JPMorgan Chase & Co. (JPM) 8-K Jpmorgan Chase Reports Fourth-quarter 2009 Net Income of $3.3 Billion, or $0.74 Per Share, on REVENUE1 of $25.2 Billion

Exhibit 99.2

EARNINGS RELEASE FINANCIAL SUPPLEMENT

FOURTH QUARTER 2009

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		17
Commercial Banking		20
Treasury & Securities Services		22
Asset Management		24
Corporate/Private Equity		27
Credit-Related Information		29
Market Risk-Related Information		34
Supplemental Detail
Capital, Intangible Assets and Deposits		35
Per Share-Related Information		36
Glossary of Terms		37

Page 1

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
SELECTED INCOME STATEMENT DATA:
Reported Basis
Total net revenue	$	23,164		$	26,622		$	25,623		$	25,025		$	17,226			(13	)%		34	%	$	100,434		$	67,252			49	%
Total noninterest expense		12,004			13,455			13,520			13,373			11,255			(11	)		7			52,352			43,500			20
Pre-provision profit (a)		11,160			13,167			12,103			11,652			5,971			(15	)		87			48,082			23,752			102
Provision for credit losses		7,284			8,104			8,031			8,596			7,313			(10	)		—			32,015			20,979			53
Income/(loss) before extraordinary gain		3,278			3,512			2,721			2,141			(623	)		(7	)	NM				11,652			3,699			215
Extraordinary gain		—			76			—			—			1,325		NM			NM				76			1,906			(96	)
NET INCOME		3,278			3,588			2,721			2,141			702			(9	)		367			11,728			5,605			109
Managed Basis (b)
Total net revenue	$	25,236		$	28,780		$	27,709		$	26,922		$	19,108			(12	)		32		$	108,647		$	72,772			49
Total noninterest expense		12,004			13,455			13,520			13,373			11,255			(11	)		7			52,352			43,500			20
Pre-provision profit (a)		13,232			15,325			14,189			13,549			7,853			(14	)		68			56,295			29,272			92
Provision for credit losses		8,901			9,802			9,695			10,060			8,541			(9	)		4			38,458			24,591			56
Income/(loss) before extraordinary gain		3,278			3,512			2,721			2,141			(623	)		(7	)	NM				11,652			3,699			215
Extraordinary gain		—			76			—			—			1,325		NM			NM				76			1,906			(96	)
NET INCOME		3,278			3,588			2,721			2,141			702			(9	)		367			11,728			5,605			109
PER COMMON SHARE:
Basic Earnings (c)
Income/(loss) before extraordinary gain		0.75			0.80			0.28			0.40			(0.29	)		(6	)	NM				2.25			0.81			178
Net income		0.75			0.82			0.28			0.40			0.06			(9	)	NM				2.27			1.35			68
Diluted Earnings (c) (d)
Income/(loss) before extraordinary gain		0.74			0.80			0.28			0.40			(0.29	)		(8	)	NM				2.24			0.81			177
Net income		0.74			0.82			0.28			0.40			0.06			(10	)	NM				2.26			1.35			67
Cash dividends declared		0.05			0.05			0.05			0.05			0.38			—			(87	)		0.20			1.52			(87	)
Book value		39.88			39.12			37.36			36.78			36.15			2			10			39.88			36.15			10
Closing share price		41.67			43.82			34.11			26.58			31.53			(5	)		32			41.67			31.53			32
Market capitalization		164,261			172,596			133,852			99,881			117,695			(5	)		40			164,261			117,695			40
COMMON SHARES OUTSTANDING:
Weighted-average diluted shares outstanding (c)		3,974.1			3,962.0			3,824.1			3,758.7			3,737.5			—			6			3,879.7			3,521.8			10
Common shares outstanding at period-end		3,942.0			3,938.7			3,924.1			3,757.7			3,732.8			—			6			3,942.0			3,732.8			6
FINANCIAL RATIOS: (e)
Income/(loss) before extraordinary gain:
Return on common equity (“ROE”) (f)		8	%		9	%		3	%		5	%		(3	)%								6	%		2	%
Return on tangible common equity (“ROTCE”) (f)(g)		12			13			5			8			(5	)								10			4
Return on assets (“ROA”)		0.65			0.70			0.54			0.42			(0.11	)								0.58			0.21
Net income:
ROE (f)		8			9			3			5			1									6			4
ROTCE (f)(g)		12			14			5			8			1									10			6
ROA		0.65			0.71			0.54			0.42			0.13									0.58			0.31
CAPITAL RATIOS:
Tier 1 capital ratio		11.1	(i)		10.2			9.7			11.4			10.9
Total capital ratio		14.8	(i)		13.9			13.3			15.2			14.8
Tier 1 common capital ratio (h)		8.8	(i)		8.2			7.7			7.3			7.0
SELECTED BALANCE SHEET DATA (Period-end)
Total assets	$	2,031,989		$	2,041,009		$	2,026,642		$	2,079,188		$	2,175,052			—			(7	)	$	2,031,989		$	2,175,052			(7	)
Wholesale loans		204,175			218,953			231,625			242,284			262,044			(7	)		(22	)		204,175			262,044			(22	)
Consumer loans		429,283			434,191			448,976			465,959			482,854			(1	)		(11	)		429,283			482,854			(11	)
Deposits		938,367			867,977			866,477			906,969			1,009,277			8			(7	)		938,367			1,009,277			(7	)
Common stockholders’ equity		157,213			154,101			146,614			138,201			134,945			2			17			157,213			134,945			17
Total stockholders’ equity		165,365			162,253			154,766			170,194			166,884			2			(1	)		165,365			166,884			(1	)
Headcount		222,316			220,861			220,255			219,569			224,961			1			(1	)		222,316			224,961			(1	)
LINE OF BUSINESS NET INCOME/(LOSS)
Investment Bank	$	1,901		$	1,921		$	1,471		$	1,606		$	(2,364	)		(1	)	NM			$	6,899		$	(1,175	)	NM
Retail Financial Services		(399	)		7			15			474			624		NM			NM				97			880			(89	)
Card Services		(306	)		(700	)		(672	)		(547	)		(371	)		56			18			(2,225	)		780		NM
Commercial Banking		224			341			368			338			480			(34	)		(53	)		1,271			1,439			(12	)
Treasury & Securities Services		237			302			379			308			533			(22	)		(56	)		1,226			1,767			(31	)
Asset Management		424			430			352			224			255			(1	)		66			1,430			1,357			5
Corporate/Private Equity		1,197			1,287			808			(262	)		1,545			(7	)		(23	)		3,030			557			444
Net income	$	3,278		$	3,588		$	2,721		$	2,141		$	702			(9	)		367		$	11,728		$	5,605			109

