 2018		$	780			$	(663	)	$	(128	)		$	(235	)		$	(1,857	)		$	(322	)		$	(2,425	)

As of or for the three months ended September 30, 2017 (in millions)	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
Balance at July 1, 2017		$	2,219			$	(157	)	NA				$	44			$	(2,255	)		$	(243	)		$	(392	)
Net change		147				—			NA				26				22				(112		)		83
Balance at September 30, 2017		$	2,366			$	(157	)	NA				$	70			$	(2,233	)		$	(355	)		$	(309	)

As of or for the nine months ended September 30, 2018 (in millions)	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
Balance at January 1, 2018		$	2,164			$	(470	)	$	—			$	76			$	(1,521	)		$	(368	)		$	(119	)
Cumulative effect of changes in accounting principles^(a):
Premium amortization on purchased callable debt securities		261				—			—				—				—				—				261
Hedge accounting		169				—			(54		)		—				—				—				115
Reclassification of certain tax effects from AOCI		466				(277		)	—				16				(414		)		(79		)		(288		)
Net change		(2,280		)		84			(74		)		(327		)		78				125				(2,394		)
Balance at September 30, 2018		$	780			$	(663	)	$	(128	)		$	(235	)		$	(1,857	)		$	(322	)		$	(2,425	)

As of or for the nine months ended September 30, 2017 (in millions)	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
	Unrealized gains/(losses) on investment securities				Translation adjustments, net of hedges				Fair value hedges			Cash flow hedges				Defined benefit pension and OPEB plans				DVA on fair value option elected liabilities				Accumulated other comprehensive income/(loss)
Balance at January 1, 2017		$	1,524			$	(164	)	NA				$	(100	)		$	(2,259	)		$	(176	)		$	(1,175	)
Net change		842				7			NA				170				26				(179		)		866
Balance at September 30, 2017		$	2,366			$	(157	)	NA				$	70			$	(2,233	)		$	(355	)		$	(309	)

~~The following table summarizes~~

(a)

Represents the ~~most significant types of Firm-sponsored VIEs by business segment.~~



~~Line of Business~~	~~Transaction Type~~	~~Activity~~	~~Form 10-Q page reference~~
~~CCB~~	~~Credit card securitization trusts~~	~~Securitization of originated credit card receivables~~	~~130~~
	~~Mortgage securitization trusts~~	~~Servicing and securitization of both originated and purchased residential mortgages~~	~~130–132~~
~~CIB~~	~~Mortgage and other securitization trusts~~	~~Securitization of both originated and purchased residential and commercial mortgages, and other consumer loans~~	~~130–132~~
	~~Multi-seller conduits~~	~~Assist clients in accessing the financial markets in a cost-efficient manner and structures transactions to meet investor needs~~	~~132~~
	~~Municipal bond vehicles~~	~~Financing of municipal bond investments~~	~~132~~

~~The Firm also invests in and provides financing and other services~~adjustment to ~~VIEs sponsored by third parties. See page 133 of this Note for more information on the VIEs sponsored by third parties.~~

~~Significant Firm-sponsored VIEs~~

~~Credit card securitizations~~

~~For a more detailed discussion of JPMorgan Chase’s involvement with credit card securitizations, see Note 14 of JPMorgan Chase’s 2017 Annual Report.~~

AsAOCI as a result of the Firm’s continuing involvement, the Firm is considered to be the primary beneficiary of its Firm-sponsored credit card securitization trusts, including its primary vehicle, the Chase Issuance Trust. See the table on page 133 of this Note for further information on consolidated VIE assets and liabilities.

~~Firm-sponsored mortgage and other securitization trusts~~

The Firm securitizes (or has securitized) originated and purchased residential mortgages, commercial mortgages and other consumer loans primarily in its CCB and CIB businesses. Depending on the particular transaction, as well as the respective business involved, the Firm may act as the servicer of the loans and/or retain certain beneficial interestsnew accounting standards adopted in the ~~securitization trusts.~~

~~For a detailed discussion~~first quarter of the Firm’s involvement with Firm-sponsored mortgage and other securitization trusts, as well as the accounting treatment relating to such trusts, see Note 14 of JPMorgan Chase’s 2017 Annual Report.

The following table presents the total unpaid principal amount of assets held in Firm-sponsored private-label securitization entities, including those in which the Firm has continuing involvement, and those that are consolidated by the Firm. Continuing involvement includes servicing the loans, holding senior interests or subordinated interests (including amounts required to be held pursuant to credit risk retention rules), recourse or guarantee arrangements, and derivative transactions. In certain instances, the Firm’s only continuing involvement is servicing the loans. See Securitization activity on page 134 of this Note for further information regarding the Firm’s cash flows with and interests retained in nonconsolidated VIEs, and page 134 of this Note for information on the Firm’s loan sales to U.S. government agencies.

Principal amount outstanding
JPMorgan Chase interest in securitized assets in nonconsolidated VIEs^(c)(d)(e)
March 31, 2018 (in millions) Total assets held by securitization VIEs Assets
held in consolidated securitization VIEs Assets held in nonconsolidated securitization VIEs with continuing involvement Trading assets Investment securities Other financial assets Total interests held by JPMorgan
Chase
Securitization-related^(a)

Residential mortgage:
Prime/Alt-A and option ARMs $ 67,150
$ 3,514
$ 51,840
$ 412
$ 876
$ —
$ 1,288
Subprime 18,512
17
17,074
57
—
—
57
Commercial and other^(b)
99,298
—
69,192
766
1,079
207
2,052
Total $ 184,960
$ 3,531
$ 138,106
$ 1,235
$ 1,955
$ 207
$ 3,397

Principal amount outstanding
JPMorgan Chase interest in securitized assets in nonconsolidated VIEs^(c)(d)(e)
December 31, 2017 (in millions) Total assets held by securitization VIEs
Assets
held in consolidated securitization VIEs
Assets held in nonconsolidated securitization VIEs with continuing involvement Trading assets Investment securities Other financial assets
Total interests held by
JPMorgan
Chase
Securitization-related^(a)

Residential mortgage:
Prime/Alt-A and option ARMs $ 68,874
$ 3,615
$ 52,280
$ 410
$ 943
$ —
$ 1,353
Subprime 18,984
7
17,612
93
—
—
93
Commercial and other^(b)
94,905
63
63,411
745
1,133
157
2,035
Total $ 182,763
$ 3,685
$ 133,303
$ 1,248
$ 2,076
$ 157
$ 3,481


~~(a)~~	~~Excludes U.S. government agency securitizations and re-securitizations, which are not Firm-sponsored. See page 134 of this Note for information on the Firm’s loan sales to U.S. government agencies.~~


~~(b)~~	~~Consists of securities backed by commercial loans (predominantly real estate) and non-mortgage-related consumer receivables purchased from third parties.~~

~~(c)~~

Excludes the following: retained servicing (see Note 14 for a discussion of MSRs); securities retained from loan sales to U.S. government agencies; interest rate and foreign exchange derivatives primarily used to manage interest rate and foreign exchange risks of securitization entities (See Note 4 for further information on derivatives); senior and subordinated securities of $306 million and $31 million, respectively, at March 31, 2018, and $88 million and $48 million, respectively, at December 31, 2017, which the Firm purchased in connection with CIB’s secondary market-making activities.


~~(d)~~	~~Includes interests held in re-securitization transactions.~~

~~(e)~~

As of March 31, 2018, and December 31, 2017, 68% and 61%, respectively, of the Firm’s retained securitization interests, which are predominantly carried at fair value and include amounts required to be held pursuant to credit risk retention rules, were risk-rated “A” or better, on an S&P-equivalent basis. The retained interests in prime residential mortgages consisted of $1.3 billion of investment-grade for both periods, and $16 million and $48 million of noninvestment-grade retained interests at March 31, 2018, and December 31, 2017, respectively. The retained interests in commercial and other securitizations trusts consisted of $1.7 billion and $1.6 billion of investment-grade and $362 million and $412 million of noninvestment-grade retained interests at March 31, 2018, and December 31, 2017, respectively.2018.

~~Residential mortgage~~

The Firm securitizes residential mortgage loans originated by CCB, as well as residential mortgage loans purchased from third parties by either CCB or CIB. For a more detailed description of the Firm’s involvement with residential mortgage securitizations, see Note 14 of JPMorgan Chase’s 2017 Annual Report. See the table on page 133 of this Note for more information on the consolidated residential mortgage securitizations, and the table on the previous page of this Note for further information on interests held

(b)

Represents changes in ~~nonconsolidated residential mortgage securitizations.~~

~~Commercial mortgages and other consumer securitizations~~

CIB originates and securitizes commercial mortgage loans, and engages in underwriting and trading activities involving the securities issued by securitization trusts. For a more detailed description of the Firm’s involvement with commercial mortgage and other consumer securitizations, see Note 14 of JPMorgan Chase’s 2017 Annual Report. See the table on page 133 of this Note for more information on the consolidated commercial mortgage securitizations, and the table on the previous page of this Note for further information on interests held in nonconsolidated securitizations.

~~Re-securitizations~~

~~For a more detailed description of JPMorgan Chase’s participation in certain re-securitization transactions, see Note 14 of JPMorgan Chase’s 2017 Annual Report.~~

~~The following table presents the principal amount of securities transferred to re-securitization VIEs.~~

Three months ended
March 31,
(in millions) 2018
2017
Transfers of securities to VIEs
Agency $ 4,786
$ 3,224

~~The following table presents information on nonconsolidated re-securitization VIEs.~~

Nonconsolidated
re-securitization VIEs
(in millions) March 31, 2018
December 31, 2017
Firm-sponsored private-label
Assets held in VIEs with continuing involvement^(a)
$ 722
$ 783
Interest in VIEs 15
29
Agency
Interest in VIEs 1,804
2,250


~~(a)~~	~~represents the principal amount and includes the notional amount of interest-only securities.~~

~~As of March 31, 2018, and December 31, 2017, the Firm did not consolidate any agency re-securitizations or any Firm-sponsored private-label re-securitizations.~~

~~Multi-seller conduits~~

~~For a more detailed description of JPMorgan Chase’s principal involvement with Firm-administered multi-seller conduits, see Note 14 of JPMorgan Chase’s 2017 Annual Report.~~

~~In the normal course of business, JPMorgan Chase makes markets in and invests in commercial paper issued by the Firm-administered multi-seller conduits. The Firm held $19.1 billion and $20.4 billionof the commercial paper issued by the Firm-administered multi-seller conduits at~~March 31, 2018, and December 31, 2017 respectively, which have been eliminated in consolidation. The Firm’s investments reflect the Firm’s funding needs and capacity and were not driven by market illiquidity. Other than the amounts required to be held pursuant to credit risk retention rules, the Firm is not obligated under any agreement to purchase the commercial paper issued by the Firm-administered multi-seller conduits.

Deal-specific liquidity facilities, program-wide liquidity and credit enhancement provided by the Firm have been eliminated in consolidation. The Firm or the Firm-administered multi-seller conduits provide lending-related commitments to certain clients of the Firm-administered multi-seller conduits. The unfunded commitments were $10.0 billion and $8.8 billion at March 31, 2018, and December 31, 2017, respectively, and are reported as off-balance sheet lending-related commitments. For more information on off-balance sheet lending-related commitments, see Note 20.

~~Municipal bond vehicles~~

The Firm serves as sponsor for all Non-Customer TOB transactions. For a more detailed description of JPMorgan Chase’s Municipal bond vehicles, see Note 14 of JPMorgan Chase’s 2017 Annual Report. The Firm had no exposure to nonconsolidated Firm-sponsored municipal bond vehicles at March 31, 2018 and December 31, 2017, respectively.

~~See page 133 of this Note for further information on consolidated municipal bond vehicles.~~

~~Consolidated VIE assets and liabilities~~

~~The following table presents information on assets and liabilities related to VIEs consolidated by the Firm as of March 31, 2018, and December 31, 2017.~~

Assets Liabilities
March 31, 2018 (in millions) Trading assets Loans
Other^(c)

Total
assets^(d)

Beneficial interests in
VIE assets^(e)
Other^(f)

Total
liabilities
VIE program type^(a)

Firm-sponsored credit card trusts $ —
$ 31,773
$ 543
$ 32,316
$ 16,819
$ 14
$ 16,833
Firm-administered multi-seller conduits —
22,081
51
22,132
3,067
30
3,097
Municipal bond vehicles 1,203
—
3
1,206
1,247
2
1,249
Mortgage securitization entities^(b)
16
3,562
50
3,628
310
191
501
Other 3
—
1,763
1,766
141
111
252
Total $ 1,222
$ 57,416
$ 2,410
$ 61,048
$ 21,584
$ 348
$ 21,932

Assets Liabilities
December 31, 2017 (in millions) Trading assets Loans
Other^(c)

Total
assets^(d)

Beneficial interests in
VIE assets^(e)
Other^(f)

Total
liabilities
VIE program type^(a)

Firm-sponsored credit card trusts $ —
$ 41,923
$ 652
$ 42,575
$ 21,278
$ 16
$ 21,294
Firm-administered multi-seller conduits —
23,411
48
23,459
3,045
28
3,073
Municipal bond vehicles 1,278
—
3
1,281
1,265
2
1,267
Mortgage securitization entities^(b)
66
3,661
55
3,782
359
199
558
Other 105
—
1,916
2,021
134
104
238
Total $ 1,449
$ 68,995
$ 2,674
$ 73,118
$ 26,081
$ 349
$ 26,430


~~(a)~~	~~Excludes intercompany transactions which are eliminated in consolidation.~~


~~(b)~~	~~Includes residential and commercial mortgage securitizations.~~


~~(c)~~	~~Includes assets classified as cash and other assets on the Consolidated balance sheets.~~


~~(d)~~	The assets of the consolidated VIEs included in the program types above are used to settle the liabilities of those entities. The assets and liabilities include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation.

~~(e)~~

The interest-bearing beneficial interest liabilities issued by consolidated VIEs are classified in the line item on the Consolidated balance sheets titled, “Beneficial interests issued by consolidated variable interest entities.” The holders of these beneficial interests generally do not have recourse to the general credit of JPMorgan Chase. For conduits program-wide credit enhancements, see note 14 of JPMorgan Chase’s 2017 Annual Report. Included in beneficial interests in VIE assets are long-term beneficial interests of $17.3 billion and $21.8 billion at March 31, 2018, and December 31, 2017, respectively.


~~(f)~~	~~Includes liabilities classified as accounts payable and other liabilities on the Consolidated balance sheets.~~

~~VIEs sponsored by third parties~~

~~Tax credit vehicles~~

general partner or managing member and has control over the significant activities of the tax credit vehicles, and accordingly the Firm does not consolidate tax credit vehicles. The Firm generally invests in these partnerships as a limited partner and earns a return primarily through the receipt of tax credits allocated to the projects. The maximum loss exposure, represented by equity investments and funding commitments, was $12.9 billion and $13.4 billion, of which $2.9 billion and $3.2 billion was unfunded at March 31, 2018 and December 31, 2017 respectively. In order to reduce the risk of loss, the Firm assesses each project and withholds varying amounts of its capital investment until qualification of the project for tax credits. For further information on affordable housing tax credits, see Note 24 of JPMorgan Chase’s 2017 Annual Report. For more information on off-balance sheet lending-related commitments, see Note 20 of this Form 10-Q.

~~Customer municipal bond vehicles (TOB trusts)~~

~~The Firm may provide various services to Customer TOB trusts, including remarketing agent, liquidity or tender option provider. In certain Customer TOB transactions, the~~

~~Firm, as liquidity provider, has entered into a reimbursement agreement with the Residual holder.~~

~~The Firm’s maximum exposure as a liquidity provider to Customer TOB trusts at both March 31, 2018 and~~

~~December 31, 2017 was $5.3 billion. The~~ fair value of ~~assets held by such VIEs at March 31, 2018~~cross-currency swaps attributable to changes in cross-currency basis spreads, which are excluded from the assessment of hedge effectiveness and ~~December 31, 2017, was $9.0 billion and $9.2 billion, respectively. For more information on off-balance sheet lending-related commitments, see Note 20.~~

~~Loan securitizations~~

recorded in other comprehensive income. The ~~Firm has securitized and sold a variety~~initial cost of ~~loans, including residential mortgage, credit card, and commercial mortgage. For a further description~~cross-currency basis spreads is recognized in earnings as part of the ~~Firm’s accounting policies regarding securitizations, see Note 14~~accrual of ~~JPMorgan Chase’s 2017 Annual Report.~~

~~Securitization activity~~

~~The following table provides information related to~~interest on the Firm’s securitization activities for the three months ended March 31, 2018 and 2017, related to assets held in Firm-sponsored securitization entities that were not consolidated by the Firm, and where sale accounting was achieved at the time of the securitization.

Three months ended March 31,
2018 2017
(in millions)
Residential mortgage^(d)
Commercial and other^(e)

Residential mortgage^(d)
Commercial and other^(e)
Principal securitized $ 1,330
$ 2,991
$ 1,029
$ 1,315
All cash flows during the period^(a):

Proceeds received from loan sales as financial instruments^(b)
$ 1,338
$ 2,991
$ 1,035
$ 1,348
Servicing fees collected 126
1
133
1
Purchases of previously transferred financial assets (or the underlying collateral)^(c)
—
—
—
—
Cash flows received on interests 92
47
131
335


~~(a)~~	~~Excludes re-securitization transactions.~~cross currency swap.

The following table presents the pre-tax and after-tax changes in the components of OCI.



	2018									2017
Three months ended September 30, (in millions)	Pre-tax			Tax effect			After-tax			Pre-tax			Tax effect			After-tax
Unrealized gains/(losses) on investment securities:
Net unrealized gains/(losses) arising during the period	$	(1,117	)	$	262		$	(855	)	$	232		$	(86	)	$	146
Reclassification adjustment for realized (gains)/losses included in net income^(a)	46			(10		)	36			1			—			1
Net change	(1,071		)	252			(819		)	233			(86		)	147
Translation adjustments:
Translation	(314		)	45			(269		)	286			(106		)	180
Hedges	311			(73		)	238			(286		)	106			(180		)
Net change	(3		)	(28		)	(31		)	—			—			—
Fair value hedges, net change^(b):	45			(11		)	34			NA			NA			NA
Cash flow hedges:
Net unrealized gains/(losses) arising during the period	(122		)	27			(95		)	29			(11		)	18
Reclassification adjustment for realized (gains)/losses included in net income^(c)	9			(2		)	7			10			(2		)	8
Net change	(113		)	25			(88		)	39			(13		)	26
Defined benefit pension and OPEB plans:
Net gains/(losses) arising during the period	—			—			—			—			—			—
Reclassification adjustments included in net income^(d):
Amortization of net loss	26			(6		)	20			63			(23		)	40
Prior service costs/(credits)	(7		)	2			(5		)	(9		)	3			(6		)
Foreign exchange and other	7			(3		)	4			(19		)	7			(12		)
Net change	26			(7		)	19			35			(13		)	22
DVA on fair value option elected liabilities, net change:	(527		)	125			(402		)	(178		)	66			(112		)
Total other comprehensive income/(loss)	$	(1,643	)	$	356		$	(1,287	)	$	129		$	(46	)	$	83

	2018									2017
Nine months ended September 30, (in millions)	Pre-tax			Tax effect			After-tax			Pre-tax			Tax effect			After-tax
Unrealized gains/(losses) on investment securities:
Net unrealized gains/(losses) arising during the period	$	(3,351	)	$	787		$	(2,564	)	$	1,294		$	(476	)	$	818
Reclassification adjustment for realized (gains)/losses included in net income^(a)	371			(87		)	284			38			(14		)	24
Net change	(2,980		)	700			(2,280		)	1,332			(490		)	842
Translation adjustments^(e):
Translation	(981		)	188			(793		)	1,185			(448		)	737
Hedges	1,149			(272		)	877			(1,161		)	431			(730		)
Net change	168			(84		)	84			24			(17		)	7
Fair value hedges, net change^(b):	(96		)	22			(74		)	NA			NA			NA
Cash flow hedges:
Net unrealized gains/(losses) arising during the period	(365		)	85			(280		)	111			(42		)	69
Reclassification adjustment for realized (gains)/losses included in net income^(c)	(62		)	15			(47		)	160			(59		)	101
Net change	(427		)	100			(327		)	271			(101		)	170
Defined benefit pension and OPEB plans:
Net gains/(losses) arising during the period	25			(6		)	19			(52		)	19			(33		)
Reclassification adjustments included in net income^(d):
Amortization of net loss	78			(18		)	60			187			(69		)	118
Prior service costs/(credits)	(19		)	5			(14		)	(27		)	10			(17		)
Settlement (gain)/loss	—			—			—			(3		)	1			(2		)
Foreign exchange and other	19			(6		)	13			(51		)	11			(40		)
Net change	103			(25		)	78			54			(28		)	26
DVA on fair value option elected liabilities, net change:	$	163		$	(38	)	$	125		$	(283	)	$	104		$	(179	)
Total other comprehensive income/(loss)	$	(3,069	)	$	675		$	(2,394	)	$	1,398		$	(532	)	$	866


~~(b)~~	~~predominantly includes Level 2 assets.~~


~~(c)~~	Includes cash paid by the Firm to reacquire assets from off–balance sheet, nonconsolidated entities – for example, loan repurchases due to representation and warranties and servicer “clean-up” calls.


~~(d)~~	~~Includes prime, Alt-A, subprime, and option ARMs. Excludes certain loan securitization transactions entered into with Ginnie Mae, Fannie Mae and Freddie Mac.~~


~~(e)~~	~~Includes commercial mortgage and other consumer loans.~~

~~Loans and excess MSRs sold to U.S. government-sponsored enterprises, loans in securitization transactions pursuant to Ginnie Mae guidelines, and other third-party-sponsored securitization entities~~

~~In addition to the amounts~~

(a)

The pre-tax amount is reported in ~~the securitization activity tables above, the Firm,~~investment securities losses in the ~~normal course~~Consolidated statements of ~~business, sells originated and purchased mortgage loans and certain originated excess MSRs on a nonrecourse basis, predominantly to U.S. government-sponsored enterprises~~(“U.S. GSEs”). These loans and excess MSRs are sold primarily for the purpose of securitization by the U.S. GSEs, who provide certain guarantee provisions (e.g., credit enhancement of the loans). The Firm also sells loans into securitization transactions pursuant to Ginnie Mae guidelines; these loans are typically insured or guaranteed by another U.S. government agency. The Firm does not consolidate the securitization vehicles underlying these transactions as it is not the primary beneficiary. For a limited number of loan sales, the Firm is obligated to share a portion of the credit risk associated with the sold loans with the purchaser. See Note 20 of this Form 10-Q, and Note 27 of JPMorgan Chase’s 2017 Annual Report for additional information about the Firm’s loan sales- and securitization-related indemnifications. See Note 14 for additional information about the impact of the Firm’s sale of

certain excess MSRs. The following table summarizes the activities related to loans sold to the U.S. GSEs, loans in securitization transactions pursuant to Ginnie Mae guidelines, and other third-party-sponsored securitization entities.

Three months ended March 31,
(in millions) 2018
2017
Carrying value of loans sold $ 8,760
$ 17,169
Proceeds received from loan sales as cash —
9
Proceeds from loan sales as securities^(a)
8,619
16,987
Total proceeds received from loan sales^(b)
$ 8,619
$ 16,996
Gains on loan sales^(c)(d)
$ 14
$ 31


~~(a)~~	~~Predominantly includes securities from U.S. GSEs and Ginnie Mae that are generally sold shortly after receipt.~~


~~(b)~~	~~Excludes the value of MSRs retained upon the sale of loans.~~


~~(c)~~	~~Gains on loan sales include the value of MSRs.~~


~~(d)~~	~~The carrying value of the loans accounted for at fair value approximated the proceeds received upon loan sale.~~

~~Options to repurchase delinquent loans~~

In addition to the Firm’s obligation to repurchase certain loans due to material breaches of representations and warranties as discussed in Note 20, the Firm also has the option to repurchase delinquent loans that it services for Ginnie Mae loan pools, as well as for other U.S. government agencies under certain arrangements. The Firm typically elects to repurchase delinquent loans from Ginnie Mae loan pools as it continues to service them and/or manage the foreclosure process in accordance with the applicable requirements, and such loans continue to be insured or guaranteed. When the Firm’s repurchase option becomes exercisable, such loans must be reported on the Consolidated balance sheets as a loan with a corresponding liability. For additional information, refer to Note 11.

