JPMorgan Cut Buybacks by 84%, Steering Capital Into New Loans

JPMorgan reported third-quarter results on Oct. 13. Earnings per share of $5.57 missed the $5.90 estimate, the bank's first miss in nearly three years.

The bigger change was not in profit but in what the bank handed back. It repurchased $1.06B of stock in the quarter, against $6.70B in the second quarter.

The stock closed down 0.82% at $331.57. Goldman Sachs, which also reported that morning, rose 4% before the open and ended the day down 0.23%.

Buybacks Fell to a Sixth in One Quarter

The cut does not look like a one-off pause. In each of the three quarters before Q2, the bank bought back more than $8.2B of stock.

In the release, Dimon listed large fiscal deficits, sticky inflation, elevated asset prices and rising rates as risks. On the call, he tied the cut to growth instead: "The positive news is the main reason the buyback is down."

JPMorgan made a decision that could read as a caution signal. Dimon says it is a demand signal.

The Capital Went Into a Growing Balance Sheet

CFO Jeremy Barnum said risk-weighted assets rose about $52B in the quarter, mostly from loan growth. Energy prices and market volatility also added to the total.

Regulators require banks to fund a set share of those assets with core equity capital. JPMorgan runs that ratio at 13.9%.

Money returned to shareholders can shrink even when profit does not. What decides it is how fast the balance sheet grows.

Dimon estimated the bank still holds about $30B of excess capital. The ratio stood at 14.8% a year ago and has fallen every quarter since 15.1% in Q2 2025.

Goldman Shows the Same Demand on Another Line

Goldman earned $17.01 a share, against estimates ranging from $12.86 to $13.65. Equities trading carried the quarter.

Equity financing is the revenue a bank earns by lending cash and stock to hedge funds. Its jump to $3.37B shows funds running more leverage, meaning positions built with borrowed money.

That lending also consumes capital. Goldman's core capital ratio fell from 12.9% to 12.4% in the quarter. At JPMorgan, equities revenue rose 49% to $5B, driven by prime and derivatives.

The Part That Does Not Fit

Goldman did not cut its buyback. It bought $3B of stock at an average of $1,048.73, and the shares closed Oct. 13 at $891.91, 15% below that average.

The banks reported with the 10-year Treasury yield near 5.2%. JPMorgan's fixed income trading revenue fell for the first time in more than two years. The bank also booked $658M of securities losses without explaining them.

Sources do not explain why the shares faded during the session. The same day, a selloff in memory chip stocks pulled the Nasdaq down 0.15%.

The chart shows the past three months of a stock now getting less buyback support.

What It Means for Investors

• The market did not punish JPMorgan's miss hard, and it has not yet priced whether the 84% buyback drop will last.
• Bank stocks used to steady buybacks, led by JPMorgan and Goldman Sachs, may lose part of that support while lending growth continues.
• Bank of America and Morgan Stanley report on the morning of Oct. 14, with September CPI at 8:30 a.m. ET; if both cut buybacks, this stops being one bank's choice.
• The risk to this thesis is an unwind of hedge fund leverage, and Dimon conceded that leverage is high in some areas.

This story is based on the Oct. 13 earnings releases from JPMorgan and Goldman Sachs, JPMorgan's second-quarter financial supplement, the company's call transcript, and same-day reporting from AP, Schwab, TIKR and 24/7 Wall St. Buyback figures are gross repurchases; JPMorgan's net repurchases in Q3 were $664M. The capital calculation is an approximation, not the bank's own breakdown. Share closes are Yahoo Finance data.