(a)	Pre-provision profit is total net revenue less noninterest expense. The Firm believes that this financial measure is useful in assessing the ability of a lending institution to generate income in excess of its provision for credit losses.
(b)	For further discussion of managed basis, see Reconciliation from reported to managed summary on page 6.
(c)	Effective January 1, 2009, the Firm implemented new FASB guidance for participating securities. Accordingly, prior period amounts have been revised as required. For further discussion of the guidance, see Per share-related information on page 36.
(d)	The calculation of second quarter and full year 2009 earnings per share includes a one-time, non-cash reduction of $1.1 billion, or $0.27 per share, resulting from repayment of TARP preferred capital.
(e)	Quarterly ratios are based upon annualized amounts.
(f)	The calculation of second quarter and full year 2009 net income applicable to common equity includes a one-time, non-cash reduction of $1.1 billion resulting from repayment of TARP preferred capital. Excluding this reduction, the adjusted ROE for the second quarter and full year 2009 was 6% and 7%, respectively, and the adjusted ROTCE for the second quarter and full year 2009 was 10% and 11%, respectively. The Firm views the adjusted ROE and ROTCE, both non-GAAP financial measures, as meaningful because they increase the comparability to prior periods.
(g)	Net income applicable to common equity divided by total average common stockholders’ equity (i.e., total stockholders’ equity less preferred stock) less identifiable intangible assets (other than MSRs) and goodwill, net of related deferred tax liabilities. The Firm uses return on tangible common equity, a non-GAAP financial measure, to assess the Firm’s use of equity.
(h)	Tier 1 common is calculated as Tier 1 capital less qualifying perpetual preferred stock, qualifying trust preferred securities and qualifying minority interest in subsidiaries. The Firm uses the Tier 1 common capital ratio, a non-GAAP financial measure, to assess and compare the quality and composition of the Firm’s capital with the capital of other financial services companies.
(i)	Estimated.

Page 2

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
REVENUE
Investment banking fees	$	1,916		$	1,679		$	2,106		$	1,386		$	1,382			14	%		39	%	$	7,087		$	5,526			28	%
Principal transactions		838			3,860			3,097			2,001			(7,885	)		(78	)	NM				9,796			(10,699	)	NM
Lending & deposit-related fees		1,765			1,826			1,766			1,688			1,776			(3	)		(1	)		7,045			5,088			38
Asset management, administration and commissions		3,361			3,158			3,124			2,897			3,234			6			4			12,540			13,943			(10	)
Securities gains		381			184			347			198			456			107			(16	)		1,110			1,560			(29	)
Mortgage fees and related income		450			843			784			1,601			1,789			(47	)		(75	)		3,678			3,467			6
Credit card income		1,844			1,710			1,719			1,837			2,049			8			(10	)		7,110			7,419			(4	)
Other income		231			625			10			50			593			(63	)		(61	)		916			2,169			(58	)
Noninterest revenue		10,786			13,885			12,953			11,658			3,394			(22	)		218			49,282			28,473			73
Interest income		15,615			16,260			16,549			17,926			21,631			(4	)		(28	)		66,350			73,018			(9	)
Interest expense		3,237			3,523			3,879			4,559			7,799			(8	)		(58	)		15,198			34,239			(56	)
Net interest income		12,378			12,737			12,670			13,367			13,832			(3	)		(11	)		51,152			38,779			32
TOTAL NET REVENUE		23,164			26,622			25,623			25,025			17,226			(13	)		34			100,434			67,252			49
Provision for credit losses		7,284			8,104			8,031			8,596			7,313			(10	)		—			32,015			20,979			53
NONINTEREST EXPENSE
Compensation expense		5,112			7,311			6,917			7,588			5,024			(30	)		2			26,928			22,746			18
Occupancy expense		944			923			914			885			955			2			(1	)		3,666			3,038			21
Technology, communications and equipment expense		1,182			1,140			1,156			1,146			1,207			4			(2	)		4,624			4,315			7
Professional & outside services		1,682			1,517			1,518			1,515			1,819			11			(8	)		6,232			6,053			3
Marketing		536			440			417			384			501			22			7			1,777			1,913			(7	)
Other expense (a)		2,262			1,767			2,190			1,375			1,242			28			82			7,594			3,740			103
Amortization of intangibles		256			254			265			275			326			1			(21	)		1,050			1,263			(17	)
Merger costs		30			103			143			205			181			(71	)		(83	)		481			432			11
TOTAL NONINTEREST EXPENSE		12,004			13,455			13,520			13,373			11,255			(11	)		7			52,352			43,500			20
Income/(loss) before income tax expense and extraordinary gain		3,876			5,063			4,072			3,056			(1,342	)		(23	)	NM				16,067			2,773			479
Income tax expense/(benefit) (b)		598			1,551			1,351			915			(719	)		(61	)	NM				4,415			(926	)	NM
Income/(loss) before extraordinary gain		3,278			3,512			2,721			2,141			(623	)		(7	)	NM				11,652			3,699			215
Extraordinary gain (c)		—			76			—			—			1,325		NM			NM				76			1,906			(96	)
NET INCOME	$	3,278		$	3,588		$	2,721		$	2,141		$	702			(9	)		367		$	11,728		$	5,605			109
DILUTED EARNINGS PER SHARE
Income/(loss) before extraordinary gain (d)(e)	$	0.74		$	0.80		$	0.28		$	0.40		$	(0.29	)		(8	)	NM			$	2.24		$	0.81			177
Extraordinary gain		—			0.02			—			—			0.35		NM			NM				0.02			0.54			(96	)
NET INCOME (d)(e)	$	0.74		$	0.82		$	0.28		$	0.40		$	0.06			(10	)	NM			$	2.26		$	1.35			67
FINANCIAL RATIOS
Income/(loss) before extraordinary gain:
ROE (f)		8	%		9	%		3	%		5	%		(3	)%								6	%		2	%
ROTCE (f)		12			13			5			8			(5	)								10			4
ROA		0.65			0.70			0.54			0.42			(0.11	)								0.58			0.21
Net income:
ROE (f)		8			9			3			5			1									6			4
ROTCE (f)		12			14			5			8			1									10			6
ROA		0.65			0.71			0.54			0.42			0.13									0.58			0.31
Effective income tax rate		15			31			33			30			54									27			(33	)
Overhead ratio		52			51			53			53			65									52			65
EXCLUDING IMPACT OF MERGER COSTS (g)
Income/(loss) before extraordinary gain	$	3,278		$	3,512		$	2,721		$	2,141		$	(623	)		(7	)	NM			$	11,652		$	3,699			215
Merger costs (after-tax)		18			64			89			127			112			(72	)		(84	)		298			268			11
Income/(loss) before extraordinary gain excluding merger costs	$	3,296		$	3,576		$	2,810		$	2,268		$	(511	)		(8	)	NM			$	11,950		$	3,967			201
Diluted Per Share:
Income/(loss) before extraordinary gain (d)(e)	$	0.74		$	0.80		$	0.28		$	0.40		$	(0.29	)		(8	)	NM			$	2.24		$	0.81			177
Merger costs (after-tax)		0.01			0.02			0.02			0.03			0.03			(50	)		(67	)		0.08			0.07			14
Income/(loss) before extraordinary gain excluding merger costs (d)(e)	$	0.75		$	0.82		$	0.30		$	0.43		$	(0.26	)		(9	)	NM			$	2.32		$	0.88			164