The following table presents loans the Firm repurchased or had an option to repurchase, real estate owned, and foreclosed government-guaranteed residential mortgage loans recognized on the Firm’s Consolidated balance sheets as of March 31, 2018 and December 31, 2017. Substantially all of these loans and real estate are insured or guaranteed by U.S. government agencies.

(in millions) March 31, 2018
Dec 31,
2017
Loans repurchased or option to repurchase^(a)
$ 8,735
$ 8,629
Real estate owned 94
95
Foreclosed government-guaranteed residential mortgage loans^(b)
490
527


~~(a)~~	~~Predominantly all of these amounts relate to loans that have been repurchased from Ginnie Mae loan pools.~~


~~(b)~~	~~Relates to voluntary repurchases of loans, which are included in accrued interest and accounts receivable.~~

~~Loan delinquencies and liquidation losses~~

Net liquidation losses^(a)
Securitized assets 90 days past due Three months ended March 31,
(in millions) Mar 31,
2018
Dec 31,
2017
Mar 31,
2018
Dec 31,
2017
2018
2017
Securitized loans
Residential mortgage:
Prime / Alt-A & option ARMs $ 51,840
$ 52,280
$ 4,562
$ 4,870
$ 102
$ 212
Subprime 17,074
17,612
3,181
3,276
(602 ) 175
Commercial and other 69,192
63,411
736
957
27
52
Total loans securitized $ 138,106
$ 133,303
$ 8,479
$ 9,103
$ (473 ) $ 439


~~(a)~~	~~Includes liquidation gains as a result of private label mortgage settlement payments during the first quarter of 2018, which were reflected as asset recoveries by trustees.~~

~~Note14 – Goodwill and Mortgage servicing rights~~

~~For a discussion of the accounting policies related to goodwill and mortgage servicing rights, see Note 15 of JPMorgan Chase’s 2017 Annual Report.~~

~~Goodwill~~

~~The following table presents goodwill attributed to the business segments.~~

(in millions) March 31,
2018
December 31,
2017
Consumer & Community Banking $ 31,006
$ 31,013
Corporate & Investment Bank 6,775
6,776
Commercial Banking 2,860
2,860
Asset & Wealth Management 6,858
6,858
Total goodwill $ 47,499
$ 47,507

~~The following table presents changes in the carrying amount of goodwill.~~

Three months ended March 31,
(in millions) 2018
2017
Balance at beginning
of period
$ 47,507
$ 47,288
Changes during the period from:
Business combinations (1 ) —
Dispositions —
—
Other^(a)
(7 ) 4
Balance at March 31, $ 47,499
$ 47,292


~~(a)~~	~~Includes foreign currency remeasurement and other adjustments.~~

~~Goodwill Impairment testing~~

For a further description of the Firm’s goodwill impairment testing, including the primary method used to estimate the fair value of the reporting units, and the assumptions used in the goodwill impairment test, see Impairment testing on pages 244–245 of JPMorgan Chase’s 2017 Annual Report.

~~Goodwill was not impaired at March 31, 2018, or December 31, 2017, nor was goodwill written off due to impairment during the three months ended March 31, 2018 or 2017.~~

~~Mortgage servicing rights~~

MSRs represent the fair value of expected future cash flows for performing servicing activities for others. The fair value considers estimated future servicing fees and ancillary revenue, offset by estimated costs to service the loans, and generally declines over time as net servicing cash flows are received, effectively amortizing the MSR asset against contractual servicing and ancillary fee income. MSRs are either purchased from third parties or recognized upon sale or securitization of mortgage loans if servicing is retained. For a further description of the MSR asset, interest rate risk management, and the valuation of MSRs, see Notes 2 and 15 of JPMorgan Chase’s 2017 Annual Report.

~~The following table summarizes MSR activity for the three months endedMarch 31, 2018 and 2017.~~

As of or for the three months
ended March 31,
(in millions, except where otherwise noted) 2018
2017
Fair value at beginning of period $ 6,030
$ 6,096
MSR activity:
Originations of MSRs 176
217
Purchase of MSRs 67
—
Disposition of MSRs^(a)
(295 ) (71 )
Net additions/(dispositions) (52 ) 146

Changes due to collection/realization of expected cash flows (160 ) (206 )

Changes in valuation due to inputs and assumptions:
Changes due to market interest rates and other^(b)
382
57
Changes in valuation due to other inputs and assumptions:
Projected cash flows (e.g., cost to service) —
12
Discount rates 24
(12 )
Prepayment model changes and other^(c)
(22 ) (14 )
Total changes in valuation due to other inputs and assumptions 2
(14 )
Total changes in valuation due to inputs and assumptions 384
43
Fair value at March 31, $ 6,202
$ 6,079

Change in unrealized gains/(losses) included in income related to MSRs held at March 31, $ 384
$ 43
Contractual service fees, late fees and other ancillary fees included in income 465
487
Third-party mortgage loans serviced at March 31, (in billions) 540
584
Net servicer advances at March 31, (in billions)^(d)
3.6
4.4


~~(a)~~	Includes excess MSRs transferred to agency-sponsored trusts in exchange for stripped mortgage backed securities (“SMBS”). In each transaction, a portion of the SMBS was acquired by third parties at the transaction date; the Firm acquired the remaining balance of those SMBS as trading securities.


~~(b)~~	~~Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments.~~


~~(c)~~	~~Represents changes in prepayments other than those attributable to changes in market interest rates.~~

~~(d)~~

~~The following table presents the components of mortgage fees and related income (including the impact of MSR risk management activities) for the three months ended March 31, 2018 and 2017.~~

Three months ended March 31,
(in millions) 2018
2017
CCB mortgage fees and related income

Net production revenue $ 95
$ 141

Net mortgage servicing revenue:
Operating revenue:
Loan servicing revenue 513
522
Changes in MSR asset fair value due to collection/realization of expected cash flows (160 ) (205 )
Total operating revenue 353
317
Risk management:
Changes in MSR asset fair value due to market interest rates and other^(a)
382
57
Other changes in MSR asset fair value due to other inputs and assumptions
in model^(b)
2
(14 )
Change in derivative fair value and other (367 ) (95 )
Total risk management 17
(52 )
Total net mortgage servicing revenue 370
265

Total CCB mortgage fees and related income 465
406

All other —
—
Mortgage fees and related income $ 465
$ 406


~~(a)~~	~~Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments.~~


~~(b)~~	Represents the aggregate impact of changes in model inputs and assumptions such as projected cash flows (e.g., cost to service), discount rates and changes in prepayments other than those attributable to changes in market interest rates (e.g., changes in prepayments due to changes in home prices).

The table below outlines the key economic assumptions used to determine the fair value of the Firm’s MSRs at March 31, 2018, and December 31, 2017, and outlines hypothetical sensitivities of those fair values to immediate adverse changes in those assumptions, as defined below.

(in millions, except rates) Mar 31,
2018
Dec 31,
2017
Weighted-average prepayment speed assumption (“CPR”) 8.56 % 9.35 %
Impact on fair value of 10% adverse change $ (202 ) $ (221 )
Impact on fair value of 20% adverse change (392 ) (427 )
Weighted-average option adjusted spread 8.77 % 9.04 %
Impact on fair value of a 100 basis point adverse change $ (246 ) $ (250 )
Impact on fair value of a 200 basis point adverse change (473 ) (481 )

~~CPR: Constant prepayment rate.~~

~~Note 15 – Deposits~~

~~For a detailed discussion on deposits, see Note 17 of JPMorgan Chase’s 2017 Annual Report.~~

~~At March 31, 2018, and December 31, 2017, noninterest-bearing and interest-bearing deposits were as follows.~~

(in millions) March 31,
2018
December 31, 2017
U.S. offices
Noninterest-bearing $ 397,856
$ 393,645
Interest-bearing (included $14,765 and $14,947 at fair value)^(a)
825,223
793,618
Total deposits in U.S. offices 1,223,079
1,187,263
Non-U.S. offices
Noninterest-bearing 17,019
15,576
Interest-bearing (included $5,405 and $6,374 at fair value)^(a)
246,863
241,143
Total deposits in non-U.S. offices 263,882
256,719
Total deposits $ 1,486,961
$ 1,443,982


~~(a)~~	~~Includes structured notes classified as deposits for which the fair value option has been elected. For a further discussion, see Note 3 of JPMorgan Chase’s 2017 Annual Report.~~

~~Note 16 – Earnings per share~~

For a discussion of the computation of basic and diluted earnings per share (“EPS”), see Note 22 of JPMorgan Chase’s 2017 Annual Report. The following table presents the calculation of basic and diluted EPS for the three months ended March 31, 2018 and 2017.

(in millions, except per share amounts) Three months ended
March 31,
2018
2017
Basic earnings per share
Net income $ 8,712
$ 6,448
Less: Preferred stock dividends 409
412
Net income applicable to common equity 8,303
6,036
Less: Dividends and undistributed earnings allocated to participating securities 65
61
Net income applicable to common stockholders $ 8,238
$ 5,975

Total weighted-average basic shares
outstanding
3,458.3
3,601.7
Net income per share $ 2.38
$ 1.66

Diluted earnings per share
Net income applicable to common stockholders $ 8,238
$ 5,975
Total weighted-average basic shares
outstanding
3,458.3
3,601.7
Add: Employee stock options, SARs, warrants and unvested PSUs 21.2
28.7
Total weighted-average diluted shares outstanding 3,479.5
3,630.4
Net income per share $ 2.37
$ 1.65

~~Note 17 – Accumulated other comprehensive income/(loss)~~

As of or for the three months ended
March 31, 2018
(in millions) Unrealized
gains/(losses)
on investment securities Translation adjustments, net of hedges
Fair value hedges^(b)
Cash flow hedges Defined benefit
pension and
OPEB plans DVA on fair value option elected liabilities Accumulated other comprehensive income/(loss)

Balance at January 1, 2018 $ 2,164
$ (470 ) $ —
$ 76
$ (1,521 ) $ (368 ) $ (119 )

Cumulative effect of changes in accounting principles:^(a)

Premium amortization on purchased callable debt securities 261
—
—
—
—
—
261

Hedge accounting 169
—
(54 ) —
—
—
115

Reclassification of certain tax effects from AOCI 466
(277 ) —
16
(414 ) (79 ) (288 )
Net change (1,234 ) 27
(40 ) (73 ) 21
267
(1,032 )
Balance at March 31, 2018 $ 1,826
$ (720 ) $ (94 ) $ 19
$ (1,914 ) $ (180 ) $ (1,063 )

As of or for the three months ended
March 31, 2017
(in millions) Unrealized
gains/(losses)
on investment securities Translation adjustments, net of hedges Fair value hedges Cash flow hedges Defined benefit pension and
OPEB plans DVA on fair value option elected liabilities Accumulated other comprehensive income/(loss)

Balance at January 1, 2017 $ 1,524
$ (164 ) NA
$ (100 ) $ (2,259 ) $ (176 ) $ (1,175 )
Net change 238
7
NA
91
(15 ) (69 ) 252

Balance at March 31, 2017 $ 1,762
$ (157 ) NA
$ (9 ) $ (2,274 ) $ (245 ) $ (923 )


~~(a)~~	~~Represents the adjustment to AOCI as a result of the new accounting standards in the first quarter of 2018. For additional information, see Note 1.~~


(b)	Represents changes in fair value of cross-currency swaps attributable to changes in cross-currency basis spreads, which are excluded from the assessment of hedge effectiveness and recorded in other comprehensive income. The initial cost of cross-currency basis spreads is recognized in earnings as part of the accrual of interest on the cross currency swap.

(c)

The ~~following table presents the~~ pre-tax amounts are predominantly recorded in noninterest revenue, net interest income and ~~after-tax changes in the components of OCI.~~

2018 2017
Three months ended March 31, (in millions) Pre-tax Tax effect After-tax Pre-tax Tax effect After-tax
Unrealized gains/(losses) on debt investment securities:
Net unrealized gains/(losses) arising during the period $ (1,858 ) $ 437
$ (1,421 ) $ 367
$ (131 ) $ 236
Reclassification adjustment for realized (gains)/losses included in
net income^(a)
245
(58 ) 187
3
(1 ) 2
Net change (1,613 ) 379
(1,234 ) 370
(132 ) 238
Translation adjustments^(b):

Translation 389
(65 ) 324
582
(225 ) 357
Hedges (389 ) 92
(297 ) (556 ) 206
(350 )
Net change —
27
27
26
(19 ) 7
Fair value hedges, net change^(c):

(52 ) 12
(40 ) NA
NA
NA
Cash flow hedges:
Net unrealized gains/(losses) arising during the period (44 ) 11
(33 ) 59
(21 ) 38
Reclassification adjustment for realized (gains)/losses included in
net income^(d)
(52 ) 12
(40 ) 85
(32 ) 53
Net change (96 ) 23
(73 ) 144
(53 ) 91
Defined benefit pension and OPEB plans:
Net gains/(losses) arising during the period 23
(6 ) 17
(58 ) 21
(37 )
Reclassification adjustments included in net income^(e):

Amortization of net loss 26
(6 ) 20
62
(23 ) 39
Prior service costs/(credits) (6 ) 1
(5 ) (9 ) 3
(6 )
Settlement (gain)/loss
—
—
—
(3 ) 1
(2 )
Foreign exchange and other (19 ) 8
(11 ) (7 ) (2 ) (9 )
Net change 24
(3 ) 21
(15 ) —
(15 )
DVA on fair value option elected liabilities, net change: 350
(83 ) 267
(107 ) 38
(69 )
Total other comprehensive income/(loss) $ (1,387 ) $ 355
$ (1,032 ) $ 418
$ (166 ) $ 252


~~(a)~~	~~The pre-tax amount is reported in investment securities losses in the Consolidated statements of income.~~


~~(b)~~	~~Reclassifications of pre-tax realized gains/(losses) on translation adjustments and related hedges are reported in other income/~~compensation expense in the Consolidated statements of income. ~~The amounts were not material for the periods presented.~~


~~(c)~~	Represents changes in fair value of cross-currency swaps attributable to changes in cross-currency basis spreads, which are excluded from the assessment of hedge effectiveness and recorded in other comprehensive income. The initial cost of cross-currency basis spreads is recognized in earnings as part of the accrual of interest on the cross currency swap.


(d)	~~The pre-tax amounts are predominantly recorded in noninterest revenue, net interest income and compensation expense in the Consolidated statements of income.~~


~~(e)~~	The pre-tax amount is reported in other expense in the Consolidated statements of income.

~~Note 18 – Restricted cash~~

(e)

Reclassifications of pre-tax realized gains/(losses) on translation adjustments and related hedges are reported in other ~~restricted~~

~~assets~~

~~For a detailed discussion of the Firm’s restricted cash and other restricted assets, see Note 25 of JPMorgan Chase’s 2017 Annual Report.~~

~~As a result of the adoption of the restricted cash accounting guidance, restricted cash is included with unrestricted cash when reconciling the beginning and ending cash balances on~~income/expense in the Consolidated statements of income. During the nine months ended September 30, 2018, the Firm reclassified a net pre-tax loss of $174 million to other expense related to the liquidation of a legal entity, $23 million related to net investment hedge losses and $151 million related to cumulative translation adjustments. During the nine months ended September 30, 2017, the Firm reclassified a net pre-tax loss of $25 million to other expense related to the liquidation of a legal entity, $47 million related to net investment hedge gains and $72 million related to cumulative translation adjustments.

Note 18 – Restricted cash and other restricted

assets

For a detailed discussion of the Firm’s restricted cash and other restricted assets, refer to Note 25 of JPMorgan Chase’s 2017 Annual Report.

As a result of the adoption of the restricted cash accounting guidance in the first quarter of 2018, restricted cash is included with unrestricted cash when reconciling the beginning and ending cash balances on the Consolidated statements of cash flows.

The following table presents the components of the Firm’s restricted cash:



(in billions)	September 30, 2018		December 31, 2017
Cash reserves – Federal Reserve Banks	$	23.6	$	25.7
Segregated for the benefit of securities and futures brokerage customers	15.3		16.8
Cash reserves at non-U.S. central banks and held for other general purposes	3.3		3.3
Total restricted cash^(a)	$	42.2	$	45.8

(a)

Comprises $40.7 billion and $44.8 billion in deposits with banks, and $1.5 billion and $1.0 billion in cash ~~flows.~~

~~The following table presents~~and due from banks on the ~~components~~Consolidated balance sheets as of ~~the Firm’s restricted cash:~~

(in billions) March 31,
2018
December 31, 2017
Cash reserves – Federal Reserve Banks^(a)
$ 22.6
$ 25.7
Segregated for the benefit of securities and futures brokerage customers 18.7
16.8
Cash reserves at non-U.S. central banks and held for other general purposes 3.1
3.3
Total restricted cash^(b)
$ 44.4
$ 45.8


~~(a)~~	~~Average cash reserves were $24.5 billion and $26.2 billion for the three months ended March 31,~~September 30, 2018 and December 31, 2017, respectively.


~~(b)~~	Comprises $43.1 billion and $44.8 billion in deposits with banks, and $1.3 billion and $1.0 billion in cash and due from banks on the Consolidated balance sheets as of March 31, 2018 and December 31, 2017, respectively.

~~Also, as of March 31,~~

Also, as of September 30, 2018 and December 31, 2017, the Firm had:

Cash and securities pledged with clearing organizations for the benefit of customers of $18.8 billion and $18.0 billion, respectively.

Securities with a fair value of $2.2 billion and $3.5 billion, respectively, were also restricted in relation to customer activity.

Note 19 – Regulatory capital

For a detailed discussion on regulatory capital, refer to Note 26 of JPMorgan Chase’s 2017 Annual Report.

The Federal Reserve establishes capital requirements, including well-capitalized standards, for the consolidated financial holding company. The Office of the Comptroller of the Currency (“OCC”) establishes similar minimum capital requirements and standards for the Firm’s insured depository institutions (“IDI”), including JPMorgan Chase Bank, N.A. and Chase Bank USA, N.A.

Under the risk-based capitalguidelines of the Federal Reserve, JPMorgan Chase is required to maintain minimum ratios for CET1, Tier 1, Total, Tier 1 leverage and the SLR. Failure to meet these minimum requirements could cause the Federal Reserve to take action. IDI subsidiaries are also subject to these capital requirements by their respective primary regulators.

The following table represents the minimum and well-capitalized ratios to which the Firm and its IDI subsidiaries were subject as of September 30, 2018.



	Minimum capital ratios				Well-capitalized ratios
	BHC^(a)(e)(f)		IDI^(b)(e)(f)		BHC^(c)		IDI^(d)
Capital ratios
CET1	9.0	%	6.375	%	—	%	6.5	%
Tier 1	10.5		7.875		6.0		8.0
Total	12.5		9.875		10.0		10.0
Tier 1 leverage	4.0		4.0		5.0		5.0
SLR	5.0		6.0		—		6.0

Note: The table above is as defined by the regulations issued by the Federal Reserve, OCC and FDIC and to which the Firm and its IDI subsidiaries are subject.

(a)

Represents the Transitional minimum capital ratios applicable to the Firm ~~had:~~

~~Cash and securities pledged with clearing organizations for the benefit of customers of $17.6 billion and $18.0 billion, respectively.~~

~~Securities with a fair value of $5.8 billion and $3.5 billion, respectively, were also restricted in relation to customer activity.~~

~~Note 19 – Regulatory capital~~

~~For a detailed discussion on regulatory capital, see Note 26 of JPMorgan Chase’s 2017 Annual Report.~~

Under the risk-based capital guidelines of the Federal Reserve, JPMorgan Chase is required to maintain minimum ratios for CET1, Tier 1, Total, Tier 1 leverage and the SLR. Failure to meet these minimum requirements could cause the Federal Reserve to take action. IDI subsidiaries are also subject to these capital requirements by their respective primary regulators.

~~The following table represents the minimum and well-capitalized ratios to which the Firm and its IDI subsidiaries were subject as of March 31,~~under Basel III at September 30, 2018.

Minimum capital ratios Well-capitalized ratios

BHC^(a)(e)

IDI^(b)(e)

BHC^(c)

IDI^(d)

Capital ratios
CET1 9.0 % 6.375 % — % 6.5 %
Tier 1 10.5
7.875
6.0
8.0
Total 12.5
9.875
10.0
10.0
Tier 1 leverage 4.0
4.0
5.0
5.0
SLR 5.0
6.0
—
6.0

~~Note: The table above is as defined by the regulations issued by the Federal Reserve, OCC and FDIC and to which the Firm and its IDI subsidiaries are subject.~~


~~(a)~~	~~Represents the Transitional minimum capital ratios applicable to the Firm under Basel III at March 31, 2018. At March 31,~~ At September 30, 2018, the CET1 minimum capital ratio includes 1.875% resulting from the phase in of the Firm’s 2.5% capital conservation buffer, and 2.625%, resulting from the phase in of the Firm’s 3.5% GSIB surcharge.


(b)	Represents requirements for JPMorgan Chase’s IDI subsidiaries. The CET1 minimum capital ratio includes 1.875% resulting from the phase in of the 2.5% capital conservation buffer that is applicable to the IDI subsidiaries. The IDI subsidiaries are not subject to the GSIB surcharge.


(c)	Represents requirements for bank holding companies pursuant to regulations issued by the Federal Reserve.


(d)	Represents requirements for IDI subsidiaries pursuant to regulations issued under the FDIC Improvement Act.


(e)	For the period ended December 31, 2017, the CET1, Tier 1, Total and Tier 1 leverage minimum capital ratios applicable to the Firm were 7.5%, 9.0%, 11.0% and 4.0%, and the CET1, Tier 1, Total and Tier 1 leverage minimum capital ratios applicable to the Firm’s IDI subsidiaries were 5.75%, 7.25%, 9.25% and 4.0%, respectively.


(f)	Represents minimum SLR requirement of 3.0%, as well as, supplementary leverage buffers of 2.0% and 3.0% for BHC and IDI, respectively.

The following tables present the risk-based and leverage-based capital metrics for JPMorgan Chase and its significant IDI subsidiaries under both the Basel III Standardized and Basel III Advanced Approaches. As of September 30, 2018 and December 31, 2017, JPMorgan Chase and all of its IDI subsidiaries were well-capitalized and met all capital requirements to which each was subject.



September 30, 2018 (in millions, except ratios)	Basel III Standardized Transitional									Basel III Advanced Transitional
	JPMorgan Chase & Co.			JPMorgan Chase Bank, N.A.			Chase Bank USA, N.A.			JPMorgan Chase & Co.			JPMorgan Chase Bank, N.A.			Chase Bank USA, N.A.
Regulatory capital
CET1 capital	$	184,972		$	188,608		$	23,136		$	184,972		$	188,608		$	23,136
Tier 1 capital	210,589			188,608			23,136			210,589			188,608			23,136
Total capital	238,303			199,634			28,026			228,574			193,613			26,636

Assets
Risk-weighted	1,545,326			1,362,039			109,138			1,438,529			1,211,473			182,177
Adjusted average^(a)	2,552,612			2,141,332			116,411			2,552,612			2,141,332			116,411

Capital ratios^(b)
CET1	12.0		%	13.8		%	21.2		%	12.9		%	15.6		%	12.7		%
Tier 1	13.6			13.8			21.2			14.6			15.6			12.7
Total	15.4			14.7			25.7			15.9			16.0			14.6
Tier 1 leverage^(c)	8.2			8.8			19.9			8.2			8.8			19.9



December 31, 2017 (in millions, except ratios)	Basel III Standardized Transitional										Basel III Advanced Transitional
	JPMorgan Chase & Co.			JPMorgan Chase Bank, N.A.				Chase Bank USA, N.A.			JPMorgan Chase & Co.			JPMorgan Chase Bank, N.A.				Chase Bank USA, N.A.
Regulatory capital
CET1 capital	$	183,300		$	184,375			$	21,600		$	183,300		$	184,375			$	21,600
Tier 1 capital	208,644			184,375				21,600			208,644			184,375				21,600
Total capital	238,395			195,839				27,691			227,933			189,510			^(d)	26,250

Assets
Risk-weighted	1,499,506			1,338,970			^(d)	113,108			1,435,825			1,241,916			^(d)	190,523
Adjusted average^(a)	2,514,270			2,116,031				126,517			2,514,270			2,116,031				126,517

Capital ratios^(b)
CET1	12.2		%	13.8		%		19.1		%	12.8		%	14.8		%	^(d)	11.3		%
Tier 1	13.9			13.8				19.1			14.5			14.8			^(d)	11.3
Total	15.9			14.6			^(d)	24.5			15.9			15.3			^(d)	13.8
Tier 1 leverage^(c)	8.3			8.7				17.1			8.3			8.7				17.1


(a)	Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets.


