JPMorgan Chase & Co. (JPM) 8-K Results of Operations and Financial Condition

Exhibit 99.2

EARNINGS RELEASE FINANCIAL SUPPLEMENT

THIRD QUARTER 2008

JPMORGAN CHASE & CO.
TABLE OF CONTENTS

	Page
Consolidated Results
Consolidated Financial Highlights		2
Statements of Income		3
Consolidated Balance Sheets		4
Condensed Average Balance Sheets and Annualized Yields		5
Reconciliation from Reported to Managed Summary		6
Business Detail
Line of Business Financial Highlights — Managed Basis		7
Investment Bank		8
Retail Financial Services		11
Card Services — Managed Basis		16
Commercial Banking		19
Treasury & Securities Services		21
Asset Management		23
Corporate/Private Equity		26
Credit-Related Information		28
Supplemental Detail
Capital, Intangible Assets and Deposits		33
Glossary of Terms		34

The effects of Washington Mutual's banking operations are not included in the line of business financial highlights that follow as such operations did not have a material effect on the results of the quarter ended September 30, 2008, except as follows: (1) for JPMorgan Chase as a firm and for the Corporate/Private Equity segment, the charge to conform Washington Mutual's loan loss reserves and the extraordinary gain related to the transaction are reflected, and (2) for consolidated information as of September 30, 2008, such as the period end balance sheet, credit related statistics, capital ratios and headcount, the amounts presented reflect the acquisition of these banking operations.

Page 1

JPMORGAN CHASE & CO.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(in millions, except per share, ratio and headcount data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
SELECTED INCOME STATEMENT DATA
Total net revenue	$	14,737		$	18,399		$	16,890		$	17,384		$	16,112			(20	)%		(9	)%	$	50,026		$	53,988			(7	)%
Provision for credit losses		3,811			3,455			4,424			2,542			1,785			10			114			11,690			4,322			170
Provision for credit losses — accounting conformity (a)		1,976			—			—			—			—		NM			NM				1,976			—		NM
Total noninterest expense		11,137			12,177			8,931			10,720			9,327			(9	)		19			32,245			30,983			4
Income (loss) before extraordinary gain		(54	)		2,003			2,373			2,971			3,373			NM			NM			4,322			12,394			(65	)
Extraordinary gain (b)		581			—			—			—			—		NM			NM				581			—		NM
Net income		527			2,003			2,373			2,971			3,373			(74	)		(84	)		4,903			12,394			(60	)
PER COMMON SHARE:
Basic Earnings
Income (loss) before extraordinary gain		(0.06	)		0.56			0.70			0.88			1.00		NM			NM				1.19			3.63			(67	)
Net income		0.11			0.56			0.70			0.88			1.00			(80	)		(89	)		1.36			3.63			(63	)
Diluted Earnings
Income (loss) before extraordinary gain		(0.06	)		0.54			0.68			0.86			0.97		NM			NM				1.15			3.52			(67	)
Net income		0.11			0.54			0.68			0.86			0.97			(80	)		(89	)		1.32			3.52			(63	)
Cash dividends declared		0.38			0.38			0.38			0.38			0.38			—			—			1.14			1.10			4
Book value		36.95			37.02			36.94			36.59			35.72			—			3			36.95			35.72			3
Closing share price		46.70			34.31			42.95			43.65			45.82			36			2			46.70			45.82			2
Market capitalization		174,048			117,881			146,066			146,986			153,901			48			13			174,048			153,901			13
COMMON SHARES OUTSTANDING:
Weighted-average diluted shares outstanding		3,444.6	(g)		3,531.0			3,494.7			3,471.8			3,477.7			(2	)		(1	)		3,525.3			3,519.6			—
Common shares outstanding at period-end (c)		3,726.9			3,435.7			3,400.8			3,367.4			3,358.8			8			11			3,726.9			3,358.8			11
FINANCIAL RATIOS: (d)
Income (loss) before extraordinary gain:
Return on common equity (“ROE”)		(1	)%		6	%		8	%		10	%		11	%								4	%		14	%
Return on equity-goodwill (“ROE-GW”) (e)		(1	)		10			12			15			18									7			23
Return on assets (“ROA”)		(0.01	)		0.48			0.61			0.77			0.91									0.35			1.16
Net income:
ROE		1			6			8			10			11									5			14
ROE-GW (e)		2			10			12			15			18									8			23
ROA		0.12			0.48			0.61			0.77			0.91									0.39			1.16
CAPITAL RATIOS:
Tier 1 capital ratio		8.9	(h)		9.2			8.3			8.4			8.4
Total capital ratio		12.7	(h)		13.4			12.5			12.6			12.5
SELECTED BALANCE SHEET DATA (Period-end)
Total assets	$	2,251,469		$	1,775,670		$	1,642,862		$	1,562,147		$	1,479,575			27			52		$	2,251,469		$	1,479,575			52
Wholesale loans		288,445			229,359			231,297			213,076			197,728			26			46			288,445			197,728			46
Consumer loans		472,936			308,670			305,759			306,298			288,592			53			64			472,936			288,592			64
Deposits		969,783			722,905			761,626			740,728			678,091			34			43			969,783			678,091			43
Common stockholders’ equity		137,691			127,176			125,627			123,221			119,978			8			15			137,691			119,978			15
Headcount		228,452	(i)		195,594			182,166			180,667			179,847			17			27			228,452	(i)		179,847			27
LINE OF BUSINESS NET INCOME
Investment Bank	$	882		$	394		$	(87	)	$	124		$	296			124			198		$	1,189		$	3,015			(61	)
Retail Financial Services		247			606			(227	)		752			639			(59	)		(61	)		626			2,283			(73	)
Card Services		292			250			609			609			786			17			(63	)		1,151			2,310			(50	)
Commercial Banking		312			355			292			288			258			(12	)		21			959			846			13
Treasury & Securities Services		406			425			403			422			360			(4	)		13			1,234			975			27
Asset Management		351			395			356			527			521			(11	)		(33	)		1,102			1,439			(23	)
Corporate/Private Equity (f)		(1,963	)		(422	)		1,027			249			513			(365	)	NM				(1,358	)		1,526		NM
Net income	$	527		$	2,003		$	2,373		$	2,971		$	3,373			(74	)		(84	)	$	4,903		$	12,394			(60	)

(a)	The third quarter of 2008 included an accounting conformity loan loss reserve provision related to the acquisition of Washington Mutual’s banking operations.
(b)	JPMorgan Chase acquired the banking operations of Washington Mutual for $1.9 billion. The fair value of Washington Mutual net assets acquired exceeded the purchase price which resulted in negative goodwill. In accordance with SFAS 141, nonfinancial assets that are not held for sale were written down against that negative goodwill. The negative goodwill that remained after writing down nonfinancial assets was recognized as an extraordinary gain.
(c)	On September 30, 2008, the Firm issued $11.5 billion, or 284 million shares, of its common stock at $40.50 per share.
(d)	Ratios are based upon annualized amounts.
(e)	Net income applicable to common stock divided by total average common equity (net of goodwill). The Firm uses return on equity less goodwill, a non-GAAP financial measure, to evaluate the operating performance of the Firm. The Firm also utilizes this measure to facilitate comparisons to competitors.
(f)	The third quarter of 2008 included an accounting conformity loan loss reserve provision and an extraordinary gain related to the Washington Mutual transaction, as well as losses on preferred equity interests in Federal National Mortgage Association (“FNMA”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”). Prior periods included the after-tax impact of material litigation actions, tax audit benefits, equity earnings related to Bear Stearns and merger costs. See Corporate/Private Equity Financial Highlights for additional details.
(g)	Common equivalent shares have been excluded from the computation of diluted earnings per share for the third quarter of 2008, as the effect would be antidilutive.
(h)	Estimated.
(i)	Includes headcount related to the acquisition of Washington Mutual banking operations of 41,785.

Page 2

JPMORGAN CHASE & CO.
STATEMENTS OF INCOME
(in millions, except per share and ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
REVENUE
Investment banking fees	$	1,316		$	1,612		$	1,216		$	1,662		$	1,336			(18	)%		(1	)%	$	4,144		$	4,973			(17	)%
Principal transactions		(2,763	)		752			(803	)		165			650			NM			NM			(2,814	)		8,850			NM
Lending & deposit-related fees		1,168			1,105			1,039			1,066			1,026			6			14			3,312			2,872			15
Asset management, administration and commissions		3,485			3,628			3,596			3,896			3,663			(4	)		(5	)		10,709			10,460			2
Securities gains (losses)		424			647			33			148			237			(34	)		79			1,104			16			NM
Mortgage fees and related income		457			696			525			898			221			(34	)		107			1,678			1,220			38
Credit card income		1,771			1,803			1,796			1,857			1,777			(2	)		—			5,370			5,054			6
Other income		(115	)		(138	)		1,829			469			289			17			NM			1,576			1,360			16
Noninterest revenue		5,743			10,105			9,231			10,161			9,199			(43	)		(38	)		25,079			34,805			(28	)
Interest income		17,326			16,529			17,532			18,619			18,806			5			(8	)		51,387			52,768			(3	)
Interest expense		8,332			8,235			9,873			11,396			11,893			1			(30	)		26,440			33,585			(21	)
Net interest income		8,994			8,294			7,659			7,223			6,913			8			30			24,947			19,183			30
TOTAL NET REVENUE		14,737			18,399			16,890			17,384			16,112			(20	)		(9	)		50,026			53,988			(7	)
Provision for credit losses		3,811			3,455			4,424			2,542			1,785			10			114			11,690			4,322			170
Provision for credit losses — accounting conformity (a)		1,976			—			—			—			—			NM			NM			1,976			—			NM
NONINTEREST EXPENSE
Compensation expense		5,858			6,913			4,951			5,469			4,677			(15	)		25			17,722			17,220			3
Occupancy expense		766			669			648			659			657			14			17			2,083			1,949			7
Technology, communications and equipment expense		1,112			1,028			968			986			950			8			17			3,108			2,793			11
Professional & outside services		1,451			1,450			1,333			1,421			1,260			—			15			4,234			3,719			14
Marketing		453			413			546			570			561			10			(19	)		1,412			1,500			(6	)
Other expense		1,096			1,233			169			1,254			812			(11	)		35			2,498			2,560			(2	)
Amortization of intangibles		305			316			316			339			349			(3	)		(13	)		937			1,055			(11	)
Merger costs		96			155			—			22			61			(38	)		57			251			187			34
TOTAL NONINTEREST EXPENSE		11,137			12,177			8,931			10,720			9,327			(9	)		19			32,245			30,983			4
Income (loss) before income tax expense and extraordinary gain		(2,187	)		2,767			3,535			4,122			5,000			NM			NM			4,115			18,683			(78	)
Income tax expense (benefit) (b)		(2,133	)		764			1,162			1,151			1,627			NM			NM			(207	)		6,289			NM
Income (loss) before extraordinary gain		(54	)		2,003			2,373			2,971			3,373			NM			NM			4,322			12,394			(65	)
Extraordinary gain (c)		581			—			—			—			—			NM			NM			581			—			NM
NET INCOME	$	527		$	2,003		$	2,373		$	2,971		$	3,373			(74	)		(84	)	$	4,903		$	12,394			(60	)
DILUTED EARNINGS PER SHARE
Income (loss) before extraordinary gain	$	(0.06	)	$	0.54		$	0.68		$	0.86		$	0.97			NM			NM		$	1.15		$	3.52			(67	)
Extraordinary gain		0.17			—			—			—			—			NM			NM			0.17			—			NM
Net Income	$	0.11		$	0.54		$	0.68		$	0.86		$	0.97			(80	)		(89	)	$	1.32		$	3.52			(60	)
FINANCIAL RATIOS
Income (loss) before extraordinary gain:
ROE		(1	)%		6	%		8	%		10	%		11	%								4	%		14	%
ROE-GW		(1	)		10			12			15			18									7			23
ROA		(0.01	)		0.48			0.61			0.77			0.91									0.35			1.16
Net income:
ROE		1			6			8			10			11									5			14
ROE-GW		2			10			12			15			18									8			23
ROA		0.12			0.48			0.61			0.77			0.91									0.39			1.16
Effective income tax rate (b)		98			28			33			28			33									(5	)		34
Overhead ratio		76			66			53			62			58									64			57
EXCLUDING IMPACT OF MERGER COSTS (d)
Income (loss) before extraordinary gain	$	(54	)	$	2,003		$	2,373		$	2,971		$	3,373			NM			NM		$	4,322		$	12,394			(65	)
Less merger costs (after-tax)		60			96			—			14			38			(38	)		58			156			116			34
Income before extraordinary gain excluding merger costs	$	6		$	2,099		$	2,373		$	2,985		$	3,411			(100	)		(100	)	$	4,478		$	12,510			(64	)
Diluted Per Share:
Income (loss) before extraordinary gain	$	(0.06	)	$	0.54		$	0.68		$	0.86		$	0.97			NM			NM		$	1.15		$	3.52			(67	)
Less merger costs (after-tax)		0.02			0.03			—			—			0.01			(33	)		100			0.05			0.03			67
Income (loss) before extraordinary gain excluding merger costs	$	(0.04	)	$	0.57		$	0.68		$	0.86		$	0.98			NM			NM		$	1.20		$	3.55			(66	)

(a)	The third quarter of 2008 included an accounting conformity loan loss reserve provision related to the acquisition of Washington Mutual’s banking operations.
(b)	The income tax benefit in the third quarter and year-to-date 2008 is predominantly the result of reduced deferred tax liabilities on overseas earnings, as well as the tax benefit associated with the conforming loan loss reserve provision related to the acquisition of Washington Mutual’s banking operations.
(c)	JPMorgan Chase acquired the banking operations of Washington Mutual from the FDIC for $1.9 billion. The fair value of the net assets acquired from the FDIC exceeded the purchase price which resulted in negative goodwill. In accordance with SFAS 141, nonfinancial assets that are not held for sale were written down against that negative goodwill. The negative goodwill that remained after writing down nonfinancial assets was recognized as an extraordinary gain.
(d)	Net income excluding merger costs, a non-GAAP financial measure, is used by the Firm to facilitate comparison of results against the Firm’s ongoing operations and with other companies’ U.S. GAAP financial statements.

Page 3

JPMORGAN CHASE & CO.
CONSOLIDATED BALANCE SHEETS
(in millions)

																Sep 30, 2008
																Change
	Sep 30			Jun 30			Mar 31			Dec 31			Sep 30			Jun 30			Sep 30
	2008			2008			2008			2007			2007			2008			2007
ASSETS
Cash and due from banks	$	54,350		$	32,255		$	46,888		$	40,144		$	32,766			69	%		66	%
Deposits with banks		34,372			17,150			12,414			11,466			26,714			100			29
Federal funds sold and securities purchased under resale agreements		233,668			176,287			203,176			170,897			135,589			33			72
Securities borrowed		152,050			142,854			81,014			84,184			84,697			6			80
Trading assets:
Debt and equity instruments		401,609			409,608			386,170			414,273			389,119			(2	)		3
Derivative receivables		118,648			122,389			99,110			77,136			64,592			(3	)		84
Securities		150,779			119,173			101,647			85,450			97,706			27			54
Loans (net of allowance for loan losses)		742,329			524,783			525,310			510,140			478,207			41			55
Accrued interest and accounts receivable (a)		104,232			64,294			50,989			24,823			26,401			62			295
Premises and equipment		9,962			11,843			9,457			9,319			8,892			(16	)		12
Goodwill		46,121			45,993			45,695			45,270			45,335			—			2
Other intangible assets:
Mortgage servicing rights		17,048			11,617			8,419			8,632			9,114			47			87
Purchased credit card relationships		1,827			1,984			2,140			2,303			2,427			(8	)		(25	)
All other intangibles		3,653			3,675			3,815			3,796			3,959			(1	)		(8	)
Other assets		180,821			91,765			66,618			74,314			74,057			97			144
TOTAL ASSETS	$	2,251,469		$	1,775,670		$	1,642,862		$	1,562,147		$	1,479,575			27			52
LIABILITIES
Deposits	$	969,783		$	722,905		$	761,626		$	740,728		$	678,091			34			43
Federal funds purchased and securities sold under repurchase agreements		224,075			194,724			192,633			154,398			178,767			15			25
Commercial paper		54,480			50,151			50,602			49,596			33,978			9			60
Other borrowed funds		134,445			22,594			28,430			28,835			31,154			495			332
Trading liabilities:
Debt and equity instruments		76,213			87,841			78,982			89,162			80,748			(13	)		(6	)
Derivative payables		85,816			95,749			78,983			68,705			68,426			(10	)		25
Accounts payable, accrued expenses and other liabilities (including the allowance for lending-related commitments) (b)		260,563			171,004			106,088			94,476			86,524			52			201
Beneficial interests issued by consolidated VIEs		11,437			20,071			14,524			14,016			13,283			(43	)		(14	)
Long-term debt		271,416			260,192			189,995			183,862			173,696			4			56
Junior subordinated deferrable interest debentures held by trusts that issued guaranteed capital debt securities		17,398			17,263			15,372			15,148			14,930			1			17
TOTAL LIABILITIES		2,105,626			1,642,494			1,517,235			1,438,926			1,359,597			28			55
STOCKHOLDERS’ EQUITY
Preferred stock		8,152			6,000			—			—			—			36			NM
Common stock		3,942			3,658			3,658			3,658			3,658			8			8
Capital surplus		90,535			78,870			78,072			78,597			78,295			15			16
Retained earnings		55,217			56,313			55,762			54,715			53,064			(2	)		4
Accumulated other comprehensive income (loss)		(2,227	)		(1,566	)		(512	)		(917	)		(1,830	)		(42	)		(22	)
Shares held in RSU trust		(267	)		(269	)		—			—			—			1			NM
Treasury stock, at cost		(9,509	)		(9,830	)		(11,353	)		(12,832	)		(13,209	)		3			28
TOTAL STOCKHOLDERS’ EQUITY		145,843			133,176			125,627			123,221			119,978			10			22
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,251,469		$	1,775,670		$	1,642,862		$	1,562,147		$	1,479,575			27			52

(a)	Includes margin loans; receivables from brokers, dealers and clearing organizations; and securities fails.
(b)	Includes brokerage customer payables; payables to brokers, dealers and clearing organizations; and securities fails.