(a)	Second quarter 2009 includes a $675 million FDIC special assessment.
(b)	The income tax expense in the fourth quarter of 2009 includes tax benefits recognized upon the resolution of tax audits. The income tax benefit in the full year of 2008 included the realization of a benefit from the release of deferred tax liabilities associated with the undistributed earnings of certain non-U.S. subsidiaries that were deemed to be reinvested indefinitely.
(c)	JPMorgan Chase acquired the banking operations of Washington Mutual Bank for $1.9 billion. The fair value of the net assets acquired exceeded the purchase price, which resulted in negative goodwill. In accordance with U.S. GAAP for business combinations, 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)	Effective January 1, 2009, the Firm implemented new FASB guidance for participating securities. Accordingly, prior period amounts have been revised as required. For further discussion of this guidance, see Per share-related information on page 36.
(e)	The calculation of second quarter and full year 2009 earnings per share includes a one-time, non-cash reduction of $1.1 billion, or $0.27 per share, resulting from repayment of TARP preferred capital.
(f)	The calculation of second quarter and full year 2009 net income applicable to common equity includes a one-time, non-cash reduction of $1.1 billion resulting from repayment of TARP preferred capital. Excluding this reduction, the adjusted ROE for the second quarter and full year 2009 was 6% and 7%, respectively, and the adjusted ROTCE for the second quarter and full year 2009 was 10% and 11%, respectively. The Firm views the adjusted ROE and ROTCE, both non-GAAP financial measures, as meaningful because they increase the comparability to prior periods.
(g)	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)