(b)	For each of the risk-based capital ratios, the capital adequacy of the Firm and its IDI subsidiaries is evaluated against the lower of the two ratios as calculated under Basel III approaches (Standardized or Advanced).


(c)	The Tier 1 leverage ratio is not a risk-based measure of capital.


(d)	The prior period amounts have been revised to conform with the current period presentation.



	September 30, 2018									December 31, 2017
	Basel III Advanced Fully Phased-In									Basel III Advanced Transitional
(in millions, except ratios)	JPMorgan Chase & Co.			JPMorgan Chase Bank, N.A.			Chase Bank USA, N.A.			JPMorgan Chase & Co.			JPMorgan Chase Bank, N.A.			Chase Bank USA, N.A.
Total leverage exposure^(a)	$	3,235,518		$	2,765,905		$	175,153		$	3,204,463		$	2,775,041		$	182,803
SLR^(a)	6.5		%	6.8		%	13.2		%	6.5		%	6.6		%	11.8		%


(a)	Effective January 1, 2018, the SLR was fully phased-in under Basel III. The December 31, 2017 amounts were calculated under the Basel III ~~Standardized and Basel III Advanced Approaches. As of March~~Transitional rules.

Note 20 – Off–balance sheet lending-related

financial instruments, guarantees, and other

commitments

JPMorgan Chase provides lending-related financial instruments (e.g., commitments and guarantees) to address the financing needs of its customers and clients. The contractual amount of these financial instruments represents the maximum possible credit risk to the Firm should the customer or client draw upon the commitment or the Firm be required to fulfill its obligation under the guarantee, and should the customer or client subsequently fail to perform according to the terms of the contract. Most of these commitments and guarantees are refinanced, extended, cancelled, or expire without being drawn or a default occurring. As a result, the total contractual amount of these instruments is not, in the Firm’s view, representative of its expected future credit exposure or funding requirements. For a further discussion of lending-related commitments and guarantees, and the Firm’s related accounting policies, refer to Note27 of JPMorgan Chase’s 2017 Annual Report.

To provide for probable credit losses inherent in wholesale and certain consumer lending-related commitments, an allowance for credit losses on lending-related commitments is maintained. Refer to Note12for further information regarding the allowance for credit losses on lending-related commitments.The following table summarizes the contractual amounts and carrying values of off-balance sheet lending-related financial instruments, guarantees and other commitments at September 30, 2018, and December 31, 2017. The amounts in the table below for credit card and home equity lending-related commitments represent the total available credit for these products. The Firm has not experienced, and does not anticipate, that all available lines of credit for these products will be utilized at the same time. The Firm can reduce or cancel credit card lines of credit by providing the borrower notice or, in some cases as permitted by law, without notice. In addition, the Firm typically closes credit card lines when the borrower is 60 days or more past due. The Firm may reduce or close HELOCs when there are significant decreases in the value of the underlying property, or when there has been a demonstrable decline in the creditworthiness of the borrower.



Off–balance sheet lending-related financial instruments, guarantees and other commitments
	Contractual amount												Carrying value^(g)
	September 30, 2018										Dec 31, 2017		Sep 30, 2018			Dec 31, 2017
By remaining maturity (in millions)	Expires in 1 year or less		Expires after 1 year through 3 years		Expires after 3 years through 5 years		Expires after 5 years		Total		Total
Lending-related
Consumer, excluding credit card:
Home equity	$	916	$	1,110	$	1,693	$	16,942	$	20,661	$	20,360	$	12		$	12
Residential mortgage^(a)	6,955		—		—		12		6,967		5,736		—			—
Auto	7,911		1,430		200		89		9,630		9,255		2			2
Consumer & Business Banking	12,127		647		111		487		13,372		13,202		19			19
Total consumer, excluding credit card	27,909		3,187		2,004		17,530		50,630		48,553		33			33
Credit card	600,728		—		—		—		600,728		572,831		—			—
Total consumer^(b)	628,637		3,187		2,004		17,530		651,358		621,384		33			33
Wholesale:
Other unfunded commitments to extend credit^(c)	74,427		128,149		148,414		10,995		361,985		331,160		886			840
Standby letters of credit and other financial guarantees^(c)	14,561		9,810		5,038		2,339		31,748		35,226		585			636
Other letters of credit^(c)	3,344		137		102		—		3,583		3,712		7			3
Total wholesale^(d)	92,332		138,096		153,554		13,334		397,316		370,098		1,478			1,479
Total lending-related	$	720,969	$	141,283	$	155,558	$	30,864	$	1,048,674	$	991,482	$	1,511		$	1,512
Other guarantees and commitments
Securities lending indemnification agreements and guarantees^(e)	$	202,622	$	—	$	—	$	—	$	202,622	$	179,490	$	—		$	—
Derivatives qualifying as guarantees	2,800		361		12,384		40,349		55,894		57,174		370			304
Unsettled reverse repurchase and securities borrowing agreements	119,762		—		—		—		119,762		76,859		—			—
Unsettled repurchase and securities lending agreements	92,115		—		—		—		92,115		44,205		—			—
Loan sale and securitization-related indemnifications:
Mortgage repurchase liability	NA		NA		NA		NA		NA		NA		89			111
Loans sold with recourse	NA		NA		NA		NA		1,066		1,169		33			38
Other guarantees and commitments^(f)	10,091		1,443		384		2,641		14,559		11,867		(53		)	(76		)


(a)	Includes certain commitments to purchase loans from correspondents.


(b)	Predominantly all consumer lending-related commitments are in the U.S.

(c)

At September 30, 2018, and December 31, 2017, ~~JPMorgan Chase and all of its IDI subsidiaries were well-capitalized and met all capital requirements to which each was subject.~~

March 31, 2018
(in millions, except ratios)
Basel III Standardized Transitional Basel III Advanced Transitional
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Chase Bank
USA, N.A.

JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Chase Bank
USA, N.A.
Regulatory capital
CET1 capital $ 183,655
$ 187,903
$ 21,905
$ 183,655
$ 187,903
$ 21,905
Tier 1 capital^(a)
209,296
187,903
21,905
209,296
187,903
21,905
Total capital 238,326
199,271
27,850
228,320
193,099
26,505

Assets
Risk-weighted 1,552,952
1,382,770
105,610
1,466,095
1,260,775
185,468
Adjusted average^(b)
2,539,183
2,136,238
120,490
2,539,183
2,136,238
120,490

Capital ratios^(c)

CET1 11.8 % 13.6 % 20.7 % 12.5 % 14.9 % 11.8 %
Tier 1^(a)
13.5
13.6
20.7
14.3
14.9
11.8
Total 15.3
14.4
26.4
15.6
15.3
14.3
Tier 1 leverage^(d)
8.2
8.8
18.2
8.2
8.8
18.2

December 31, 2017
(in millions, except ratios)
Basel III Standardized Transitional Basel III Advanced Transitional
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Chase Bank
USA, N.A.

JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Chase Bank
USA, N.A.
Regulatory capital
CET1 capital $ 183,300
$ 184,375
$ 21,600
$ 183,300
$ 184,375
$ 21,600
Tier 1 capital^(a)
208,644
184,375
21,600
208,644
184,375
21,600
Total capital 238,395
195,839
27,691
227,933
189,510
^(e)
26,250

Assets
Risk-weighted 1,499,506
1,338,970
^(e)
113,108
1,435,825
1,241,916
^(e)
190,523
Adjusted average^(b)
2,514,270
2,116,031
126,517
2,514,270
2,116,031
126,517

Capital ratios^(c)

CET1 12.2 % 13.8 % 19.1 % 12.8 % 14.8 %
^(e)
11.3 %
Tier 1^(a)
13.9
13.8
19.1
14.5
14.8
^(e)
11.3
Total 15.9
14.6
^(e)
24.5
15.9
15.3
^(e)
13.8
Tier 1 leverage^(d)
8.3
8.7
17.1
8.3
8.7
17.1


~~(a)~~	~~Includes~~reflected the deduction associated with the permissible holdings of covered funds (as defined by the Volcker Rule) for JPMorgan Chase & Co. and JPMorgan Chase Bank, N.A. The deduction was not material as of March 31, 2018 and December 31, 2017.


~~(b)~~	Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets.


~~(c)~~	For each of the risk-based capital ratios, the capital adequacy of the Firm and its IDI subsidiaries is evaluated against the lower of the two ratios as calculated under Basel III approaches (Standardized or Advanced) as required by the Collins Amendment of the Dodd-Frank Act (the “Collins Floor”).


~~(d)~~	~~The Tier 1 leverage ratio is not a risk-based measure of capital.~~


~~(e)~~	~~The prior period amounts have been revised to conform with the current period presentation.~~

March 31, 2018 December 31, 2017
Basel III Advanced Fully Phased-In Basel III Advanced Transitional
(in millions, except ratios)
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Chase Bank
USA, N.A.

JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Chase Bank
USA, N.A.
Total leverage exposure^(a)
$ 3,234,103
$ 2,799,403
$ 177,666
$ 3,204,463
$ 2,775,041
$ 182,803
SLR^(a)
6.5 % 6.7 % 12.3 % 6.5 % 6.6 % 11.8 %


~~(a)~~	~~Effective January 1, 2018, the SLR was fully phased-in under Basel III. Prior period amounts were calculated under the Basel III Transitional rules.~~

~~Note 20 – Off–balance sheet lending-related financial instruments, guarantees, and other commitments~~

~~JPMorgan Chase provides lending-related financial instruments (e.g., commitments and guarantees) to meet the financing needs of its customers. The~~ contractual amount net of ~~these financial instruments represents the maximum possible credit~~ risk ~~to the Firm should the counterparty draw upon the commitment or the Firm be required to fulfill its obligation under the guarantee,~~participations totaling $287 million and should the counterparty subsequently fail to perform according to the terms of the contract. Most of these commitments and guarantees are refinanced, extended, cancelled, or expire without being drawn or a default occurring. As a result, the total contractual amount of these instruments is not, in the Firm’s view, representative of its expected future credit exposure or funding requirements. For a further discussion of lending-related commitments and guarantees, and the Firm’s related accounting policies, see Note 27 of JPMorgan Chase’s 2017 Annual Report.

To provide for probable credit losses inherent in wholesale and certain consumer lending-related commitments, an allowance for credit losses on lending-related commitments is maintained. See Note 12 for further information regarding the allowance for credit losses on lending-related commitments.The following table summarizes the contractual amounts and carrying values of off-balance sheet lending-related financial instruments, guarantees and other commitments at March 31, 2018, and December 31, 2017. The amounts in the table below for credit card and home equity lending-related commitments represent the total available credit for these products. The Firm has not experienced, and does not anticipate, that all available lines of credit for these products will be utilized at the same time. The Firm can reduce or cancel credit card lines of credit by providing the borrower notice or, in some cases as permitted by law, without notice. In addition, the Firm typically closes credit card lines when the borrower is 60 days or more past due. The Firm may reduce or close HELOCs when there are significant decreases in the value of the underlying property, or when there has been a demonstrable decline in the creditworthiness of the borrower.

Off–balance sheet lending-related financial instruments, guarantees and other commitments

Contractual amount
Carrying value^(g)

March 31, 2018
Dec 31,
2017

Mar 31,
2018
Dec 31,
2017
By remaining maturity
(in millions) Expires in 1 year or less Expires after
1 year through
3 years Expires after
3 years through
5 years Expires after 5 years Total
Total

Lending-related
Consumer, excluding credit card:
Home equity $ 1,712
$ 1,245
$ 1,439
$ 16,177
$ 20,573

$ 20,360

$ 12
$ 12
Residential mortgage^(a)
6,661
—
—
13
6,674

5,736

—
—
Auto 7,652
848
219
65
8,784

9,255

2
2
Consumer & Business Banking 11,957
903
106
519
13,485

13,202

19
19
Total consumer, excluding credit card 27,982
2,996
1,764
16,774
49,516

48,553

33
33
Credit card 588,232
—
—
—
588,232

572,831

—
—
Total consumer^(b)
616,214
2,996
1,764
16,774
637,748

621,384

33
33
Wholesale:
Other unfunded commitments to extend credit^(c)
68,984
130,836
139,583
7,115
346,518

331,160

870
840
Standby letters of credit and other financial guarantees^(c)
15,543
10,086
7,241
1,932
34,802

35,226

719
636
Other letters of credit^(c)
2,739
82
134
—
2,955

3,712

4
3
Total wholesale^(d)
87,266
141,004
146,958
9,047
384,275

370,098

1,593
1,479
Total lending-related $ 703,480
$ 144,000
$ 148,722
$ 25,821
$ 1,022,023

$ 991,482

$ 1,626
$ 1,512
Other guarantees and commitments

Securities lending indemnification agreements and guarantees^(e)
$ 216,863
$ —
$ —
$ —
$ 216,863

$ 179,490

$ —
$ —
Derivatives qualifying as guarantees 2,391
326
12,421
40,178
55,316

57,174

427
304
Unsettled reverse repurchase and securities borrowing agreements 128,774
—
—
—
128,774

76,859

—
—
Unsettled repurchase and securities lending agreements 90,034
—
—
—
90,034

44,205

—
—
Loan sale and securitization-related indemnifications:

Mortgage repurchase liability NA
NA
NA
NA
NA

NA

111
111
Loans sold with recourse NA
NA
NA
NA
1,136

1,169

36
38
Other guarantees and commitments^(f)
9,791
1,118
166
3,174
14,249

11,867

(584 ) (76 )


~~(a)~~	~~Includes certain commitments to purchase loans from correspondents.~~


~~(b)~~	~~Predominantly all consumer lending-related commitments are in the U.S.~~

~~(c)~~

~~At March 31, 2018, and December 31, 2017, reflected the contractual amount net of risk participations totaling~~ $334 million for both periods, for other unfunded commitments to extend credit; $10.8 billion and $10.4 billion, respectively, for standby letters of credit and other financial guarantees; and $330 million and $405 million respectively, for other ~~letters of credit. In regulatory filings with the Federal Reserve these commitments are shown gross of risk participations.~~


~~(d)~~	~~At March 31, 2018, and December 31, 2017, the U.S. portion of the contractual amount of total wholesale lending-related commitments was 76% and 77%, respectively.~~


~~(e)~~	At March 31, 2018, and December 31, 2017, collateral held by the Firm in support of securities lending indemnification agreements was $226.5 billion and $188.7 billion, respectively. Securities lending collateral primarily consists of cash and securities issued by governments that are members of G7 and U.S. government agencies.

~~(f)~~

At ~~March 31, 2018~~, ~~and December 31, 2017,~~ primarily includes letters of credit hedged by derivative transactions and managed on a market risk basis, unfunded commitments related to institutional lending and commitments associated with the Firm’s membership in certain clearing houses. Additionally, includes unfunded commitments predominantly related to certain tax-oriented equity investments.


~~(g)~~	For lending-related products, the carrying value represents the allowance for lending-related commitments and the guarantee liability; for derivative-related products, the carrying value represents the fair value.

~~Other~~ unfunded commitments to extend ~~credit~~

~~Other unfunded commitments to extend credit generally consist of commitments~~credit; $9.9 billion and $10.4 billion, respectively, for ~~working capital and general corporate purposes, extensions~~standby letters of credit ~~to support commercial paper facilities~~ and bond financings in the event that those obligations cannot be remarketed to new investors, as well as committed liquidity facilities to clearing organizations. The Firm also issues commitments under multipurpose facilities which could be drawn upon in several forms, including the issuance of a standby letterother financial guarantees; and $469 million and $405 million, respectively, for other letters of credit.

~~The Firm acts as a settlement and custody bank in~~ In regulatory filings with the ~~U.S. tri-party repurchase transaction market. In its role as settlement and custody bank, the Firm is exposed to the intra-day credit~~Federal Reserve these commitments are shown gross of risk ~~of its cash borrower clients, usually broker-dealers. This exposure arises under secured~~

~~clearance advance facilities that the Firm extends to its clients (i.e., cash borrowers); these facilities contractually limit the Firm’s intra-day credit risk to the facility amount~~

~~and must be repaid by the end of the day. As of~~participations.

(d)

At both ~~March 31,~~September 30, 2018, and December 31, 2017, the ~~secured clearance advance facility maximum outstanding commitment~~U.S. portion of the contractual amount ~~was$1.5 billion.~~

~~Standby letters~~ of ~~credit and other financial guarantees~~

~~Standby letters of credit and other financial guarantees are conditional lending~~total wholesale lending-related commitments issued by the Firm to guarantee the performance of a client or customer to a third party under certain arrangements, such as commercial paper facilities, bond financings, acquisition financings, trade and similar transactions.

~~The following table summarizes the standby letters of credit and other letters of credit arrangements as of March 31,~~was 76%.

(e)

At September 30, 2018, and December 31, ~~2017.~~

~~Standby letters of credit, other financial guarantees and other letters of credit~~

March 31, 2018 December 31, 2017
(in millions) Standby letters of
credit and other financial guarantees
Other letters
of credit
Standby letters of
credit and other financial guarantees
Other letters
of credit
Investment-grade^(a)
$ 28,048
$ 2,101
$ 28,492
$ 2,646
Noninvestment-grade^(a)
6,754
854
6,734
1,066
Total contractual amount $ 34,802
$ 2,955
$ 35,226
$ 3,712

Allowance for lending-related commitments $ 200
$ 4
$ 192
$ 3
Guarantee liability 519
—
444
—
Total carrying value $ 719
$ 4
$ 636
$ 3

Commitments with collateral $ 16,766
$ 681
$ 17,421
$ 878


~~(a)~~	~~The ratings scale is based on the Firm’s internal ratings which generally correspond to ratings as defined by S&P and Moody’s.~~

~~Derivatives qualifying as guarantees~~

~~The Firm transacts certain derivative contracts that have the characteristics of a guarantee under U.S. GAAP. For further information on these derivatives, see Note 27 of JPMorgan Chase’s~~ 2017, ~~Annual Report.~~

~~The following table summarizes the derivatives qualifying as guarantees as of March 31, 2018, and December 31, 2017.~~

(in millions) March 31, 2018
December 31, 2017
Notional amounts
Derivative guarantees 55,316
57,174
Stable value contracts with contractually limited exposure 28,453
29,104
Maximum exposure of stable value contracts with contractually limited exposure 2,945
3,053

Fair value
Derivative payables 427
304
Derivative receivables —
—

In addition to derivative contracts that meet the characteristics of a guarantee, the Firm is both a purchaser and seller of credit protection in the credit derivatives market. For a further discussion of credit derivatives, see Note 4.

~~Loan sales- and securitization-related indemnifications~~

In connection with the Firm’s mortgage loan sale and securitization activities with GSEs and in certain private label transactions, the Firm has made representations and warranties that the loans sold meet certain requirements, and that may require the Firm to repurchase mortgage loans and/or indemnify the loan purchaser if such representations and warranties are breached by the Firm. Further, although the Firm’s securitizations are predominantly nonrecourse, the Firm does provide recourse servicing in certain limited cases where it agrees to share credit risk with the owner of the mortgage loans. For additional information, see Note 27 of JPMorgan Chase’s 2017 Annual Report.

~~The liability related to repurchase demands associated with private label securitizations is separately evaluated~~collateral held by the Firm in ~~establishing its litigation reserves. For additional information regarding litigation, see Note 22~~support of ~~this Form 10-Q~~securities lending indemnification agreements was $214.3 billion and ~~Note 29~~$188.7 billion, respectively. Securities lending collateral primarily consists of ~~JPMorgan Chase’s 2017 Annual Report.~~

~~Guarantees of subsidiary~~

~~The Parent Company has guaranteed certain long-term debt~~cash and ~~structured notes of its subsidiaries, including JPMorgan Chase Financial Company LLC (“JPMFC”), a 100%-owned finance subsidiary. All~~ securities issued by ~~JPMFC~~governments that are ~~fully~~members of G7 and ~~unconditionally guaranteed~~U.S. government agencies.

(f)

At September 30, 2018, and December 31, 2017, primarily includes letters of credit hedged by ~~the Parent Company,~~derivative transactions and ~~these guarantees rank~~managed on a ~~parity~~market risk basis, unfunded commitments related to institutional lending and commitments associated with the Firm’s ~~unsecured~~membership in certain clearing houses. Additionally, includes unfunded commitments predominantly related to certain tax-oriented equity investments.

(g)

For lending-related products, the carrying value represents the allowance for lending-related commitments and ~~unsubordinated indebtedness.~~

~~Note 21 – Pledged assets and collateral~~

~~For a discussion of~~ the ~~Firm’s pledged assets and collateral, see Note 28 of JPMorgan Chase’s 2017 Annual Report.~~guarantee liability; for derivative-related products, the carrying value represents the fair value.

Other unfunded commitments to extend credit

Other unfunded commitments to extend credit generally consist of commitments for working capital and general corporate purposes, extensions of credit to support commercial paper facilities and bond financings in the event that those obligations cannot be remarketed to new investors, as well as committed liquidity facilities to clearing organizations. The Firm also issues commitments under multipurpose facilities which could be drawn upon in several forms, including the issuance of a standby letter of credit.

The Firm acts as a settlement and custody bank in the U.S. tri-party repurchase transaction market. In its role as settlement and custody bank, the Firm in part is exposed to the intra-day credit risk of its cash borrower clients, usually broker-dealers. This exposure arises under secured

clearance advance facilities that the Firm extended to its clients (i.e., cash borrowers); these facilities contractually limit the Firm’s intra-day credit risk to the facility amount

and must be repaid by the end of the day. As of December 31, 2017 the secured clearance advance facility maximum outstanding commitment amount was$1.5 billion. As of September 30, 2018 the Firm no longer offers such arrangements to its clients.

Standby letters of credit and other financial guarantees

Standby letters of credit and other financial guarantees are conditional lending commitments issued by the Firm to guarantee the performance of a client or customer to a third party under certain arrangements, such as commercial paper facilities, bond financings, acquisition financings, trade and similar transactions.

The following table summarizes the standby letters of credit and other letters of credit arrangementsas of September 30, 2018, and December 31, 2017.

Standby letters of credit, other financial guarantees and other letters of credit



	September 30, 2018				December 31, 2017
(in millions)	Standby letters of credit and other financial guarantees		Other letters of credit		Standby letters of credit and other financial guarantees		Other letters of credit
Investment-grade^(a)	$	25,038	$	2,507	$	28,492	$	2,646
Noninvestment-grade^(a)	6,710		1,076		6,734		1,066
Total contractual amount	$	31,748	$	3,583	$	35,226	$	3,712

Allowance for lending-related commitments	$	171	$	7	$	192	$	3
Guarantee liability	414		—		444		—
Total carrying value	$	585	$	7	$	636	$	3

Commitments with collateral	$	16,074	$	559	$	17,421	$	878

~~Pledged assets~~

(a)

The Firm may pledge financial assets that it owns to maintain potential borrowing capacity with central banks and for other purposes, including to secure borrowings and public deposits, collateralize repurchase and other securities financing agreements, and cover customer short sales. Certain of these pledged assets may be sold or repledged or otherwise used by the secured parties and are identified as financial instruments owned (pledged to various parties) on the Consolidated balance sheets.

~~The following table presents the Firm’s pledged assets.~~

(in billions) March 31, 2018
December 31,
2017
Assets that may be sold or repledged or otherwise used by secured parties $ 143.7
$ 129.6
Assets that may not be sold or repledged or otherwise used by secured parties 72.4
67.9
Assets pledged at Federal Reserve banks and FHLBs 487.9
493.7
Total assets pledged $ 704.0
$ 691.2

Total assets pledged do not include assets of consolidated VIEs; these assets are used to settle the liabilities of those entities. See Note 13 for additional information on assets and liabilities of consolidated VIEs. For additional informationratings scale is based on the Firm’s ~~securities financing activities, see Note 10. For additional information on the Firm’s long-term debt, see Note 19 of JPMorgan Chase’s 2017 Annual Report.~~

~~Collateral~~

~~The Firm accepts financial assets~~internal ratings which generally correspond to ratings as ~~collateral that it is permitted to sell or repledge, deliver or otherwise use. This collateral is generally obtained under resale agreements, securities borrowing agreements, customer margin loans~~defined by S&P and ~~derivative agreements. Collateral is generally used under repurchase agreements, securities lending agreements or to cover customer short sales and to collateralize deposits and derivative agreements.~~

~~The following table presents the fair value of collateral accepted.~~

(in billions) March 31, 2018
December 31,
2017
Collateral permitted to be sold or repledged, delivered, or otherwise used $ 1,093.6
$ 968.8
Collateral sold, repledged, delivered or otherwise used 873.5
775.3

~~Note 22 – Litigation~~

~~Contingencies~~

~~As of March~~Moody’s.