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JPMORGAN CHASE & CO.
CONDENSED AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS
(in millions, except rates)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
AVERAGE BALANCES
ASSETS
Deposits with banks	$	41,303		$	38,813		$	31,975		$	41,363		$	39,906			6	%		4	%	$	37,378		$	24,848			50	%
Federal funds sold and securities purchased under resale agreements		164,980			155,664			153,864			140,622			133,780			6			23			158,195			134,009			18
Securities borrowed		134,651			100,322			83,490			86,649			87,955			34			53			106,258			85,878			24
Trading assets — debt instruments		298,760			302,053			322,986			308,175			310,445			(1	)		(4	)		307,899			287,680			7
Securities		119,443			109,834			89,757			93,236			95,694			9			25			106,392			95,982			11
Loans		536,890			537,964			526,598			508,172			476,912			—			13			533,829			470,078			14
Other assets (a)		37,237			15,629			—			—			—			138			NM			17,694			—			NM
Total interest-earning assets		1,333,264			1,260,279			1,208,670			1,178,217			1,144,692			6			16			1,267,645			1,098,475			15
Trading assets — equity instruments		92,300			99,525			78,810			93,453			86,177			(7	)		7			90,220			86,923			4
Goodwill		45,947			45,781			45,699			45,321			45,276			—			1			45,809			45,194			1
Other intangible assets:
Mortgage servicing rights		11,811			9,947			8,273			8,795			9,290			19			27			10,017			8,487			18
All other intangible assets		5,512			5,823			6,202			6,220			6,532			(5	)		(16	)		5,845			6,840			(15	)
All other noninterest-earning assets		267,525			247,344			222,143			198,031			185,367			8			44			245,749			183,853			34
TOTAL ASSETS	$	1,756,359		$	1,668,699		$	1,569,797		$	1,530,037		$	1,477,334			5			19		$	1,665,285		$	1,429,772			16
LIABILITIES
Interest-bearing deposits	$	589,348		$	612,305		$	600,132		$	587,297		$	540,937			(4	)		9		$	600,554		$	517,856			16
Federal funds purchased and securities sold under repurchase agreements		200,032			203,348			179,897			171,450			206,174			(2	)		(3	)		194,446			204,942			(5	)
Commercial paper		47,579			47,323			47,584			48,821			26,511			1			79			47,496			24,726			92
Other borrowings (b)		91,756			92,309			107,552			99,259			104,995			(1	)		(13	)		97,185			100,492			(3	)
Other liabilities (c)		70,065			19,168			—			—			—			266			NM			29,891			—			NM
Beneficial interests issued by consolidated VIEs		11,431			17,990			14,082			14,183			14,454			(36	)		(21	)		14,490			14,691			(1	)
Long-term debt		261,385			229,336			200,354			191,797			177,851			14			47			230,472			162,929			41
Total interest-bearing liabilities		1,271,596			1,221,779			1,149,601			1,112,807			1,070,922			4			19			1,214,534			1,025,636			18
Noninterest-bearing liabilities		351,023			315,965			295,616			295,670			287,436			11			22			320,978			286,369			12
TOTAL LIABILITIES		1,622,619			1,537,744			1,445,217			1,408,477			1,358,358			6			19			1,535,512			1,312,005			17
Preferred stock		7,100			4,549			—			—			—			56			NM			3,895			—			NM
Common stockholders’ equity		126,640			126,406			124,580			121,560			118,976			—			6			125,878			117,767			7
TOTAL STOCKHOLDERS’ EQUITY		133,740			130,955			124,580			121,560			118,976			2			12			129,773			117,767			10
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,756,359		$	1,668,699		$	1,569,797		$	1,530,037		$	1,477,334			5			19		$	1,665,285		$	1,429,772			16
AVERAGE RATES
INTEREST-EARNING ASSETS
Deposits with banks		3.04	%		3.87	%		4.22	%		4.95	%		5.06	%								3.66	%		4.85	%
Federal funds sold and securities purchased under resale agreements		3.76			3.84			3.80			4.41			4.83									3.80			4.92
Securities borrowed		2.07			2.29			3.56			4.77			5.60									2.53			5.45
Trading assets — debt instruments		6.06			5.59			5.75			5.84			6.09									5.80			5.90
Securities		5.09			5.27			5.47			5.58			5.69									5.26			5.68
Loans		6.31			6.36			7.10			7.60			7.80									6.58			7.66
Other assets (a)		3.29			3.97			—			—			—									3.49			—
Total interest-earning assets		5.22			5.34			5.88			6.30			6.55									5.47			6.46
INTEREST-BEARING LIABILITIES
Interest-bearing deposits		2.26			2.36			3.09			3.84			4.13									2.57			4.12
Federal funds purchased and securities sold under repurchase agreements		2.63			2.73			3.31			4.35			5.18									2.87			5.16
Commercial paper		2.05			2.17			3.41			4.40			4.68									2.54			4.82
Other borrowings (b)		4.32			4.28			5.03			5.02			4.90									4.57			4.88
Other liabilities (c)		0.90			1.32			—			—			—									0.99			—
Beneficial interests issued by consolidated VIEs		2.87			2.24			3.78			4.36			4.52									2.90			3.86
Long-term debt		3.31			3.27			3.82			3.90			3.99									3.44			3.87
Total interest-bearing liabilities		2.61			2.71			3.45			4.06			4.41									2.91			4.38
INTEREST RATE SPREAD		2.61	%		2.63	%		2.43	%		2.24	%		2.14	%								2.56	%		2.08	%
NET YIELD ON INTEREST-EARNING ASSETS		2.73	%		2.71	%		2.59	%		2.46	%		2.43	%								2.68	%		2.37	%
NET YIELD ON INTEREST-EARNING ASSETS ADJUSTED FOR SECURITIZATIONS		3.06	%		3.06	%		2.95	%		2.80	%		2.75	%								3.02	%		2.70	%

(a)	Predominantly margin loans.
(b)	Includes securities sold but not yet purchased.
(c)	Includes brokerage customer payables.

Page 5

JPMORGAN CHASE & CO.
RECONCILIATION FROM REPORTED TO MANAGED SUMMARY
(in millions)

The Firm prepares its Consolidated financial statements using accounting principles generally accepted in the United States of America (“U.S. GAAP”). That presentation, which is referred to as “reported basis,” provides the reader with an understanding of the Firm’s results that can be tracked consistently from year to year and enables a comparison of the Firm’s performance with other companies’ U.S. GAAP financial statements.

In addition to analyzing the Firm’s results on a reported basis, management reviews the Firm’s and the lines’ of business results on a “managed” basis, which is a non-GAAP financial measure. The Firm’s definition of managed basis starts with the reported U.S. GAAP results and includes certain reclassifications that assume credit card loans securitized by Card Services remain on the balance sheet and presents revenue on a fully taxable-equivalent (“FTE”) basis. These adjustments do not have any impact on net income as reported by the lines of business or by the Firm as a whole. The impact of these adjustments are summarized below. For additional information about managed basis, please refer to the Glossary of Terms on page 34.

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
CREDIT CARD INCOME
Credit card income — reported	$	1,771		$	1,803		$	1,796		$	1,857		$	1,777			(2	)%		—	%	$	5,370		$	5,054			6	%
Impact of:
Credit card securitizations		(843	)		(843	)		(937	)		(885	)		(836	)		—			(1	)		(2,623	)		(2,370	)		(11	)
Credit card income — managed	$	928		$	960		$	859		$	972		$	941			(3	)		(1	)	$	2,747		$	2,684			2
OTHER INCOME
Other income — reported	$	(115	)	$	(138	)	$	1,829		$	469		$	289			17			NM		$	1,576		$	1,360			16
Impact of:
Tax-equivalent adjustments		323			247			203			182			192			31			68			773			501			54
Other income — managed	$	208		$	109		$	2,032		$	651		$	481			91			(57	)	$	2,349		$	1,861			26
TOTAL NONINTEREST REVENUE
Total noninterest revenue — reported	$	5,743		$	10,105		$	9,231		$	10,161		$	9,199			(43	)		(38	)	$	25,079		$	34,805			(28	)
Impact of:
Credit card securitizations		(843	)		(843	)		(937	)		(885	)		(836	)		—			(1	)		(2,623	)		(2,370	)		(11	)
Tax-equivalent adjustments		323			247			203			182			192			31			68			773			501			54
Total noninterest revenue — managed	$	5,223		$	9,509		$	8,497		$	9,458		$	8,555			(45	)		(39	)	$	23,229		$	32,936			(29	)
NET INTEREST INCOME
Net interest income — reported	$	8,994		$	8,294		$	7,659		$	7,223		$	6,913			8			30		$	24,947		$	19,183			30
Impact of:
Credit card securitizations		1,716			1,673			1,618			1,504			1,414			3			21			5,007			4,131			21
Tax-equivalent adjustments		155			202			124			90			95			(23	)		63			481			287			68
Net interest income — managed	$	10,865		$	10,169		$	9,401		$	8,817		$	8,422			7			29		$	30,435		$	23,601			29
TOTAL NET REVENUE
Total net revenue — reported	$	14,737		$	18,399		$	16,890		$	17,384		$	16,112			(20	)		(9	)	$	50,026		$	53,988			(7	)
Impact of:
Credit card securitizations		873			830			681			619			578			5			51			2,384			1,761			35
Tax-equivalent adjustments		478			449			327			272			287			6			67			1,254			788			59
Total net revenue — managed	$	16,088		$	19,678		$	17,898		$	18,275		$	16,977			(18	)		(5	)	$	53,664		$	56,537			(5	)
PROVISION FOR CREDIT LOSSES
Provision for credit losses — reported	$	5,787		$	3,455		$	4,424		$	2,542		$	1,785			67			224		$	13,666		$	4,322			216
Impact of:
Credit card securitizations		873			830			681			619			578			5			51			2,384			1,761			35
Provision for credit losses — managed	$	6,660		$	4,285		$	5,105		$	3,161		$	2,363			55			182		$	16,050		$	6,083			164
INCOME TAX EXPENSE
Income tax expense (benefit) — reported	$	(2,133	)	$	764		$	1,162		$	1,151		$	1,627			NM			NM		$	(207	)	$	6,289			NM
Impact of:
Tax-equivalent adjustments		478			449			327			272			287			6			67			1,254			788			59
Income tax expense (benefit) — managed	$	(1,655	)	$	1,213		$	1,489		$	1,423		$	1,914			NM			NM		$	1,047		$	7,077			(85	)

Page 6

JPMORGAN CHASE & CO.
LINE OF BUSINESS FINANCIAL HIGHLIGHTS — MANAGED BASIS
(in millions, except ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
TOTAL NET REVENUE (FTE)
Investment Bank	$	4,035		$	5,470		$	3,011		$	3,172		$	2,946			(26	)%		37	%	$	12,516		$	14,998			(17	)%
Retail Financial Services		4,875			5,015			4,702			4,815			4,201			(3	)		16			14,592			12,664			15
Card Services		3,887			3,775			3,904			3,971			3,867			3			1			11,566			11,264			3
Commercial Banking		1,125			1,106			1,067			1,084			1,009			2			11			3,298			3,019			9
Treasury & Securities Services		1,953			2,019			1,913			1,930			1,748			(3	)		12			5,885			5,015			17
Asset Management		1,961			2,064			1,901			2,389			2,205			(5	)		(11	)		5,926			6,246			(5	)
Corporate/Private Equity		(1,748	)		229			1,400			914			1,001			NM			NM			(119	)		3,331			NM
TOTAL NET REVENUE	$	16,088		$	19,678		$	17,898		$	18,275		$	16,977			(18	)		(5	)	$	53,664		$	56,537			(5	)
NET INCOME
Investment Bank	$	882		$	394		$	(87	)	$	124		$	296			124			198		$	1,189		$	3,015			(61	)
Retail Financial Services		247			606			(227	)		752			639			(59	)		(61	)		626			2,283			(73	)
Card Services		292			250			609			609			786			17			(63	)		1,151			2,310			(50	)
Commercial Banking		312			355			292			288			258			(12	)		21			959			846			13
Treasury & Securities Services		406			425			403			422			360			(4	)		13			1,234			975			27
Asset Management		351			395			356			527			521			(11	)		(33	)		1,102			1,439			(23	)
Corporate/Private Equity (a)		(1,963	)		(422	)		1,027			249			513			(365	)	NM				(1,358	)		1,526			NM
TOTAL NET INCOME	$	527		$	2,003		$	2,373		$	2,971		$	3,373			(74	)		(84	)	$	4,903		$	12,394			(60	)
AVERAGE EQUITY (b)
Investment Bank	$	26,000		$	23,319		$	22,000		$	21,000		$	21,000			11			24		$	23,781		$	21,000			13
Retail Financial Services		17,000			17,000			17,000			16,000			16,000			—			6			17,000			16,000			6
Card Services		14,100			14,100			14,100			14,100			14,100			—			—			14,100			14,100			—
Commercial Banking		7,000			7,000			7,000			6,700			6,700			—			4			7,000			6,435			9
Treasury & Securities Services		3,500			3,500			3,500			3,000			3,000			—			17			3,500			3,000			17
Asset Management		5,500			5,066			5,000			4,000			4,000			9			38			5,190			3,834			35
Corporate/Private Equity		53,540			56,421			55,980			56,760			54,176			(5	)		(1	)		55,307			53,398			4
TOTAL AVERAGE EQUITY	$	126,640		$	126,406		$	124,580		$	121,560		$	118,976			—			6		$	125,878		$	117,767			7
RETURN ON EQUITY (b)
Investment Bank		13	%		7	%		(2	)%		2	%		6	%								7	%		19	%
Retail Financial Services		6			14			(5	)		19			16									5			19
Card Services		8			7			17			17			22									11			22
Commercial Banking		18			20			17			17			15									18			18
Treasury & Securities Services		46			49			46			56			48									47			43
Asset Management		25			31			29			52			52									28			50

(a)

The third quarter of 2008 included an accounting conformity loan loss reserve provision and an extraordinary gain related to the Washington Mutual transaction, as well as losses on preferred equity interests in FNMA and Freddie Mac. Prior periods included the after-tax impact of material litigation actions, tax audit benefits, equity earnings related to Bear Stearns and merger costs. See Corporate/Private Equity Financial Highlights for additional details.

(b)

Each business segment is allocated capital by taking into consideration stand-alone peer comparisons, economic risk measures and regulatory capital requirements. The amount of capital assigned to each business is referred to as equity.

Note on business segment presentation:

The effects of Washington Mutual’s banking operations are not included in the line of business finanical highlights that follow as such operations did not have a material effect on the results of the quarter ended September 30, 2008, except as follows: (1) for JPMorgan Chase as a firm and for the Corporate/Private Equity segment, the charge to conform Washington Mutual’s loan loss reserves and the extraordinary gain related to the transaction are reflected, and (2) for consolidated information as of September 30, 2008, such as the period end balance sheet, credit related statistics, capital ratios and headcount, the amounts presented reflect the acquisition of these banking operations.

Page 7

JPMORGAN CHASE & CO.
INVESTMENT BANK
FINANCIAL HIGHLIGHTS
(in millions, except ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT
REVENUE
Investment banking fees	$	1,593		$	1,735		$	1,206		$	1,657		$	1,330			(8	)%		20	%	$	4,534		$	4,959			(9	)%
Principal transactions		(922	)		838			(798	)		(623	)		(435	)	NM				(112	)		(882	)		5,032		NM
Lending & deposit-related fees		118			105			102			142			118			12			—			325			304			7
Asset management, administration and commissions		847			709			744			705			712			19			19			2,300			1,996			15
All other income		(279	)		(226	)		(66	)		(166	)		(76	)		(23	)		(267	)		(571	)		88		NM
Noninterest revenue		1,357			3,161			1,188			1,715			1,649			(57	)		(18	)		5,706			12,379			(54	)
Net interest income		2,678			2,309			1,823			1,457			1,297			16			106			6,810			2,619			160
TOTAL NET REVENUE (a)		4,035			5,470			3,011			3,172			2,946			(26	)		37			12,516			14,998			(17	)
Provision for credit losses		234			398			618			200			227			(41	)		3			1,250			454			175
Credit reimbursement from TSS (b)		31			30			30			30			31			3			—			91			91			—
NONINTEREST EXPENSE
Compensation expense		2,162			3,132			1,241			1,561			1,178			(31	)		84			6,535			6,404			2
Noncompensation expense		1,654			1,602			1,312			1,450			1,200			3			38			4,568			3,659			25
TOTAL NONINTEREST EXPENSE		3,816			4,734			2,553			3,011			2,378			(19	)		60			11,103			10,063			10
Income (loss) before income tax expense		16			368			(130	)		(9	)		372			(96	)		(96	)		254			4,572			(94	)
Income tax expense (benefit) (c)		(866	)		(26	)		(43	)		(133	)		76		NM			NM				(935	)		1,557		NM
NET INCOME (LOSS)	$	882		$	394		$	(87	)	$	124		$	296			124			198		$	1,189		$	3,015			(61	)
FINANCIAL RATIOS
ROE		13	%		7	%		(2	)%		2	%		6	%								7	%		19	%
ROA		0.39			0.19			(0.05	)		0.07			0.17									0.19			0.59
Overhead ratio		95			87			85			95			81									89			67
Compensation expense as a % of total net revenue		54			57			41			49			40									52			43
REVENUE BY BUSINESS
Investment banking fees:
Advisory	$	576		$	370		$	483		$	646		$	595			56			(3	)	$	1,429		$	1,627			(12	)
Equity underwriting		518			542			359			544			267			(4	)		94			1,419			1,169			21
Debt underwriting		499			823			364			467			468			(39	)		7			1,686			2,163			(22	)
Total investment banking fees		1,593			1,735			1,206			1,657			1,330			(8	)		20			4,534			4,959			(9	)
Fixed income markets		815			2,347			466			615			687			(65	)		19			3,628			5,724			(37	)
Equity markets		1,650			1,079			976			578			537			53			207			3,705			3,325			11
Credit portfolio		(23	)		309			363			322			392		NM			NM				649			990			(34	)
Total net revenue	$	4,035		$	5,470		$	3,011		$	3,172		$	2,946			(26	)		37		$	12,516		$	14,998			(17	)
REVENUE BY REGION
Americas	$	1,052		$	3,165		$	536		$	1,128		$	1,016			(67	)		4		$	4,753		$	7,037			(32	)
Europe/Middle East/Africa		2,509			1,512			1,641			1,334			1,389			66			81			5,662			5,967			(5	)
Asia/Pacific		474			793			834			710			541			(40	)		(12	)		2,101			1,994			5
Total net revenue	$	4,035		$	5,470		$	3,011		$	3,172		$	2,946			(26	)		37		$	12,516		$	14,998			(17	)

(a)	Total net revenue included tax-equivalent adjustments, predominantly due to tax-exempt income from municipal bond investments and income tax credits related to affordable housing investments, of $427 million, $404 million, $289 million, $230 million, and $255 million for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $1.1 billion and $697 million for year-to-date 2008 and 2007, respectively.
(b)	Treasury & Securities Services (“TSS”) was charged a credit reimbursement related to certain exposures managed within the Investment Bank credit portfolio on behalf of clients shared with TSS.
(c)	The income tax benefit in the third quarter and year-to-date 2008 is predominantly the result of reduced deferred tax liabilities on overseas earnings.