																Dec 31, 2009
																Change
	Dec 31			Sep 30			Jun 30			Mar 31			Dec 31			Sep 30			Dec 31
	2009			2009			2009			2009			2008			2009			2008
ASSETS
Cash and due from banks	$	26,206		$	21,068		$	25,133		$	26,681		$	26,895			24	%		(3	)%
Deposits with banks		63,230			59,623			61,882			89,865			138,139			6			(54	)
Federal funds sold and securities purchased under resale agreements		195,404			171,007			159,170			157,237			203,115			14			(4	)
Securities borrowed		119,630			128,059			129,263			127,928			124,000			(7	)		(4	)
Trading assets:
Debt and equity instruments		330,918			330,370			298,135			298,453			347,357			—			(5	)
Derivative receivables		80,210			94,065			97,491			131,247			162,626			(15	)		(51	)
Securities		360,390			372,867			345,563			333,861			205,943			(3	)		75
Loans		633,458			653,144			680,601			708,243			744,898			(3	)		(15	)
Less: Allowance for loan losses		31,602			30,633			29,072			27,381			23,164			3			36
Loans, net of allowance for loan losses		601,856			622,511			651,529			680,862			721,734			(3	)		(17	)
Accrued interest and accounts receivable		67,427			59,948			61,302			52,168			60,987			12			11
Premises and equipment		11,118			10,675			10,668			10,336			10,045			4			11
Goodwill		48,357			48,334			48,288			48,201			48,027			—			1
Other intangible assets:
Mortgage servicing rights		15,531			13,663			14,600			10,634			9,403			14			65
Purchased credit card relationships		1,246			1,342			1,431			1,528			1,649			(7	)		(24	)
All other intangibles		3,375			3,520			3,651			3,821			3,932			(4	)		(14	)
Other assets		107,091			103,957			118,536			106,366			111,200			3			(4	)
TOTAL ASSETS	$	2,031,989		$	2,041,009		$	2,026,642		$	2,079,188		$	2,175,052			—			(7	)
LIABILITIES
Deposits	$	938,367		$	867,977		$	866,477		$	906,969		$	1,009,277			8			(7	)
Federal funds purchased and securities loaned or sold under repurchase agreements		261,413			310,219			300,931			279,837			192,546			(16	)		36
Commercial paper		41,794			53,920			42,713			33,085			37,845			(22	)		10
Other borrowed funds		55,740			50,824			73,968			112,257			132,400			10			(58	)
Trading liabilities:
Debt and equity instruments		64,946			65,233			56,021			53,786			45,274			—			43
Derivative payables		60,125			69,214			67,197			86,020			121,604			(13	)		(51	)
Accounts payable and other liabilities (including the allowance for lending-related commitments)		162,696			171,386			171,685			165,521			187,978			(5	)		(13	)
Beneficial interests issued by consolidated VIEs		15,225			17,859			20,945			9,674			10,561			(15	)		44
Long-term debt		246,703			254,413			254,226			243,569			252,094			(3	)		(2	)
Junior subordinated deferrable interest debentures held by trusts that issued guaranteed capital debt securities		19,615			17,711			17,713			18,276			18,589			11			6
TOTAL LIABILITIES		1,866,624			1,878,756			1,871,876			1,908,994			2,008,168			(1	)		(7	)
STOCKHOLDERS’ EQUITY
Preferred stock		8,152			8,152			8,152			31,993			31,939			—			(74	)
Common stock		4,105			4,105			4,105			3,942			3,942			—			4
Capital surplus		97,982			97,564			97,662			91,469			92,143			—			6
Retained earnings		62,481			59,573			56,355			55,487			54,013			5			16
Accumulated other comprehensive income (loss)		(91	)		283			(3,438	)		(4,490	)		(5,687	)	NM				98
Shares held in RSU trust		(68	)		(86	)		(86	)		(86	)		(217	)		21			69
Treasury stock, at cost		(7,196	)		(7,338	)		(7,984	)		(8,121	)		(9,249	)		2			22
TOTAL STOCKHOLDERS’ EQUITY		165,365			162,253			154,766			170,194			166,884			2			(1	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,031,989		$	2,041,009		$	2,026,642		$	2,079,188		$	2,175,052			—			(7	)