Derivatives qualifying as guarantees

The Firm transacts certain derivative contracts that have the characteristics of a guarantee under U.S. GAAP. For further information on these derivatives, refer to Note27 of JPMorgan Chase’s 2017 Annual Report.

The following table summarizes the derivatives qualifying as guarantees as of September 30, 2018, and December 31, 2017.



(in millions)	September 30, 2018		December 31, 2017
Notional amounts
Derivative guarantees	$	55,894	$	57,174
Stable value contracts with contractually limited exposure	28,574		29,104
Maximum exposure of stable value contracts with contractually limited exposure	2,954		3,053

Fair value
Derivative payables	370		304
Derivative receivables	—		—

Loan sales- and securitization-related indemnifications

In connection with the Firm’s mortgage loan sale and securitization activities with GSEs and in certain private label transactions, the Firm has made representations and warranties that the loans sold meet certain requirements, and that may require the Firm to repurchase mortgage loans and/or indemnify the loan purchaser if such representations and warranties are breached by the Firm. Further, although the Firm’s securitizations are predominantly nonrecourse, the Firm does provide recourse servicing in certain limited cases where it agrees to share credit risk with the owner of the mortgage loans. For additional information, refer to Note27 of JPMorgan Chase’s 2017 Annual Report.

The liability related to repurchase demands associated with private label securitizations is separately evaluated by the Firm in establishing its litigation reserves. For additional information regarding litigation, refer to Note22 of this Form 10-Q and Note 29 of JPMorgan Chase’s 2017 Annual Report.

Guarantees of subsidiary

The Parent Company has guaranteed certain long-term debt and structured notes of its subsidiaries, including JPMorgan Chase Financial Company LLC (“JPMFC”), a 100%-owned finance subsidiary. All securities issued by JPMFC are fully and unconditionally guaranteed by the Parent Company, and these guarantees rank on a parity with the Firm’s unsecured and unsubordinated indebtedness.

Note 21 – Pledged assets and collateral

For a discussion of the Firm’s pledged assets and collateral, refer to Note28 of JPMorgan Chase’s 2017 Annual Report.

Pledged assets

The Firm may pledge financial assets that it owns to maintain potential borrowing capacity with central banks and for other purposes, including to secure borrowings and public deposits, collateralize repurchase and other securities financing agreements, and cover customer short sales. Certain of these pledged assets may be sold or repledged or otherwise used by the secured parties and are parenthetically identified on the Consolidated balance sheets as assets pledged.

The following table presents the Firm’s pledged assets.



(in billions)	September 30, 2018		December 31, 2017
Assets that may be sold or repledged or otherwise used by secured parties	$	130.7	$	135.8
Assets that may not be sold or repledged or otherwise used by secured parties	76.2		68.1
Assets pledged at Federal Reserve banks and FHLBs	488.9		493.7
Total assets pledged	$	695.8	$	697.6

Total assets pledged do not include assets of consolidated VIEs; these assets are used to settle the liabilities of those entities. Refer to Note 13for additional information on assets and liabilities of consolidated VIEs. For additional information on the Firm’s securities financing activities, refer to Note10. For additional information on the Firm’s long-term debt, refer to Note 19 of JPMorgan Chase’s 2017 Annual Report.

Collateral

The Firm accepts financial assets as collateral that it is permitted to sell or repledge, deliver or otherwise use. This collateral is generally obtained under resale agreements, securities borrowing agreements, customer margin loans and derivative agreements. Collateral is generally used under repurchase agreements, securities lending agreements or to cover customer short sales and to collateralize deposits and derivative agreements.

The following table presents the fair value of collateral accepted.



(in billions)	September 30, 2018		December 31, 2017
Collateral permitted to be sold or repledged, delivered, or otherwise used	$	1,114.1	$	968.8
Collateral sold, repledged, delivered or otherwise used	927.5		771.0

Certain prior period amounts for both collateral and pledged assets (including the corresponding pledged assets parenthetical disclosure for trading assets and other assets on the Consolidated balance sheets) have been revised to conform with the current period presentation.

Note 22 – Litigation

Contingencies

As of September 30, 2018, the Firm and its subsidiaries and affiliates are defendants or putative defendants in numerous legal proceedings, including private, civil litigations and regulatory/government investigations. The litigations range from individual actions involving a single plaintiff to class action lawsuits with potentially millions of class members. Investigations involve both formal and informal proceedings, by both governmental agencies and self-regulatory organizations. These legal proceedings are at varying stages of adjudication, arbitration or investigation, and involve each of the Firm’s lines of business and geographies and a wide variety of claims (including common law tort and contract claims and statutory antitrust, securities and consumer protection claims), some of which present novel legal theories.

The Firm believes the estimate of the aggregate range of reasonably possible losses, in excess of reserves established, for its legal proceedings is from $0 to approximately $1.6 billion at September 30, 2018. This estimated aggregate range of reasonably possible losses was based upon currently available information for those proceedings in which the Firm believes that an estimate of reasonably possible loss can be made. For certain matters, the Firm does not believe that such an estimate can be made, as of that date. The Firm’s estimate of the aggregate range of reasonably possible losses involves significant judgment, given:

the number, variety and varying stages of the proceedings, including the fact that many are in preliminary stages,

the existence in many such proceedings of multiple defendants, including the Firm, whose share of liability (if any) has yet to be determined,

the numerous yet-unresolved issues in many of the proceedings, including issues regarding class certification and the scope of many of the claims, and

the attendant uncertainty of the various potential outcomes of such proceedings, including where the Firm has made assumptions concerning future rulings by the court or other adjudicator, or about the behavior or incentives of adverse parties or regulatory authorities, and those assumptions prove to be incorrect.

In addition, the outcome of a particular proceeding may be a result which the Firm did not take into account in its estimate because the Firm had deemed the likelihood of that outcome to be remote. Accordingly, the Firm’s estimate of the aggregate range of reasonably possible losses will change from time to time, and actual losses may vary significantly.

Set forth below are descriptions of the Firm’s material legal proceedings.

American Depositary Receipts Pre-Release Inquiry. The Staff of the U.S. Securities and Exchange Commission’s Enforcement Division has been investigating depositary banks and broker-dealers, including the Firm, in connection with activity relating to pre-released American Depositary Receipts. The Staff’s investigation focuses on the period of 2011 to 2015. The Firm continues to cooperate with this investigation and is currently engaged in settlement discussions. There is no assurance that such discussions will result in a settlement.

Foreign Exchange Investigations and Litigation. The Firm previously reported settlements with certain government authorities relating to its foreign exchange (“FX”) sales and trading activities and controls related to those activities. FX-related investigations and inquiries by government authorities, including competition authorities, are ongoing, and the Firm is cooperating with and working to resolve those matters. In May 2015, the Firm pleaded guilty to a single violation of federal antitrust law. In January 2017, the Firm was sentenced, with judgment entered thereafter and a term of probation ending in January 2020. The Department of Labor has granted the Firm a five-year exemption of disqualification that allows the Firm and its affiliates to continue to rely on the Qualified Professional Asset Manager exemption under the Employee Retirement Income Security Act (“ERISA”) until January 2023. The Firm will need to reapply in due course for a further exemption to cover the remainder of the ten-year disqualification period. Separately, in February 2017 the South Africa Competition Commission referred its FX investigation of the Firm and other banks to the South Africa Competition Tribunal, which is conducting civil proceedings concerning that matter.

The Firm is also one of a number of foreign exchange dealers named as defendants in a class action filed in the United States District Court for the Southern District of New York by U.S.-based plaintiffs, principally alleging violations of federal antitrust laws based on an alleged conspiracy to manipulate foreign exchange rates (the “U.S. class action”). In January 2015, the Firm entered into a settlement agreement in the U.S. class action. Following this settlement, a number of additional putative class actions were filed seeking damages for persons who transacted FX futures and options on futures (the “exchanged-based actions”), consumers who purchased foreign currencies at allegedly inflated rates (the “consumer action”), participants or beneficiaries of qualified ERISA plans (the “ERISA actions”), and purported indirect purchasers of FX instruments (the “indirect purchaser action”). Since then, the Firm has entered into a revised settlement agreement to resolve the consolidated U.S. class action, including the exchange-based actions. The Court granted final approval of

that settlement agreement in August 2018. Certain members of the settlement class have filed requests to the Court to be excluded from the class. The District Court has dismissed one of the ERISA actions, and the United States Court of Appeals for the Second Circuit affirmed that dismissal in July 2018. The District Court has also dismissed the indirect purchaser action, and the plaintiffs have sought leave to replead their complaint. The consumer action and a second ERISA action remain pending in the District Court.

General Motors Litigation. JPMorgan Chase Bank, N.A. participated in, and was the Administrative Agent on behalf of a syndicate of lenders on, a $1.5 billion syndicated Term Loan facility (“Term Loan”) for General Motors Corporation (“GM”). In July 2009, in connection with the GM bankruptcy proceedings, the Official Committee of Unsecured Creditors of Motors Liquidation Company (“Creditors Committee”) filed a lawsuit against JPMorgan Chase Bank, N.A., in its individual capacity and as Administrative Agent for other lenders on the Term Loan, seeking to hold the underlying lien invalid based on the filing of a UCC-3 termination statement relating to the Term Loan. In January 2015, following several court proceedings, the United States Court of Appeals for the Second Circuit reversed the Bankruptcy Court’s dismissal of the Creditors Committee’s claim and remanded the case to the Bankruptcy Court with instructions to enter partial summary judgment for the Creditors Committee as to the termination statement. The proceedings in the Bankruptcy Court continue with respect to, among other things, additional defenses asserted by JPMorgan Chase Bank, N.A. and the value of additional collateral on the Term Loan that was unaffected by the filing of the termination statement at issue. In connection with that additional collateral, a trial in the Bankruptcy Court regarding the value of certain representative assets concluded in May 2017, and a ruling was issued in September 2017. The Bankruptcy Court found that 33 of the 40 representative assets are fixtures and that these fixtures generally should be valued on a “going concern” basis. The Creditors Committee sought leave to appeal the Bankruptcy Court’s ruling that the fixtures should be valued on a “going concern” basis rather than on a liquidation basis, and in September 2018, the District Court denied that request. In addition, certain Term Loan lenders filed cross-claims in the Bankruptcy Court against JPMorgan Chase Bank, N.A. seeking indemnification and asserting various claims. The parties have engaged in mediation concerning, among other things, the characterization and value of the remaining additional collateral, in light of the Bankruptcy Court’s ruling regarding the representative assets, as well as other issues, including the cross-claims. In September 2018, the Bankruptcy Court approved a schedule for continued proceedings concerning issues that the parties have been unable to resolve through mediation.

Interchange Litigation. A group of merchants and retail associations filed a series of class action complaints alleging that Visa and MasterCard, as well as certain banks, conspired to set the price of credit and debit card

interchange fees and enacted respective rules in violation of antitrust laws. The parties settled the cases for a cash payment, a temporary reduction of credit card interchange, and modifications to certain credit card network rules. In December 2013, the District Court granted final approval of the settlement.

A number of merchants appealed the settlement to the United States Court of Appeals for the Second Circuit, which, in June 2016, vacated the District Court’s certification of the class action and reversed the approval of the class settlement. In March 2017, the U.S. Supreme Court declined petitions seeking review of the decision of the Court of Appeals. The case was remanded to the District Court for further proceedings consistent with the appellate decision. The original class action was divided into two separate actions, one seeking primarily monetary relief and the other seeking primarily injunctive relief. In September 2018, the parties to the class action seeking monetary relief finalized an agreement which amends and supersedes the prior settlement agreement, and the plaintiffs filed a motion seeking preliminary approval of the modified settlement. This settlement provides for the defendants to contribute an additional $900 million to the approximately $5.3 billion currently held in escrow from the original settlement. Upon preliminary approval by the District Court, $600 million of that additional amount will be funded from the litigation escrow account established under the Visa defendants’ Retrospective Responsibility Plan, and $300 million will be paid by Mastercard and certain banks in accordance with an agreement among themselves regarding their respective shares. In June 2018, Visa deposited an additional $600 million into its litigation escrow account, which in turn led to a corresponding change in the conversion rate of Visa Class B to Class A shares. Of the Mastercard-related portion, the Firm’s share is approximately $36 million. The class action seeking primarily injunctive relief continues separately.

In addition, certain merchants have filed individual actions raising similar allegations against Visa and Mastercard, as well as against the Firm and other banks, and those actions are proceeding.

LIBOR and Other Benchmark Rate Investigations and Litigation. JPMorgan Chase has received subpoenas and requests for documents and, in some cases, interviews, from federal and state agencies and entities, including the U.S. Commodity Futures Trading Commission (“CFTC”) and various state attorneys general, as well as the European Commission (“EC”), the Swiss Competition Commission (“ComCo”) and other regulatory authorities and banking associations around the world relating primarily to the process by which interest rates were submitted to the British Bankers Association (“BBA”) in connection with the setting of the BBA’s London Interbank Offered Rate (“LIBOR”) for various currencies, principally in 2007 and 2008. Some of the inquiries also relate to similar processes by which information on rates was submitted to the European Banking Federation (“EBF”) in connection with

the setting of the EBF’s Euro Interbank Offered Rates (“EURIBOR”) and to the Japanese Bankers’ Association for the setting of Tokyo Interbank Offered Rates (“TIBOR”) during similar time periods, as well as processes for the setting of U.S. dollar ISDAFIX rates and other reference rates in various parts of the world during similar time periods, including through 2012. The Firm continues to cooperate with these investigations to the extent that they are ongoing. The Firm has recently reached a resolution with the CFTC concerning the CFTC’s U.S. dollar ISDAFIX-related investigation. As previously reported, the Firm has resolved EC inquiries relating to Yen LIBOR and Swiss Franc LIBOR. In December 2016, the Firm resolved ComCo inquiries relating to these same rates. ComCo’s investigation relating to EURIBOR, to which the Firm and other banks are subject, continues. In December 2016, the EC issued a decision against the Firm and other banks finding an infringement of European antitrust rules relating to EURIBOR. The Firm has filed an appeal of that decision with the European General Court, and that appeal is pending.

In addition, the Firm has been named as a defendant along with other banks in a series of individual and putative class actions filed in various United States District Courts. These actions have been filed, or consolidated for pre-trial purposes, in the United States District Court for the Southern District of New York. In these actions, plaintiffs make varying allegations that in various periods, starting in 2000 or later, defendants either individually or collectively manipulated various benchmark rates by submitting rates that were artificially low or high. Plaintiffs allege that they transacted in loans, derivatives or other financial instruments whose values are affected by changes in these rates and assert a variety of claims including antitrust claims seeking treble damages. These matters are in various stages of litigation.

The Firm has agreed to settle putative class actions related to exchange-traded Eurodollar futures contracts, Swiss franc LIBOR, EURIBOR, the Singapore Interbank Offered Rate, the Singapore Swap Offer Rate and the Australian Bank Bill Swap Reference Rate. Those settlements are all subject to further documentation and court approval.

The Firm is one of the defendants in a number of putative class actions alleging that defendant banks and ICAP conspired to manipulate the U.S. dollar ISDAFIX rates. In April 2016, the Firm settled this litigation, along with certain other banks. Those settlements have been preliminarily approved by the Court.

Municipal Derivatives Litigation. Several civil actions were commenced in New York and Alabama courts against the Firm relating to certain Jefferson County, Alabama (the “County”) warrant underwritings and swap transactions. The claims in the civil actions generally alleged that the Firm made payments to certain third parties in exchange for being chosen to underwrite more than $3.0 billion in warrants issued by the County and to act as the counterparty for certain swaps executed by the County. The County filed for bankruptcy in November 2011. In June 2013, the County filed a Chapter 9 Plan of Adjustment, as amended (the “Plan of Adjustment”), which provided that all the above-described actions against the Firm would be released and dismissed with prejudice. In November 2013, the Bankruptcy Court confirmed the Plan of Adjustment, and in December 2013, certain sewer rate payers filed an appeal challenging the confirmation of the Plan of Adjustment. All conditions to the Plan of Adjustment’s effectiveness, including the dismissal of the actions against the Firm, were satisfied or waived and the transactions contemplated by the Plan of Adjustment occurred in December 2013. Accordingly, all the above-described actions against the Firm have been dismissed pursuant to the terms of the Plan of Adjustment. The appeal of the Bankruptcy Court’s order confirming the Plan of Adjustment was dismissed in August 2018, but appellants have filed a motion for rehearing which remains pending.

Wendel. Since 2012, the French criminal authorities have been investigating a series of transactions entered into by senior managers of Wendel Investissement (“Wendel”) during the period from 2004 through 2007 to restructure their shareholdings in Wendel. JPMorgan Chase Bank, N.A., Paris branch provided financing for the transactions to a number of managers of Wendel in 2007. JPMorgan Chase has cooperated with the investigation. The investigating judges issued an ordonnance de renvoi in November 2016, referring JPMorgan Chase Bank, N.A. to the French tribunal correctionnel for alleged complicity in tax fraud. No date for trial has been set by the court. The Firm has been successful in legal challenges made to the Court of Cassation, France’s highest court, with respect to the criminal proceedings. In January 2018, the Paris Court of Appeal issued a decision cancelling the mise en examen of JPMorgan Chase Bank, N.A. The Court of Cassation ruled in September 2018 that a mise en examen is a prerequisite for an ordonnance de renvoi and remanded the case to the Court of Appeal to consider JPMorgan Chase Bank, N.A.’s application for the annulment of the ordonnance de renvoi referring JPMorgan Chase Bank, N.A. to the French tribunal correctionnel. Any further actions in the criminal proceedings are stayed pending the outcome of that

application. In addition, a number of the managers have commenced civil proceedings against JPMorgan Chase Bank, N.A. The claims are separate, involve different allegations and are at various stages of proceedings.

* * *

In addition to the various legal proceedings discussed above, JPMorgan Chase and its subsidiaries are named as defendants or are otherwise involved in a substantial number of other legal proceedings. The Firm believes it has meritorious defenses to the claims asserted against it in its currently outstanding legal proceedings and it intends to defend itself vigorously. Additional legal proceedings may be initiated from time to time in the future.

The Firm has established reserves for several hundred of its currently outstanding legal proceedings. In accordance with the provisions of U.S. GAAP for contingencies, the Firm accrues for a litigation-related liability when it is probable that such a liability has been incurred and the amount of the loss can be reasonably estimated. The Firm evaluates its outstanding legal proceedings each quarter to assess its litigation reserves, and makes adjustments in such reserves, upwards or downward, as appropriate, based on management’s best judgment after consultation with counsel. The Firm’s legal expense/(benefit) was $20 million and $(107) million for the three months ended September 30, 2018 and 2017, respectively, and $90 million and $172 million for the nine months ended September 30, 2018 and 2017. There is no assurance that the Firm’s litigation reserves will not need to be adjusted in the future.

In view of the inherent difficulty of predicting the outcome of legal proceedings, particularly where the claimants seek very large or indeterminate damages, or where the matters present novel legal theories, involve a large number of parties or are in early stages of discovery, the Firm cannot state with confidence what will be the eventual outcomes of the currently pending matters, the timing of their ultimate resolution or the eventual losses, fines, penalties or consequences related to those matters. JPMorgan Chase believes, based upon its current knowledge and after consultation with counsel, consideration of the material legal proceedings described above and after taking into account its current litigation reserves and its estimated aggregate range of possible losses, that the other legal proceedings currently pending against it should not have a material adverse effect on the Firm’s consolidated financial condition. The Firm notes, however, that in light of the uncertainties involved in such proceedings, there is no assurance that the ultimate resolution of these matters will not significantly exceed the reserves it has currently accrued or that a matter will not have material reputational consequences. As a result, the outcome of a particular matter may be material to JPMorgan Chase’s operating results for a particular period, depending on, among other factors, the size of the loss or liability imposed and the level of JPMorgan Chase’s income for that period.

Note 23 – Business segments

The Firm is managed on a line of business basis. There are four major reportable business segments - Consumer & Community Banking, Corporate & Investment Bank, Commercial Banking and Asset & Wealth Management. In addition, there is a Corporate segment.

The business segments are determined based on the products and services provided, or the type of customer served, and they reflect the manner in which financial information is currently evaluated by management. Results of these lines of business are presented on a managed basis. For a further discussion concerning JPMorgan Chase’s business segments, refer to Segment results below, and Note 31 of JPMorgan Chase’s 2017 Annual Report.

Segment results

The following table provides a summary of the Firm’s segment results as of or for the three and nine months ended September 30, 2018 and 2017, on a managed basis. The Firm’s definition of managed basis starts with the reported U.S. GAAP results and includes certain reclassifications to present total net revenue for the Firm

(and each of the Firm’s lines of business and geographies and a wide variety of claims (including common law tort and contract claims and statutory antitrust, securities and consumer protection claims), some of which present novel legal theories.

The Firm believes the estimate of the aggregate range of reasonably possible losses, in excess of reserves established, for its legal proceedings is from $0 to approximately $1.7 billion at March 31, 2018. This estimated aggregate range of reasonably possible losses was based upon currently available information for those proceedings in which the Firm believes that an estimate of reasonably possible loss can be made. For certain matters, the Firm does not believe that such an estimate can be made, as of that date. The Firm’s estimate of the aggregate range of reasonably possible losses involves significant judgment, given:

~~the number, variety and varying stages of the proceedings, including the fact that many are in preliminary stages,~~

~~the existence in many such proceedings of multiple defendants, including the Firm, whose share of liability (if any) has yet to be determined,~~

~~the numerous yet-unresolved issues in many of the proceedings, including issues regarding class certification and the scope of many of the claims, and~~

~~Set forth below are descriptions of the Firm’s material legal proceedings.~~

~~Foreign Exchange Investigations and Litigation.~~ The Firm previously reported settlements with certain government authorities relating to its foreign exchange (“FX”) sales and trading activities and controls related to those activities. FX-related investigations and inquiries by government authorities, including competition authorities, are ongoing, and the Firm is cooperating with and working to resolve those matters. In May 2015, the Firm pleaded guilty to a single violation of federal antitrust law. In January 2017, the Firm was sentenced, with judgment entered thereafter and a term of probation ending in January 2020. The Department of Labor has granted the Firm a five-year exemption of disqualification that allows the Firm and its affiliates to continue to rely on the Qualified Professional Asset Manager exemption under the Employee Retirement Income Security Act (“ERISA”) until January 2023. The Firm will need to reapply in due course for a further exemption to cover the remainder of the ten-year disqualification period. Separately, in February 2017 the South Africa Competition Commission referred its FX investigation of the Firm and other banks to the South Africa Competition Tribunal, which is conducting civil proceedings concerning that matter.

The Firm is also one of a number of foreign exchange dealers defending a class action filed in the United States District Court for the Southern District of New York by U.S.-based plaintiffs, principally alleging violations of federal antitrust laws based on an alleged conspiracy to manipulate foreign exchange rates (the “U.S. class action”). In January 2015, the Firm entered into a settlement agreement in the U.S. class action. Following this settlement, a number of additional putative class actions were filed seeking damages for persons who transacted FX futures and options on futures (the “exchanged-based actions”), consumers who purchased foreign currencies at allegedly inflated rates (the “consumer action”), participants or beneficiaries of qualified ERISA plans (the “ERISA actions”), and purported indirect purchasers of FX instruments (the “indirect purchaser action”). Since then, the Firm has entered into a revised settlement agreement to resolve the consolidated U.S. class action, including the exchange-based actions. That agreement has been preliminarily approved by the Court and a final approval hearing is scheduled for May 2018. Certain members of the settlement class have filed requests to the Court to be excluded from the class. The District Court has dismissed one of the ERISA actions, and the plaintiffs have filed an appeal. The District Court has also dismissed the indirect purchaser action, and the plaintiffs have sought leave to replead their complaint. The consumer action and a second ERISA action remain pending in the District Court.