Page 8

JPMORGAN CHASE & CO.
INVESTMENT BANK
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except headcount and ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
SELECTED BALANCE SHEET DATA (Period-end)
Equity	$	33,000		$	26,000		$	22,000		$	21,000		$	21,000			27	%		57	%	$	33,000		$	21,000			57	%
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	890,040		$	814,860		$	755,828		$	735,685		$	710,665			9			25		$	820,497		$	688,730			19
Trading assets — debt and equity instruments		360,821			367,184			369,456			371,842			372,212			(2	)		(3	)		365,802			355,708			3
Trading assets — derivative receivables		105,462			99,395			90,234			74,659			63,017			6			67			98,390			59,336			66
Loans:
Loans retained (a)		69,022			76,239			74,106			68,928			61,919			(9	)		11			73,107			59,996			22
Loans held-for-sale & loans at fair value		17,612			20,440			19,612			24,977			17,315			(14	)		2			19,215			15,278			26
Total loans		86,634			96,679			93,718			93,905			79,234			(10	)		9			92,322			75,274			23
Adjusted assets (b)		694,459			676,777			662,419			644,573			625,619			3			11			677,945			600,688			13
Equity		26,000			23,319			22,000			21,000			21,000			11			24			23,781			21,000			13
Headcount		30,989			37,057			25,780			25,543			25,691			(16	)		21			30,989			25,691			21
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs (recoveries)	$	13		$	(8	)	$	13		$	(9	)	$	67		NM				(81	)	$	18		$	45			(60	)
Nonperforming assets:
Nonperforming loans (c)		436			313			321			353			265			39			65			436			265			65
Other nonperforming assets		147			177			118			100			60			(17	)		145			147			60			145
Allowance for credit losses:
Allowance for loan losses		2,654			2,429			1,891			1,329			1,112			9			139			2,654			1,112			139
Allowance for lending-related commitments		463			469			607			560			568			(1	)		(18	)		463			568			(18	)
Total allowance for credit losses		3,117			2,898			2,498			1,889			1,680			8			86			3,117			1,680			86
Net charge-off (recovery) rate (a) (d)		0.07	%		(0.04	)%		0.07	%		(0.05	)%		0.43	%								0.03	%		0.10	%
Allowance for loan losses to average loans (a) (d)		3.85			3.19	(e)		2.55	(e)		1.93			1.80									3.63	(e)		1.85
Allowance for loan losses to nonperforming loans (c)		657			843			683			439			585									657			585
Nonperforming loans to average loans		0.50			0.32			0.34			0.38			0.33									0.47			0.35

(a)	Loans retained included credit portfolio loans, leveraged leases and other accrual loans, and excluded loans at fair value.
(b)	Adjusted assets, a non-GAAP financial measure, equals total assets minus (1) securities purchased under resale agreements and securities borrowed less securities sold, not yet purchased; (2) assets of variable interest entities (“VIEs”) consolidated under FIN 46R; (3) cash and securities segregated and on deposit for regulatory and other purposes; and (4) goodwill and intangibles. The amount of adjusted assets is presented to assist the reader in comparing the Investment Bank’s (“IB”) asset and capital levels to other investment banks in the securities industry. Asset-to-equity leverage ratios are commonly used as one measure to assess a company’s capital adequacy. The IB believes an adjusted asset amount that excludes the assets discussed above, which are considered to have a low risk profile, provides a more meaningful measure of balance sheet leverage in the securities industry.
(c)	Nonperforming loans included loans held-for-sale and loans at fair value of $32 million, $25 million, $44 million, $50 million, and $75 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, which were excluded from the allowance coverage ratios. Nonperforming loans excluded distressed loans held-for-sale that were purchased as part of IB’s proprietary activities.
(d)	Loans held-for-sale & loans at fair value were excluded when calculating the allowance coverage ratio and net charge-off (recovery) rate.
(e)	Excluding the impact of a loan originated in March 2008 to Bear Stearns, the adjusted ratio would be 3.46%, 2.61%, and 3.76% for the quarters ended June 30, 2008, and March 31, 2008, and year-to-date 2008, respectively. The average balance of the loan extended to Bear Stearns was $6.0 billion, $1.7 billion, and $2.6 billion for the quarters ended June 30, 2008, and March 31, 2008, and year-to-date 2008, respectively.

Page 9

JPMORGAN CHASE & CO.
INVESTMENT BANK
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio and rankings data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
MARKET RISK — AVERAGE TRADING AND CREDIT PORTFOLIO VAR (a)
Trading activities:
Fixed income	$	183		$	155		$	120		$	103		$	98			18	%		87	%	$	150		$	72			108	%
Foreign exchange		20			26			35			31			23			(23	)		(13	)		27			21			29
Equities		80			30			31			63			35			167			129			47			43			9
Commodities and other		41			31			28			29			28			32			46			33			34			(3	)
Diversification (b)		(104	)		(92	)		(92	)		(102	)		(72	)		(13	)		(44	)		(95	)		(68	)		(40	)
Total trading VAR (c)		220			150			122			124			112			47			96			162			102			59
Credit portfolio VAR (d)		47			35			30			26			17			34			176			38			14			171
Diversification (b)		(49	)		(36	)		(30	)		(27	)		(22	)		(36	)		(123	)		(39	)		(16	)		(144	)
Total trading and credit portfolio VAR	$	218		$	149		$	122		$	123		$	107			46			104		$	161			100			61

	September 30, 2008 YTD					Full Year 2007
	Market					Market
MARKET SHARES AND RANKINGS (e)	Share			Rankings		Share			Rankings
Global debt, equity and equity-related		10	%		#1		8	%		# 2
Global syndicated loans		12	%		#1		13	%		# 1
Global long-term debt (f)		9	%		#1		7	%		# 3
Global equity and equity-related (g)		12	%		#1		9	%		# 2
Global announced M&A (h)		24	%		#3		27	%		# 4
U.S. debt, equity and equity-related		15	%		#1		10	%		# 2
U.S. syndicated loans		27	%		#1		24	%		# 1
U.S. long-term debt (f)		15	%		#1		10	%		# 2
U.S. equity and equity-related (g)		17	%		#1		11	%		# 5
U.S. announced M&A (h)		33	%		#3		28	%		# 3

(a)	Results for second quarter 2008 include one month of the combined Firm’s results and two months of heritage JPMorgan Chase & Co. results. All prior periods reflect heritage JPMorgan Chase & Co. results.
(b)	Average VARs were less than the sum of the VARs of their market risk components, which was due to risk offsets resulting from portfolio diversification. The diversification effect reflected the fact that the risks were not perfectly correlated. The risk of a portfolio of positions is usually less than the sum of the risks of the positions themselves.
(c)	Trading VAR includes predominantly all trading activities in IB; however, particular risk parameters of certain products are not fully captured, for example, correlation risk or the credit spread sensitivity of certain mortgage products. Trading VAR does not include VAR related to held-for-sale funded loans and unfunded commitments, nor the debit valuation adjustments (“DVA”) taken on derivative and structured liabilities to reflect the credit quality of the Firm. Trading VAR also does not include the MSR portfolio or VAR related to other corporate functions, such as Corporate/Private Equity.
(d)	Includes VAR on derivative credit valuation adjustments, hedges of the credit valuation adjustment and mark-to-market hedges of the retained loan portfolio, which are all reported in principal transactions revenue. This VAR does not include the retained loan portfolio.
(e)	Source: Thomson Reuters Securities data. September 30, 2008 YTD results are pro forma for the acquisition of Bear Stearns. Full year 2007 results represent heritage-JPMorgan Chase & Co. only.
(f)	Includes asset-backed securities, mortgage-backed securities and municipal securities.
(g)	Includes rights offerings; U.S. domiciled equity and equity-related transactions.
(h)	Source: Thomson Reuters Securities data. Global announced M&A is based upon rank value; all other rankings were based upon proceeds, with full credit to each book manager/equal if joint. Because of joint assignments, market share of all participants will add up to more than 100%. Global and U.S. announced M&A market share and ranking for 2007 include transactions withdrawn since December 31, 2007. U.S. announced M&A represents any U.S. involvement ranking.

Page 10

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS
(in millions, except ratio and headcount data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT
REVENUE
Lending & deposit-related fees	$	538		$	497		$	461		$	496		$	492			8	%		9	%	$	1,496		$	1,385			8	%
Asset management, administration and commissions		346			375			377			332			336			(8	)		3			1,098			943			16
Securities gains (losses)		—			—			—			1			—			—			—			—			—			—
Mortgage fees and related income		437			696			525			888			229			(37	)		91			1,658			1,206			37
Credit card income		204			194			174			174			167			5			22			572			472			21
All other income		206			198			154			219			296			4			(30	)		558			687			(19	)
Noninterest revenue		1,731			1,960			1,691			2,110			1,520			(12	)		14			5,382			4,693			15
Net interest income		3,144			3,055			3,011			2,705			2,681			3			17			9,210			7,971			16
TOTAL NET REVENUE		4,875			5,015			4,702			4,815			4,201			(3	)		16			14,592			12,664			15
Provision for credit losses		1,678			1,332			2,492			1,051			680			26			147			5,502			1,559			253
NONINTEREST EXPENSE
Compensation expense		1,120			1,184			1,160			1,113			1,087			(5	)		3			3,464			3,256			6
Noncompensation expense		1,552			1,386			1,310			1,313			1,265			12			23			4,248			3,753			13
Amortization of intangibles		100			100			100			114			117			—			(15	)		300			351			(15	)
TOTAL NONINTEREST EXPENSE		2,772			2,670			2,570			2,540			2,469			4			12			8,012			7,360			9
Income (loss) before income tax expense		425			1,013			(360	)		1,224			1,052			(58	)		(60	)		1,078			3,745			(71	)
Income tax expense (benefit)		178			407			(133	)		472			413			(56	)		(57	)		452			1,462			(69	)
NET INCOME (LOSS)	$	247		$	606		$	(227	)	$	752		$	639			(59	)		(61	)	$	626		$	2,283			(73	)
FINANCIAL RATIOS
ROE		6	%		14	%		(5	)%		19	%		16	%								5	%		19	%
Overhead ratio		57			53			55			53			59									55			58
Overhead ratio excluding core deposit intangibles (a)		55			51			53			50			56									53			55
SELECTED BALANCE SHEET DATA (Period-end)
Assets	$	228,982		$	230,695		$	227,916		$	225,908		$	216,754			(1	)		6		$	228,982		$	216,754			6
Loans:
Loans retained		187,548			187,595			184,211			181,016			172,498			—			9			187,548			172,498			9
Loans held-for-sale & loans at fair value (b)		9,655			16,282			18,000			16,541			18,274			(41	)		(47	)		9,655			18,274			(47	)
Total loans		197,203			203,877			202,211			197,557			190,772			(3	)		3			197,203			190,772			3
Deposits		222,574			223,121			230,854			221,129			216,135			—			3			222,574			216,135			3
Equity	$	25,000		$	17,000		$	17,000		$	16,000		$	16,000			47			56			25,000			16,000			56
SELECTED BALANCE SHEET DATA (Average)
Assets	$	230,428		$	232,725		$	227,560		$	221,557		$	214,852			(1	)		7		$	230,239		$	216,218			6
Loans:
Loans retained		187,429			185,993			182,220			176,140			168,495			1			11			185,222			165,479			12
Loans held-for-sale & loans at fair value (b)		16,037			20,492			17,841			17,538			19,560			(22	)		(18	)		18,116			24,289			(25	)
Total loans		203,466			206,485			200,061			193,678			188,055			(1	)		8			203,338			189,768			7
Deposits		222,180			226,487			225,555			219,226			216,904			(2	)		2			224,731			217,669			3
Equity		17,000			17,000			17,000			16,000			16,000			—			6			17,000			16,000			6
Headcount		67,265			69,550			70,095			69,465			68,528			(3	)		(2	)		67,265			68,528			(2	)

(a)

Retail Financial Services uses the overhead ratio (excluding the amortization of core deposit intangibles (“CDI”)), a non-GAAP financial measure, to evaluate the underlying expense trends of the business. Including CDI amortization expense in the overhead ratio calculation results in a higher overhead ratio in the earlier years and a lower overhead ratio in later years; this method would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio excludes Regional Banking’s core deposit intangible amortization expense related to The Bank of New York transaction and the Bank One merger of $99 million, $99 million, $99 million, $113 million, and $116 million for the quarters ending September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $297 million and $347 million for year-to-date 2008 and 2007, respectively.

(b)

Loans included prime mortgage loans originated with the intent to sell, which were accounted for at fair value. These loans, classified as trading assets on the Consolidated balance sheets, totaled $8.1 billion, $14.1 billion, $13.5 billion, $12.6 billion, and $14.4 billion at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. Average loans included prime mortgage loans, classified as trading assets on the Consolidated balance sheets, of $14.5 billion, $16.9 billion, $13.4 billion, $13.5 billion, and $14.1 billion for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $14.9 billion and $11.4 billion for the year-to-date 2008 and 2007, respectively.

Page 11

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs	$	1,196		$	941		$	789		$	522		$	350			27	%		242	%	$	2,926		$	805			263	%
Nonperforming loans (a) (b) (c)		4,443			3,515			2,992			2,399			1,820			26			144			4,443			1,820			144
Nonperforming assets (a) (b) (c)		5,131			4,123			3,524			2,886			2,232			24			130			5,131			2,232			130
Allowance for loan losses		4,957			4,475			4,208			2,634			2,105			11			135			4,957			2,105			135
Net charge-off rate (d) (e)		2.44	%		1.99	%		1.71	%		1.17	%		0.82	%								2.05	%		0.65	%
Allowance for loan losses to ending loans (d)		2.64			2.39			2.28			1.46			1.22									2.64			1.22
Allowance for loan losses to nonperforming loans (d)		117			134			147			113			117									117			117
Nonperforming loans to total loans		2.25			1.72			1.48			1.21			0.95									2.25			0.95
REGIONAL BANKING
Noninterest revenue	$	1,049		$	1,022		$	878		$	940		$	1,013			3			4		$	2,949		$	2,783			6
Net interest income		2,652			2,571			2,543			2,363			2,325			3			14			7,766			6,920			12
Total net revenue		3,701			3,593			3,421			3,303			3,338			3			11			10,715			9,703			10
Provision for credit losses		1,552			1,213			2,324			915			574			28			170			5,089			1,301			291
Noninterest expense		1,773			1,778			1,794			1,785			1,760			—			1			5,345			5,238			2
Income (loss) before income tax expense		376			602			(697	)		603			1,004			(38	)		(63	)		281			3,164			(91	)
Net income (loss)		218			354			(433	)		371			611			(38	)		(64	)		139			1,930			(93	)
ROE		7	%		11	%		(14	)		% 12	%		21	%								1	%		22	%
Overhead ratio		48			49			52			54			53									50			54
Overhead ratio excluding core deposit intangibles (f)		45			47			50			51			49									47			50

(a)	Nonperforming loans included loans held-for-sale and loans accounted for at fair value of $207 million, $180 million, $129 million, $69 million, and $17 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. Certain of these loans are classified as trading assets on the Consolidated balance sheets.
(b)	Nonperforming loans and assets excluded (1) loans eligible for repurchase as well as loans repurchased from Governmental National Mortgage Association (“GNMA”) pools that are insured by U.S. government agencies of $1.8 billion, $1.9 billion, $1.8 billion, $1.5 billion, and $1.3 billion at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and (2) education loans that are 90 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $405 million, $ 371 million, $252 million, $279 million, and $241 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. These amounts for GNMA and education loans are excluded, as reimbursement is proceeding normally.
(c)	During the second quarter of 2008, the policy for classifying subprime mortgage and home equity loans as nonperforming was changed to conform with all other home lending products. Prior period nonperforming loans and assets have been revised to conform with this change.
(d)	Loans held-for-sale and loans accounted for at fair value under SFAS 159 were excluded when calculating the allowance coverage ratio and the net charge-off rate.
(e)	The net charge-off rate for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, and December 31, 2007, excluded $45 million, $19 million, $14 million, and $2 million, respectively, and the nine months ended September 30, 2008, excluded $78 million of charge-offs related to prime mortgage loans held by Corporate/Private Equity.
(f)	Regional Banking uses the overhead ratio (excluding the amortization of core deposit intangibles (“CDI”)), a non-GAAP financial measure, to evaluate the underlying expense trends of the business. Including CDI amortization expense in the overhead ratio calculation results in a higher overhead ratio in the earlier years and a lower overhead ratio in later years; this inclusion would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio excludes Regional Banking’s core deposit intangible amortization expense related to The Bank of New York transaction and the Bank One merger of $99 million, $99 million, $99 million, $113 million, and $116 million for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $297 million and $347 million for year-to-date 2008 and 2007, respectively.