Page 4

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
AVERAGE BALANCES
ASSETS
Deposits with banks	$	49,705		$	62,248		$	68,001		$	88,587		$	106,156			(20	)%		(53	)%	$	67,015		$	54,666			23	%
Federal funds sold and securities purchased under resale agreements		156,848			151,705			142,226			160,986			205,182			3			(24	)		152,926			170,006			(10	)
Securities borrowed		125,453			129,301			122,235			120,752			123,523			(3	)		2			124,462			110,598			13
Trading assets — debt instruments		256,414			250,148			245,444			252,098			269,576			3			(5	)		251,035			298,266			(16	)
Securities		374,327			359,451			354,216			281,420			174,652			4			114			342,655			123,551			177
Loans		642,406			665,386			697,908			726,959			752,524			(3	)		(15	)		682,885			588,801			16
Other assets (a)		29,868			24,155			36,638			27,411			56,322			24			(47	)		29,510			27,404			8
Total interest-earning assets		1,635,021			1,642,394			1,666,668			1,658,213			1,687,935			—			(3	)		1,650,488			1,373,292			20
Trading assets — equity instruments		74,936			66,790			63,507			62,748			72,782			12			3			67,028			85,836			(22	)
Goodwill		48,341			48,328			48,273			48,071			46,838			—			3			48,254			46,068			5
Other intangible assets:
Mortgage servicing rights		13,768			14,384			12,256			11,141			14,837			(4	)		(7	)		12,898			11,229			15
All other intangible assets		4,741			4,984			5,218			5,443			5,586			(5	)		(15	)		5,095			5,779			(12	)
All other noninterest-earning assets		216,418			222,296			242,450			281,503			339,887			(3	)		(36	)		240,438			269,413			(11	)
TOTAL ASSETS	$	1,993,225		$	1,999,176		$	2,038,372		$	2,067,119		$	2,167,865			—			(8	)	$	2,024,201		$	1,791,617			13
LIABILITIES
Interest-bearing deposits	$	667,269		$	660,998		$	672,350		$	736,460		$	777,604			1			(14	)	$	684,016		$	645,058			6
Federal funds purchased and securities loaned or sold under repurchase agreements		283,263			303,175			289,971			226,110			203,568			(7	)		39			275,862			196,739			40
Commercial paper		42,290			42,728			37,371			33,694			40,486			(1	)		4			39,055			45,734			(15	)
Other borrowings and liabilities (b)		182,422			178,985			207,489			236,673			264,236			2			(31	)		201,182			161,555			25
Beneficial interests issued by consolidated VIEs		16,002			19,351			14,493			9,757			9,440			(17	)		70			14,930			13,220			13
Long-term debt		268,476			271,281			274,323			258,732			248,125			(1	)		8			268,238			234,909			14
Total interest-bearing liabilities		1,459,722			1,476,518			1,495,997			1,501,426			1,543,459			(1	)		(5	)		1,483,283			1,297,215			14
Noninterest-bearing liabilities		368,826			365,038			373,172			397,243			460,894			1			(20	)		375,961			356,148			6
TOTAL LIABILITIES		1,828,548			1,841,556			1,869,169			1,898,669			2,004,353			(1	)		(9	)		1,859,244			1,653,363			12
Preferred stock		8,152			8,152			28,338			31,957			24,755			—			(67	)		19,054			9,138			109
Common stockholders’ equity		156,525			149,468			140,865			136,493			138,757			5			13			145,903			129,116			13
TOTAL STOCKHOLDERS’ EQUITY		164,677			157,620			169,203			168,450			163,512			4			1			164,957			138,254			19
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,993,225		$	1,999,176		$	2,038,372		$	2,067,119		$	2,167,865			—			(8	)	$	2,024,201		$	1,791,617			13
AVERAGE RATES
INTEREST-EARNING ASSETS
Deposits with banks		0.95	%		0.83	%		1.45	%		2.03	%		3.34	%								1.40	%		3.51	%
Federal funds sold and securities purchased under resale agreements		0.92			0.96			1.04			1.64			2.88									1.14			3.52
Securities borrowed		0.14			(0.09	)		(0.32	)		0.29			0.92									—			2.08
Trading assets — debt instruments		4.63			4.78			4.91			5.27			6.18									4.89			5.89
Securities		3.32			3.62			3.64			4.16			5.14									3.65			5.22
Loans		5.51			5.64			5.65			5.87			6.44									5.67			6.54
Other assets (a)		1.42			2.18			0.80			2.44			3.06									1.62			3.27
Total interest-earning assets		3.80			3.95			4.00			4.41			5.12									4.04			5.36
INTEREST-BEARING LIABILITIES
Interest-bearing deposits		0.53			0.65			0.70			0.93			1.53									0.71			2.26
Federal funds purchased and securities sold under repurchase agreements		0.08			0.20			0.23			0.36			0.95									0.21			2.37
Commercial paper		0.20			0.23			0.24			0.47			1.17									0.28			2.24
Other borrowings and liabilities (b)		1.87			1.70			1.32			1.46			2.56									1.57			3.24
Beneficial interests issued by consolidated VIEs		1.32			1.43			1.59			1.57			3.79									1.46			3.06
Long-term debt		2.01			2.09			2.60			2.73			3.87									2.35			3.56
Total interest-bearing liabilities		0.88			0.95			1.04			1.23			2.01									1.02			2.64
INTEREST RATE SPREAD		2.92	%		3.00	%		2.96	%		3.18	%		3.11	%								3.02	%		2.72	%
NET YIELD ON INTEREST-EARNING ASSETS		3.02	%		3.10	%		3.07	%		3.29	%		3.28	%								3.12	%		2.87	%
NET YIELD ON INTEREST-EARNING ASSETS ADJUSTED FOR SECURITIZATIONS		3.33	%		3.40	%		3.37	%		3.60	%		3.55	%								3.42	%		3.19	%

(a)	Includes margin loans and the Firm’s investment in asset-backed commercial paper under the Federal Reserve Bank of Boston’s AML facility.
(b)	Includes securities sold but not yet purchased, brokerage customer payables and advances from Federal Home Loan Banks.

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”). This 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 results and the results of lines of business 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 it 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 37.

		QUARTERLY TRENDS																					FULL YEAR
																	4Q09 Change												2009 Change
		4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
CREDIT CARD INCOME
Credit card income — reported		$	1,844		$	1,710		$	1,719		$	1,837		$	2,049			8	%		(10	)%	$	7,110		$	7,419			(4	)%
Impact of:
Credit card securitizations			(375	)		(285	)		(294	)		(540	)		(710	)		(32	)		47			(1,494	)		(3,333	)		55
Credit card income — managed		$	1,469		$	1,425		$	1,425		$	1,297		$	1,339			3			10		$	5,616		$	4,086			37
OTHER INCOME
Other income — reported		$	231		$	625		$	10		$	50		$	593			(63	)		(61	)	$	916		$	2,169			(58	)
Impact of:
Tax-equivalent adjustments			397			371			335			337			556			7			(29	)		1,440			1,329			8
Other income — managed		$	628		$	996		$	345		$	387		$	1,149			(37	)		(45	)	$	2,356		$	3,498			(33	)
TOTAL NONINTEREST REVENUE
Total noninterest revenue — reported		$	10,786		$	13,885		$	12,953		$	11,658		$	3,394			(22	)		218		$	49,282		$	28,473			73
Impact of:
Credit card securitizations			(375	)		(285	)		(294	)		(540	)		(710	)		(32	)		47			(1,494	)		(3,333	)		55
Tax-equivalent adjustments			397			371			335			337			556			7			(29	)		1,440			1,329			8
Total noninterest revenue — managed		$	10,808		$	13,971		$	12,994		$	11,455		$	3,240			(23	)		234		$	49,228		$	26,469			86
NET INTEREST INCOME
Net interest income — reported		$	12,378		$	12,737		$	12,670		$	13,367		$	13,832			(3	)		(11	)	$	51,152		$	38,779			32
Impact of:
Credit card securitizations			1,992			1,983			1,958			2,004			1,938			—			3			7,937			6,945			14
Tax-equivalent adjustments			58			89			87			96			98			(35	)		(41	)		330			579			(43	)
Net interest income — managed		$	14,428		$	14,809		$	14,715		$	15,467		$	15,868			(3	)		(9	)	$	59,419		$	46,303			28
	��
TOTAL NET REVENUE
Total net revenue — reported		$	23,164		$	26,622		$	25,623		$	25,025		$	17,226			(13	)		34		$	100,434		$	67,252			49
Impact of:
Credit card securitizations			1,617			1,698			1,664			1,464			1,228			(5	)		32			6,443			3,612			78
Tax-equivalent adjustments			455			460			422			433			654			(1	)		(30	)		1,770			1,908			(7	)
Total net revenue — managed		$	25,236		$	28,780		$	27,709		$	26,922		$	19,108			(12	)		32		$	108,647		$	72,772			49
PRE-PROVISION PROFIT
Total pre-provision profit — reported		$	11,160		$	13,167		$	12,103		$	11,652		$	5,971			(15	)		87		$	48,082		$	23,752			102
Impact of:
Credit card securitizations			1,617			1,698			1,664			1,464			1,228			(5	)		32			6,443			3,612			78
Tax-equivalent adjustments			455			460			422			433			654			(1	)		(30	)		1,770			1,908			(7	)
Total pre-provision profit — managed		$	13,232		$	15,325		$	14,189		$	13,549		$	7,853			(14	)		68		$	56,295		$	29,272			92
PROVISION FOR CREDIT LOSSES
Provision for credit losses — reported		$	7,284		$	8,104		$	8,031		$	8,596		$	7,313			(10	)		—		$	32,015		$	20,979			53
Impact of:
Credit card securitizations			1,617			1,698			1,664			1,464			1,228			(5	)		32			6,443			3,612			78
Provision for credit losses — managed		$	8,901		$	9,802		$	9,695		$	10,060		$	8,541			(9	)		4		$	38,458		$	24,591			56
INCOME TAX EXPENSE/(BENEFIT)
Income tax expense/(benefit) — reported		$	598		$	1,551		$	1,351		$	915		$	(719	)		(61	)	NM			$	4,415		$	(926	)	NM
Impact of:
Tax-equivalent adjustments			455			460			422			433			654			(1	)		(30	)		1,770			1,908			(7	)
Income tax expense/(benefit) — managed		$	1,053		$	2,011		$	1,773		$	1,348		$	(65	)		(48	)	NM			$	6,185		$	982		NM