~~General Motors Litigation.~~ JPMorgan Chase Bank, N.A. participated in, and was the Administrative Agent on behalf of a syndicate of lenders on, a $1.5 billion syndicated Term Loan facility (“Term Loan”) for General Motors Corporation

(“GM”). In July 2009, in connection with the GM bankruptcy proceedings, the Official Committee of Unsecured Creditors of Motors Liquidation Company (“Creditors Committee”) filed a lawsuit against JPMorgan Chase Bank, N.A., in its individual capacity and as Administrative Agent for other lenders on the Term Loan, seeking to hold the underlying lien invalid based on the filing of a UCC-3 termination statement relating to the Term Loan. In January 2015, following several court proceedings, the United States Court of Appeals for the Second Circuit reversed the Bankruptcy Court’s dismissal of the Creditors Committee’s claim and remanded the case to the Bankruptcy Court with instructions to enter partial summary judgment for the Creditors Committee as to the termination statement. The proceedings in the Bankruptcy Court continue with respect to, among other things, additional defenses asserted by JPMorgan Chase Bank, N.A. and the value of additional collateral on the Term Loan that was unaffected by the filing of the termination statement at issue. In connection with that additional collateral, a trial in the Bankruptcy Court regarding the value of certain representative assets concluded in May 2017, and a ruling was issued in September 2017. The Bankruptcy Court found that 33 of the 40 representative assets are fixtures and that these fixtures generally should be valued on a “going concern” basis. The Creditors Committee is seeking leave to appeal the Bankruptcy Court’s ruling that the fixtures should be valued on a “going concern” basis rather than on a liquidation basis. In addition, certain Term Loan lenders filed cross-claims in the Bankruptcy Court against JPMorgan Chase Bank, N.A. seeking indemnification and asserting various claims. The parties are engaged in mediation concerning, among other things, the characterization and value of the remaining additional collateral, in light of the Bankruptcy Court’s ruling regarding the representative assets, as well as other issues, including the cross-claims.

~~Hopper Estate Litigation.~~ The Firm is a defendant in an action in connection with its role as an independent administrator of an estate. The plaintiffs sought in excess of $7 million in compensatory damages, primarily relating to attorneys’ fees incurred by the plaintiffs. After a trial in probate court in Dallas, Texas that ended in September 2017, the jury returned a verdict against the Firm, awarding plaintiffs their full compensatory damages and multiple billions in punitive damages. In light of legal limitations on the availability of damages, the plaintiffs moved for judgment in the total amount of approximately $91 million, including punitive damages. The Firm has entered into a settlement in principle with two of the plaintiffs. Pending before the Court is the remaining plaintiff’s request that the Court enter judgment for up to $14 million and the Firm’s request that the court enter judgment wholly in its favor or, alternatively, that it limit the award to less than $8 million.

~~Interchange Litigation.~~ A group of merchants and retail associations filed a series of class action complaints alleging that Visa and MasterCard, as well as certain banks, conspired to set the price of credit and debit card interchange fees and enacted respective rules in violation of

antitrust laws. The parties settled the cases for a cash payment of $6.1 billion to the class plaintiffs (of which the Firm’s share is approximately 20%) and an amount equal to ten basis points of credit card interchange for a period of 8 months to be measured from a date within 60 days of the end of the opt-out period. The settlement also provided for modifications to each credit card network’s rules, including those that prohibit surcharging credit card transactions. In December 2013, the District Court granted final approval of the settlement.

A number of merchants appealed to the United States Court of Appeals for the Second Circuit, which, in June 2016, vacated the District Court’s certification of the class action and reversed the approval of the class settlement. In March 2017, the U.S. Supreme Court declined petitions seeking review of the decision of the Court of Appeals. The case has been remanded to the District Court for further proceedings consistent with the appellate decision. The parties are engaged in an ongoing mediation process.

~~In addition, certain merchants have filed individual actions raising similar allegations against Visa and MasterCard, as well as against the Firm and other banks, and those actions are proceeding.~~

~~LIBOR and Other Benchmark Rate Investigations and Litigation.~~ JPMorgan Chase has received subpoenas and requests for documents and, in some cases, interviews, from federal and state agencies and entities, including the U.S. Commodity Futures Trading Commission (“CFTC”) and various state attorneys general, as well as the European Commission (“EC”), the Swiss Competition Commission (“ComCo”) and other regulatory authorities and banking associations around the world relating primarily to the process by which interest rates were submitted to the British Bankers Association (“BBA”) in connection with the setting of the BBA’s London Interbank Offered Rate (“LIBOR”) for various currencies, principally in 2007 and 2008. Some of the inquiries also relate to similar processes by which information on rates was submitted to the European Banking Federation (“EBF”) in connection with the setting of the EBF’s Euro Interbank Offered Rates (“EURIBOR”) and to the Japanese Bankers’ Association for the setting of Tokyo Interbank Offered Rates (“TIBOR”) during similar time periods, as well as processes for the setting of U.S. dollar ISDAFIX rates and other reference rates in various parts of the world during similar time periods, including through 2012. The Firm continues to cooperate with these ongoing investigations, and is currently engaged in discussions with the CFTC about resolving its U.S. dollar ISDAFIX-related investigation with respect to the Firm. There is no assurance that such discussions will result in a settlement. As previously reported, the Firm has resolved EC inquiries relating to Yen LIBOR and Swiss Franc LIBOR. In December 2016, the Firm resolved ComCo inquiries relating to these same rates. ComCo’s investigation relating to EURIBOR, to which the Firm and other banks are subject, continues. In December 2016, the EC issued a decision against the Firm and other banks finding an infringement of European antitrust rules

~~relating to EURIBOR. The Firm has filed an appeal with the European General Court.~~

~~The Firm has agreed to settle a putative class action related to Swiss franc LIBOR, and that settlement remains subject to final court approval.~~

~~In an action related to EURIBOR, the District Court dismissed all claims except a single antitrust claim and two common law claims, and dismissed all defendants except the Firm and Citibank.~~

In actions related to U.S. dollar LIBOR, the District Court dismissed certain claims, including antitrust claims brought by some plaintiffs whom the District Court found did not have standing to assert such claims, and permitted antitrust claims, claims under the Commodity Exchange Act and common law claims to proceed. The plaintiffs whose antitrust claims were dismissed for lack of standing have filed an appeal. In January 2018, the Firm agreed to settle a putative class action related to exchange-traded Eurodollar futures contracts. This settlement is subject to further documentation and court approval. In February 2018, the District Court (i) granted class certification with respect to certain antitrust claims related to bonds and interest rate swaps sold directly by the defendants, (ii) denied class certification with respect to state common law claims brought by the holders of those bonds and swaps and (iii) denied class certification with respect to two other putative class actions related to exchange-traded Eurodollar futures contracts and LIBOR-based loans held by plaintiff lending institutions. The Firm and another defendant have petitioned for leave to appeal the class certification of the antitrust claims related to bonds and swaps, and the two class plaintiffs whose class certification motions were denied have also petitioned for leave to appeal.

In an action related to the Singapore Interbank Offered Rate and the Singapore Swap Offer Rate, the District Court dismissed without prejudice all claims except a single antitrust claim, and dismissed without prejudice all defendants except the Firm, Bank of America and Citibank. The plaintiffs filed an amended complaint in September 2017, which the Firm and other defendants have moved to dismiss.

~~Mortgage-Backed Securities and Repurchase Litigation and Related Regulatory Investigations.~~ The Firm and affiliates (together, “JPMC”), Bear Stearns and affiliates (together, “Bear Stearns”) and certain Washington Mutual affiliates (together, “Washington Mutual”) have been named as defendants in a number of cases in their various roles in offerings of MBS.

~~Issuer Litigation – Individual Purchaser Actions. The Firm has resolved all of the individual actions brought against JPMC, Bear Stearns and Washington Mutual as MBS issuers (and, in some cases, also as underwriters of their own MBS offerings).~~

~~Repurchase Litigation~~. The Firm has resolved all of the actions brought by trustees and/or securities administrators of various MBS trusts on behalf of purchasers of securities issued by those trusts, and those settlements have been approved by the relevant courts.

~~Additional actions have been filed against third-party trustees that relate to loan repurchase and servicing claims involving trusts sponsored by JPMC, Bear Stearns and Washington Mutual.~~

In actions against the Firm involving offerings of MBS issued by the Firm, the Firm has contractual rights to indemnification from sellers of mortgage loans that were securitized in such offerings. However, certain of those indemnity rights may prove effectively unenforceable in various situations, such as where the loan sellers are now defunct.

The Firm has entered into agreements with a number of MBS trustees or entities that purchased MBS that toll applicable statute of limitations periods with respect to their claims, and has settled, and in the future may settle, tolled claims. There is no assurance that the Firm will not be named as a defendant in additional MBS-related litigation.

~~Derivative Action~~. A shareholder derivative action against the Firm, as nominal defendant, and certain of its current and former officers and members of its Board of Directors relating to the Firm’s MBS activities was filed in California federal court in 2013. In June 2017, the court granted defendants’ motion to dismiss the cause of action that alleged material misrepresentations and omissions in the Firm’s proxy statement, found that the court did not have personal jurisdiction over the individual defendants with respect to the remaining causes of action, and transferred that remaining portion of the case to the United States District Court for the Southern District of New York without ruling on the merits. The motion by the defendants to dismiss is pending.

~~Municipal Derivatives Litigation.~~ ~~Several civil actions were commenced in New York and Alabama courts against the Firm relating to certain Jefferson County, Alabama (the~~

“County”) warrant underwritings and swap transactions. The claims in the civil actions generally alleged that the Firm made payments to certain third parties in exchange for being chosen to underwrite more than $3.0 billion in warrants issued by the County and to act as the counterparty for certain swaps executed by the County. The County filed for bankruptcy in November 2011. In June 2013, the County filed a Chapter 9 Plan of Adjustment, as amended (the “Plan of Adjustment”), which provided that all the above-described actions against the Firm would be released and dismissed with prejudice. In November 2013, the Bankruptcy Court confirmed the Plan of Adjustment, and in December 2013, certain sewer rate payers filed an appeal challenging the confirmation of the Plan of Adjustment. All conditions to the Plan of Adjustment’s effectiveness, including the dismissal of the actions against the Firm, were satisfied or waived and the transactions contemplated by the Plan of Adjustment occurred in December 2013. Accordingly, all the above-described actions against the Firm have been dismissed pursuant to the terms of the Plan of Adjustment. The appeal of the Bankruptcy Court’s order confirming the Plan of Adjustment remains pending.

~~Petters Bankruptcy and Related Matters.~~ JPMorgan Chase and certain of its affiliates, including One Equity Partners (“OEP”), were named as defendants in several actions filed in connection with the receivership and bankruptcy proceedings pertaining to Thomas J. Petters and certain affiliated entities (collectively, “Petters”) and the Polaroid Corporation. The principal actions against JPMorgan Chase and its affiliates were brought by a court-appointed receiver for Petters and the trustees in bankruptcy proceedings for three Petters entities. These actions generally sought to avoid certain putative transfers in connection with (i) the 2005 acquisition by Petters of Polaroid, which at the time was majority-owned by OEP; (ii) two credit facilities that JPMorgan Chase and other financial institutions entered into with Polaroid; and (iii) a credit line and investment accounts held by Petters. In January 2017, the Court substantially denied the defendants’ motion to dismiss an amended complaint filed by the plaintiffs. In October 2017, JPMorgan Chase and its affiliates reached an agreement to settle the litigation brought by the Petters bankruptcy trustees, or their successors, and the receiver for Thomas J. Petters. The settlement is subject to Court approval, which is pending.

~~Wendel.~~ Since 2012, the French criminal authorities have been investigating a series of transactions entered into by senior managers of Wendel Investissement (“Wendel”) during the period from 2004 through 2007 to restructure their shareholdings in Wendel. JPMorgan Chase Bank, N.A., Paris branch provided financing for the transactions to a number of managers of Wendel in 2007. JPMorgan Chase has cooperated with the investigation. The investigating judges issued an ~~ordonnance de renvoi~~ ~~in November 2016, referring JPMorgan Chase Bank, N.A. to the French~~ ~~tribunal correctionnel~~ ~~for alleged complicity in tax fraud. No date for trial has been set by the court. The Firm has been successful in legal challenges made to the Court of~~

~~Cassation, France’s highest court, with respect to the criminal proceedings. In January 2018, the Paris Court of Appeal issued a decision cancelling the~~ ~~mise en examen~~ of JPMorgan Chase Bank, N.A. The Firm is requesting clarification from the Court of Cassation concerning the Court of Appeal’s decision before seeking direction on next steps in the criminal proceedings. In addition, a number of the managers have commenced civil proceedings against JPMorgan Chase Bank, N.A. The claims are separate, involve different allegations and are at various stages of proceedings.

~~* * *~~

The Firm has established reserves for several hundred of its currently outstanding legal proceedings. In accordance with the provisions of U.S. GAAP for contingencies, the Firm accrues for a litigation-related liability when it is probable that such a liability has been incurred and the amount of the loss can be reasonably estimated. The Firm evaluates its outstanding legal proceedings each quarter to assess its litigation reserves, and makes adjustments in such reserves, upwards or downward, as appropriate, based on management’s best judgment after consultation with counsel. The Firm’s legal expense was $70 million and $218 million for the three months ended March 31, 2018 and 2017, respectively. There is no assurance that the Firm’s litigation reserves will not need to be adjusted in the future.

In view of the inherent difficulty of predicting the outcome of legal proceedings, particularly where the claimants seek very large or indeterminate damages, or where the matters present novel legal theories, involve a large number of parties or are in early stages of discovery, the Firm cannot state with confidence what will be the eventual outcomes of the currently pending matters, the timing of their ultimate resolution or the eventual losses, fines, penalties or consequences related to those matters. JPMorgan Chase believes, based upon its current knowledge, after consultation with counsel and after taking into account its current litigation reserves, that the legal proceedings currently pending against it should not have a material adverse effect on the Firm’s consolidated financial condition. The Firm notes, however, that in light of the uncertainties involved in such proceedings, there is no assurance that the ultimate resolution of these matters will not significantly exceed the reserves it has currently accrued or that a matter will not have material reputational consequences. As a result, the outcome of a particular matter may be material to JPMorgan Chase’s operating results for a particular period, depending on, among other factors, the size of the loss or liability imposed and the level of JPMorgan Chase’s income for that period.

~~Note 23 – Business segments~~

The business segments are determined based on the products and services provided, or the type of customer served, and they reflect the manner in which financial information is currently evaluated by management. Results of these lines of business are presented on a managed basis. For a further discussion concerning JPMorgan Chase’s business segments, see Segment results below, and Note 31 of JPMorgan Chase’s 2017 Annual Report.

~~Segment results~~

The following table provides a summary of the Firm’s segment results as of or for the three months ended March 31, 2018 and 2017, on a managed basis. The Firm’s definition of managed basis starts with the reported U.S. GAAP results and includes certain reclassifications to present total net revenue for the Firm (and each of the

reportable business segments) on an FTE basis. Accordingly, revenue from investments that receive tax credits and tax-exempt securities is presented in the managed results on a basis comparable to taxable investments and securities. This allows management to assess the comparability of revenue from year-to-year arising from both taxable and tax-exempt sources. The corresponding income tax impact related to tax-exempt items is recorded within income tax expense. These adjustments have no impact on net income as reported by the Firm as a whole or by the lines of business.

Business segment capital allocation

The amount of capital assigned to each business is referred to as equity. On at least an annual basis, the Firm assesses the level of capital required for each line of business as well as the assumptions and methodologies used to allocate capital. For additional information on business segment capital allocation, refer to Line of business equity on pages 88-89 of JPMorgan Chase’s 2017 Annual Report.

Net income in 2018 for the business segments reflects the favorable impact of the reduction in the U.S. federal statutory income tax rate as a result of the TCJA.



Segment results and reconciliation^(a)
As of or for the three months ended September 30, (in millions, except ratios)	Consumer & Community Banking						Corporate & Investment Bank						Commercial Banking						Asset & Wealth Management
	2018			2017			2018			2017			2018			2017			2018			2017
Noninterest revenue	$	4,176		$	3,898		$	6,505		$	6,119		$	576		$	592		$	2,680		$	2,617
Net interest income	9,114			8,135			2,300			2,496			1,695			1,554			879			855
Total net revenue	13,290			12,033			8,805			8,615			2,271			2,146			3,559			3,472
Provision for credit losses	980			1,517			(42		)	(26		)	(15		)	(47		)	23			8
Noninterest expense	6,982			6,495			5,175			4,793			853			800			2,585			2,408
Income before income tax expense	5,328			4,021			3,672			3,848			1,433			1,393			951			1,056
Income tax expense	1,242			1,468			1,046			1,302			344			512			227			382
Net income	$	4,086		$	2,553		$	2,626		$	2,546		$	1,089		$	881		$	724		$	674
Average equity	$	51,000		$	51,000		$	70,000		$	70,000		$	20,000		$	20,000		$	9,000		$	9,000
Total assets	560,432			537,459			928,148			851,808			217,194			220,064			166,716			149,170
Return on equity	31		%	19		%	14		%	13		%	21		%	17		%	31		%	29		%
Overhead ratio	53			54			59			56			38			37			73			69



As of or for the three months ended September 30, (in millions, except ratios)	Corporate					Reconciling Items^(a)						Total
	2018			2017		2018			2017			2018			2017
Noninterest revenue	$	(177	)	$	109	$	(408	)	$	(555	)	$	13,352		$	12,780
Net interest income	74			77		(154		)	$	(319	)	13,908			12,798
Total net revenue	(103		)	186		(562		)	$	(874	)	27,260			25,578
Provision for credit losses	2			—		—			—			948			1,452
Noninterest expense	28			74		—			—			15,623			14,570
Income/(loss) before income tax expense/(benefit)	(133		)	112		(562		)	(874		)	10,689			9,556
Income tax expense/(benefit)	12			34		(562		)	(874		)	2,309			2,824
Net income/(loss)	$	(145	)	$	78	$	—		$	—		$	8,380		$	6,732
Average equity	$	80,439		$	81,861	$	—		$	—		$	230,439		$	231,861
Total assets	742,693			804,573		NA			NA			2,615,183			2,563,074
Return on equity	NM			NM		NM			NM			14		%	11		%
Overhead ratio	NM			NM		NM			NM			57			57


(a)	Segment managed results reflect revenue on an FTE basis with the corresponding income tax impact ~~related to tax-exempt items is~~ recorded within income tax ~~expense.~~expense/(benefit). These adjustments ~~have no impact~~are eliminated in reconciling items to arrive at the Firm’s reported U.S. GAAP results.



Segment results and reconciliation^(a)
As of or for the nine months ended September 30, (in millions, except ratios)	Consumer & Community Banking						Corporate & Investment Bank						Commercial Banking						Asset & Wealth Management
	2018			2017			2018			2017			2018			2017			2018			2017
Noninterest revenue	$	12,063		$	10,899		$	21,954		$	19,598		$	1,758		$	1,774		$	7,997		$	7,677
Net interest income	26,321			23,516			7,257			7,541			4,995			4,478			2,640			2,520
Total net revenue	38,384			34,415			29,211			27,139			6,753			6,252			10,637			10,197
Provision for credit losses	3,405			4,341			(142		)	(175		)	23			(214		)	40			30
Noninterest expense	20,770			19,390			16,237			14,854			2,541			2,415			7,732			7,606
Income before income tax expense	14,209			10,684			13,116			12,460			4,189			4,051			2,865			2,561
Income tax expense	3,385			3,920			3,318			3,963			988			1,469			616			878
Net income	$	10,824		$	6,764		$	9,798		$	8,497		$	3,201		$	2,582		$	2,249		$	1,683
Average equity	$	51,000		$	51,000		$	70,000		$	70,000		$	20,000		$	20,000		$	9,000		$	9,000
Total assets	560,432			537,459			928,148			851,808			217,194			220,064			166,716			149,170
Return on equity	27		%	17		%	18		%	15		%	20		%	16		%	32		%	24		%
Overhead ratio	54			56			56			55			38			39			73			75



As of or for the nine months ended September 30, (in millions, except ratios)	Corporate						Reconciling Items^(a)						Total
	2018			2017			2018			2017			2018			2017
Noninterest revenue	$	(220	)	$	963		$	(1,337	)	$	(1,733	)	$	42,215		$	39,178
Net interest income	(35		)	2			(473		)	$	(987	)	40,705			37,070
Total net revenue	(255		)	965			(1,810		)	$	(2,720	)	82,920			76,248
Provision for credit losses	(3		)	—			—			—			3,323			3,982
Noninterest expense	394			355			—			—			47,674			44,620
Income/(loss) before income tax expense/(benefit)	(646		)	610			(1,810		)	(2,720		)	31,923			27,646
Income tax expense/(benefit)	18			(73		)	(1,810		)	(2,720		)	6,515			7,437
Net income/(loss)	$	(664	)	$	683		$	—		$	—		$	25,408		$	20,209
Average equity	$	78,995		$	79,937		$	—		$	—		$	228,995		$	229,937
Total assets	742,693			804,573			NA			NA			2,615,183			2,563,074
Return on equity	NM			NM			NM			NM			14		%	11		%
Overhead ratio	NM			NM			NM			NM			57			59

(a)

Segment managed results reflect revenue on ~~net income as reported by~~an FTE basis with the ~~Firm as a whole or by the lines of business.~~

~~Business segment capital allocation~~

The amount of capital assigned to each business is referred to as equity. On at least an annual basis, the Firm assesses the level of capital required for each line of business as well as the assumptions and methodologies used to allocate capital. For additional information on business segment capital allocation, see Line of business equity on page 88 of JPMorgan Chase’s 2017 Annual Report.

~~Net income in the first quarter of 2018 for the business segments reflects the favorable impact of the reduction in the U.S. federal statutory~~corresponding income tax ~~rate as a result of~~impact recorded within income tax expense/(benefit). These adjustments are eliminated in reconciling items to arrive at the ~~TCJA.~~

Segment results and reconciliation^(a)
As of or for the three months ended March 31,
(in millions, except ratios) Consumer &
Community Banking Corporate &
Investment Bank Commercial Banking Asset & Wealth Management
2018
2017
2018
2017
2018
2017
2018
2017
Noninterest revenue $ 4,139
$ 3,317
$ 7,917
$ 6,999
$ 549
$ 599
$ 2,630
$ 2,469
Net interest income 8,458
7,653
2,566
2,600
1,617
1,419
876
819
Total net revenue 12,597
10,970
10,483
9,599
2,166
2,018
3,506
3,288
Provision for credit losses 1,317
1,430
(158 ) (96 ) (5 ) (37 ) 15
18
Noninterest expense 6,909
6,395
5,659
5,184
844
825
2,581
2,781
Income before income tax expense 4,371
3,145
4,982
4,511
1,327
1,230
910
489
Income tax expense 1,045
1,157
1,008
1,270
302
431
140
104
Net income $ 3,326
$ 1,988
$ 3,974
$ 3,241
$ 1,025
$ 799
$ 770
$ 385
Average equity $ 51,000
$ 51,000
$ 70,000
$ 70,000
$ 20,000
$ 20,000
$ 9,000
$ 9,000
Total assets 540,659
524,770
909,845
840,304
220,880
217,348
158,439
141,049
Return on equity 25 % 15 % 22 % 18 % 20 % 15 % 34 % 16 %
Overhead ratio 55
58
54
54
39
41
74
85

As of or for the three months ended March 31,
(in millions, except ratios) Corporate
Reconciling Items^(a)
Total
2018
2017
2018
2017
2018
2017
Noninterest revenue $ (185 ) $ 73
$ (455 ) $ (582 ) $ 14,595
$ 12,875
Net interest income (47 ) (98 ) (158 ) $ (329 ) 13,312
12,064
Total net revenue (232 ) (25 ) (613 ) $ (911 ) 27,907
24,939
Provision for credit losses (4 ) —
—
—
1,165
1,315
Noninterest expense 87
98
—
—
16,080
15,283
Income/(loss) before income tax expense/(benefit) (315 ) (123 ) (613 ) (911 ) 10,662
8,341
Income tax expense/(benefit) 68
(158 ) (613 ) (911 ) 1,950
1,893
Net income/(loss) $ (383 ) $ 35
$ —
$ —
$ 8,712
$ 6,448
Average equity $ 77,615
$ 77,703
$ —
$ —
$ 227,615
$ 227,703
Total assets 779,962
822,819
NA
NA
2,609,785
2,546,290
Return on equity NM
NM
NM
NM
15 % 11 %
Overhead ratio NM
NM
NM
NM
58
61

	Firm’s reported U.S. GAAP results.
~~(a)~~	Segment managed results reflect revenue on an FTE basis with the corresponding income tax impact recorded within income tax expense/(benefit). These adjustments are eliminated in reconciling items to arrive at the Firm’s reported U.S. GAAP results.