Page 12

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
REGIONAL BANKING (continued)
BUSINESS METRICS (in billions)
Home equity origination volume	$	2.6		$	5.3		$	6.7		$	9.8		$	11.2			(51	)%		(77	)%	$	14.6		$	38.5			(62	)%
End of period loans owned:
Home equity	$	94.6		$	95.1		$	95.0		$	94.8		$	93.0			(1	)		2		$	94.6		$	93.0			2
Mortgage (a)		13.6			14.9			15.9			15.7			12.3			(9	)		11			13.6			12.3			11
Business banking		16.5			16.4			15.8			15.4			14.9			1			11			16.5			14.9			11
Education		15.3			13.0			12.4			11.0			10.2			18			50			15.3			10.2			50
Other loans (b)		1.0			1.1			1.1			2.3			2.4			(9	)		(58	)		1.0			2.4			(58	)
Total end of period loans		141.0			140.5			140.2			139.2			132.8			—			6			141.0			132.8			6
End of period deposits:
Checking	$	69.0		$	69.1		$	69.1		$	67.0		$	64.5			—			7		$	69.0		$	64.5			7
Savings		105.0			105.8			105.4			96.0			95.7			(1	)		10			105.0			95.7			10
Time and other		37.5			37.0			44.6			48.7			46.5			1			(19	)		37.5			46.5			(19	)
Total end of period deposits		211.5			211.9			219.1			211.7			206.7			—			2			211.5			206.7			2
Average loans owned:
Home equity	$	94.8		$	95.1		$	95.0		$	94.0		$	91.8			—			3		$	95.0		$	89.1			7
Mortgage loans (a)		14.3			15.6			15.8			13.7			9.9			(8	)		44			15.2			9.2			65
Business banking		16.4			16.1			15.6			15.1			14.8			2			11			16.1			14.5			11
Education (c)		14.1			12.7			12.0			10.6			9.8			11			44			12.9			10.4			24
Other loans (b)		1.0			1.1			1.5			2.3			2.4			(9	)		(58	)		1.2			2.6			(54	)
Total average loans (c)		140.6			140.6			139.9			135.7			128.7			—			9			140.4			125.8			12
Average deposits:
Checking	$	68.0		$	68.5		$	66.3		$	64.5		$	64.9			(1	)		5		$	63.4		$	66.5			(5	)
Savings		105.5			105.8			100.3			96.3			97.1			—			9			103.9			97.4			7
Time and other		36.7			39.6			47.7			47.7			43.3			(7	)		(15	)		45.5			42.5			7
Total average deposits		210.2			213.9			214.3			208.5			205.3			(2	)		2			212.8			206.4			3
Average assets		148.7			149.3			149.9			147.1			140.6			—			6			149.3			138.1			8
Average equity		12.4			12.4			12.4			11.8			11.8			—			5			12.4			11.8			5
CREDIT DATA AND QUALITY STATISTICS
30+ day delinquency rate (d) (e)		4.18	%		3.61	%		3.23	%		3.03	%		2.39	%								4.18	%		2.39	%
Net charge-offs
Home equity	$	663		$	511		$	447		$	248		$	150			30			342		$	1,621		$	316			413
Mortgage		318			211			163			73			40			51		NM				692			86		NM
Business banking		55			51			40			38			33			8			67			146			88			66
Other loans		34			48			21			28			23			(29	)		48			103			88			17
Total net charge-offs		1,070			821			671			387			246			30			335			2,562			578			343
Net charge-off rate
Home equity		2.78	%		2.16	%		1.89	%		1.05	%		0.65	%								2.28	%		0.47	%
Mortgage (f)		7.59			4.95			3.79			2.06			1.60									5.40			1.25
Business banking		1.33			1.27			1.03			1.00			0.88									1.21			0.81
Other loans		0.97			1.80			0.89			1.21			1.01									1.21			1.28
Total net charge-off rate (c) (f)		2.92			2.35			1.94			1.16			0.78									2.41			0.63
Nonperforming assets (g) (h)	$	4,310		$	3,506		$	3,047		$	2,574		$	2,034			23			112		$	4,310		$	2,034			112

(a)	Balance reported predominantly reflected subprime mortgage loans owned.
(b)	Included commercial loans derived from community development activities prior to March 31, 2008.
(c)	Average loans included loans held-for-sale of $1.2 billion, $3.1 billion, $4.0 billion, $3.7 billion, and $3.2 billion for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $2.8 billion and $3.8 billion for year-to-date 2008 and 2007, respectively. These amounts were excluded when calculating the net charge-off rate.
(d)	Excluded loans eligible for repurchase as well as loans repurchased from GNMA pools that are insured by U.S. government agencies of $2.0 billion, $1.5 billion, $1.5 billion, $1.2 billion, and $979 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. These amounts are excluded as reimbursement is proceeding normally.
(e)	Excluded loans that are 30 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $787 million, $594 million, $534 million, $663 million, and $590 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. These amounts are excluded as reimbursement is proceeding normally.
(f)	The net charge-off rate for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, and December 31, 2007, excluded $45 million, $19 million, $14 million, and $2 million, respectively, and the nine months ended September 30, 2008, excluded $78 million of charge-offs related to prime mortgage loans held by Corporate/Private Equity.
(g)	Nonperforming assets excluded (1) loans eligible for repurchase as well as loans repurchased from Governmental National Mortgage Association (“GNMA”) pools that are insured by U.S. government agencies of $1.8 billion, $1.9 billion, $1.8 billion, $1.5 billion, and $1.3 billion at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and (2) education loans that are 90 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $405 million, $371 million, $252 million, $279 million, and $241 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. These amounts for GNMA and education loans are excluded, as reimbursement is proceeding normally.
(h)	During the second quarter of 2008, the policy for classifying subprime mortgage and home equity loans as nonperforming was changed to conform with all other home lending products. Prior period nonperforming assets have been revised to conform with this change.

Page 13

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
REGIONAL BANKING (continued)
RETAIL BRANCH BUSINESS METRICS
Investment sales volume	$	4,389		$	5,211		$	4,084		$	4,114		$	4,346			(16	)%		1	%	$	13,684		$	14,246			(4	)%
Number of:
Branches		3,179			3,157			3,146			3,152			3,096			1			3			3,179			3,096			3
ATMs		9,308			9,310			9,237			9,186			8,943			—			4			9,308			8,943			4
Personal bankers		10,201			9,995			9,826			9,650			9,503			2			7			10,201			9,503			7
Sales specialists		3,959			4,116			4,133			4,105			4,025			(4	)		(2	)		3,959			4,025			(2	)
Active online customers (in thousands)		7,315			7,180			6,454			5,918			5,706			2			28			7,315			5,706			28
Checking accounts (in thousands)		11,672			11,336			11,068			10,839			10,644			3			10			11,672			10,644			10
MORTGAGE BANKING
Production revenue	$	254		$	597		$	576		$	321		$	176			(57	)		44		$	1,427		$	1,039			37
Net mortgage servicing revenue:
Loan servicing revenue		695			678			634			665			629			3			10			2,007			1,845			9
Changes in MSR asset fair value:
Due to inputs or assumptions in model		(786	)		1,519			(632	)		(766	)		(810	)	NM				3			101			250			(60	)
Other changes in fair value		(390	)		(394	)		(425	)		(393	)		(377	)		1			(3	)		(1,209	)		(1,138	)		(6	)
Total changes in MSR asset fair value		(1,176	)		1,125			(1,057	)		(1,159	)		(1,187	)	NM				1			(1,108	)		(888	)		(25	)
Derivative valuation adjustments and other		893			(1,478	)		598			1,232			788		NM				13			13			(353	)	NM
Total net mortgage servicing revenue		412			325			175			738			230			27			79			912			604			51
Total net revenue		666			922			751			1,059			406			(28	)		64			2,339			1,643			42
Noninterest expense		747			649			536			518			485			15			54			1,932			1,469			32
Income (loss) before income tax expense		(81	)		273			215			541			(79	)	NM				(3	)		407			174			134
Net income (loss)		(50	)		169			132			332			(48	)	NM				(4	)		251			107			135
ROE		(8	)%		28	%		22	%		66			(10	)%								14	%		7	%
Business metrics (in billions)
Third-party mortgage loans serviced (ending)	$	681.8		$	659.1		$	627.1		$	614.7		$	600.0			3			14		$	681.8		$	600.0			14
MSR net carrying value (ending)		10.6			10.9			8.4			8.6			9.1			(3	)		16			10.6			9.1			16
Avg mortgage loans held-for-sale & loans at fair value (a)		14.9			17.4			13.8			13.8			16.4			(14	)		(9	)		15.4			20.4			(25	)
Average assets		35.4			36.2			32.2			30.6			31.4			(2	)		13			34.6			35.0			(1	)
Average equity		2.4			2.4			2.4			2.0			2.0			—			20			2.4			2.0			20
Mortgage origination volume by channel (in billions)
Retail	$	8.4		$	12.5		$	12.6		$	9.9		$	11.1			(33	)		(24	)	$	33.5		$	35.6			(6	)
Wholesale		5.9			9.1			10.6			10.2			9.8			(35	)		(40	)		25.6			32.5			(21	)
Correspondent		13.2			17.0			12.0			9.5			7.2			(22	)		83			42.2			18.4			129
CNT (negotiated transactions)		10.2			17.5			11.9			10.4			11.1			(42	)		(8	)		39.6			32.9			20
Total		37.7			56.1			47.1			40.0			39.2			(33	)		(4	)		140.9			119.4			18

(a) Included $14.5 billion, $16.9 billion, $13.4 billion, $13.5 billion, and $14.1 billion of prime mortgage loans at fair value for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $14.9 billion and $11.4 billion for year-to-date 2008 and 2007, respectively. These loans are classified as trading assets on the Consolidated balance sheets.

Page 14

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
AUTO FINANCE
Noninterest revenue	$	157		$	155		$	151		$	142		$	140			1	%		12	%	$	463		$	409			13	%
Net interest income		349			343			379			308			307			2			14			1,071			898			19
Total net revenue		506			498			530			450			447			2			13			1,534			1,307			17
Provision for credit losses		124			117			168			133			96			6			29			409			247			66
Noninterest expense		252			243			240			237			224			4			13			735			653			13
Income before income tax expense		130			138			122			80			127			(6	)		2			390			407			(4	)
Net income		79			83			74			49			76			(5	)		4			236			246			(4	)
ROE		14	%		15	%		13	%		9	%		14	%								14	%		15	%
ROA		0.68			0.71			0.65			0.44			0.70									0.68			0.76
Business metrics (in billions)
Auto origination volume	$	3.8		$	5.6		$	7.2		$	5.6		$	5.2			(32	)		(27	)	$	16.6		$	15.7			6
End-of-period loans and lease related assets
Loans outstanding	$	43.2		$	44.7		$	44.4		$	42.0		$	40.3			(3	)		7		$	43.2		$	40.3			7
Lease financing receivables		0.1			0.2			0.3			0.3			0.6			(50	)		(83	)		0.1			0.6			(83	)
Operating lease assets		2.2			2.1			2.0			1.9			1.8			5			22			2.2			1.8			22
Total end-of-period loans and lease related assets		45.5			47.0			46.7			44.2			42.7			(3	)		7			45.5			42.7			7
Average loans and lease related assets
Loans outstanding	$	43.8		$	44.7		$	42.9		$	41.1		$	39.9			(2	)		10		$	43.8		$	39.8			10
Lease financing receivables		0.1			0.2			0.3			0.5			0.7			(50	)		(86	)		0.2			1.1			(82	)
Operating lease assets		2.2			2.1			1.9			1.9			1.8			5			22			2.1			1.7			24
Total average loans and lease related assets		46.1			47.0			45.1			43.5			42.4			(2	)		9			46.1			42.6			8
Average assets		46.4			47.3			45.5			43.8			42.9			(2	)		8			46.4			43.1			8
Average equity		2.3			2.3			2.3			2.2			2.2			—			5			2.3			2.2			5
Credit quality statistics
30+ day delinquency rate		1.82	%		1.57	%		1.44	%		1.85	%		1.65	%								1.82	%		1.65	%
Net charge-offs
Loans	$	123		$	118		$	117		$	132		$	98			4			26		$	358		$	218			64
Lease receivables		1			1			1			1			1			—			—			3			3			—
Total net charge-offs		124			119			118			133			99			4			25			361			221			63
Net charge-off rate
Loans		1.12	%		1.06	%		1.10	%		1.27	%		0.97	%								1.09	%		0.73	%
Lease receivables		3.98			2.01			1.34			0.79			0.57									2.00			0.36
Total net charge-off rate		1.12			1.07			1.10			1.27			0.97									1.10			0.72
Nonperforming assets	$	239		$	164		$	160		$	188		$	156			46			53		$	239		$	156			53

Page 15

JPMORGAN CHASE & CO.
CARD SERVICES - MANAGED BASIS
FINANCIAL HIGHLIGHTS
(in millions, except ratio data and where otherwise noted)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT
REVENUE
Credit card income	$	633		$	673		$	600		$	712		$	692			(6	)%		(9	)%	$	1,906		$	1,973			(3	)%
All other income		13			91			119			122			67			(86	)		(81	)		223			239			(7	)
Noninterest revenue		646			764			719			834			759			(15	)		(15	)		2,129			2,212			(4	)
Net interest income		3,241			3,011			3,185			3,137			3,108			8			4			9,437			9,052			4
TOTAL NET REVENUE		3,887			3,775			3,904			3,971			3,867			3			1			11,566			11,264			3
Provision for credit losses		2,229			2,194			1,670			1,788			1,363			2			64			6,093			3,923			55
NONINTEREST EXPENSE
Compensation expense		267			258			267			260			256			3			4			792			761			4
Noncompensation expense		773			763			841			790			827			1			(7	)		2,377			2,383			—
Amortization of intangibles		154			164			164			173			179			(6	)		(14	)		482			547			(12	)
TOTAL NONINTEREST EXPENSE		1,194			1,185			1,272			1,223			1,262			1			(5	)		3,651			3,691			(1	)
Income before income tax expense		464			396			962			960			1,242			17			(63	)		1,822			3,650			(50	)
Income tax expense		172			146			353			351			456			18			(62	)		671			1,340			(50	)
NET INCOME	$	292		$	250		$	609		$	609		$	786			17			(63	)	$	1,151		$	2,310			(50	)
Memo: Net securitization gains (amortization)	$	(28	)	$	36		$	70		$	28		$	—		NM			NM			$	78		$	39			100
FINANCIAL METRICS
ROE		8	%		7	%		17	%		17	%		22	%								11	%		22	%
Overhead ratio		31			31			33			31			33									32			33
% of average managed outstandings:
Net interest income		8.18			7.92			8.34			8.20			8.29									8.15			8.15
Provision for credit losses		5.63			5.77			4.37			4.67			3.64									5.26			3.53
Noninterest revenue		1.63			2.01			1.88			2.18			2.03									1.84			1.99
Risk adjusted margin (a)		4.19			4.16			5.85			5.71			6.68									4.73			6.61
Noninterest expense		3.01			3.12			3.33			3.20			3.37									3.15			3.32
Pretax income (ROO) (b)		1.17			1.04			2.52			2.51			3.31									1.57			3.29
Net income		0.74			0.66			1.60			1.59			2.10									0.99			2.08
BUSINESS METRICS
Charge volume (in billions)	$	93.9		$	93.6		$	85.4		$	95.5		$	89.8			—			5		$	272.9		$	259.1			5
Net accounts opened (in millions)		3.6			3.6			3.4			5.3			4.0			—			(10	)		10.6			11.1			(5	)
Credit cards issued (in millions)		156.9			157.6			156.4			155.0			153.6			—			2			156.9			153.6			2
Number of registered internet customers (in millions)		27.5			28.0			26.7			28.3			26.4			(2	)		4			27.5			26.4			4
Merchant acquiring business (c)
Bank card volume (in billions)	$	197.1		$	199.3		$	182.4		$	194.4		$	181.4			(1	)		9		$	578.8		$	524.7			10
Total transactions (in billions)		5.7			5.6			5.2			5.4			5.0			2			14			16.5			14.3			15

(a)	Represents total net revenue less provision for credit losses.
(b)	Pretax return on average managed outstandings.
(c)	Represents 100% of the merchant acquiring business.

Page 16

JPMORGAN CHASE & CO.
CARD SERVICES - MANAGED BASIS
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except headcount and ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
SELECTED ENDING BALANCES
Loans:
Loans on balance sheets	$	77,565		$	76,278		$	75,888		$	84,352		$	79,409			2	%		(2	)%	$	77,565		$	79,409			(2	)%
Securitized loans		81,745			79,120			75,062			72,701			69,643			3			17			81,745			69,643			17
Managed loans	$	159,310		$	155,398		$	150,950		$	157,053		$	149,052			3			7		$	159,310		$	149,052			7
Equity	$	15,000		$	14,100		$	14,100		$	14,100		$	14,100			6			6		$	15,000		$	14,100			6
SELECTED AVERAGE BALANCES
Managed assets	$	169,413		$	161,601		$	159,602		$	158,183		$	154,956			5			9		$	163,560		$	155,206			5
Loans:
Loans on balance sheets	$	79,183		$	75,630		$	79,445		$	79,028		$	79,993			5			(1	)	$	78,090		$	80,301			(3	)
Securitized loans		78,371			77,195			74,108			72,715			68,673			2			14			76,564			68,200			12
Managed average loans	$	157,554		$	152,825		$	153,553		$	151,743		$	148,666			3			6		$	154,654		$	148,501			4
Equity	$	14,100		$	14,100		$	14,100		$	14,100		$	14,100			—			—		$	14,100		$	14,100			—
Headcount		19,722			19,570			18,931			18,554			18,887			1			4			19,722			18,887			4
MANAGED CREDIT QUALITY STATISTICS
Net charge-offs	$	1,979		$	1,894		$	1,670		$	1,488		$	1,363			4			45		$	5,543		$	4,008			38
Net charge-off rate		5.00	%		4.98	%		4.37	%		3.89	%		3.64	%								4.79	%		3.61	%
Managed delinquency ratios
30+ days		3.69	%		3.46	%		3.66	%		3.48	%		3.25	%								3.69	%		3.25	%
90+ days		1.74			1.76			1.84			1.65			1.50									1.74			1.50
Allowance for loan losses (a)	$	3,951		$	3,705		$	3,404		$	3,407		$	3,107			7			27		$	3,951		$	3,107			27
Allowance for loan losses to period-end loans (a)		5.09	%		4.86	%		4.49	%		4.04	%		3.91	%								5.09	%		3.91	%

(a) Loans on a reported basis.