Page 6

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
TOTAL NET REVENUE (FTE)
Investment Bank (a)	$	4,929		$	7,508		$	7,301		$	8,371		$	(272	)		(34	)%	NM		%	$	28,109		$	12,335			128	%
Retail Financial Services		7,669			8,218			7,970			8,835			8,684			(7	)		(12	)		32,692			23,520			39
Card Services		5,148			5,159			4,868			5,129			4,908			—			5			20,304			16,474			23
Commercial Banking		1,406			1,459			1,453			1,402			1,479			(4	)		(5	)		5,720			4,777			20
Treasury & Securities Services		1,835			1,788			1,900			1,821			2,249			3			(18	)		7,344			8,134			(10	)
Asset Management		2,195			2,085			1,982			1,703			1,658			5			32			7,965			7,584			5
Corporate/Private Equity (a)		2,054			2,563			2,235			(339	)		402			(20	)		411			6,513			(52	)	NM
TOTAL NET REVENUE	$	25,236		$	28,780		$	27,709		$	26,922		$	19,108			(12	)		32		$	108,647		$	72,772			49
TOTAL PRE-PROVISION PROFIT
Investment Bank (a)	$	2,643		$	3,234		$	3,234		$	3,597		$	(3,013	)		(18	)	NM			$	12,708		$	(1,509	)	NM
Retail Financial Services		3,367			4,022			3,891			4,664			4,638			(16	)		(27	)		15,944			11,443			39
Card Services		3,752			3,853			3,535			3,783			3,419			(3	)		10			14,923			11,334			32
Commercial Banking		863			914			918			849			980			(6	)		(12	)		3,544			2,831			25
Treasury & Securities Services		444			508			612			502			910			(13	)		(51	)		2,066			2,911			(29	)
Asset Management		725			734			628			405			445			(1	)		63			2,492			2,286			9
Corporate/Private Equity (a)		1,438			2,060			1,371			(251	)		474			(30	)		203			4,618			(24	)	NM
TOTAL PRE-PROVISION PROFIT	$	13,232		$	15,325		$	14,189		$	13,549		$	7,853			(14	)		68		$	56,295		$	29,272			92
NET INCOME/(LOSS)
Investment Bank	$	1,901		$	1,921		$	1,471		$	1,606		$	(2,364	)		(1	)	NM			$	6,899		$	(1,175	)	NM
Retail Financial Services		(399	)		7			15			474			624		NM			NM				97			880			(89	)
Card Services		(306	)		(700	)		(672	)		(547	)		(371	)		56			18			(2,225	)		780		NM
Commercial Banking		224			341			368			338			480			(34	)		(53	)		1,271			1,439			(12	)
Treasury & Securities Services		237			302			379			308			533			(22	)		(56	)		1,226			1,767			(31	)
Asset Management		424			430			352			224			255			(1	)		66			1,430			1,357			5
Corporate/Private Equity		1,197			1,287			808			(262	)		1,545			(7	)		(23	)		3,030			557			444
TOTAL NET INCOME/(LOSS)	$	3,278		$	3,588		$	2,721		$	2,141		$	702			(9	)		367		$	11,728		$	5,605			109
AVERAGE EQUITY (b)
Investment Bank	$	33,000		$	33,000		$	33,000		$	33,000		$	33,000			—			—		$	33,000		$	26,098			26
Retail Financial Services		25,000			25,000			25,000			25,000			25,000			—			—			25,000			19,011			32
Card Services		15,000			15,000			15,000			15,000			15,000			—			—			15,000			14,326			5
Commercial Banking		8,000			8,000			8,000			8,000			8,000			—			—			8,000			7,251			10
Treasury & Securities Services		5,000			5,000			5,000			5,000			4,500			—			11			5,000			3,751			33
Asset Management		7,000			7,000			7,000			7,000			7,000			—			—			7,000			5,645			24
Corporate/Private Equity		63,525			56,468			47,865			43,493			46,257			12			37			52,903			53,034			—
TOTAL AVERAGE EQUITY	$	156,525		$	149,468		$	140,865		$	136,493		$	138,757			5			13		$	145,903		$	129,116			13
RETURN ON EQUITY (b)
Investment Bank		23	%		23	%		18	%		20	%		(28	)%								21	%		(5	)%
Retail Financial Services		(6	)		—			—			8			10									—			5
Card Services		(8	)		(19	)		(18	)		(15	)		(10	)								(15	)		5
Commercial Banking		11			17			18			17			24									16			20
Treasury & Securities Services		19			24			30			25			47									25			47
Asset Management		24			24			20			13			14									20			24