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of JPMorgan Chase & Co.:

Results of Review of Financial Statements

We have reviewed the accompanying consolidated balance sheet of JPMorgan Chase & Co. and its subsidiaries (the “Firm”) as of ~~March 31,~~September 30, 2018, and the related consolidated statements of income and comprehensive income for the three-month and nine-month periods ended September 30, 2018 and 2017 and the consolidated statements of changes in stockholders’ equity and of cash flows for the ~~three-month~~nine-month periods ended ~~March 31,~~September 30, 2018 and 2017, including the related notes (collectively referred to as the “interim financial statements”). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of the Firm as of December 31, 2017, and the related consolidated statements of income, comprehensive income, changes in stockholders’ equity and of cash flows for the year then ended (not presented herein), and in our report dated February 27, 2018, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet information as of December 31, 2017, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

These interim financial statements are the responsibility of the Firm’s management. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Firm in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our review in accordance with the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

~~May 2,~~October 31, 2018

PricewaterhouseCoopers LLP, 300 Madison Avenue, New York, NY 10017

																																		JPMorgan Chase & Co.
Consolidated average balance sheets, interest and rates
Consolidated average balance sheets, interest and rates (unaudited)																			Consolidated average balance sheets, interest and rates (unaudited)
(Taxable-equivalent interest and rates; in millions, except rates)

	Three months ended March 31, 2018								Three months ended March 31, 2017										Three months ended September 30, 2018								Three months ended September 30, 2017
	Average balance			Interest^(f)		Rate (annualized)			Average balance			Interest^(f)				Rate (annualized)			Average balance			Interest^(f)		Rate (annualized)			Average balance			Interest^(f)		Rate (annualized)
Assets
Deposits with banks	$	423,807		$	1,321	1.26	%		$	423,746		$	725			0.69	%		$	408,595		$	1,585	1.54	%		$	456,673		$	1,259	1.09
Federal funds sold and securities purchased under resale agreements	198,362			731		1.49			196,965			526				1.08			208,439			952		1.81			188,594			622		1.31
Securities borrowed	109,733			62		0.23			95,372			(44		)	^(g)	(0.19	)		117,057			200		0.68			95,597			—		—
Trading assets – debt instruments	256,040			2,118		3.35			225,801			1,883				3.38			258,027			2,170		3.34			240,876			1,974		3.25
Taxable securities	195,641			1,313		2.72			240,803			1,430				2.41			187,942			1,402		2.96			216,011			1,362		2.50
Nontaxable securities^(a)	44,113			510		4.69			44,762			690				6.25			42,045			490		4.62			45,106			676		5.95
Total investment securities	239,754			1,823		3.08		^(h)	285,565			2,120				3.01		^(h)	229,987			1,892		3.26		^(g)	261,117			2,038		3.10	^(g)
Loans	926,548			11,117		4.87			891,904			9,823				4.47			951,724			12,250		5.11			909,580			10,591		4.62
All other interest-earning assets^(b)	49,169			681		5.61			41,559			338				3.30			46,429			945		8.07			41,737			522		4.96
Total interest-earning assets	2,203,413			17,853		3.29			2,160,912			15,371				2.88			2,220,258			19,994		3.57			2,194,174			17,006		3.07
Allowance for loan losses	(13,482		)						(13,723		)								(13,207		)						(13,290		)
Cash and due from banks	22,173								19,920										21,101								20,289
Trading assets – equity instruments	107,688								115,284										102,962								119,463
Trading assets – derivative receivables	60,492								61,400										62,075								59,839
Goodwill, MSRs and other intangible assets	54,702								54,249										54,652								53,788
Other assets	151,057								135,120										151,780								134,968
Total assets	$	2,586,043							$	2,533,162									$	2,599,621							$	2,569,231
Liabilities
Interest-bearing deposits	$	1,046,521		$	1,060	0.41	%		$	986,015		$	483			0.20	%		$	1,057,262		$	1,621	0.61	%		$	1,029,534		$	837	0.32
Federal funds purchased and securities loaned or sold under repurchase agreements	196,112			578		1.20			189,611			293				0.63			184,377			827		1.78			181,851			451		0.98
Short-term borrowings^(c)	57,603			209		1.47			36,521			73				0.79			61,042			288		1.87			52,958			149		1.12
Trading liabilities – debt and other interest-bearing liabilities^(d)(e)	171,488			660		1.56			176,824			405				0.93			177,091			1,018		2.28			168,738			570		1.34
Beneficial interests issued by consolidated VIEs	23,561			123		2.11			38,775			135				1.41			19,921			122		2.41			29,832			123		1.62
Long-term debt	279,005			1,753		2.55			292,224			1,589				2.21			275,979			2,056		2.96			294,626			1,759		2.37
Total interest-bearing liabilities	1,774,290			4,383		1.00			1,719,970			2,978				0.70			1,775,672			5,932		1.33			1,757,539			3,889		0.88
Noninterest-bearing deposits	399,487								405,548										395,600								401,489
Trading liabilities – equity instruments^(e)	28,631								21,072										36,309								20,905
Trading liabilities – derivative payables	41,745								48,373										44,810								44,627
All other liabilities, including the allowance for lending-related commitments	88,207								84,428										90,539								86,742
Total liabilities	2,332,360								2,279,391										2,342,930								2,311,302
Stockholders’ equity
Preferred stock	26,068								26,068										26,252								26,068
Common stockholders’ equity	227,615								227,703										230,439								231,861
Total stockholders’ equity	253,683								253,771										256,691								257,929
Total liabilities and stockholders’ equity	$	2,586,043							$	2,533,162									$	2,599,621							$	2,569,231
Interest rate spread						2.29	%									2.18	%							2.24	%							2.19
Net interest income and net yield on interest-earning assets				$	13,470	2.48						$	12,393			2.33						$	14,062	2.51						$	13,117	2.37

(a) Represents securities which are tax-exempt for U.S. federal income tax purposes.

(b) Includes held-for-investment margin loans, which are classified in accrued interest and accounts receivable, and all other interest-earning assets, ~~included~~which are classified in other assets on the Consolidated balance sheets.

(d) Other interest-bearing liabilities include brokerage customer payables.

(e) The combined balance of trading liabilities – debt and equity instruments were ~~$98.0~~$106.4 billion and ~~$94.1~~$89.4 billion for the three months ended ~~March 31,~~September 30, 2018 and 2017, respectively.

(f) Interest includes the effect of certain related hedging derivatives. Taxable-equivalent amounts are used where applicable.

(g) For the three months ended September 30, 2018 and 2017, the annualized rates for securities, based on amortized cost, were 3.29% and 3.14%, respectively; this does not give effect to changes in fair value that are reflected in AOCI.



JPMorgan Chase & Co.
Consolidated average balance sheets, interest and rates (unaudited)
(Taxable-equivalent interest and rates; in millions, except rates)

	Nine months ended September 30, 2018								Nine months ended September 30, 2017
	Average balance			Interest^(f)		Rate (annualized)			Average balance			Interest^(f)				Rate (annualized)
Assets
Deposits with banks	$	419,392		$	4,449	1.42	%		$	439,974		$	3,002			0.91	%
Federal funds sold and securities purchased under resale agreements	203,969			2,490		1.63			192,922			1,676				1.16
Securities borrowed	113,112			410		0.49			93,708			(65		)	^(h)	(0.09	)
Trading assets – debt instruments	256,872			6,415		3.34			233,884			5,691				3.25
Taxable securities	190,970			4,098		2.87			228,580			4,202				2.46
Nontaxable securities^(a)	42,911			1,494		4.65			45,123			2,086				6.18
Total investment securities	233,881			5,592		3.20		^(g)	273,703			6,288				3.07		^(g)
Loans	939,408			35,047		4.99			902,216			30,479				4.52
All other interest-earning assets^(b)	48,743			2,474		6.79			41,113			1,295				4.21
Total interest-earning assets	2,215,377			56,877		3.43			2,177,520			48,366				2.97
Allowance for loan losses	(13,303		)						(13,453		)
Cash and due from banks	21,771								20,003
Trading assets – equity instruments	107,580								120,307
Trading assets – derivative receivables	61,188								59,824
Goodwill, MSRs and other intangible assets	54,656								53,978
Other assets	152,325								135,830
Total assets	$	2,599,594							$	2,554,009
Liabilities
Interest-bearing deposits	$	1,054,419		$	4,021	0.51	%		$	1,007,345		$	1,949			0.26	%
Federal funds purchased and securities loaned or sold under repurchase agreements	190,832			2,164		1.52			189,236			1,131				0.80
Short-term borrowings^(c)	60,341			757		1.68			44,273			318				0.96
Trading liabilities – debt and other interest-bearing liabilities^(d)(e)	176,507			2,579		1.95			172,949			1,490				1.15
Beneficial interests issued by consolidated VIEs	21,449			366		2.28			34,197			386				1.51
Long-term debt	276,865			5,812		2.81			294,248			5,035				2.29
Total interest-bearing liabilities	1,780,413			15,699		1.18			1,742,248			10,309				0.79
Noninterest-bearing deposits	398,728								403,704
Trading liabilities – equity instruments^(e)	33,206								20,441
Trading liabilities – derivative payables	42,919								45,900
All other liabilities, including the allowance for lending-related commitments	89,203								85,711
Total liabilities	2,344,469								2,298,004
Stockholders’ equity
Preferred stock	26,130								26,068
Common stockholders’ equity	228,995								229,937
Total stockholders’ equity	255,125								256,005
Total liabilities and stockholders’ equity	$	2,599,594							$	2,554,009
Interest rate spread						2.25	%									2.18	%
Net interest income and net yield on interest-earning assets				$	41,178	2.49						$	38,057			2.34

(a) Represents securities which are tax-exempt for U.S. federal income tax purposes.

(b) Includes held-for-investment margin loans, which are classified in accrued interest and accounts receivable, and all other interest-earning assets, which are classified in other assets on the Consolidated balance sheets.

(d) Other interest-bearing liabilities include brokerage customer payables.

(e) The combined balance of trading liabilities – debt and equity instruments were $105.1 billion and $91.3 billion for the nine months ended September 30, 2018 and 2017, respectively.

(f) Interest includes the effect of certain related hedging derivatives. Taxable-equivalent amounts are used where applicable.

(g) For the nine months ended September 30, 2018 and 2017, the annualized rates for securities, based on amortized cost, were 3.23% and 3.11%, respectively; this does not give effect to changes in fair value that are reflected in AOCI.

(h) Negative interest income and yield is related to client-driven demand for certain securities combined with the impact of low interest rates; this is matched book activity and the negative interest expense on the corresponding securities loaned is recognized in interest expense and reported within trading liabilities – debt and other interest-bearing ~~liabilities.~~liabilities

(h) For the three months ended March 31, 2018 and 2017, the annualized rates for securities, based on amortized cost, were 3.12% and 3.04%, respectively; this does not give effect to changes in fair value that are reflected in AOCI.



GLOSSARY OF TERMS AND ACRONYMS

2017 Annual Report or 2017 Form 10-K: Annual report on Form 10-K for year ended December 31, 2017, filed with the U.S. Securities and Exchange Commission.

ABS: Asset-backed securities

Active foreclosures: Loans referred to foreclosure where formal foreclosure proceedings are ongoing. Includes both judicial and non-judicial states.

AFS: Available-for-sale

Allowance for loan losses to total loans: represents period-end allowance for loan losses divided by retained loans.

AOCI: Accumulated other comprehensive income/(loss)

ARM(s): Adjustable rate mortgage(s)

AWM: Asset & Wealth Management

Beneficial interests issued by consolidated VIEs:represents the interest of third-party holders of debt, equity securities, or other obligations, issued by VIEs that JPMorgan Chase consolidates.

Benefit obligation: refers to the projected benefit obligation for pension plans and the accumulated postretirement benefit obligation for OPEB plans.

BHC: Bank holding company

CB: Commercial Banking

CBB: Consumer & Business Banking

CCAR: Comprehensive Capital Analysis and Review

CCB: Consumer & Community Banking

CCP: “Central counterparty” is a clearing house that interposes itself between counterparties to contracts traded in one or more financial markets, becoming the buyer to every seller and the seller to every buyer and thereby ensuring the future performance of open contracts. A CCP becomes counterparty to trades with market participants through novation, an open offer system, or another legally binding arrangement.

CDS: Credit default swaps

CEO: Chief Executive Officer

CET1 Capital: Common equity Tier 1 Capital

CFTC: Commodity Futures Trading Commission

CFO: Chief Financial Officer

Chase Bank USA, N.A.: Chase Bank USA, National Association

CIB: Corporate & Investment Bank

CIO: Chief Investment Office

Client deposits and other third party liabilities: Deposits, as well as deposits that are swept to on-balance sheet liabilities (e.g., commercial paper, federal funds purchased and securities loaned or sold under repurchase agreements) as part of client cash management programs.

CLO: Collateralized loan obligations

CLTV: Combined loan-to-value

Collateral-dependent:A loan is considered to be collateral-dependent when repayment of the loan is expected to be provided solely by the underlying collateral, rather than by cash flows from the borrower’s operations, income or other resources.

Commercial Card: provides a wide range of payment services to corporate and public sector clients worldwide through the commercial card products. Services include procurement, corporate travel and entertainment, expense management services, and business-to-business payment solutions.

Core loans: represents loans considered central to the Firm’s ongoing businesses; core loans exclude loans classified as trading assets, runoff portfolios, discontinued portfolios and portfolios the Firm has an intent to exit.

Credit derivatives:Financial instruments whose value is derived from the credit risk associated with the debt of a third party issuer (the reference entity) which allow one party (the protection purchaser) to transfer that risk to another party (the protection seller). Upon the occurrence of a credit event by the reference entity, which may include, among other events, the bankruptcy or failure to pay its obligations, or certain restructurings of the debt of the reference entity, neither party has recourse to the reference entity. The protection purchaser has recourse to the protection seller for the difference between the face value of the CDS contract and the fair value at the time of settling the credit derivative contract. The determination as to whether a credit event has occurred is generally made by the relevant International Swaps and Derivatives Association (“ISDA”) Determinations Committee.

Criticized: Criticized loans, lending-related commitments and derivative receivables that are classified as special mention, substandard and doubtful categories for regulatory purposes and are generally consistent with a rating of CCC+/Caa1 and below, as defined by S&P and Moody’s.

CRO: Chief Risk Officer

CVA: Credit valuation ~~adjustments~~adjustment

DFAST: Dodd-Frank Act Stress Test

Dodd-Frank Act: Wall Street Reform and Consumer Protection Act

DOJ: U.S. Department of Justice

DOL: U.S.Department of Labor

DVA: Debit valuation adjustment

~~E&P:~~ ~~Exploration & Production~~

EC: European Commission

Eligible LTD: Long-term debt satisfying certain eligibility criteria

Embedded derivatives: are implicit or explicit terms or features of a financial instrument that affect some or all of the cash flows or the value of the instrument in a manner similar to a derivative. An instrument containing such terms or features is referred to as a “hybrid.” The component of

the hybrid that is the non-derivative instrument is referred

to as the “host.” For example, callable debt is a hybrid instrument that contains a plain vanilla debt instrument (i.e., the host) and an embedded option that allows the issuer to redeem the debt issue at a specified date for a specified amount (i.e., the embedded derivative). However, a floating rate instrument is not a hybrid composed of a fixed-rate instrument and an interest rate swap.

ERISA: Employee Retirement Income Security Act of 1974

EPS: Earnings per share

Exchange-traded derivatives: Derivative contracts that are executed on an exchange and settled via a central clearing house.

Fannie Mae: Federal National Mortgage Association

FASB: Financial Accounting Standards Board

FCA: Financial Conduct Authority

FCC: Firmwide Control Committee

FDIA: Federal Depository Insurance Act

FDIC: Federal Deposit Insurance Corporation

Federal Reserve: The Board of the Governors of the Federal Reserve System

Fee share: Proportion of fee revenue based on estimates of investment banking fees generated across the industry from investment banking transactions in M&A, equity and debt underwriting, and loan syndications. Source: Dealogic, a third party provider of investment banking fee competitive analysis and volume-based league tables for the above noted industry products.

FFELP: Federal Family Education Loan Program

FFIEC: Federal Financial Institutions Examination Council

FHA: Federal Housing Administration

FHLB: Federal Home Loan Bank

FICO score:A measure of consumer credit risk based on information in consumer credit reports produced by Fair Isaac Corporation. Because certain aged data is excluded from credit reports based on rules in the Fair Credit Reporting Act, FICO scores may not reflect all historical information about a consumer.

Firm: JPMorgan Chase & Co.

Forward points: represents the interest rate differential between two currencies, which is either added to or subtracted from the current exchange rate (i.e., “spot rate”) to determine the forward exchange rate.

Freddie Mac: Federal Home Loan Mortgage Corporation

Free-standing derivatives: is a derivative contract entered into either separate and apart from any of the Firm’s other financial instruments or equity transactions. Or, in conjunction with some other transaction and is legally detachable and separately exercisable.

FSB: Financial Stability Board

FTE: Fully taxable-equivalent

FVA: Funding valuation adjustment

FX: Foreign exchange

G7: “Group of Seven nations”:Countries in the G7 are Canada, France, Germany, Italy, Japan, the U.K. and the U.S.

G7 government securities:Securities issued by the government of one of the G7 nations.

Ginnie Mae:Government National Mortgage Association

GSE: Fannie Mae and Freddie Mac

GSIB: ~~Globally~~Global systemically important banks

HAMP: Home affordable modification program

Headcount-related expense: Includes salary and benefits (excluding performance-based incentives), and other noncompensation costs related to employees.

HELOAN: Home equity loan

HELOC: Home equity line of credit

Home equity – senior lien:represents loans and commitments where JPMorgan Chase holds the first security interest on the property.

Home equity – junior lien:represents loans and commitments where JPMorgan Chase holds a security interest that is subordinate in rank to other liens.

HQLA: High quality liquid assets

HTM: Held-to-maturity

IDI: Insured depository institutions

IHC: JPMorgan Chase Holdings LLC, an intermediate holding company

Impaired loan:Impaired loans are loans measured at amortized cost, for which it is probable that the Firm will be unable to collect all amounts due, including principal and interest, according to the contractual terms of the agreement. Impaired loans include the following:

All wholesale nonaccrual loans

All TDRs (both wholesale and consumer), including ones that have returned to accrual status

Investment-grade:An indication of credit quality based on JPMorgan Chase’s internal risk assessment system. “Investment grade” generally represents a risk profile similar to a rating of a “BBB-”/“Baa3” or better, as defined by independent rating agencies.

IR: Interest rate

ISDA: International Swaps and Derivatives Association

JPMorgan Chase: JPMorgan Chase & Co.

JPMorgan Chase Bank, N.A.: JPMorgan Chase Bank, National Association

~~JPMorgan~~J.P. Morgan Securities: J.P. Morgan Securities LLC

LCR: Liquidity coverage ratio

LGD: Loss given default

LIBOR: London Interbank Offered Rate

LLC:Limited Liability Company

LOB: Line of business

Loss emergence period: represents the time period between the date at which the loss is estimated to have been incurred and the ultimate realization of that loss.

LTIP: Long-term incentive plan

LTV: “Loan-to-value ratio”: For residential real estate loans, the relationship, expressed as a percentage, between the principal amount of a loan and the appraised value of the collateral (i.e., residential real estate) securing the loan.

Origination date LTV ratio

The LTV ratio at the origination date of the loan. Origination date LTV ratios are calculated based on the actual appraised values of collateral (i.e., loan-level data) at the origination date.

Current estimated LTV ratio

An estimate of the LTV as of a certain date. The current estimated LTV ratios are calculated using estimated collateral values derived from a nationally recognized home price index measured at the metropolitan statistical area (“MSA”) level. These MSA-level home price indices consist of actual data to the extent available and forecasted data where actual data is not available. As a result, the estimated collateral values used to calculate these ratios do not represent actual appraised loan-level collateral values; as such, the resulting LTV ratios are necessarily imprecise and should therefore be viewed as estimates.

Combined LTV ratio

The LTV ratio considering all available lien positions, as well as unused lines, related to the property. Combined LTV ratios are used for junior lien home equity products.

Master netting agreement:A single agreement with a counterparty that permits multiple transactions governed by that agreement to be terminated or accelerated and settled through a single payment in a single currency in the event of a default (e.g., bankruptcy, failure to make a required payment or securities transfer or deliver collateral or margin when due).

Measurement alternative: Measures equity securities without readily determinable fair values at cost less impairment (if any), plus or minus observable price changes from an identical or similar investment of the same issuer.

MBS: Mortgage-backed securities

MD&A: Management’s discussion and analysis

~~MMDA:~~ ~~Money Market Deposit Accounts~~

Moody’s: Moody’s Investor Services

Mortgage product types:

Alt-A

Alt-A loans are generally higher in credit quality than subprime loans but have characteristics that would disqualify the borrower from a traditional prime loan. Alt-A lending characteristics may include one or more of the following: (i) limited documentation; (ii) a high CLTV ratio; (iii) loans secured by non-owner occupied properties; or (iv) a debt-to-income ratio above normal limits. A substantial proportion of the Firm’s Alt-A loans are those where a borrower does not provide complete documentation of his or her assets or the amount or source of his or her income.

Option ARMs

The option ARM real estate loan product is an adjustable-rate mortgage loan that provides the borrower with the option each month to make a fully amortizing, interest-only or minimum payment. The minimum payment on an option ARM loan is based on the interest rate charged during the introductory period. This introductory rate is usually significantly below the fully indexed rate. The fully indexed rate is calculated using an index rate plus a margin. Once the introductory period ends, the contractual interest rate charged on the loan increases to the fully indexed rate and adjusts monthly to reflect movements in the index. The minimum payment is typically insufficient to cover interest accrued in the prior month, and any unpaid interest is deferred and added to the principal balance of the loan. Option ARM loans are subject to payment recast, which converts the loan to a variable-rate fully amortizing loan upon meeting specified loan balance and anniversary date triggers.

Prime

Prime mortgage loans are made to borrowers with good credit records who meet specific underwriting requirements, including prescriptive requirements related to income and overall debt levels. New prime mortgage borrowers provide full documentation and generally have reliable payment histories.

Subprime

Subprime loans are loans that, prior to mid-2008, were offered to certain customers with one or more high risk characteristics, including but not limited to: (i) unreliable or poor payment histories; (ii) a high LTV ratio of greater than 80% (without borrower-paid mortgage insurance); (iii) a high debt-to-income ratio; (iv) an occupancy type for the loan is other than the borrower’s primary residence; or (v) a history of delinquencies or late payments on the loan.

MSA: Metropolitan statistical areas

MSR: Mortgage servicing rights

NA:Data is not applicable or available for the period presented.

Net Capital Rule: Rule 15c3-1 under the Securities Exchange Act of 1934.

Net charge-off/(recovery) rate: represents net charge-offs/(recoveries) (annualized) divided by average retained loans for the reporting period.

Net interchange income includes the following components:


•	Interchange income:Fees earned by credit and debit card issuers on sales transactions.


•	Rewards costs: The cost to the Firm for points earned by cardholders enrolled in credit card rewards programs.


•	Partner payments: Payments to co-brand credit card partners based on the cost of loyalty program rewards earned by cardholders on credit card transactions.

~~Interchange income~~:~~A fee paid to a credit card issuer in the clearing and settlement of a sales or cash advance transaction.~~

~~Reward costs: The cost to the Firm for points earned by cardholders enrolled in credit card reward programs.~~

~~Partner payments: Payments to co-brand credit card partners based on the cost of loyalty program rewards earned by cardholders on credit card transactions.~~

Net yield on interest-earning assets: The average rate for interest-earning assets less the average rate paid for all sources of funds.

NM:Not meaningful

NOL: Net operating loss

Nonaccrual loans:Loans for which interest income is not recognized on an accrual basis. Loans (other than credit card loans and certain consumer loans insured by U.S. government agencies) are placed on nonaccrual status when full payment of principal and interest is not expected, regardless of delinquency status, or when principal and interest has been in default for a period of 90 days or more unless the loan is both well-secured and in the process of collection. Collateral-dependent loans are typically maintained on nonaccrual status.