Page 17

JPMORGAN CHASE & CO.
CARD RECONCILIATION OF REPORTED AND MANAGED DATA
(in millions)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT DATA (a)
Credit card income
Reported	$	1,476		$	1,516		$	1,537		$	1,597		$	1,528			(3)	%		(3)	%	$	4,529		$	4,343			4	%
Securitization adjustments		(843	)		(843	)		(937	)		(885	)		(836	)		—			(1	)		(2,623	)		(2,370	)		(11	)
Managed credit card income	$	633		$	673		$	600		$	712		$	692			(6	)		(9	)	$	1,906		$	1,973			(3	)
Net interest income
Reported	$	1,525		$	1,338		$	1,567		$	1,633		$	1,694			14			(10	)	$	4,430		$	4,921			(10	)
Securitization adjustments		1,716			1,673			1,618			1,504			1,414			3			21			5,007			4,131			21
Managed net interest income	$	3,241		$	3,011		$	3,185		$	3,137		$	3,108			8			4		$	9,437		$	9,052			4
Total net revenue
Reported	$	3,014		$	2,945		$	3,223		$	3,352		$	3,289			2			(8	)	$	9,182		$	9,503			(3	)
Securitization adjustments		873			830			681			619			578			5			51			2,384			1,761			35
Managed total net revenue	$	3,887		$	3,775		$	3,904		$	3,971		$	3,867			3			1		$	11,566		$	11,264			3
Provision for credit losses
Reported	$	1,356		$	1,364		$	989		$	1,169		$	785			(1	)		73		$	3,709		$	2,162			72
Securitization adjustments		873			830			681			619			578			5			51			2,384			1,761			35
Managed provision for credit losses	$	2,229		$	2,194		$	1,670		$	1,788		$	1,363			2			64		$	6,093		$	3,923			55
BALANCE SHEETS — AVERAGE BALANCES (a)
Total average assets
Reported	$	93,701		$	87,021		$	88,013		$	88,244		$	88,856			8			5		$	89,594		$	89,491			—
Securitization adjustments		75,712			74,580			71,589			69,939			66,100			2			15			73,966			65,715			13
Managed average assets	$	169,413		$	161,601		$	159,602		$	158,183		$	154,956			5			9		$	163,560		$	155,206			5
CREDIT QUALITY STATISTICS (a)
Net charge-offs
Reported	$	1,106		$	1,064		$	989		$	869		$	785			4			41		$	3,159		$	2,247			41
Securitization adjustments		873			830			681			619			578			5			51			2,384			1,761			35
Managed net charge-offs	$	1,979		$	1,894		$	1,670		$	1,488		$	1,363			4			45		$	5,543		$	4,008			38

(a) JPMorgan Chase & Co. uses the concept of “managed receivables” to evaluate the credit performance and overall performance of the underlying credit card loans, both sold and not sold; as the same borrower is continuing to use the credit card for ongoing charges, a borrower’s credit performance will affect both the receivables sold under SFAS 140 and those not sold. Thus, in its disclosures regarding managed receivables, JPMorgan Chase & Co. treats the sold receivables as if they were still on the balance sheet in order to disclose the credit performance (such as net charge-off rates) of the entire managed credit card portfolio. Managed results exclude the impact of credit card securitizations on total net revenue, the provision for credit losses, net charge-offs and loan receivables. Securitization does not change reported net income versus managed earnings; however, it does affect the classification of items on the Consolidated Statements of Income and Consolidated Balance Sheets.

Page 18

JPMORGAN CHASE & CO.
COMMERCIAL BANKING
FINANCIAL HIGHLIGHTS
(in millions, except ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT
REVENUE
Lending & deposit-related fees	$	212		$	207		$	193		$	172		$	159			2	%		33	%	$	612		$	475			29	%
Asset management, administration and commissions		29			26			26			24			24			12			21			81			68			19
All other income (a)		147			150			115			130			107			(2	)		37			412			394			5
Noninterest revenue		388			383			334			326			290			1			34			1,105			937			18
Net interest income		737			723			733			758			719			2			3			2,193			2,082			5
TOTAL NET REVENUE		1,125			1,106			1,067			1,084			1,009			2			11			3,298			3,019			9
Provision for credit losses		126			47			101			105			112			168			13			274			174			57
NONINTEREST EXPENSE
Compensation expense		177			173			178			184			160			2			11			528			522			1
Noncompensation expense		298			290			294			307			300			3			(1	)		882			890			(1	)
Amortization of intangibles		11			13			13			13			13			(15	)		(15	)		37			42			(12	)
TOTAL NONINTEREST EXPENSE		486			476			485			504			473			2			3			1,447			1,454			—
Income before income tax expense		513			583			481			475			424			(12	)		21			1,577			1,391			13
Income tax expense		201			228			189			187			166			(12	)		21			618			545			13
NET INCOME	$	312		$	355		$	292		$	288		$	258			(12	)		21		$	959		$	846			13
MEMO:
Revenue by product:
Lending	$	377		$	376		$	379		$	380		$	343			—			10		$	1,132		$	1,039			9
Treasury services		643			630			616			631			594			2			8			1,889			1,719			10
Investment banking		87			91			68			70			64			(4	)		36			246			222			11
Other		18			9			4			3			8			100			125			31			39			(21	)
Total Commercial Banking revenue	$	1,125		$	1,106		$	1,067		$	1,084		$	1,009			2			11		$	3,298		$	3,019			9
IB revenue, gross (b)	$	252		$	270		$	203		$	227		$	194			(7	)		30		$	725		$	661			10
Revenue by business:
Middle Market Banking	$	729		$	708		$	706		$	695		$	680			3			7		$	2,143		$	1,994			7
Mid-Corporate Banking		236			235			207			239			167			—			41			678			576			18
Real Estate Banking		91			94			97			102			108			(3	)		(16	)		282			319			(12	)
Other		69			69			57			48			54			—			28			195			130			50
Total Commercial Banking revenue	$	1,125		$	1,106		$	1,067		$	1,084		$	1,009			2			11		$	3,298		$	3,019			9
FINANCIAL RATIOS
ROE		18	%		20	%		17	%		17	%		15	%								18	%		18	%
Overhead ratio		43			43			45			46			47									44			48

(a)	IB-related and commercial card revenue is included in all other income.
(b)	Represents the total revenue related to investment banking products sold to Commercial Banking (“CB”) clients.

Page 19

JPMORGAN CHASE & CO.
COMMERCIAL BANKING
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio and headcount data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
SELECTED BALANCE SHEET DATA (Period-end)
Equity	$	8,000		$	7,000		$	7,000		$	6,700		$	6,700			14	%		19	%	$	8,000		$	6,700			19	%
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	101,681		$	103,469		$	101,979		$	94,550		$	86,652			(2	)		17		$	102,374		$	84,643			21
Loans:
Loans retained		71,901			70,682			67,510			63,749			60,839			2			18			70,038			59,045			19
Loans held-for-sale & loans at fair value		397			379			521			1,795			433			5			(8	)		432			550			(21	)
Total loans (a)		72,298			71,061			68,031			65,544			61,272			2			18			70,470			59,595			18
Liability balances (b)		99,410			99,404			99,477			96,716			88,081			—			13			99,430			84,697			17
Equity		7,000			7,000			7,000			6,700			6,700			—			4			7,000			6,435			9
MEMO:
Loans by business:
Middle Market Banking	$	43,155		$	42,879		$	40,111		$	38,275		$	37,617			1			15		$	42,052		$	37,016			14
Mid-Corporate Banking		16,491			15,357			15,150			15,440			12,076			7			37			15,669			11,484			36
Real Estate Banking		7,513			7,500			7,457			7,347			7,144			—			5			7,490			7,038			6
Other		5,139			5,325			5,313			4,482			4,435			(3	)		16			5,259			4,057			30
Total Commercial Banking loans	$	72,298		$	71,061		$	68,031		$	65,544		$	61,272			2			18		$	70,470		$	59,595			18
Headcount		3,965			4,028			4,075			4,125			4,158			(2	)		(5	)		3,965			4,158			(5	)
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs	$	40		$	49		$	81		$	33		$	20			(18	)		100		$	170		$	11		NM
Nonperforming loans (c)		572			486			446			146			134			18			327			572			134			327
Allowance for credit losses:
Allowance for loan losses (d)		1,905			1,843			1,790			1,695			1,623			3			17			1,905			1,623			17
Allowance for lending-related commitments		191			170			200			236			236			12			(19	)		191			236			(19	)
Total allowance for credit losses		2,096			2,013			1,990			1,931			1,859			4			13			2,096			1,859			13
Net charge-off rate (a)		0.22	%		0.28	%		0.48	%		0.21	%		0.13	%								0.32	%		0.02	%
Allowance for loan losses to average loans (a)		2.65			2.61			2.65			2.66			2.67									2.72			2.75
Allowance for loan losses to nonperforming loans (c)		333			401			426			1,161			1,211									333			1,211
Nonperforming loans to average loans		0.79			0.68			0.66			0.22			0.22									0.81			0.22

(a)	Loans held-for-sale and loans accounted for at fair value were excluded when calculating the allowance coverage ratio and the net charge-off rate.
(b)	Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities sold under repurchase agreements.
(c)	Nonperforming loans included loans held-for-sale and loans at fair value of $26 million at both June 30, 2008 and March 31, 2008. These amounts were excluded when calculating the allowance coverage ratios. There were no nonperforming loans held-for-sale or held at fair value at September 30, 2008, December 31, 2007, and September 30, 2007.
(d)	The allowance for loan losses at June 30, 2008, included an amount related to loans acquired in the merger with Bear Stearns.

Page 20

JPMORGAN CHASE & CO.
TREASURY & SECURITIES SERVICES
FINANCIAL HIGHLIGHTS
(in millions, except headcount and ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT
REVENUE
Lending & deposit-related fees	$	290		$	283		$	269		$	247		$	244			2	%		19	%	$	842		$	676			25	%
Asset management, administration and commissions		719			846			820			806			730			(15	)		(2	)		2,385			2,244			6
All other income		221			228			200			228			171			(3	)		29			649			480			35
Noninterest revenue		1,230			1,357			1,289			1,281			1,145			(9	)		7			3,876			3,400			14
Net interest income		723			662			624			649			603			9			20			2,009			1,615			24
TOTAL NET REVENUE		1,953			2,019			1,913			1,930			1,748			(3	)		12			5,885			5,015			17
Provision for credit losses		18			7			12			4			9			157			100			37			15			147
Credit reimbursement to IB (a)		(31	)		(30	)		(30	)		(30	)		(31	)		(3	)		—			(91	)		(91	)		—
NONINTEREST EXPENSE
Compensation expense		664			669			641			607			579			(1	)		15			1,974			1,746			13
Noncompensation expense		661			632			571			598			538			5			23			1,864			1,563			19
Amortization of intangibles		14			16			16			17			17			(13	)		(18	)		46			49			(6	)
TOTAL NONINTEREST EXPENSE		1,339			1,317			1,228			1,222			1,134			2			18			3,884			3,358			16
Income before income tax expense		565			665			643			674			574			(15	)		(2	)		1,873			1,551			21
Income tax expense		159			240			240			252			214			(34	)		(26	)		639			576			11
NET INCOME	$	406		$	425		$	403		$	422		$	360			(4	)		13		$	1,234		$	975			27
REVENUE BY BUSINESS
Treasury Services	$	897		$	852		$	813		$	824		$	780			5			15			2,562		$	2,189			17
Worldwide Securities Services		1,056			1,167			1,100			1,106			968			(10	)		9			3,323			2,826			18
TOTAL NET REVENUE	$	1,953		$	2,019		$	1,913		$	1,930		$	1,748			(3	)		12		$	5,885		$	5,015			17
FINANCIAL RATIOS
ROE		46	%		49	%		46	%		56	%		48	%								47	%		43	%
Overhead ratio		69			65			64			63			65									66			67
Pretax margin ratio (b)		29			33			34			35			33									32			31
SELECTED BALANCE SHEET DATA (Period-end)
Equity	$	4,500		$	3,500		$	3,500		$	3,000		$	3,000			29			50		$	4,500		$	3,000			50
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	49,386		$	56,192		$	57,204		$	60,830		$	55,688			(12	)		(11	)	$	54,243		$	50,829			7
Loans (c)		26,650			23,822			23,086			23,489			20,602			12			29			24,527			19,921			23
Liability balances (d)		259,992			268,293			254,369			250,645			236,381			(3	)		10			260,882			221,606			18
Equity		3,500			3,500			3,500			3,000			3,000			—			17			3,500			3,000			17
Headcount		27,592			27,232			26,561			25,669			25,209			1			9			27,592			25,209			9

(a)	TSS is charged a credit reimbursement related to certain exposures managed within the IB credit portfolio on behalf of clients shared with TSS.
(b)	Pretax margin represents income before income tax expense divided by total net revenue, which is a measure of pretax performance and another basis by which management evaluates its performance and that of its competitors.
(c)	Loan balances include wholesale overdrafts, commercial card and trade finance loans.
(d)	Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities sold under repurchase agreements.

Page 21

JPMORGAN CHASE & CO.
TREASURY & SECURITIES SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data and where otherwise noted)

TSS firmwide metrics include revenue recorded in the CB, Regional Banking and Asset Management (“AM”) lines of business and excludes FX revenue recorded in the IB for TSS-related FX activity. In order to capture the firmwide impact of Treasury Services (“TS”) and TSS products and revenue, management reviews firmwide metrics such as liability balances, revenue and overhead ratios in assessing financial performance for TSS. Firmwide metrics are necessary in order to understand the aggregate TSS business.

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
TSS FIRMWIDE DISCLOSURES
Treasury Services revenue — reported	$	897		$	852		$	813		$	824		$	780			5	%		15	%	$	2,562		$	2,189			17	%
Treasury Services revenue reported in Commercial Banking		643			630			616			631			594			2			8			1,889			1,719			10
Treasury Services revenue reported in other lines of business		76			72			69			75			70			6			9			217			195			11
Treasury Services firmwide revenue (a)		1,616			1,554			1,498			1,530			1,444			4			12			4,668			4,103			14
Worldwide Securities Services revenue		1,056			1,167			1,100			1,106			968			(10	)		9			3,323			2,826			18
Treasury & Securities Services firmwide revenue (a)	$	2,672		$	2,721		$	2,598		$	2,636		$	2,412			(2	)		11		$	7,991		$	6,929			15
Treasury Services firmwide liability balances (average) (b)	$	227,760		$	230,689		$	221,716		$	218,416		$	201,671			(1	)		13		$	226,725		$	192,560			18
Treasury & Securities Services firmwide liability balances (average) (b)		359,401			367,670			353,845			347,361			324,462			(2	)		11			360,302			306,302			18
TSS FIRMWIDE FINANCIAL RATIOS
Treasury Services firmwide overhead ratio (c)		52	%		54	%		55	%		53	%		54	%								54	%		57	%
Treasury & Securities Services firmwide overhead ratio (c)		60			58			58			57			59									59			60
FIRMWIDE BUSINESS METRICS
Assets under custody (in billions)	$	14,417		$	15,476		$	15,690		$	15,946		$	15,614			(7	)		(8	)	$	14,417		$	15,614			(8	)
Number of:
US$ ACH transactions originated (in millions)		997			993			1,004			984			943			—			6			2,994			2,886			4
Total US$ clearing volume (in thousands)		29,277			29,063			28,056			28,386			28,031			1			4			86,396			82,650			5
International electronic funds transfer volume (in thousands) (d)		41,831			41,432			40,039			42,723			41,415			1			1			123,302			125,882			(2	)
Wholesale check volume (in millions)		595			618			623			656			731			(4	)		(19	)		1,836			2,269			(19	)
Wholesale cards issued (in thousands) (e)		21,858			19,917			19,122			18,722			18,108			10			21			21,858			18,108			21

(a)	TSS firmwide FX revenue, which includes FX revenue recorded in TSS and FX revenue associated with TSS customers who are FX customers of the IB, was $196 million, $222 million, $191 million, $157 million, and $144 million for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $609 million and $395 million for year-to-date 2008 and 2007, respectively. This is not included in the TS and TSS firmwide revenue.
(b)	Firmwide liability balances include TS’ liability balances recorded in the Commercial Banking line of business.
(c)	Overhead ratios have been calculated based upon firmwide revenue and TSS and TS expense, respectively, including those allocated to certain other lines of business. FX revenue and expense recorded in the IB for TSS-related FX activity are not included in this ratio.
(d)	International electronic funds transfer includes non-US$ ACH and clearing volume.
(e)	Wholesale cards issued include domestic commercial card, stored value card, prepaid card, and government electronic benefit card products.