(a)

In the second quarter of 2009, Investment Bank (“IB”) began reporting credit reimbursement from TSS as a component of total net revenue, whereas TSS continues to report its credit reimbursement to IB as a separate line item on its income statement (not part of total net revenue). Corporate/Private Equity includes an adjustment to offset IB’s inclusion of the credit reimbursement in total net revenue. Prior periods have been revised for IB and Corporate/Private Equity to reflect this presentation.

(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.

Page 7

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT
REVENUE
Investment banking fees	$	1,892		$	1,658		$	2,239		$	1,380		$	1,373			14	%		38	%	$	7,169		$	5,907			21	%
Principal transactions		84			2,714			1,841			3,515			(6,160	)		(97	)	NM				8,154			(7,042	)	NM
Lending & deposit-related fees		174			185			167			138			138			(6	)		26			664			463			43
Asset management, administration and commissions		608			633			717			692			764			(4	)		(20	)		2,650			3,064			(14	)
All other income (a)		(14	)		63			(108	)		(56	)		139		NM			NM				(115	)		(341	)		66
Noninterest revenue		2,744			5,253			4,856			5,669			(3,746	)		(48	)	NM				18,522			2,051		NM
Net interest income		2,185			2,255			2,445			2,702			3,474			(3	)		(37	)		9,587			10,284			(7	)
TOTAL NET REVENUE (b)		4,929			7,508			7,301			8,371			(272	)		(34	)	NM				28,109			12,335			128
Provision for credit losses		(181	)		379			871			1,210			765		NM			NM				2,279			2,015			13
NONINTEREST EXPENSE
Compensation expense		549			2,778			2,677			3,330			1,166			(80	)		(53	)		9,334			7,701			21
Noncompensation expense		1,737			1,496			1,390			1,444			1,575			16			10			6,067			6,143			(1	)
TOTAL NONINTEREST EXPENSE		2,286			4,274			4,067			4,774			2,741			(47	)		(17	)		15,401			13,844			11
Income/(loss) before income tax expense		2,824			2,855			2,363			2,387			(3,778	)		(1	)	NM				10,429			(3,524	)	NM
Income tax expense/(benefit) (c)		923			934			892			781			(1,414	)		(1	)	NM				3,530			(2,349	)	NM
NET INCOME/(LOSS)	$	1,901		$	1,921		$	1,471		$	1,606		$	(2,364	)		(1	)	NM			$	6,899		$	(1,175	)	NM
FINANCIAL RATIOS
ROE		23	%		23	%		18	%		20	%		(28	)%								21	%		(5	)%
ROA		1.12			1.12			0.83			0.89			(1.08	)								0.99			(0.14	)
Overhead ratio		46			57			56			57		NM										55			112
Compensation expense as a % of total net revenue		11			37			37			40		NM										33			62
REVENUE BY BUSINESS
Investment banking fees:
Advisory	$	611		$	384		$	393		$	479		$	579			59			6		$	1,867		$	2,008			(7	)
Equity underwriting		549			681			1,103			308			330			(19	)		66			2,641			1,749			51
Debt underwriting		732			593			743			593			464			23			58			2,661			2,150			24
Total investment banking fees		1,892			1,658			2,239			1,380			1,373			14			38			7,169			5,907			21
Fixed income markets		2,735			5,011			4,929			4,889			(1,671	)		(45	)	NM				17,564			1,957		NM
Equity markets		971			941			708			1,773			(94	)		3		NM				4,393			3,611			22
Credit portfolio (a)		(669	)		(102	)		(575	)		329			120		NM			NM				(1,017	)		860		NM
Total net revenue	$	4,929		$	7,508		$	7,301		$	8,371		$	(272	)		(34	)	NM			$	28,109		$	12,335			128
REVENUE BY REGION (a)
Americas	$	2,872		$	3,850		$	4,118		$	4,316		$	(2,203	)		(25	)	NM			$	15,156		$	2,610			481
Europe/Middle East/Africa		1,502			2,912			2,303			3,073			2,026			(48	)		(26	)		9,790			7,710			27
Asia/Pacific		555			746			880			982			(95	)		(26	)	NM				3,163			2,015			57
Total net revenue	$	4,929		$	7,508		$	7,301		$	8,371		$	(272	)		(34	)	NM			$	28,109		$	12,335			128