Nonperforming assets: Nonperforming assets include nonaccrual loans, nonperforming derivatives and certain assets acquired in loan satisfactions, predominantly real estate owned and other commercial and personal property.

~~NOW:~~ ~~Negotiable Order of Withdrawal~~

~~NSFR:~~ ~~Net stable funding ratio~~

~~OAS:~~ ~~Option-adjusted spread~~

OCC: Office of the Comptroller of the Currency

OCI: Other comprehensive income/(loss)

OEP: One Equity Partners

OIS: Overnight index swap

OPEB: Other postretirement employee benefit

OTC: “Over-the-counter derivatives”:Derivative contracts that are negotiated, executed and settled bilaterally between two derivative counterparties, where one or both counterparties is a derivatives dealer.

OTC cleared: “Over-the-counter cleared derivatives”:Derivative contracts that are negotiated and executed bilaterally, but subsequently settled via a central clearing house, such that each derivative counterparty is only exposed to the default of that clearing house.

OTTI: Other-than-temporary impairment

Overhead ratio: Noninterest expense as a percentage of total net revenue.

Parent Company: JPMorgan Chase & Co.

Participating securities: represents unvested share-based compensation awards containing nonforfeitable rights to dividends or dividend equivalents (collectively, “dividends”), which are included in the earnings per share calculation using the two-class method. JPMorgan Chase grants restricted stock and RSUs to certain employees under its share-based compensation programs, which entitle the recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to the dividends paid to holders of common stock. These unvested awards meet the definition of participating securities. Under the two-class method, all earnings (distributed and undistributed) are allocated to each class of common stock and participating securities, based on their respective rights to receive dividends.

PCA: Prompt corrective action

PCI: “Purchased credit-impaired” loansrepresents certain loans that were acquired and deemed to be credit-impaired on the acquisition date in accordance with the guidance of the FASB. The guidance allows purchasers to aggregate credit-impaired loans acquired in the same fiscal quarter into one or more pools, provided that the loans have

common risk characteristics (e.g., product type, LTV ratios, FICO scores, past due status, geographic location). A pool is then accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows.

PD: Probability of default

PRA: Prudential Regulatory Authority

Pre-provision profit/(loss): represents total net revenue less noninterest expense. The Firm believes that this financial measure is useful in assessing the ability of a lending institution to generate income in excess of its provision for credit losses.

Principal transactions revenue:Principal transactions revenue is driven by many factors, including the bid-offer spread, which is the difference between the price at which the Firm is willing to buy a financial or other instrument and the price at which the Firm is willing to sell that instrument. It also consists of realized (as a result of closing out or termination of transactions, or interim cash payments) and unrealized (as a result of changes in valuation) gains and losses on financial and other instruments (including those accounted for under the fair value option) primarily used in client-driven market-making activities and on private equity investments. In connection with its client-driven market-making activities, the Firm transacts in debt and equity instruments, derivatives and commodities (including physical commodities inventories and financial instruments that reference commodities). Principal transactions revenue also includes certain realized and unrealized gains and losses related to hedge accounting and specified risk-management activities, including: (a) certain derivatives designated in qualifying hedge accounting relationships (primarily fair value hedges of commodity and foreign exchange risk), (b) certain derivatives used for specific risk management purposes, primarily to mitigate credit risk and foreign exchange risk, and (c) other derivatives.

PSU(s): Performance share units

Receivables from customers: primarily represents margin loans to brokerage customers that are collateralized through assets maintained in the clients’ brokerage accounts, as such no allowance is held against these receivables. These receivables are reported within accrued interest and accounts receivable on the Firm’s Consolidated balance sheets.

Regulatory VaR: Daily aggregated VaR calculated in accordance with regulatory rules.

REO: Real estate owned

Reported basis: Financial statements prepared under U.S. GAAP, which excludes the impact of taxable-equivalent adjustments.

Retained loans:Loans that are held-for-investment (i.e. excludes loans held-for-sale and loans at fair value).

Revenue wallet: Total fee revenue based on estimates of investment banking fees generated across the industry (i.e., the revenue wallet) from investment banking transactions in M&A, equity and debt underwriting, and loan syndications. Source: Dealogic, a third-party provider of investment banking competitive analysis and volume based league tables for the above noted industry products.

RHS:Rural Housing Service of the U.S. Department of Agriculture

ROE: Return on equity

ROTCE: Return on tangible common equity

RSU(s): Restricted stock units

RWA: “Risk-weighted assets”:Basel III establishes two comprehensive approaches for calculating RWA (a Standardized approach and an Advanced approach) which include capital requirements forcredit risk, market risk, and in the case of Basel III Advanced, also operational risk.Key differences in the calculation of credit risk RWA between the Standardized and Advanced approaches are that for Basel III Advanced, credit risk RWA is based on risk-sensitive approaches which largely rely on the use of internal credit models and parameters, whereas for Basel III Standardized, credit risk RWA is generally based on supervisory risk-weightings which vary primarily by counterparty type and asset class. Market risk RWA is calculated on a generally consistent basis between Basel III Standardized and Basel III Advanced.

S&P: Standard and Poor’s 500 Index

SAR(s): Stock appreciation rights

SCCL: Single-counterparty credit limits

Scored portfolio: The scored portfolio predominantly includes residential real estate loans, credit card loans and certain auto and business banking loans where credit loss estimates are based on statistical analysis of credit losses over discrete periods of time. The statistical analysis uses portfolio modeling, credit scoring and decision-support tools.

SEC: U.S.Securities and Exchange Commission

Seed capital: Initial JPMorgan capital invested in products, such as mutual funds, with the intention of ensuring the fund is of sufficient size to represent a viable offering to clients, enabling pricing of its shares, and allowing the manager to develop a track record. After these goals are achieved, the intent is to remove the Firm’s capital from the investment.

~~Short sale:~~ is a sale of real estate in which proceeds from selling the underlying property are less than the amount owed the Firm under the terms of the related mortgage and the related lien is released upon receipt of such proceeds.

Single-name: Single reference-entities

SLR: Supplementary leverage ratio

SMBS: Stripped mortgage-backed securities

~~SOA:~~ ~~Society of Actuaries~~

SPEs: Special purpose entities

Structural interest rate risk: represents interest rate risk of the non-trading assets and liabilities of the Firm.

Structured notes:Structured notes are ~~predominantly~~ financial instruments ~~containing~~whose cash flows are linked to the movement in one or more indexes, interest rates, foreign exchange rates, commodities prices, prepayment rates, or other market variables. The notes typically contain embedded (but not separable or detachable) derivatives. ~~Where present,~~Contractual cash flows for principal, interest, or both can vary in amount and timing throughout the ~~embedded derivative is~~life of the ~~primary driver~~note based on non-traditional indexes or non-traditional uses of ~~risk.~~traditional interest rates or indexes.

Suspended foreclosures:Loans referred to foreclosure where formal foreclosure proceedings have started but are currently on hold, ~~which~~whic

h could be due to bankruptcy or loss mitigation. Includes both judicial and non-judicial states.

Taxable-equivalent basis: In presenting managed results, the total net revenue for each of the business segments and the Firm is presented on a tax-equivalent basis. Accordingly, revenue from investments that receive tax credits and tax-exempt securities is presented in the managed results on a basis comparable to taxable investments and securities; the corresponding income tax impact related to tax-exempt items is recorded within income tax expense.

TBVPS: Tangible book value per share

TCE: Tangible common equity

TDR:“Troubled debt restructuring” is deemed to occur when the Firm modifies the original terms of a loan agreement by granting a concession to a borrower that is experiencing financial difficulty.

TLAC: Total Loss Absorbing Capacity

U.K.: United Kingdom

Unaudited:Financial statements and information that have not been subjected to auditing procedures sufficient to permit an independent certified public accountant to express an opinion.

U.S.: United States of America

U.S. GAAP:Accounting principles generally accepted in the United States of America.

U.S. GSE(s): “U.S. government-sponsored enterprises”:In the U.S., GSEs are quasi-governmental, privately-held entities established by Congress to improve the flow of credit to specific sectors of the economy and provide certain essential services to the public. U.S. GSEs include Fannie Mae and Freddie Mac, but do not include Ginnie Mae, which is directly owned by the U.S. Department of Housing and Urban Development. U.S. GSE obligations are not explicitly guaranteed as to the timely payment of principal and interest by the full faith and credit of the U.S. government.

U.S. Treasury:U.S. Department of the Treasury

VA: U.S. Department of Veterans Affairs

VaR: “Value-at-risk” is a measure of the dollar amount of potential loss from adverse market moves in an ordinary market environment.

VIEs: Variable interest entities

Warehouse loans:consist of prime mortgages originated with the intent to sell that are accounted for at fair value and classified as trading assets.

Washington Mutual transaction:On September 25, 2008, JPMorgan Chase acquired certain of the assets of the banking operations of Washington Mutual Bank (“Washington Mutual”) from the FDIC.



LINE OF BUSINESS METRICS

CONSUMER & COMMUNITY BANKING (“CCB”)

Debit and credit card sales volume: Dollar amount of cardmember purchases, net of returns.

Deposit margin/deposit spread: represents net interest income expressed as a percentage of average deposits.

Home Lending Production and Home Lending Servicing revenue comprises the following:

Net production revenue: includes net gains or losses on originations and sales of mortgage loans, other production-related fees and losses related to the repurchase of previously-sold loans.

Net mortgage servicing revenue: includes the following components:

a) Operating revenue predominantly represents the return on Home Lending Servicing’s MSR asset and includes:

Actual gross income earned from servicing third-party mortgage loans, such as contractually specified servicing fees and ancillary income; and

The change in the fair value of the MSR asset due to the collection or realization of expected cash flows.

b) Risk management represents the components of Home Lending Servicing’s MSR asset that are subject to ongoing risk management activities, together with derivatives and other instruments used in those risk management activities.

Mortgage origination channels comprise the following:

Retail: Borrowers who buy or refinance a home through direct contact with a mortgage banker employed by the Firm using a branch office, the Internet or by phone. Borrowers are frequently referred to a mortgage banker by a banker in a Chase branch, real estate brokers, home builders or other third parties.

Correspondent: Banks, thrifts, other mortgage banks and other financial institutions that sell closed loans to the Firm.

Card Services: includes the Card and Merchant Services businesses.

Card: is a business that primarily issues credit cards to consumers and small businesses.

Merchant Services: is a business that primarily processes transactions for merchants.

Net revenue rate: represents Card Services net revenue (annualized) expressed as a percentage of average loans for the period.

Auto loan and lease origination volume: Dollar amount of auto loans and leases originated.

CORPORATE & INVESTMENT BANK (“CIB”)

Definition of selected CIB revenue:

Investment Banking: incorporates all revenue associated with investment banking activities, and is reported net of investment banking revenue shared with other lines of business.

Treasury Services: offers a broad range of products and services that enable clients to manage payments and receipts, as well as invest and manage funds. Products include U.S. dollar and multi-currency clearing, ACH, lockbox, disbursement and reconciliation services, check deposits, and currency-related services.

Lending: includes net interest income, fees, gains or losses on loan sale activity, gains or losses on securities received as part of a loan restructuring, and the risk management results related to the credit portfolio. Lending also includes Trade Finance, which includes loans tied directly to goods crossing borders, export/import loans, commercial letters of credit, standby letters of credit, and supply chain finance.

Fixed Income Markets: primarily includes revenue related to market-making across global fixed income markets, including foreign exchange, interest rate, credit and commodities markets.

Equity Markets: primarily includes revenue related to market-making across global equity products, including cash instruments, derivatives, convertibles and ~~Prime Services.~~prime brokerage.

Securities Services: primarilyincludes custody, fund accounting and administration, and securities lending products sold principally to asset managers, insurance companies and public and private investment funds. Also includes clearance, collateral management and depositary receipts business which provides broker-dealer clearing and custody services, including tri-party repo transactions, collateral management products, and depositary bank services for American and global depositary receipt programs.

Description of certain business metrics:

Assets under custody (“AUC”): represents activities associated with the safekeeping and servicing of assets on which Securities Services earns fees.

Investment banking fees: represents advisory, equity underwriting, bond underwriting and loan syndication fees.

COMMERCIAL BANKING (“CB”)

CB is divided into four primary client segments: Middle Market Banking, Corporate Client Banking, Commercial Term Lending, and Real Estate Banking.

Middle Market Banking: covers corporate, municipal and nonprofit clients, with annual revenue generally ranging between $20 million and $500 million.

Corporate Client Banking: covers clients with annual revenue generally ranging between $500 million and $2 billion and focuses on clients that have broader investment banking needs.

Commercial Term Lending: primarily provides term financing to real estate investors/owners for multifamily properties as well as office, retail and industrial properties.

Real Estate Banking: provides full-service banking to investors and developers of institutional-grade real estate investment properties.

Other: primarily includes lending and investment-related activities within the Community Development Banking business.

CB product revenue comprises the following:

Lending: includes a variety of financing alternatives, which are primarily provided on a secured basis; collateral includes receivables, inventory, equipment, real estate or other assets. Products include term loans, revolving lines of credit, bridge financing, asset-based structures, leases, and standby letters of credit.

Treasury services: includes revenue from a broad range of products and services that enable CB clients to manage payments and receipts, as well as invest and manage funds.

Investment banking: includes revenue from a range of products providing CB clients with sophisticated capital-raising alternatives, as well as balance sheet and risk management tools through advisory, equity underwriting, and loan syndications. Revenue from fixed income and equity market products used by CB clients is also included.

Other: product revenue primarily includes tax-equivalent adjustments generated from Community Development Banking activity and certain income derived from principal transactions.

ASSET & WEALTH MANAGEMENT (“AWM”)

Assets under management (“AUM”): represent assets managed by AWM on behalf of its Private Banking, Institutional and Retail clients.

Client assets: represent assets under management, as well as custody, brokerage, administration and deposit accounts.

Multi-asset: Any fund or account that allocates assets under management to more than one asset class.

Alternative assets: The following types of assets constitute alternative investments – hedge funds, currency, real estate, private equity and other investment funds designed to focus on nontraditional strategies.

AWM’s lines of business consist of the following:

Asset Management: provides comprehensive global investment services - including asset management, pension analytics, asset-liability management and active risk-budgeting strategies.

Wealth Management: offers investment advice and wealth management, including investment management, capital markets and risk management, tax and estate planning, banking, lending and specialty-wealth advisory services.

AWM’s client segments consist of the following:

Private Banking: clients include high- and ultra-high-net-worth individuals, families, money managers, business owners and small corporations worldwide.

Institutional: clients include both corporate and public institutions, endowments, foundations, nonprofit organizations and governments worldwide.

Retail: clients include financial intermediaries and individual investors.

Asset Management has two high-level measures of its overall fund performance:

Percentage of mutual fund assets under management in funds rated 4- or 5-star: Mutual fund rating services rank funds based on their risk-adjusted performance over various periods. A 5-star rating is the best rating and represents the top 10% of industry-wide ranked funds.

A 4-star rating represents the next 22.5% of industry-wide ranked funds. A 3-star rating represents the next 35% of industry-wide ranked funds. A 2-star rating represents the next 22.5% of industry-wide ranked funds. A 1-star rating is the worst rating and represents the bottom 10% of industry-wide ranked funds. The “overall Morningstar rating” is derived from a weighted average of the performance associated with a fund’s three-, five- and ten-year (if applicable) Morningstar Rating metrics. For U.S. domiciled funds, separate star ratings are given at the individual share class level. The Nomura “star rating” is based on three-year risk-adjusted performance only. Funds with fewer than three years of history are not rated and hence excluded from this analysis. All ratings, the assigned peer categories and the asset values used to derive this analysis are sourced from these fund rating providers. The data providers re-denominate the asset values into U.S. dollars. This % of AUM is based on star ratings at the share class level for U.S. domiciled funds, and at a “primary share class” level to represent the star rating of all other funds except for Japan where Nomura provides ratings at the fund level. The “primary share class”, as defined by Morningstar, denotes the share class recommended as being the best proxy for the portfolio and in most cases will be the most retail version (based upon annual management charge, minimum investment, currency and other factors). The performance data could have been different if all funds/accounts would have been included. Past performance is not indicative of future results.

Percentage of mutual fund assets under management in funds ranked in the 1st or 2nd quartile (one, three, and five years): All quartile rankings, the assigned peer categories and the asset values used to derive this analysis are sourced from the fund ranking providers. Quartile rankings are done on the net-of-fee absolute return of each fund. The data providers re-denominate the asset values into U.S. dollars. This % of AUM is based on fund performance and associated peer rankings at the share class level for U.S. domiciled funds, at a “primary share class” level to represent the quartile ranking of the U.K., Luxembourg and Hong Kong funds and at the fund level for all other funds. The “primary share class”, as defined by Morningstar, denotes the share class recommended as being the best proxy for the portfolio and in most cases will be the most retail version (based upon annual management charge, minimum investment, currency and other factors). Where peer group rankings given for a fund are in more than one “primary share class” territory both rankings are included to reflect local market competitiveness (applies to “Offshore Territories” and “HK SFC Authorized” funds only). The performance data could have been different if all funds/accounts would have been included. Past performance is not indicative of future results.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

For a discussion of the quantitative and qualitative disclosures about market risk, ~~see~~refer to the Market Risk Management section of Management’s discussion and analysis and pages 121-128 of JPMorgan Chase’s 2017 Annual Report.

Item 4. Controls and Procedures.

As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of the Firm’s management, including its Chairman and Chief Executive Officer and its Chief Financial Officer, of the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934). Based on that evaluation, the Chairman and Chief Executive Officer and the Chief Financial Officer concluded that these disclosure controls and procedures were effective. ~~See~~Refer to Exhibits 31.1 and 31.2 for the Certification statements issued by the Chairman and Chief Executive Officer and Chief Financial Officer.

The Firm is committed to maintaining high standards of internal control over financial reporting. Nevertheless, because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, in a firm as large and complex as JPMorgan Chase, lapses or deficiencies in internal controls do occur from time to time, and there can be no assurance that any such deficiencies will not result in significant deficiencies or material weaknesses in internal controls in the future. For further information, ~~see~~refer to “Management’s report on internal control over financial reporting” on page 146 of JPMorgan Chase’s 2017 Annual Report. There was no change in the Firm’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) that occurred during the three months ended ~~March 31,~~September 30, 2018, that has materially affected, or is reasonably likely to materially affect, the Firm’s internal control over financial reporting.

Part II – Other Information

Item 1. Legal Proceedings.

For information that updates the disclosures set forth under Part I, Item 3: Legal Proceedings, in JPMorgan Chase’s 2017 Annual Report on Form 10-K, ~~see~~refer to the discussion of the Firm’s material legal proceedings in Note 22 of this Form 10-Q.

Item 1A. Risk Factors.

For a discussion of certain risk factors affecting the Firm, ~~see~~refer to Part I, Item 1A: Risk Factors on pages 8–26 of JPMorgan Chase’s 2017 Annual Report on Form 10-K and Forward-Looking Statements on page 7385 of this Form 10-Q.

Supervision and regulation

For information on Supervision and Regulation, ~~see~~refer to Recent regulatory ~~updates~~developments on page 3344 of this Form 10-Q and the Supervision and regulation section on pages 1–8 of JPMorgan Chase’s 2017 Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

~~During~~The Firm did not have any unregistered sale of equity securities during the three months ended ~~March 31, 2018, no shares of common stock of JPMorgan Chase & Co. were issued in transactions exempt from registration under the Securities Act of 1933, pursuant to Section 4(2) thereof.~~September 30, 2018.

Repurchases under the common equity repurchase program

Following receipt in June 2017 of the Federal Reserve’s non-objection to the Firm’s 2017 capital plan, the Firm’s Board of Directors authorized the repurchase of up to $19.4 billion of common equity (common stock and warrants) between July 1, 2017 and June 30, 2018. This authorization includes shares repurchased to offset issuancesFor information regarding repurchases under the Firm’s equity-based compensation plans. The following table sets forth the Firm’s repurchases of common equity for the three months ended March 31, 2018 and 2017. There were no warrants repurchased during the three months ended March 31, 2018 and 2017.

Three months ended March 31,
(in millions) 2018
2017
Total shares of common stock repurchased 41.4
32.1
Aggregate common stock repurchases $ 4,671
$ 2,832

~~The Firm may, from time to time, enter into written trading plans under Rule 10b5-1 of the Securities Exchange Act of 1934 to facilitate repurchases in accordance with the~~ common equity repurchase ~~program. A Rule 10b5-1 repurchase plan allows the Firm~~program, refer to repurchase its equity during periods when it would not otherwise be repurchasing common equity — for example, during internal trading blackout periods. All purchases under Rule 10b5-1 plans must be made according to predefined plans established when the Firm is not awareCapital Risk Management on pages 44-48 of ~~material nonpublic information.~~

~~The authorization to repurchase common equity will be utilized at management’s discretion,~~this Form 10-Q and ~~the timing~~pages 82-91 of purchases and the exact amount of common equity that may be repurchased is subject to various factors, including market conditions; legal and regulatory considerations affecting the amount and timing of repurchase activity; the Firm’s capital position (taking into account goodwill and intangibles); internal capital generation; and alternative investment opportunities. The repurchase program does not include specific price targets or timetables; maybe executed through open market purchases or privately negotiated transactions, or utilizing Rule 10b5-1 programs; and may be suspended at any time.JPMorgan Chase’s 2017 10-K.

Shares repurchased pursuant to the common equity repurchase program during the ~~three~~nine months ended ~~March 31,~~September 30, 2018, were as follows.

Three months ended March 31, 2018 Total shares of common stock repurchased
Average price paid per share of common stock^(a)

Aggregate repurchases
of common equity
(in millions)^(a)

Dollar value of remaining authorized repurchase
(in millions)^(a)

January 12,479,338
$ 110.98
$ 1,385
$ 8,442

February 14,798,888
112.94
1,671
6,771

March 14,140,809
114.20
1,615
5,156
^(b)
First quarter 41,419,035
$ 112.78
$ 4,671
$ 5,156
^(b)



Nine months ended September 30, 2018	Total shares of common stock repurchased	Average price paid per share of common stock^(a)		Aggregate repurchases of common equity (in millions)^(a)		Dollar value of remaining authorized repurchase (in millions)^(a)
First quarter	41,419,035	$	112.78	$	4,671	$	5,156	^(b)
Second quarter	45,299,370	109.67		4,968		188		^(c)
July	15,450,734	107.83		1,666		19,059
August	12,302,781	115.67		1,423		17,636
September	11,528,761	115.07		1,327		16,309
Third quarter	39,282,276	112.41		4,416		16,309
Year-to-date	126,000,681	$	111.55	$	14,055	$	16,309


(a)	Excludes commissions cost.


(b)	Represents the amount remaining under the $19.4 billion repurchase program that was authorized by the Board of Directors on June 28, 2017.


(c)	The $188 million unused portion under the prior Board authorization was canceled when the $20.7 billion program was authorized.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.



Exhibit No.		Description of Exhibit

15		Letter re: Unaudited Interim Financial Information.^(a)

31.1		Certification.^(a)

31.2		Certification.^(a)

32		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.^(b)

101.INS		The instance document does not appear in the interactive data file because its XBRL ~~Instance Document.~~tags are embedded within the inline XBRL document.^(a)(c)
101.SCH		XBRL Taxonomy Extension Schema Document.^(a)
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.^(a)
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document.^(a)
101.LAB		XBRL Taxonomy Extension Label Linkbase Document.^(a)
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.^(a)


(a)	Filed herewith.


(b)	Furnished herewith. This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

(c)

Pursuant to Rule 405 of Regulation S-T, includes the following financial information included in the Firm’s Quarterly Report on Form 10-Q for the quarterly period ended ~~March 31,~~September 30, 2018, formatted in XBRL (eXtensible Business Reporting Language) interactive data files: (i) the Consolidated statements of income (unaudited) for the three and nine months ended ~~March 31,~~September 30, 2018 and 2017, (ii) the Consolidated statements of comprehensive income (unaudited) for the three and nine months ended ~~March 31,~~September 30, 2018 and 2017, (iii) the Consolidated balance sheets (unaudited) as of ~~March 31,~~September 30, 2018, and December 31, 2017, (iv) the Consolidated statements of changes in stockholders’ equity (unaudited) for the ~~three~~nine months ended ~~March 31,~~September 30, 2018 and 2017, (v) the Consolidated statements of cash flows (unaudited) for the ~~three~~nine months ended ~~March 31,~~September 30, 2018 and 2017, and (vi) the Notes to Consolidated Financial Statements (unaudited).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

JPMorgan Chase & Co.