Page 22

JPMORGAN CHASE & CO.
ASSET MANAGEMENT
FINANCIAL HIGHLIGHTS
(in millions, except ratio, ranking and headcount data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT
REVENUE
Asset management, administration and commissions	$	1,538		$	1,573		$	1,531		$	1,901		$	1,760			(2	)%		(13	)%	$	4,642		$	4,920			(6	)%
All other income		43			130			59			159			152			(67	)		(72	)		232			495			(53	)
Noninterest revenue		1,581			1,703			1,590			2,060			1,912			(7	)		(17	)		4,874			5,415			(10	)
Net interest income		380			361			311			329			293			5			30			1,052			831			27
TOTAL NET REVENUE		1,961			2,064			1,901			2,389			2,205			(5	)		(11	)		5,926			6,246			(5	)
Provision for credit losses		20			17			16			(1	)		3			18		NM				53			(17	)	NM
NONINTEREST EXPENSE
Compensation expense		816			886			825			1,030			848			(8	)		(4	)		2,527			2,491			1
Noncompensation expense		525			494			477			510			498			6			5			1,496			1,405			6
Amortization of intangibles		21			20			21			19			20			5			5			62			60			3
TOTAL NONINTEREST EXPENSE		1,362			1,400			1,323			1,559			1,366			(3	)		—			4,085			3,956			3
Income before income tax expense		579			647			562			831			836			(11	)		(31	)		1,788			2,307			(22	)
Income tax expense		228			252			206			304			315			(10	)		(28	)		686			868			(21	)
NET INCOME	$	351		$	395		$	356		$	527		$	521			(11	)		(33	)	$	1,102		$	1,439			(23	)
REVENUE BY CLIENT SEGMENT
Private Bank (a)	$	631		$	708		$	596		$	650		$	624			(11	)		1		$	1,935		$	1,712			13
Institutional		486			472			490			754			603			3			(19	)		1,448			1,771			(18	)
Retail		399			490			466			640			639			(19	)		(38	)		1,355			1,768			(23	)
Private Wealth Management (a)		352			356			349			345			339			(1	)		4			1,057			995			6
Bear Stearns Brokerage		93			38			—			—			—			145		NM				131			—		NM
Total net revenue	$	1,961		$	2,064		$	1,901		$	2,389		$	2,205			(5	)		(11	)	$	5,926		$	6,246			(5	)
FINANCIAL RATIOS
ROE		25	%		31	%		29	%		52	%		52	%								28	%		50	%
Overhead ratio		69			68			70			65			62									69			63
Pretax margin ratio (b)		30			31			30			35			38									30			37
BUSINESS METRICS
Number of:
Client advisors		1,684			1,717			1,744			1,729			1,680			(2	)		—			1,684			1,680			—
Retirement planning services participants		1,492,000			1,505,000			1,519,000			1,501,000			1,495,000			(1	)		—			1,492,000			1,495,000			—
Bear Stearns brokers		323			326			—			—			—			(1	)	NM				323			—		NM
% of customer assets in 4 & 5 Star Funds (c)		39	%		40	%		49	%		55	%		55	%		(3	)		(29	)		39	%		55	%		(29	)
% of AUM in 1st and 2nd quartiles: (d)
1 year		49	%		51	%		52	%		57	%		47	%		(4	)		4			49	%		47	%		4
3 years		67	%		70	%		73	%		75	%		73	%		(4	)		(8	)		67	%		73	%		(8	)
5 years		77	%		76	%		75	%		76	%		76	%		1			1			77	%		76	%		1
SELECTED BALANCE SHEET DATA (Period-end)
Equity	$	7,000		$	5,200		$	5,000		$	4,000		$	4,000			35			75		$	7,000		$	4,000			75
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	71,189		$	65,015		$	60,286		$	55,989		$	53,879			9			32		$	65,518		$	50,498			30
Loans (e)		39,750			39,264			36,628			32,627			30,928			1			29			38,552			28,440			36
Deposits		65,621			69,975			68,184			64,630			59,907			(6	)		10			67,918			56,920			19
Equity		5,500			5,066			5,000			4,000			4,000			9			38			5,190			3,834			35
Headcount		15,493			15,840			14,955			14,799			14,510			(2	)		7			15,493			14,510			7
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs (recoveries)	$	(1	)	$	2		$	(2	)	$	2		$	(5	)	NM				80		$	(1	)	$	(10	)		90
Nonperforming loans		121			68			11			12			28			78			332			121			28			332
Allowance for loan losses		170			147			130			112			115			16			48			170			115			48
Allowance for lending-related commitments		5			5			6			7			6			—			(17	)		5			6			(17	)
Net charge-off (recovery) rate		(0.01)	%		0.02	%		(0.02)	%		0.02	%		(0.06	)%								—	%		(0.05	)%
Allowance for loan losses to average loans		0.43			0.37			0.35			0.34			0.37									0.44			0.40
Allowance for loan losses to nonperforming loans		140			216			1,182			933			411									140			411
Nonperforming loans to average loans		0.30			0.17			0.03			0.04			0.09									0.31			0.10

(a)	In the third quarter of 2008, certain clients were transferred from Private Bank to Private Wealth Management. Prior periods have been revised to conform with this change.
(b)	Pretax margin represents income before income tax expense divided by total net revenue, which is a measure of pretax performance and another basis by which management evaluates its performance and that of its competitors.
(c)	Derived from the following rating services: Morningstar for the United States; Micropal for the United Kingdom, Luxembourg, Hong Kong and Taiwan; and Nomura for Japan.
(d)	Derived from the following rating services: Lipper for the United States and Taiwan; Micropal for the United Kingdom, Luxembourg and Hong Kong; and Nomura for Japan.
(e)	Reflects the transfer in 2007 of held-for-investment prime mortgage loans from AM to Corporate within the Corporate/Private Equity segment.

Page 23

JPMORGAN CHASE & CO.
ASSET MANAGEMENT
FINANCIAL HIGHLIGHTS, CONTINUED
(in billions)

											Sep 30, 2008
											Change
	Sep 30		Jun 30		Mar 31		Dec 31		Sep 30		Jun 30			Sep 30
	2008		2008		2008		2007		2007		2008			2007
Assets by asset class
Liquidity	$	524	$	478	$	471	$	400	$	368		10	%		42	%
Fixed income		189		199		200		200		195		(5	)		(3	)
Equities & balanced		308		378		390		472		481		(19	)		(36	)
Alternatives		132		130		126		121		119		2			11
TOTAL ASSETS UNDER MANAGEMENT		1,153		1,185		1,187		1,193		1,163		(3	)		(1	)
Custody / brokerage / administration / deposits		409		426		382		379		376		(4	)		9
TOTAL ASSETS UNDER SUPERVISION	$	1,562	$	1,611	$	1,569	$	1,572	$	1,539		(3	)		1
Assets by client segment
Institutional	$	653	$	645	$	652	$	632	$	603		1			8
Private Bank (a)		194		181		179		183		179		7			8
Retail		223		276		279		300		304		(19	)		(27	)
Private Wealth Management (a)		75		75		77		78		77		—			(3	)
Bear Stearns Brokerage		8		8		—		—		—		—		NM
TOTAL ASSETS UNDER MANAGEMENT	$	1,153	$	1,185	$	1,187	$	1,193	$	1,163		(3	)		(1	)
Institutional	$	653	$	646	$	652	$	633	$	604		1			8
Private Bank (a)		417		415		412		403		395		—			6
Retail		303		357		366		394		399		(15	)		(24	)
Private Wealth Management (a)		134		133		139		142		141		1			(5	)
Bear Stearns Brokerage		55		60		—		—		—		(8	)	NM
TOTAL ASSETS UNDER SUPERVISION	$	1,562	$	1,611	$	1,569	$	1,572	$	1,539		(3	)		1
Assets by geographic region
U.S. / Canada	$	785	$	771	$	773	$	760	$	745		2			5
International		368		414		414		433		418		(11	)		(12	)
TOTAL ASSETS UNDER MANAGEMENT	$	1,153	$	1,185	$	1,187	$	1,193	$	1,163		(3	)		(1	)
U.S. / Canada	$	1,100	$	1,093	$	1,063	$	1,032	$	1,022		1			8
International		462		518		506		540		517		(11	)		(11	)
TOTAL ASSETS UNDER SUPERVISION	$	1,562	$	1,611	$	1,569	$	1,572	$	1,539		(3	)		1
Mutual fund assets by asset class
Liquidity	$	470	$	416	$	405	$	339	$	308		13			53
Fixed income		44		47		45		46		46		(6	)		(4	)
Equities		134		179		186		224		235		(25	)		(43	)
TOTAL MUTUAL FUND ASSETS	$	648	$	642	$	636	$	609	$	589		1			10

(a) In the third quarter of 2008, certain clients were transferred from Private Bank to Private Wealth Management. Prior periods have been revised to conform with this change.

Page 24

JPMORGAN CHASE & CO.
ASSET MANAGEMENT
FINANCIAL HIGHLIGHTS, CONTINUED
(in billions)

	QUARTERLY TRENDS															YEAR-TO-DATE
	3Q08			2Q08			1Q08			4Q07			3Q07			2008			2007
ASSETS UNDER SUPERVISION (continued)
Assets under management rollforward
Beginning balance	$	1,185		$	1,187		$	1,193		$	1,163		$	1,109		$	1,193		$	1,013
Net asset flows:
Liquidity		55			1			68			26			33			124			52
Fixed income		(4	)		(1	)		—			3			(2	)		(5	)		6
Equities, balanced & alternative		(5	)		(3	)		(21	)		4			2			(29	)		24
Market / performance / other impacts (a)		(78	)		1			(53	)		(3	)		21			(130	)		68
TOTAL ASSETS UNDER MANAGEMENT	$	1,153		$	1,185		$	1,187		$	1,193		$	1,163		$	1,153		$	1,163
Assets under supervision rollforward
Beginning balance	$	1,611		$	1,569		$	1,572		$	1,539		$	1,472		$	1,572		$	1,347
Net asset flows		61			(5	)		52			37			41			108			106
Market / performance / other impacts (a)		(110	)		47			(55	)		(4	)		26			(118	)		86
TOTAL ASSETS UNDER SUPERVISION	$	1,562		$	1,611		$	1,569		$	1,572		$	1,539		$	1,562		$	1,539

(a) Second quarter 2008 reflects $15 billion for assets under management and $68 billion for assets under supervision from the Bear Stearns acquisition on May 30, 2008.

Page 25

JPMORGAN CHASE & CO.
CORPORATE/PRIVATE EQUITY
FINANCIAL HIGHLIGHTS
(in millions, except headcount data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
INCOME STATEMENT
REVENUE
Principal transactions (a)	$	(1,876	)	$	(97	)	$	5		$	773		$	1,082		NM		%	NM		%	$	(1,968	)	$	3,779		NM		%
Securities gains (losses) (b)		440			656			42			146			128			(33	)		244			1,138			(107	)	NM
All other income (c)		(274	)		(378	)		1,639			213			70			28		NM				987			228			333
Noninterest revenue		(1,710	)		181			1,686			1,132			1,280		NM			NM				157			3,900			(96	)
Net interest income (expense)		(38	)		48			(286	)		(218	)		(279	)	NM				86			(276	)		(569	)		51
TOTAL NET REVENUE		(1,748	)		229			1,400			914			1,001		NM			NM				(119	)		3,331		NM
Provision for credit losses (d)		2,355			290			196			14			(31	)	NM			NM				2,841			(25	)	NM
NONINTEREST EXPENSE
Compensation expense		652			611			639			714			569			7			15			1,902			2,040			(7	)
Noncompensation expense (e)		570			699			(82	)		982			674			(18	)		(15	)		1,187			2,048			(42	)
Merger costs		96			155			—			22			61			(38	)		57			251			187			34
Subtotal		1,318			1,465			557			1,718			1,304			(10	)		1			3,340			4,275			(22	)
Net expense allocated to other businesses		(1,150	)		(1,070	)		(1,057	)		(1,057	)		(1,059	)		(7	)		(9	)		(3,277	)		(3,174	)		(3	)
TOTAL NONINTEREST EXPENSE		168			395			(500	)		661			245			(57	)		(31	)		63			1,101			(94	)
Income (loss) before income tax expense and extraordinary gain		(4,271	)		(456	)		1,704			239			787		NM			NM				(3,023	)		2,255		NM
Income tax expense (benefit)		(1,727	)		(34	)		677			(10	)		274		NM			NM				(1,084	)		729		NM
Income (loss) before extraordinary gain		(2,544	)		(422	)		1,027			249			513		NM			NM				(1,939	)		1,526		NM
Extraordinary gain (f)		581			—			—			—			—		NM			NM				581			—		NM
NET INCOME (LOSS)	$	(1,963	)	$	(422	)	$	1,027		$	249		$	513		(365)			NM			$	(1,358	)	$	1,526		NM
MEMO:
TOTAL NET REVENUE
Private equity	$	(216	)	$	197		$	163		$	688		$	733		NM			NM			$	144		$	3,279			(96	)
Corporate		(1,532	)		32			1,237			226			268		NM			NM				(263	)		52		NM
																													��
TOTAL NET REVENUE	$	(1,748	)	$	229		$	1,400		$	914		$	1,001		NM			NM			$	(119	)	$	3,331		NM
NET INCOME (LOSS)
Private equity	$	(164	)	$	99		$	57		$	356		$	409		NM			NM			$	(8	)	$	1,809		NM
Corporate		(1,064	)		19			970			(93	)		142		NM			NM				(75	)		(167	)		55
Merger related items (g)		(735	)		(540	)		—			(14	)		(38	)		(36	)	NM				(1,275	)		(116	)	NM
TOTAL NET INCOME (LOSS)	$	(1,963	)	$	(422	)	$	1,027		$	249		$	513			(365	)	NM			$	(1,358	)	$	1,526		NM
Headcount		21,641			22,317			21,769			22,512			22,864			(3	)		(5	)		21,641			22,864			(5	)

(a)	Included losses on preferred equity interests in Federal National Mortgage Association (“FNMA”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”) in the third quarter of 2008.
(b)	Included gain on sale of MasterCard shares in the second quarter of 2008.
(c)	Included proceeds from the sale of Visa shares in its initial public offering in the first quarter of 2008.
(d)	Included a $1.9 billion charge to conform Washington Mutual's loan loss reserves to JPMorgan Chase's accounting policy in the third quarter of 2008.
(e)	Included a release of credit card litigation reserves in the first quarter of 2008.
(f)	Effective September 25, 2008, JPMorgan Chase acquired the banking operations of Washington Mutual from the FDIC for $1.9 billion. The fair value of the Washington Mutual net assets acquired exceeded the purchase price which resulted in negative goodwill. In accordance with SFAS 141, nonfinancial assets that are not held for sale were written down against that negative goodwill. The negative goodwill that remained after writing down nonfinancial assets was recognized as an extraordinary gain.
(g)	The third quarter of 2008 included an accounting conformity loan loss reserve provision and an extraordinary gain related to the Washington Mutual transaction. The second quarter of 2008 reflects items related to the Bear Stearns merger, which included Bear Stearn’s equity earnings, merger costs, Bear Stearns asset management liquidation costs and Bear Stearns private client services broker retention expense. Periods prior to the second quarter of 2008 represent costs related to the Bank One and Bank of New York transactions.

Page 26

JPMORGAN CHASE & CO.
CORPORATE/PRIVATE EQUITY
FINANCIAL HIGHLIGHTS, CONTINUED
(in millions, except ratio data)

	QUARTERLY TRENDS																			YEAR-TO-DATE
														3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07		3Q07		2Q08			3Q07			2008			2007			2007
SUPPLEMENTAL
TREASURY
Securities gains (losses) (a)	$	442		$	656		$	42		$	146	$	126		(33)	%		251	%	$	1,140		$	(109	)	NM		%
Investment securities portfolio (average)		105,984			97,223			80,443			82,445		85,470		9			24			94,592			86,552			9
Investment securities portfolio (ending)		115,703			103,751			91,323			76,200		86,495		12			34			115,703			86,495			34
Mortgage loans (average) (b)		42,432			42,143			39,096			34,436		29,854		1			42			41,228			27,326			51
Mortgage loans (ending) (b)		41,976			42,602			41,125			36,942		32,804		(1	)		28			41,976			32,804			28
PRIVATE EQUITY
Private equity gains (losses)
Direct investments
Realized gains	$	40		$	540		$	1,113		$	100	$	504		(93	)		(92	)	$	1,693		$	2,212			(23	)
Unrealized gains (losses) (c)		(273	)		(326	)		(881	)		569		227		16		NM				(1,480	)		1,038		NM
Total direct investments		(233	)		214			232			669		731	NM			NM				213			3,250			(93	)
Third-party fund investments		27			6			(43	)		43		35		350			(23	)		(10	)		122		NM
Total private equity gains (losses) (d)	$	(206	)	$	220		$	189		$	712	$	766	NM			NM			$	203		$	3,372			(94	)
Private equity portfolio information
Direct investments
Publicly-held securities
Carrying value	$	600		$	615		$	603		$	390	$	409		(2	)		47
Cost		705			665			499			288		291		6			142
Quoted public value		657			732			720			536		560		(10	)		17
Privately-held direct securities
Carrying value		6,038			6,270			5,191			5,914		5,336		(4	)		13
Cost		6,058			6,113			4,973			4,867		5,003		(1	)		21
Third-party fund investments
Carrying value		889			838			811			849		839		6			6
Cost		1,121			1,094			1,064			1,076		1,078		2			4
Total private equity portfolio — Carrying value	$	7,527		$	7,723		$	6,605		$	7,153	$	6,584		(3	)		14
Total private equity portfolio — Cost	$	7,884		$	7,872		$	6,536		$	6,231	$	6,372		—			24

(a)	The second quarter of 2008 included gain on the sale of MasterCard shares. All periods reflect repositioning of the Corporate investment securities portfolio and exclude gains/losses on securities used to manage risk associated with MSRs.
(b)	Held-for-investment prime mortgage loans were transferred from RFS and AM to the Corporate/Private Equity segment for risk management and reporting purposes. The initial transfers had no material impact on the financial results of Corporate/Private Equity.
(c)	Unrealized gains (losses) contains reversals of unrealized gains and losses that were recognized in prior periods and have now been realized.
(d)	Included in principal transactions revenue in the Consolidated Statements of Income.