(Registrant)



By:	/s/ Nicole Giles
	Nicole Giles
	Managing Director and Corporate Controller
	(Principal Accounting Officer)



Date:	~~May 2,~~October 31, 2018

INDEX TO EXHIBITS



Exhibit No.		Description of Exhibit

15		Letter re: Unaudited Interim Financial Information.

31.1		Certification.

31.2		Certification.

32		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.†

101.INS		The instance document does not appear in the interactive data file because its XBRL ~~Instance Document.~~tags are embedded within the inline XBRL document.
101.SCH		XBRL Taxonomy Extension Schema Document.
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB		XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.

†		This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

~~168~~186



For the quarterly period ended	Commission file
~~March 31,~~September 30, 2018	number 1-5805



Delaware	13-2624428
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

270 Park Avenue, New York, New York	10017
(Address of principal executive offices)	(Zip Code)



Large accelerated filer x	Accelerated filer	o

Non-accelerated filer ~~(Do not check if a smaller reporting company)~~o	Smaller reporting company	o

	Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o



Part I – Financial information		Page
Item 1.	Financial Statements.
	Consolidated Financial Statements – JPMorgan Chase & Co.:
	Consolidated statements of income (unaudited) for the three and nine months ended ~~March 31,~~September 30, 2018 and 2017	7486
	Consolidated statements of comprehensive income (unaudited) for the three and nine months ended ~~March 31,~~September 30, 2018 and 2017	7587
	Consolidated balance sheets (unaudited) at ~~March 31,~~September 30, 2018 and December 31, 2017	7688
	Consolidated statements of changes in stockholders’ equity (unaudited) for the ~~three~~nine months ended ~~March 31,~~September 30, 2018 and 2017	7789
	Consolidated statements of cash flows (unaudited) for the ~~three~~nine months ended ~~March 31,~~September 30, 2018 and 2017	7890
	Notes to Consolidated Financial Statements (unaudited)	7991
	Report of Independent Registered Public Accounting Firm	~~154~~172
	Consolidated Average Balance Sheets, Interest and Rates (unaudited) for the three and nine months ended ~~March 31,~~September 30, 2018 and 2017	~~155~~173
	Glossary of Terms and Acronyms and Line of Business Metrics	~~156~~175
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.
	Consolidated Financial Highlights	3
	Introduction	4
	Executive Overview	5
	Consolidated Results of Operations	8
	Consolidated Balance Sheets and Cash Flows Analysis	1012
	Off-Balance Sheet Arrangements	1315
	Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures	14
	~~Business Segment Results~~	16
	~~Enterprise-Wide Risk Management~~Business Segment Results	3019
	~~Capital~~Enterprise-Wide Risk Management	3242
	~~Liquidity~~Capital Risk Management	3844
	~~Consumer Credit Portfolio~~Liquidity Risk Management	4549
	~~Wholesale~~Consumer Credit Portfolio	5057
	~~Investment~~Wholesale Credit Portfolio ~~Risk Management~~	6062
	~~Market~~Investment Portfolio Risk Management	6172
	~~Country~~Market Risk Management	6673
	Country Risk Management	78
	Critical Accounting Estimates Used by the Firm	6779
	Accounting and Reporting Developments	7082
	Forward-Looking Statements	7385
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	~~164~~183
Item 4.	Controls and Procedures.	~~164~~183
Part II – Other information
Item 1.	Legal Proceedings.	~~164~~183
Item 1A.	Risk Factors.	~~164~~183
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	~~164~~183
Item 3.	Defaults Upon Senior Securities.	~~165~~184
Item 4.	Mine Safety Disclosures.	~~165~~184
Item 5.	Other Information.	~~165~~184
Item 6.	Exhibits.	~~166~~184



CCB ROE ~~25%~~31%		• Average core loans up 8%6%; average deposits of ~~$660~~$674 billion up 6%4% • Client investment assets of ~~$276~~$298 billion, up ~~13%, with record net flows this quarter~~14% • Credit card sales volume up 12% and merchant processing volume up ~~15%~~14%
CIB ROE ~~22%~~14%		• ~~Maintained~~ #1 ~~ranking for~~ Global Investment Banking fees with ~~8.1%~~8.7% wallet share ~~in 1Q18~~year-to-date • ~~Record~~ Equity Markets revenue of ~~$2.0~~$1.6 billion, up 17% • Treasury Services revenue up ~~14%~~12% and Securities Services revenue up ~~16%~~5%
CB ROE ~~20%~~21%		• Average loan balances ~~of $202 billion,~~ up 6%4% • Strong credit quality with 0a net recovery of 3 bps ~~net charge-off rate~~
AWM ROE ~~34%~~31%		• ~~Record average~~Average loan balances ~~of $133 billion,~~ up 12% • Assets under management (“AUM”) of ~~$2.0~~$2.1 trillion, up ~~10%~~7%


(unaudited) As of or for the period ended, (in millions, except per share, ratio, headcount data and where otherwise noted)																				(unaudited) As of or for the period ended, (in millions, except per share, ratio, headcount data and where otherwise noted)																	Nine months ended Sept. 30,
	(unaudited) As of or for the period ended, (in millions, except per share, ratio, headcount data and where otherwise noted)	1Q18			4Q17			3Q17				2Q17				1Q17					3Q18			2Q18			1Q18			4Q17			3Q17				2018			2017
Selected income statement data	Selected income statement data																			Selected income statement data
Total net revenue	Total net revenue	$	27,907		$	24,457		$	25,578			$	25,731			$	24,939			Total net revenue	$	27,260		$	27,753		$	27,907		$	24,457		$	25,578			$	82,920		$	76,248
Total noninterest expense	Total noninterest expense	16,080			14,895			14,570				14,767				15,283				Total noninterest expense	15,623			15,971			16,080			14,895			14,570				47,674			44,620
Pre-provision profit	Pre-provision profit	11,827			9,562			11,008				10,964				9,656				Pre-provision profit	11,637			11,782			11,827			9,562			11,008				35,246			31,628
Provision for credit losses	Provision for credit losses	1,165			1,308			1,452				1,215				1,315				Provision for credit losses	948			1,210			1,165			1,308			1,452				3,323			3,982
Income before income tax expense	Income before income tax expense	10,662			8,254			9,556				9,749				8,341				Income before income tax expense	10,689			10,572			10,662			8,254			9,556				31,923			27,646
Income tax expense	Income tax expense	1,950			4,022			2,824				2,720				1,893				Income tax expense	2,309			2,256			1,950			4,022			2,824				6,515			7,437
Net income	Net income	$	8,712		$	4,232		$	6,732			$	7,029			$	6,448			Net income	$	8,380		$	8,316		$	8,712		$	4,232		$	6,732			$	25,408		$	20,209
Earnings per share data	Earnings per share data																			Earnings per share data
Net income: Basic	Net income: Basic	$	2.38		$	1.08		$	1.77			$	1.83			$	1.66			Net income: Basic	$	2.35		$	2.31		$	2.38		$	1.08		$	1.77			$	7.04		$	5.26
Diluted	Diluted	2.37			1.07			1.76				1.82				1.65				Diluted	2.34			2.29			2.37			1.07			1.76				7.00			5.22
Average shares: Basic	Average shares: Basic	3,458.3			3,489.7			3,534.7				3,574.1				3,601.7				Average shares: Basic	3,376.1			3,415.2			3,458.3			3,489.7			3,534.7				3,416.5			3,570.9
Diluted	Diluted	3,479.5			3,512.2			3,559.6				3,599.0				3,630.4				Diluted	3,394.3			3,434.7			3,479.5			3,512.2			3,559.6				3,436.2			3,597.0
Market and per common share data	Market and per common share data																			Market and per common share data
Market capitalization	Market capitalization	374,423			366,301			331,393				321,633				312,078				Market capitalization	375,239			350,204			374,423			366,301			331,393				375,239			331,393
Common shares at period-end	Common shares at period-end	3,404.8			3,425.3			3,469.7				3,519.0				3,552.8				Common shares at period-end	3,325.4			3,360.9			3,404.8			3,425.3			3,469.7				3,325.4			3,469.7
Share price:^(a)	Share price:^(a)																			Share price:^(a)
High	High	$	119.33		$	108.46		$	95.88			$	92.65			$	93.98			High	$	119.24		$	115.15		$	119.33		$	108.46		$	95.88			$	119.33		$	95.88
Low	Low	103.98			94.96			88.08				81.64				83.03				Low	102.20			103.11			103.98			94.96			88.08				102.20			81.64
Close	Close	109.97			106.94			95.51				91.40				87.84				Close	112.84			104.20			109.97			106.94			95.51				112.84			95.51
Book value per share	Book value per share	67.59			67.04			66.95				66.05				64.68				Book value per share	69.52			68.85			67.59			67.04			66.95				69.52			66.95
Tangible book value per share (“TBVPS”)^(b)	Tangible book value per share (“TBVPS”)^(b)	54.05			53.56			54.03				53.29				52.04				Tangible book value per share (“TBVPS”)^(b)	55.68			55.14			54.05			53.56			54.03				55.68			54.03
Cash dividends declared per share	Cash dividends declared per share	0.56			0.56			0.56				0.50				0.50				Cash dividends declared per share	0.80			0.56			0.56			0.56			0.56				1.92			1.56
Selected ratios and metrics	Selected ratios and metrics																			Selected ratios and metrics
Return on common equity (“ROE”)		15		%	7		%	11		%		12		%		11		%
Return on tangible common equity (“ROTCE”)^(b)		19			8			13				14				13
Return on assets		1.37			0.66			1.04				1.10				1.03
Return on common equity (“ROE”) ^(c)																				Return on common equity (“ROE”) ^(c)	14		%	14		%	15		%	7		%	11		%		14		%	11		%
Return on tangible common equity (“ROTCE”)^(b)(c)																				Return on tangible common equity (“ROTCE”)^(b)(c)	17			17			19			8			13				18			14
Return on assets^(c)																				Return on assets^(c)	1.28			1.28			1.37			0.66			1.04				1.31			1.06
Overhead ratio	Overhead ratio	58			61			57				57				61				Overhead ratio	57			58			58			61			57				57			59
Loans-to-deposits ratio	Loans-to-deposits ratio	63			64			63				63				63				Loans-to-deposits ratio	65			65			63			64			63				65			63
High quality liquid assets (“HQLA”) (in billions)^(c)		$	539		$	560		$	568			$	541			$	528
Liquidity coverage ratio (“LCR”) (average)(d)	Liquidity coverage ratio (“LCR”) (average)(d)	115		%	119		%	120		%		115		%		NA				Liquidity coverage ratio (“LCR”) (average)(d)	115			115			115			119			120				115			118
Common equity Tier 1 (“CET1”) capital ratio^(d)(e)	Common equity Tier 1 (“CET1”) capital ratio^(d)(e)	11.8			12.2			12.5			^(h)	12.5			^(h)	12.4			^(h)	Common equity Tier 1 (“CET1”) capital ratio^(d)(e)	12.0			12.0			11.8			12.2			12.5			(h)	12.0			12.5			(h)
Tier 1 capital ratio^(d)(e)	Tier 1 capital ratio^(d)(e)	13.5			13.9			14.1			^(h)	14.2			^(h)	14.1			^(h)	Tier 1 capital ratio^(d)(e)	13.6			13.6			13.5			13.9			14.1			(h)	13.6			14.1			(h)
Total capital ratio^(d)(e)	Total capital ratio^(d)(e)	15.3			15.9			16.1				16.0				15.6				Total capital ratio^(d)(e)	15.4			15.5			15.3			15.9			16.1				15.4			16.1
Tier 1 leverage ratio^(d)(e)	Tier 1 leverage ratio^(d)(e)	8.2			8.3			8.4				8.5				8.4				Tier 1 leverage ratio^(d)(e)	8.2			8.2			8.2			8.3			8.4				8.2			8.4
Supplementary leverage ratio (“SLR”)^(e)(f)	Supplementary leverage ratio (“SLR”)^(e)(f)	6.5		%	6.5		%	6.6		%		6.7		%		6.6		%		Supplementary leverage ratio (“SLR”)^(e)(f)	6.5			6.5			6.5			6.5			6.6				6.5			6.6
Selected balance sheet data (period-end)	Selected balance sheet data (period-end)																			Selected balance sheet data (period-end)
Trading assets	Trading assets	$	412,282		$	381,844		$	420,418			$	407,064			$	402,513			Trading assets	$	419,827		$	418,799		$	412,282		$	381,844		$	420,418			$	419,827		$	420,418
Investment securities	Investment securities	238,188			249,958			263,288				263,458				281,850				Investment securities	231,398			233,015			238,188			249,958			263,288				231,398			263,288
Loans	Loans	934,424			930,697			913,761				908,767				895,974				Loans	954,318			948,414			934,424			930,697			913,761				954,318			913,761
Core loans	Core loans	870,536			863,683			843,432				834,935				812,119				Core loans	899,006			889,433			870,536			863,683			843,432				899,006			843,432
Average core loans	Average core loans	861,089			850,166			837,522				824,583				805,382				Average core loans	894,279			877,640			861,089			850,166			837,522				877,774			822,611
Total assets	Total assets	2,609,785			2,533,600			2,563,074				2,563,174				2,546,290				Total assets	2,615,183			2,590,050			2,609,785			2,533,600			2,563,074				2,615,183			2,563,074
Deposits	Deposits	1,486,961			1,443,982			1,439,027				1,439,473				1,422,999				Deposits	1,458,762			1,452,122			1,486,961			1,443,982			1,439,027				1,458,762			1,439,027
Long-term debt	Long-term debt	274,449			284,080			288,582				292,973				289,492				Long-term debt	270,124			273,114			274,449			284,080			288,582				270,124			288,582
Common stockholders’ equity	Common stockholders’ equity	230,133			229,625			232,314				232,415				229,795				Common stockholders’ equity	231,192			231,390			230,133			229,625			232,314				231,192			232,314
Total stockholders’ equity	Total stockholders’ equity	256,201			255,693			258,382				258,483				255,863				Total stockholders’ equity	258,956			257,458			256,201			255,693			258,382				258,956			258,382
Headcount	Headcount	253,707			252,539			251,503				249,257				246,345				Headcount	255,313			252,942			253,707			252,539			251,503				255,313			251,503
Credit quality metrics	Credit quality metrics																			Credit quality metrics
Allowance for credit losses	Allowance for credit losses	$	14,482		$	14,672		$	14,648			$	14,480			$	14,490			Allowance for credit losses	$	14,225		$	14,367		$	14,482		$	14,672		$	14,648			$	14,225		$	14,648
Allowance for loan losses to total retained loans	Allowance for loan losses to total retained loans	1.44		%	1.47		%	1.49		%		1.49		%		1.52		%		Allowance for loan losses to total retained loans	1.39		%	1.41		%	1.44		%	1.47		%	1.49		%		1.39		%	1.49		%
Allowance for loan losses to retained loans excluding purchased credit-impaired loans^(f)(g)	Allowance for loan losses to retained loans excluding purchased credit-impaired loans^(f)(g)	1.25			1.27			1.29				1.28				1.31				Allowance for loan losses to retained loans excluding purchased credit-impaired loans^(f)(g)	1.23			1.22			1.25			1.27			1.29				1.23			1.29
Nonperforming assets	Nonperforming assets	$	6,364		$	6,426		$	6,154			$	6,432			$	6,826			Nonperforming assets	$	5,034		$	5,767		$	6,364		$	6,426		$	6,154			$	5,034		$	6,154
Net charge-offs^(g)	Net charge-offs^(g)	1,335			1,264			1,265				1,204				1,654				Net charge-offs^(g)	1,033			1,252			1,335			1,264			1,265				3,620			4,123			(i)
Net charge-off rate^(g)	Net charge-off rate^(g)	0.59		%	0.55		%	0.56		%		0.54		%		0.76		%		Net charge-off rate^(g)	0.43		%	0.54		%	0.59		%	0.55		%	0.56		%		0.52		%	0.62		%	(i)


(a)	Based on daily prices reported by the New York Stock Exchange.


(b)	TBVPS and ROTCE are non-GAAP financial measures. For a further discussion of these measures, ~~see~~refer to Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures on pages ~~14–15.~~16-18.


(c)	HQLA represents the average amount of assets that qualify for inclusion in the LCR for all periods presented except March 31, 2017, which represents the period-end balance. For additional information, see HQLA on page 38.Quarterly ratios are based upon annualized amounts.


(e)	Ratios presented are calculated under the Basel III Transitional capital rules and for the capital ratios represent the lower of the Standardized or Advanced ~~approach as required by the Collins Amendment of the Dodd-Frank Act (the “Collins Floor”). See~~approach. Refer to Capital Risk Management on pages ~~32-37~~44-48 for additional information on Basel ~~III and the Collins Floor.~~III.


~~(e)~~(f)	Effective January 1, 2018, the SLR was fully phased-in under Basel III. The SLR is defined as Tier 1 capital divided by the Firm’s total leverage exposure. ~~Prior period ratios~~Ratios prior to March 31, 2018 were calculated under the Basel III Transitional rules.


~~(g)~~	~~Excluding net charge-offs of $467 million related to the student loan portfolio sale, the net charge-off rates for the three months ended March 31, 2017 would have been 0.54%.~~69–71.


(h)	The prior period ratios have been revised to conform with the current period presentation.


(i)	Excluding net charge-offs of $467 million related to the student loan portfolio sale, the net charge-off rate for the nine months ended September 30, 2017 would have been 0.55%.


Financial performance of JPMorgan Chase	Financial performance of JPMorgan Chase								Financial performance of JPMorgan Chase
(unaudited) As of or for the period ended, (in millions, except per share data and ratios)	Three months ended March 31,								Three months ended September 30,								Nine months ended September 30,
	2018			2017			Change		2018			2017			Change		2018			2017			Change
Selected income statement data
Total net revenue	$	27,907		$	24,939		12	%	$	27,260		$	25,578		7	%	$	82,920		$	76,248		9	%
Total noninterest expense	16,080			15,283			5		15,623			14,570			7		47,674			44,620			7
Pre-provision profit	11,827			9,656			22		11,637			11,008			6		35,246			31,628			11
Provision for credit losses	1,165			1,315			(11	)	948			1,452			(35	)	3,323			3,982			(17	)
Net income	8,712			6,448			35		8,380			6,732			24		25,408			20,209			26
Diluted earnings per share	$	2.37		$	1.65		44		$	2.34		$	1.76		33		$	7.00		$	5.22		34
Selected ratios and metrics
Return on common equity	15		%	11		%			14		%	11		%			14		%	11		%
Return on tangible common equity	19			13					17			13					18			14
Book value per share	$	67.59		$	64.68		4		$	69.52		$	66.95		4		$	69.52		$	66.95		4
Tangible book value per share	54.05			52.04			4		55.68			54.03			3		55.68			54.03			3
Capital ratios^(a)
CET1^(b)	11.8		%	12.4		%			12.0		%	12.5		%			12.0		%	12.5		%
Tier 1 capital^(b)	13.5			14.1					13.6			14.1					13.6			14.1
Total capital	15.3			15.6					15.4			16.1					15.4			16.1



xYes	oNo



xYes	oNo



oYes	xNo



INTRODUCTION


(a)	Included operating lease income of ~~$1.0~~$1.2 billion and ~~$824~~$928 million for the three months ended ~~March 31, 2018~~, respectively, and ~~2017.~~$3.3 billion and $2.6 billion for the nine months ended , respectively.


•	in Fixed Income Markets, higher revenue in Currencies & Emerging Markets on increased activity levels, as well as in Commodities compared to a challenging prior year. The increase was partially offset by lower revenue in Credit and Securitized Products. For additional information, refer to CIB segment results on pages 26-31 , and Note 5.


–	a $250 million reduction in the allowance for loan losses in the residential real estate PCI portfolio, reflecting continued improvement in home prices and lower delinquencies,


–	a $150 million addition to the allowance for loan losses in the credit card portfolio, due to loan growth and higher loss rates, as anticipated, compared to a $300 million addition in the prior year,


–	lower net charge-offs in the residential real estate portfolio, largely driven by a recovery of approximately $80 million from a loan sale, and


–	lower net charge-offs in the auto portfolio as the prior year included $49 million of incremental charge-offs recorded in accordance with regulatory guidance


–	~~$102 million of~~ higher net charge-offs ~~primarily~~ in the credit card portfolio due to seasoning of ~~newer~~more recent vintages, ~~in line with expectations, partially offset by a decrease in net charge-offs in the residential real estate portfolio, reflecting continued improvement in home prices and delinquencies, and~~as anticipated


–•	the ~~absence of a $218 million write-down recorded~~decrease in the ~~prior year~~consumer provision was partially offset by a lower net benefit in ~~connection with~~ the wholesale provision in the current period, which includes net recoveries predominantly related to a loan sale ~~of the student loan portfolio.~~ in CIB.


–	higher net charge-offs in the credit card portfolio due to seasoning of more recent vintages, as anticipated


–	the prior year included a $218 million write-down recorded in connection with the sale of the student loan portfolio


(a)	Included Firmwide legal ~~expense~~expense/(benefit) of ~~$70~~$20 million and ~~$218~~$(107) million for the three months ended ~~March 31,~~September 30, 2018 and 2017, ~~respectively.~~respectively, and $90 million and $172 million for the nine months ended September 30, 2018 and 2017.


(b)	Included FDIC-related expense of ~~$383~~$349 million and ~~$381~~$353 million for the three months ended ~~March 31,~~September 30, 2018 and 2017, ~~respectively.~~respectively, and $1.1 billion for each of the nine months ended September 30, 2018 and 2017.

																	Selected Consolidated balance sheets data
(in millions)	Mar 31, 2018			Dec 31, 2017			Change		Sep 30, 2018			Dec 31, 2017			Change
Assets
Cash and due from banks	$	24,834		$	25,898		(4	)%	$	23,225		$	25,898		(10	)%
Deposits with banks	389,978			405,406			(4	)	395,872			405,406			(2	)
Federal funds sold and securities purchased under resale agreements	247,608			198,422			25		217,632			198,422			10
Securities borrowed	116,132			105,112			10		122,434			105,112			16
Trading assets:
Debt and equity instruments	355,368			325,321			9		359,765			325,321			11
Derivative receivables	56,914			56,523			1		60,062			56,523			6
Investment securities	238,188			249,958			(5	)	231,398			249,958			(7	)
Loans	934,424			930,697			—		954,318			930,697			3
Allowance for loan losses	(13,375		)	(13,604		)	(2	)	(13,128		)	(13,604		)	(3	)
Loans, net of allowance for loan losses	921,049			917,093			—		941,190			917,093			3
Accrued interest and accounts receivable	72,659			67,729			7		78,792			67,729			16
Premises and equipment	14,382			14,159			2		14,180			14,159			—
Goodwill, MSRs and other intangible assets	54,533			54,392			—		54,697			54,392			1
Other assets	118,140			113,587			4		115,936			113,587			2
Total assets	$	2,609,785		$	2,533,600		3	%	$	2,615,183		$	2,533,600		3	%


•	a reduction in the wholesale allowance primarily driven by loan sales related to a single name in the Oil & Gas portfolio in the first quarter of 2018 and other net portfolio activity.



Type of off-balance sheet arrangement	Location of disclosure	Page references
Special-purpose entities: variable interests and other obligations, including contingent obligations, arising from variable interests in nonconsolidated VIEs	~~See~~Refer to Note 13	~~130-135~~148-153
Off-balance sheet lending-related financial instruments, guarantees, and other commitments	~~See~~Refer to Note 20	~~145-148~~162-165


(a)	Predominantly recognized in CIB and CB business segments and Corporate.


(b)	The decrease in fully taxable-equivalent adjustments in the three and nine months ended ~~March 31,~~September 30, 2018, reflects the impact of the TCJA.


(a)	Interest includes the effect of related hedges. Taxable-equivalent amounts are used where applicable.


(b)	For a reconciliation of net interest income on a reported and managed basis, ~~see~~refer to reconciliation from the Firm’s reported U.S. GAAP results to managed basis on page ~~14.~~16.


(c)	For further information on CIB’s Markets businesses, ~~see~~refer to page ~~23.~~30.

OTC and OTC-cleared derivative payables containing downgrade triggers

(in millions)

September 30, 2018

December 31, 2017

Aggregate fair value of net derivative payables

Collateral posted