Page 27

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION
(in millions)

											Sep 30, 2008
											Change
	Sep 30		Jun 30		Mar 31		Dec 31		Sep 30		Jun 30			Sep 30
	2008		2008		2008		2007		2007		2008			2007
CREDIT EXPOSURE (a)
WHOLESALE (b)
Loans — U.S.	$	202,169	$	137,236	$	141,921	$	133,253	$	126,343		47	%		60	%
Loans — Non-U.S.		86,276		92,123		89,376		79,823		71,385		(6	)		21
TOTAL WHOLESALE LOANS — REPORTED (c)		288,445		229,359		231,297		213,076		197,728		26			46
CONSUMER (d)
Home loan portfolio (includes RFS and Corporate/Private Equity):
Home equity		143,311		95,129		94,968		94,832		93,026		51			54
Prime mortgage		95,047		47,185		45,080		40,558		35,610		101			167
Subprime mortgage		22,025		14,792		15,775		15,473		12,120		49			82
Option ARMs		41,642		—		—		—		—	NM			NM
Total home loan portfolio		302,025		157,106		155,823		150,863		140,756		92			115
Auto loans and leases		43,306		44,867		44,714		42,350		40,871		(3	)		6
Credit card — reported		92,881		76,278		75,888		84,352		79,409		22			17
Other loans		34,724		30,419		29,334		28,733		27,556		14			26
TOTAL CONSUMER LOANS — REPORTED		472,936		308,670		305,759		306,298		288,592		53			64
TOTAL LOANS — REPORTED		761,381		538,029		537,056		519,374		486,320		42			57
Credit card — securitized		93,664		79,120		75,062		72,701		69,643		18			34
TOTAL LOANS — MANAGED		855,045		617,149		612,118		592,075		555,963		39			54
Derivative receivables		118,648		122,389		99,110		77,136		64,592		(3	)		84
Receivables from customers (e)		25,422		26,572		—		—		—		(4	)	NM
TOTAL CREDIT-RELATED ASSETS		999,115		766,110		711,228		669,211		620,555		30			61
Wholesale lending-related commitments		407,057		430,028		438,392		446,652		468,145		(5	)		(13	)
TOTAL	$	1,406,172	$	1,196,138	$	1,149,620	$	1,115,863	$	1,088,700		18			29
Memo: Total by category
Total wholesale exposure (f)	$	839,572	$	808,348	$	768,799	$	736,864	$	730,465		4			15
Total consumer managed loans (g)		566,600		387,790		380,821		378,999		358,235		46			58
Total	$	1,406,172	$	1,196,138	$	1,149,620	$	1,115,863	$	1,088,700		18			29
Risk profile of wholesale credit exposure:
Investment-grade (h)	$	603,061	$	595,043	$	590,439	$	571,394	$	548,663		1			10
Noninvestment-grade: (h)
Noncriticized		178,001		154,218		147,771		134,983		155,172		15			15
Criticized performing		14,690		11,611		9,570		6,267		5,605		27			162
Criticized nonperforming		1,418		899		742		571		414		58			243
Total noninvestment-grade		194,109		166,728		158,083		141,821		161,191		16			20
Loans held-for-sale & loans at fair value		16,980		20,005		20,277		23,649		20,611		(15	)		(18	)
Receivables from customers (e)		25,422		26,572		—		—		—		(4	)	NM
Total wholesale exposure	$	839,572	$	808,348	$	768,799	$	736,864	$	730,465		4			15

(a)	Includes credit exposure related to the acquisition of Washington Mutual.
(b)	Includes Investment Bank, Commercial Banking, Treasury & Securities Services and Asset Management.
(c)	Includes loans held-for-sale & loans at fair value.
(d)	Includes Retail Financial Services, Card Services and residential mortgage loans reported in the Corporate/Private Equity segment to be risk managed by the Chief Investment Office.
(e)	Represents margin loans to brokerage customers included in accrued interest and accounts receivable on the Consolidated Balance Sheet.
(f)	Represents total wholesale loans, derivative receivables, wholesale lending-related commitments and receivables from customers.
(g)	Represents total consumer loans plus credit card securitizations, and excludes consumer lending-related commitments.
(h)	Excludes loans held-for-sale & loans at fair value.

Note: The risk profile is based on JPMorgan Chase & Co.’s internal risk ratings, which generally correspond to the following
     ratings as defined by Standard & Poor’s / Moody’s:
Investment-Grade: AAA / Aaa to BBB- / Baa3
Noninvestment-Grade: BB+ / Ba1 and below

Page 28

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions, except ratio data)

																Sep 30, 2008
																Change
	Sep 30			Jun 30			Mar 31			Dec 31			Sep 30			Jun 30			Sep 30
	2008			2008			2008			2007			2007			2008			2007
NONPERFORMING ASSETS AND RATIOS
WHOLESALE LOANS — EXCLUDING WASHINGTON MUTUAL (a)
Loans — U.S.	$	913		$	806		$	761		$	490		$	401			13	%		128	%
Loans — Non-U.S.		220			64			20			24			26			244		NM
TOTAL WHOLESALE LOANS-EXCLUDING WASHINGTON MUTUAL		1,133			870			781			514			427			30			165
CONSUMER LOANS — EXCLUDING WASHINGTON MUTUAL (b)
Home loan portfolio (includes RFS and Corporate/Private Equity):
Home equity (c)		1,142			1,008			924			786			556			13			105
Prime mortgage		1,496			1,232			860			501			282			21			430
Subprime mortgage (c)		2,384			1,715			1,401			1,017			790			39			202
Total home loan portfolio		5,022			3,955			3,185			2,304			1,628			27			208
Auto loans and leases		119			102			94			116			92			17			29
Credit card — reported		5			6			6			7			7			(17	)		(29	)
Other loans		382			340			335			341			336			12			14
TOTAL CONSUMER LOANS-EXCLUDING WASHINGTON MUTUAL (d)		5,528			4,403			3,620			2,768			2,063			26			168
TOTAL LOANS EXCLUDING WASHINGTON MUTUAL (c)		6,661			5,273			4,401			3,282			2,490			26			168
Nonperforming loans acquired in Washington Mutual transaction		6,662			—			—			—			—		NM			NM
TOTAL NONPERFORMING LOANS REPORTED (c)		13,323			5,273			4,401			3,282			2,490			153			435
Derivative receivables		45			80			31			29			34			(44	)		32
Assets acquired in loan satisfactions - excluding Washington Mutual		1,064			880			711			622			485			21			119
Assets acquired in loan satisfactions acquired in Washington Mutual transaction		1,478			—			—			—			—			NM			NM
TOTAL NONPERFORMING ASSETS	$	15,910		$	6,233		$	5,143		$	3,933		$	3,009			155			429
TOTAL NONPERFORMING LOANS TO TOTAL LOANS EXCLUDING WASHINGTON MUTUAL		1.21	%		0.98	%		0.82	%		0.63	%		0.51	%
TOTAL NONPERFORMING LOANS TO TOTAL LOANS REPORTED		1.75	%		0.98	%		0.82	%		0.63	%		0.51	%
NONPERFORMING ASSETS BY LOB
Investment Bank	$	583		$	490		$	439		$	453		$	325			19			79
Retail Financial Services (c)		4,924			3,943			3,395			2,817			2,215			25			122
Card Services		5			6			6			7			7			(17	)		(29	)
Commercial Banking		624			510			453			148			136			22			359
Treasury & Securities Services		—			—			—			—			—			—			—
Asset Management		121			68			11			12			28			78			332
Corporate/Private Equity (e)		1,513			1,216			839			496			298			24			408
TOTAL EXCLUDING WASHINGTON MUTUAL		7,770			6,233			5,143			3,933			3,009			25			158
Acquired in Washington Mutual transaction		8,140			—			—			—			—		NM			NM
TOTAL	$	15,910		$	6,233		$	5,143		$	3,933		$	3,009			155			429

(a)	Included nonperforming loans held-for-sale and loans at fair value of $32 million, $51 million, $70 million, $50 million, and $75 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. Excluded purchased held-for-sale wholesale loans.
(b)	There were no nonperforming loans held-for-sale at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007.
(c)	During the second quarter of 2008, the policy for classifying subprime mortgage and home equity loans as nonperforming was changed to conform with all other home lending products. Prior period nonperforming loans and assets have been revised to conform with this change.
(d)	Nonperforming loans and assets excluded (1) loans eligible for repurchase as well as loans repurchased from GNMA pools that are insured by U.S. government agencies of $1.8 billion, $1.9 billion, $1.8 billion, $1.5 billion, and $1.3 billion at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and (2) education loans that are 90 days past due and still accruing, which are insured by U.S. government agencies under the Federal Family Education Loan Program of $405 million, $371 million, $252 million, $279 million, and $241 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. These amounts for GNMA and education loans are excluded, as reimbursement is proceeding normally.
(e)	Predominantly relates to held-for-investment prime mortgage loans transferred from RFS and AM to the Corporate/Private Equity segment.

Page 29

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions, except ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
GROSS CHARGE-OFFS
Wholesale loans	$	71		$	82		$	130		$	54		$	101			(13	)%		(30	)%	$	283		$	131			116	%
Consumer (includes RFS and Corporate/Private Equity)		1,375			1,079			880			582			403			27			241			3,334			965			245
Credit card — reported		1,245			1,209			1,144			1,000			911			3			37			3,598			2,635			37
Total loans — reported		2,691			2,370			2,154			1,636			1,415			14			90			7,215			3,731			93
Credit card — securitized		985			949			791			716			679			4			45			2,725			2,085			31
Total loans — managed		3,676			3,319			2,945			2,352			2,094			11			76			9,940			5,816			71
RECOVERIES
Wholesale loans		19			41			38			29			19			(54	)		—			98			84			17
Consumer (includes RFS and Corporate/Private Equity)		49			54			55			47			49			(9	)		—			158			150			5
Credit card — reported		139			145			155			131			126			(4	)		10			439			388			13
Total loans — reported		207			240			248			207			194			(14	)		7			695			622			12
Credit card — securitized		112			119			110			97			101			(6	)		11			341			324			5
Total loans — managed		319			359			358			304			295			(11	)		8			1,036			946			10
NET CHARGE-OFFS
Wholesale loans		52			41			92			25			82			27			(37	)		185			47			294
Consumer (includes RFS and Corporate/Private Equity)		1,326			1,025			825			535			354			29			275			3,176			815			290
Credit card — reported		1,106			1,064			989			869			785			4			41			3,159			2,247			41
Total loans — reported		2,484			2,130			1,906			1,429			1,221			17			103			6,520			3,109			110
Credit card — securitized		873			830			681			619			578			5			51			2,384			1,761			35
Total loans — managed	$	3,357		$	2,960		$	2,587		$	2,048		$	1,799			13			87		$	8,904		$	4,870			83
NET CHARGE-OFF RATES — ANNUALIZED
Wholesale loans (a)		0.10	%		0.08	%		0.18	%		0.05	%		0.19	%								0.12	%		0.04	%
Consumer (includes RFS and Corporate/Private Equity) (b)		2.29			1.81			1.50			1.01			0.70									1.87			0.56
Credit card — reported		5.56			5.66			5.01			4.36			3.89									5.40			3.74
Total loans — reported (a) (b)		1.91			1.67			1.53			1.19			1.07									1.70			0.94
Credit card — securitized		4.43			4.32			3.70			3.38			3.34									4.16			3.45
Total loans — managed (a) (b)		2.24			2.02			1.81			1.48			1.37									2.02			1.28
Memo: Credit card — managed		5.00			4.98			4.37			3.89			3.64									4.79			3.61

(a)

Average wholesale loans held-for-sale and loans at fair value were $18.0 billion, $20.8 billion, $20.1 billion, $26.8 billion, and $17.8 billion for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $19.6 billion and $15.8 billion for year-to-date 2008 and 2007, respectively. These amounts were excluded when calculating the net charge-off rates.

(b)

Average consumer (excluding card) loans held-for-sale and loans at fair value were $1.5 billion, $3.6 billion, $4.4 billion, $4.0 billion, and $5.4 billion for the quarters ended September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, and $3.2 billion and $12.9 billion for year-to-date 2008 and 2007, respectively. These amounts were excluded when calculating the net charge-off rates.

Page 30

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions, except ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
SUMMARY OF CHANGES IN THE ALLOWANCE FOR LOAN LOSSES
Beginning balance	$	13,246		$	11,746		$	9,234		$	8,113		$	7,633			13	%		74	%	$	9,234		$	7,279			27	%
Additions resulting from acquisition, September 25, 2008 (a)		2,535			—			—			—			—			NM			NM			2,535			—			NM
Net charge-offs		(2,484	)		(2,130	)		(1,906	)		(1,429	)		(1,221	)		(17	)		(103	)		(6,520	)		(3,109	)		(110	)
Provision for loan losses		3,784			3,624			4,419			2,550			1,693			4			124			11,827			3,988			197
Provision for credit losses — accounting conformity (a)		1,976			—			—			—			—			NM			NM			1,976			—			NM
Other		(5)			6			(1	)		—			8		NM			NM				—			(45	)	NM
Ending balance	$	19,052		$	13,246		$	11,746		$	9,234		$	8,113			44			135		$	19,052		$	8,113			135
SUMMARY OF CHANGES IN THE ALLOWANCE FOR LENDING-RELATED COMMITMENTS
Beginning balance	$	686		$	855		$	850		$	858		$	766			(20	)		(10	)	$	850		$	524			62
Provision for lending-related commitments		27			(169	)		5			(8	)		92		NM				(71	)		(137	)		334		NM
Ending balance	$	713		$	686		$	855		$	850		$	858			4			(17	)	$	713		$	858			(17	)
ALLOWANCE COMPONENTS AND RATIOS
ALLOWANCE FOR LOAN LOSSES
Wholesale
Asset specific	$	253		$	174		$	146		$	108		$	53			45			377
Formula — based		5,326			4,295			3,691			3,046			2,810			24			90
Total wholesale		5,579			4,469			3,837			3,154			2,863			25			95
Consumer
Asset specific		70			61			75			80			70			15			—
Formula — based		13,403			8,716			7,834			6,000			5,180			54			159
Total consumer		13,473			8,777			7,909			6,080			5,250			54			157
Total allowance for loan losses		19,052			13,246			11,746			9,234			8,113			44			135
Allowance for lending-related commitments		713			686			855			850			858			4			(17	)
Total allowance for credit losses	$	19,765		$	13,932		$	12,601		$	10,084		$	8,971			42			120
Wholesale allowance for loan losses to total wholesale loans (b)		2.06	%		2.13	%		1.82	%		1.67	%		1.62	%
Consumer allowance for loan losses to total consumer loans (c) (d)		3.42			2.86			2.63			2.01			1.84
Allowance for loan losses to total loans (b) (c) (d)		2.86			2.57			2.29			1.88			1.76
Allowance for loan losses to total nonperforming loans (d) (e)		287			254			271			286			336
ALLOWANCE FOR LOAN LOSSES BY LOB
Investment Bank	$	2,654		$	2,429		$	1,891		$	1,329		$	1,112			9			139
Retail Financial Services		4,957			4,475			4,208			2,634			2,105			11			135
Card Services		3,951			3,705			3,404			3,407			3,107			7			27
Commercial Banking		1,905			1,843			1,790			1,695			1,623			3			17
Treasury & Securities Services		47			40			26			18			13			18			262
Asset Management		170			147			130			112			115			16			48
Corporate/Private Equity		857			607			297			39			38			41		NM
Washington Mutual Acquisition		4,511			—			—			—			—		NM			NM
Total	$	19,052		$	13,246		$	11,746		$	9,234		$	8,113			44			135

(a)	Related to the Washington Mutual transaction in the third quarter of 2008.
(b)	Wholesale loans held-for-sale and loans at fair value were $17.0 billion, $20.0 billion, $20.3 billion, $23.6 billion, and $20.6 billion at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively, these amounts were excluded when calculating the allowance coverage ratios.
(c)	Consumer loans held-for-sale were $1.6 billion, $2.2 billion, $4.5 billion, $4.0 billion, and $3.9 billion at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively. These amounts were excluded when calculating the allowance coverage ratios.
(d)	Approximately $77.7 billion in credit impaired loans acquired in the Washington Mutual transaction and accounted for under SOP 03-3 were excluded when calculating the ratio of allowance for loan losses to total loans. These loans are recorded at fair value on the acquisition date, including an adjustment for credit impairment. Accordingly, no allowance for loan losses has been recorded as of September 30, 2008.
(e)	Nonperforming loans held-for-sale and loans at fair value were $32 million, $51 million, $70 million, $50 million, and $75 million at September 30, 2008, June 30, 2008, March 31, 2008, December 31, 2007, and September 30, 2007, respectively.
(f)	Approximately $6.7 billion in nonperforming loans acquired in the Washington Mutual transaction and accounted for under SOP 3-3 were excluded when calculating the ratio of allowance for loan losses to total nonperforming loans. These loans were recorded at fair value on the acquisition date, including an adjustment for credit impairment. Accordingly, no allowance for loan losses has been recorded for these assets as of September 30, 2008.

Page 31

JPMORGAN CHASE & CO.
CREDIT-RELATED INFORMATION, CONTINUED
(in millions)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
PROVISION FOR CREDIT LOSSES
LOANS
Investment Bank	$	238		$	538		$	571		$	208		$	146			(56	)%		63	%	$	1,347		$	168			NM	%
Commercial Banking		105			77			143			105			98			36			7			325			125			160
Treasury & Securities Services		7			7			11			5			3			—			133			25			6			317
Asset Management		21			17			17			(2	)		4			24			425			55			(17	)	NM
Corporate/Private Equity (a)(b)		564			36			—			—			—		NM			NM				600			—		NM
Total wholesale		935			675			742			316			251			39			273			2,352			282		NM
Retail Financial Services		1,678			1,331			2,492			1,051			688			26			144			5,501			1,569			251
Card Services — reported		1,356			1,364			989			1,169			785			(1	)		73			3,709			2,162			72
Corporate/Private Equity (a)(c)		1,791			254			196			14			(31	)	NM			NM				2,241			(25	)	NM
Total consumer		4,825			2,949			3,677			2,234			1,442			64			235			11,451			3,706			209
Total provision for loan losses	$	5,760		$	3,624		$	4,419		$	2,550		$	1,693			59			240		$	13,803		$	3,988			246
LENDING-RELATED COMMITMENTS
Investment Bank	$	(4	)	$	(140	)	$	47		$	(8	)	$	81			97		NM			$	(97	)	$	286		NM
Commercial Banking		21			(30	)		(42	)		—			14		NM				50			(51	)		49		NM
Treasury & Securities Services		11			—			1			(1	)		6		NM				83			12			9			33
Asset Management		(1	)		—			(1	)		1			(1	)	NM				—			(2	)		—		NM
Total wholesale		27			(170	)		5			(8	)		100		NM				(73	)		(138	)		344		NM
Retail Financial Services		—			1			—			—			(8	)	NM			NM				1			(10	)	NM
Card Services — reported		—			—			—			—			—			—			—			—			—			—
Total consumer		—			1			—			—			(8	)	NM			NM				1			(10	)	NM
Total provision for lending-related commitments	$	27		$	(169	)	$	5		$	(8	)	$	92		NM				(71	)	$	(137	)	$	334		NM
TOTAL PROVISION FOR CREDIT LOSSES
Investment Bank	$	234		$	398		$	618		$	200		$	227			(41	)		3		$	1,250		$	454			175
Commercial Banking		126			47			101			105			112			168			13			274			174			57
Treasury & Securities Services		18			7			12			4			9			157			100			37			15			147
Asset Management		20			17			16			(1	)		3			18		NM				53			(17	)	NM
Corporate/Private Equity (a)(b)		564			36			—			—			—		NM			NM				600			—		NM
Total wholesale		962			505			747			308			351			90			174			2,214			626			254
Retail Financial Services		1,678			1,332			2,492			1,051			680			26			147			5,502			1,559			253
Card Services — reported		1,356			1,364			989			1,169			785			(1	)		73			3,709			2,162			72
Corporate/Private Equity (a)(c)		1,791			254			196			14			(31	)	NM			NM				2,241			(25	)	NM
Total consumer		4,825			2,950			3,677			2,234			1,434			64			236			11,452			3,696			210
Total provision for credit losses		5,787			3,455			4,424			2,542			1,785			67			224			13,666			4,322			216
Card Services — securitized		873			830			681			619			578			5			51			2,384			1,761			35
Managed provision for credit losses	$	6,660		$	4,285		$	5,105		$	3,161		$	2,363			55			182		$	16,050		$	6,083			164

(a)	Represents provision expense related to loans acquired in the Washington Mutual transaction in the third quarter of 2008.
(b)	Represents provision expense related to loans acquired in the Bear Stearns transaction in the second quarter of 2008.
(c)	Includes amounts related to held-for-investment prime mortgages transferred from RFS and AM to the Corporate/Private Equity segment during 2007.

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JPMORGAN CHASE & CO. CAPITAL, INTANGIBLE ASSETS AND DEPOSITS
(in millions, except per share and ratio data)

	QUARTERLY TRENDS																					YEAR-TO-DATE
																3Q08 Change												2008 Change
	3Q08			2Q08			1Q08			4Q07			3Q07			2Q08			3Q07			2008			2007			2007
COMMON SHARES OUTSTANDING
Weighted-average basic shares outstanding		3,444.6			3,426.2			3,396.0			3,367.1			3,375.9			1	%		2	%		3,422.3			3,415.8			—	%
Weighted-average diluted shares outstanding		3,444.6	(d)		3,531.0			3,494.7			3,471.8			3,477.7			(2	)		(1	)		3,525.3			3,519.6			—
Common shares outstanding — at period end		3,726.9			3,435.7			3,400.8			3,367.4			3,358.8			8			11			3,726.9			3,358.8			11
Cash dividends declared per share	$	0.38		$	0.38		$	0.38		$	0.38		$	0.38			—			—		$	1.14		$	1.10			4
Book value per share		36.95			37.02			36.94			36.59			35.72			—			4			36.95			35.72			3
Dividend payout (a)		399	%		71	%		56	%		44	%		39	%								89	%		31	%
NET INCOME	$	527		$	2,003		$	2,373		$	2,971		$	3,373			(74	)		(84	)	$	4,903		$	12,394			(60	)
Preferred dividends		161			90			—			—			—			79			NM			251			—			NM
Net income applicable to common stock	$	366		$	1,913		$	2,373		$	2,971		$	3,373			(81	)		(89	)	$	4,652		$	12,394			(62	)
NET INCOME PER SHARE
Basic earnings per share
Income (loss) before extraordinary gain		(0.06	)		0.56			0.70			0.88			1.00			NM			NM			1.19			3.63			(67	)
Net income		0.11			0.56			0.70			0.88			1.00			(80	)		(89	)		1.36			3.63			(63	)
Diluted earnings per share
Income (loss) before extraordinary gain		(0.06	)		0.54			0.68			0.86			0.97			NM			NM			1.15			3.52			(67	)
Net income		0.11			0.54			0.68			0.86			0.97			(80	)		(89	)		1.32			3.52			(63	)
SHARE PRICE
High	$	49.00		$	49.95		$	49.29		$	48.02		$	50.48			(2	)		(3	)	$	49.95		$	53.25			(6	)
Low		29.24			33.96			36.01			40.15			42.16			(14	)		(31	)		29.24			42.16			(31	)
Close		46.70			34.31			42.95			43.65			45.82			36			2			46.70			45.82			2
Market capitalization		174,048			117,881			146,066			146,986			153,901			48			13			174,048			153,901			13
STOCK REPURCHASE PROGRAM (b)
Aggregate repurchases	$	—		$	—		$	—		$	163.3		$	2,135.4			—			NM		$	—		$	8,011.6			NM
Common shares repurchased		—			—			—			3.6			47.0			—			NM			—			164.6			NM
Average purchase price	$	—		$	—		$	—		$	45.29		$	45.42			—			NM		$	—		$	48.67			NM
CAPITAL RATIOS (c)
Tier 1 capital	$	111,824	(e)	$	98,775		$	89,646		$	88,746		$	86,096			13			30
Total capital		159,265	(e)		145,012			134,948			132,242			128,543			10			24
Risk-weighted assets		1,255,419	(e)		1,079,199			1,075,697			1,051,879			1,028,551			16			22
Adjusted average assets		1,555,250	(e)		1,536,439			1,507,724			1,473,541			1,423,171			1			9
Tier 1 capital ratio		8.9	%(e)		9.2	%		8.3	%		8.4	%		8.4	%
Total capital ratio		12.7	(e)		13.4			12.5			12.6			12.5
Tier 1 leverage ratio		7.2	(e)		6.4			5.9			6.0			6.0
INTANGIBLE ASSETS (PERIOD-END)
Goodwill	$	46,121		$	45,993		$	45,695		$	45,270		$	45,335			—			2
Mortgage servicing rights		17,048			11,617			8,419			8,632			9,114			47			87
Purchased credit card relationships		1,827			1,984			2,140			2,303			2,427			(8	)		(25	)
All other intangibles		3,653			3,675			3,815			3,796			3,959			(1	)		(8	)
Total intangibles	$	68,649		$	63,269		$	60,069		$	60,001		$	60,835			9			13
DEPOSITS
U.S. offices:
Noninterest-bearing	$	193,253		$	125,606		$	132,072		$	129,406		$	115,036			54			68
Interest-bearing		506,974			362,150			394,613			376,194			354,459			40			43
Non-U.S. offices:
Noninterest-bearing		9,747			7,827			7,232			6,342			6,559			25			49
Interest-bearing		259,809			227,322			227,709			228,786			202,037			14			29
Total deposits	$	969,783		$	722,905		$	761,626		$	740,728		$	678,091			34			43

(a)	Based on net income amounts.
(b)	Excludes commission costs.
(c)	The Federal Reserve has granted the Firm, for a period of 18 months following the merger with Bear Stearns, relief up to a certain specified amount and subject to certain conditions from the Federal Reserve’s risk-based and leverage capital guidelines in respect to the Bear Stearns risk-weighted assets and other exposures acquired. The amount of such relief is subject to reduction by one-sixth each quarter subsequent to the acquisition and expires on October 1, 2009.
(d)	Common equivalent shares have been excluded from the computation of diluted earnings per share for the third quarter of 2008, as the effect would be antidilutive
(e)	Estimated.

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JPMORGAN CHASE & CO.
Glossary of Terms

ACH:Automated Clearing House.

Average managed assets:Refers to total assets on the Firm’s Consolidated Balance Sheets plus credit card receivables that have been securitized.

Beneficial interest issued by consolidated VIEs:Represents the interest of third-party holders of debt/equity securities, or other obligations, issued by VIEs that JPMorgan Chase & Co. consolidates under FIN 46R. The underlying obligations of the VIEs consist of short-term borrowings, commercial paper and long-term debt. The related assets consist of trading assets, available- for-sale securities, loans and other assets.

Contractual credit card charge-off:In accordance with the Federal Financial Institutions Examination Council policy, credit card loans are charged off by the end of the month in which the account becomes 180 days past due or within 60 days from receiving notification of the filing of bankruptcy, whichever is earlier.

Corporate/Private Equity:Includes Private Equity, Treasury and Corporate Other, which includes other centrally managed expense and discontinued operations.

Credit card securitizations:Card Services’ managed results excludes the impact of credit card securitizations on total net revenue, the provision for credit losses, net charge-offs and loan receivables. Through securitization, the Firm transforms a portion of its credit card receivables into securities, which are sold to investors. The credit card receivables are removed from the Consolidated Balance Sheets through the transfer of the receivables to a trust and the sale of undivided interests to investors that entitle the investors to specific cash flows generated from the credit card receivables. The Firm retains the remaining undivided interests as seller’s interests, which are recorded in loans on the Consolidated Balance Sheets. A gain or loss on the sale of credit card receivables to investors is recorded in other income. Securitization also affects the Firm’s Consolidated Statements of Income as the aggregate amount of interest income, certain fee revenue and recoveries that is in excess of the aggregate amount of interest paid to the investors, gross credit losses and other trust expense related to the securitized receivables are reclassified into credit card income in the Consolidated Statements of Income.

FIN 46(R):FASB Interpretation No. 46 (revised December 2003), “Consolidation of Variable Interest Entities, an interpretation of Accounting Research Bulletin No. 51.”

Investment-grade:An indication of credit quality based upon JPMorgan Chase & Co.’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.

Managed basis:A non-GAAP presentation of financial results that includes reclassifications related to credit card securitizations and to present revenue on a fully taxable-equivalent basis. Management uses this non-GAAP financial measure at the segment level because it believes this provides information to enable investors to understand the underlying operational performance and trends of the particular business segment and facilitates a comparison of the business segment with the performance of competitors.

Managed credit card receivables:Refers to credit card receivables on the Firm’s Consolidated Balance Sheets plus credit card receivables that have been securitized.

Mark-to-market exposure:A measure, at a point in time, of the value of a derivative or foreign exchange contract in the open market. When the mark-to-market value is positive, it indicates the counterparty owes JPMorgan Chase & Co. and, therefore, creates a repayment risk for the Firm. When the mark-to-market value is negative, JPMorgan Chase & Co. owes the counterparty. In this situation, the Firm does not have repayment risk.

Merger costs:Reflects costs associated with the Washington Mutual and Bear Stearns mergers in 2008, costs associated with The Bank of New York, Inc. transaction (“The Bank of New York”) in 2007, and costs associated with the 2004 merger with Bank One Corporation.

MSR risk management revenue:Includes changes in MSR asset fair value due to inputs or assumptions in model and derivative valuation adjustments and other.

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.

Overhead ratio:Noninterest expense as a percentage of total net revenue.

Principal transactions (revenue):Realized and unrealized gains and losses from trading activities (including physical commodities inventories that are accounted for at the lower of cost or fair value) and changes in fair value associated with financial instruments held by the Investment Bank for which the SFAS 159 fair value option was elected. Principal transactions revenue also include private equity gains and losses.

Reported basis:Financial statements prepared under accounting principles generally accepted in the United States of America (“U.S. GAAP”). The reported basis includes the impact of credit card securitizations, but excludes the impact of taxable equivalent adjustments.

SFAS:Statement of Financial Accounting Standards.

SFAS 140:“Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities — a replacement of FASB Statement No. 125.”

SFAS 141:“Business Combinations.”

SFAS 157:“Fair Value Measurements.”

SFAS 159:“The Fair Value Option for Financial Assets and Financial Liabilities — Including an amendment of FASB Statement No. 115.”

SOP 03-3:“Accounting for Certain Loans of Debt Securities Acquired in a Transfer.”

Taxable-equivalent basis:Total net revenue for each of the business segments and the Firm is presented on a tax-equivalent basis. Accordingly, revenue from tax-exempt securities and investments that receive tax credits is presented in the managed results on a basis comparable to fully taxable securities and investments. This non-GAAP financial measure allows management to assess the comparability of revenue arising from both taxable and tax-exempt sources. The corresponding income tax impact related to these items is recorded within income tax expense.

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. GAAP:Accounting principles generally accepted in the United States of America.

Value-at-risk (“VAR”):A measure of the dollar amount of potential loss from adverse market moves in an ordinary market environment.

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JPMORGAN CHASE & CO.
Line of Business Metrics

Investment Banking

IB’S REVENUE COMPRISES THE FOLLOWING:

1. Investment banking feesinclude advisory, equity underwriting, bond underwriting and loan syndication fees.

2. Fixed income marketsinclude client and portfolio management revenue related to both market-making and proprietary risk-taking across global fixed income markets, including foreign exchange, interest rate, credit and commodities markets.

3. Equities marketsinclude client and portfolio management revenue related to market-making and proprietary risk-taking across global equity products, including cash instruments, derivatives and convertibles.

4. Credit portfolio revenueincludes net interest income, fees and loan sale activity, as well as gains or losses on securities received as part of a loan restructuring, for the IB’s credit portfolio. Credit portfolio revenue also includes the results of risk management related to the Firm’s lending and derivative activities, and changes in the credit valuation adjustment, which is the component of the fair value of a derivative that reflects the credit quality of the counterparty.

Retail Financial Services

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN REGIONAL BANKING:

1. Personal bankers —Retail branch office personnel who acquire, retain and expand new and existing customer relationships by assessing customer needs and recommending and selling appropriate banking products and services.

2. Sales specialists— Retail branch office personnel who specialize in the marketing of a single product, including mortgages, investments, and business banking, by partnering with the personal bankers.

MORTGAGE BANKING REVENUE COMPRISES THE FOLLOWING:

1. Production revenueincludes net gains or losses on originations and sales of prime and subprime mortgage loans and other production-related fees.

2. Net mortgage servicing revenue

a)	Servicing revenuerepresents all gross income earned from servicing third-party mortgage loans including stated service fees, excess service fees, late fees and other ancillary fees.
b)	Changes in MSR asset fair value due to:

— market-based inputssuch as interest rates and volatility, as well as updates to assumptions used in the MSR valuation model.

— modeled servicing portfolio runoff (or time decay)

c) Derivative valuation adjustments and other, which represents changes in the fair value of derivative instruments used to offset the impact of changes in the market-based inputs to the MSR valuation model.

3. MSR risk management resultsinclude changes in the MSR asset fair value due to inputs or assumptions and derivative valuation adjustments and other.

Retail Financial Services (continued)

MORTGAGE BANKING’S ORIGINATION CHANNELS COMPRISE THE FOLLOWING:

1. Retail— Borrowers who are buying or refinancing 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 real estate brokers, home builders or other third parties.

2. Wholesale— A third-party mortgage broker refers loan applications to a mortgage banker at the Firm. Brokers are independent loan originators that specialize in finding and counseling borrowers but do not provide funding for and do not underwrite the loans.

3. Correspondent— Correspondents are banks, thrifts, other mortgage banks and other financial institutions that sell closed loans to the Firm.

4. Correspondent negotiated transactions (“CNT”)— These transactions occur when mid- to large-sized mortgage lenders, banks and bank-owned mortgage companies sell servicing to the Firm on an as-originated basis, and exclude purchased bulk servicing transactions. These transactions supplement traditional production channels and provide growth opportunities in the servicing portfolio in stable and rising-rate periods.

Card Services

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN CARD SERVICES:

1. Charge volume— Represents the dollar amount of cardmember purchases, balance transfers and cash advance activity.

2. Net accounts opened— Includes originations, purchases and sales.

3. Merchant acquiring business— Represents an entity that processes bank card transactions for merchants. JPMorgan Chase & Co. is a partner in Chase Paymentech Solutions, LLC, a merchant acquiring business.

4. Bank card volume— Represents the dollar amount of transactions processed for merchants.

5. Total transactions— Represents the number of transactions and authorizations processed for merchants.

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JPMORGAN CHASE & CO.
Line of Business Metrics (continued)

Commercial Banking

COMMERCIAL BANKING REVENUE COMPRISES THE FOLLOWING:

1. Lendingincludes a variety of financing alternatives, which are primarily provided on a basis secured by receivables, inventory, equipment, real estate or other assets. Products include term loans, revolving lines of credit, bridge financing, asset-based structures and leases.

2. Treasury servicesincludes a broad range of products and services enabling clients to transfer, invest and manage the receipt and disbursement of funds, while providing the related information reporting. These products and services include U.S. dollar and multi-currency clearing, ACH, lockbox, disbursement and reconciliation services, check deposits, other check and currency-related services, trade finance and logistics solutions, commercial card, and deposit products, sweeps and money market mutual funds.

3. Investment bankingproducts provide clients with sophisticated capital-raising alternatives, as well as balance sheet and risk management tools through loan syndications, investment-grade debt, asset-backed securities, private placements, high-yield bonds, equity underwriting, advisory, interest rate derivatives, foreign exchange hedges and securities sales.

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN COMMERCIAL BANKING:

1. Liability balancesinclude deposits and deposits that are swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities sold under repurchase agreements.

2. IB revenue, gross— Represents total revenue related to investment banking products sold to CB clients.

Treasury & Securities Services

Treasury & Securities Services firmwide metrics include certain TSS product revenue and liability balances reported in other lines of business related to customers who are also customers of those other lines of business. In order to capture the firmwide impact of TS and TSS products and revenue, management reviews firmwide metrics such as liability balances, revenue and overhead ratios in assessing financial performance for TSS. Firmwide metrics are necessary, in management’s view, in order to understand the aggregate TSS business.

DESCRIPTION OF SELECTED BUSINESS METRICS WITHIN TREASURY & SECURITIES SERVICES:

Liability balancesinclude deposits and deposits that are swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities sold under repurchase agreements.

Asset Management

Assets under management:Represent assets actively managed by Asset Management on behalf of institutional, private banking, retail, private client services and Bear Stearns brokerage clients. Excludes assets managed by American Century Companies, Inc., in which the Firm has a 43% ownership interest as of September 30, 2008.

Assets under supervision:Represents assets under management as well as custody, brokerage, administration and deposit accounts.

Alternative assets:The following types of assets constitute alternative investments — hedge funds, currency, real estate and private equity.

AM’s CLIENT SEGMENTS COMPRISE THE FOLLOWING:

1. Institutionalbrings comprehensive global investment services — including asset management, pension analytics, asset/liability management and active risk budgeting strategies — to corporate and public institutions, endowments, foundations, not-for-profit organizations and governments worldwide.

2. ThePrivate Bankaddresses every facet of wealth management for ultra-high-net-worth individuals and families worldwide, including investment management, capital markets and risk management, tax and estate planning, banking, capital raising and specialty-wealth advisory services.

3. Retailprovides worldwide investment management services and retirement planning and administration through third-party and direct distribution of a full range of investment vehicles.

4. Private Wealth Managementoffers high-net-worth individuals, families and business owners in the United States comprehensive wealth management solutions, including investment management, capital markets and risk management, tax and estate planning, banking, and specialty-wealth advisory services.

5. Bear Stearns Brokerageprovides investment advice and wealth management services to high-net-worth individuals, money managers, and small corporations.

Page 36