(a)	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. IB recognizes this credit reimbursement in its credit portfolio business in all other income. Prior periods have been revised to conform with the current presentation.
(b)	Total net revenue included tax-equivalent adjustments, predominantly due to income tax credits related to affordable housing and alternative energy investments, as well as, tax-exempt income from municipal bond investments, of $357 million, $371 million, $334 million, $365 million, and $583 million for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $1.4 billion and $1.7 billion for full year 2009 and 2008, respectively.
(c)	The income tax benefit in the full year of 2008 includes 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																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
SELECTED BALANCE SHEET DATA (Period-end)
Loans:
Loans retained (a)	$	45,544		$	55,703		$	64,500		$	66,506		$	71,357			(18	)%		(36	)%	$	45,544		$	71,357			(36	)%
Loans held-for-sale & loans at fair value		3,567			4,582			6,814			10,993			13,660			(22	)		(74	)		3,567			13,660			(74	)
Total loans		49,111			60,285			71,314			77,499			85,017			(19	)		(42	)		49,111			85,017			(42	)
Equity		33,000			33,000			33,000			33,000			33,000			—			—			33,000			33,000			—
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	674,241		$	678,796		$	710,825		$	733,166		$	869,159			(1	)		(22	)	$	699,039		$	832,729			(16	)
Trading assets — debt and equity instruments		285,363			270,695			265,336			272,998			306,168			5			(7	)		273,624			350,812			(22	)
Trading assets — derivative receivables		72,640			86,651			100,536			125,021			153,875			(16	)		(53	)		96,042			112,337			(15	)
Loans:
Loans retained (a)		51,573			61,269			68,224			70,041			73,110			(16	)		(29	)		62,722			73,108			(14	)
Loans held-for-sale & loans at fair value		4,158			4,981			8,934			12,402			16,378			(17	)		(75	)		7,589			18,502			(59	)
Total loans		55,731			66,250			77,158			82,443			89,488			(16	)		(38	)		70,311			91,610			(23	)
Adjusted assets (b)		519,403			515,718			531,632			589,163			685,242			1			(24	)		538,724			679,780			(21	)
Equity		33,000			33,000			33,000			33,000			33,000			—			—			33,000			26,098			26
Headcount		24,654			24,828			25,783			26,142			27,938			(1	)		(12	)		24,654			27,938			(12	)
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs	$	685		$	750		$	433		$	36		$	87			(9	)	NM			$	1,904		$	105		NM
Nonperforming assets:
Nonperforming loans:
Nonperforming loans retained (a)		3,196			4,782			3,407			1,738			1,143			(33	)		180			3,196			1,143			180
Nonperforming loans held-for-sale & loans at fair value		308			128			112			57			32			141		NM				308			32		NM
Total nonperforming loans		3,504			4,910			3,519			1,795			1,175			(29	)		198			3,504			1,175			198
Derivative receivables		529			624			704			1,010			1,079			(15	)		(51	)		529			1,079			(51	)
Assets acquired in loan satisfactions		203			248			311			236			247			(18	)		(18	)		203			247			(18	)
Total nonperforming assets		4,236			5,782			4,534			3,041			2,501			(27	)		69			4,236			2,501			69
Allowance for credit losses:
Allowance for loan losses		3,756			4,703			5,101			4,682			3,444			(20	)		9			3,756			3,444			9
Allowance for lending-related commitments		485			401			351			295			360			21			35			485			360			35
Total allowance for credit losses		4,241			5,104			5,452			4,977			3,804			(17	)		11			4,241			3,804			11
Net charge-off rate (a)		5.27	%		4.86	%		2.55	%		0.21	%		0.47	%								3.04	%		0.14	%
Allowance for loan losses to period-end loans retained (a)		8.25			8.44			7.91			7.04			4.83									8.25			4.83
Allowance for loan losses to average loans retained (a) (d)		7.28			7.68			7.48			6.68			4.71									5.99			4.71
Allowance for loan losses to nonperforming loans retained (c)		118			98			150			269			301									118			301
Nonperforming loans to total period-end loans		7.13			8.14			4.93			2.32			1.38									7.13			1.38
Nonperforming loans to total average loans		6.29			7.41			4.56			2.18			1.31									4.98			1.28

(a)	Loans retained included credit portfolio loans, leveraged leases and other accrual loans, and excluded loans held-for-sale and loans accounted for 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 consolidated variable interest entities (“VIEs”); (3) cash and securities segregated and on deposit for regulatory and other purposes; (4) goodwill and intangibles; (5) securities received as collateral; and (6) investments purchased under the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility. 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. IB believes an adjusted asset amount that excludes the assets discussed above, which were considered to have a low risk profile, provides a more meaningful measure of balance sheet leverage in the securities industry.
(c)	Nonperforming loans excluded distressed loans held-for-sale that were purchased as part of IB’s proprietary activities.
(d)	Excluding the impact of a loan originated in March 2008 to Bear Stearns, the adjusted ratio would be 4.84% for 2008. The average balance of the loan extended to Bear Stearns was $1.9 billion for 2008.

Page 9

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
MARKET RISK — AVERAGE TRADING AND CREDITPORTFOLIO VAR - 99% CONFIDENCE LEVEL (a)
Trading activities:
Fixed income	$	171		$	243		$	249		$	218		$	276			(30	)%		(38	)%	$	221		$	181			22	%
Foreign exchange		23			30			26			40			55			(23	)		(58	)		30			34			(12	)
Equities		35			28			77			162			87			25			(60	)		75			57			32
Commodities and other		26			38			34			28			30			(32	)		(13	)		32			32			—
Diversification (b)		(92	)		(134	)		(136	)		(159	)		(146	)		31			37			(131	)		(108	)		(21	)
Total trading VaR (c)		163			205			250			289			302			(20	)		(46	)		227			196			16
Credit portfolio VaR (d)		41			50			133			182			165			(18	)		(75	)		101			69			46
Diversification (b)		(20	)		(49	)		(116	)		(135	)		(140	)		59			86			(80	)		(63	)		(27	)
Total trading and credit portfolio VaR	$	184		$	206		$	267		$	336		$	327			(11	)		(44	)	$	248		$	202			23

	Full Year 2009		Full Year 2008
	Market		Market
MARKET SHARES AND RANKINGS (e)	Share	Rankings	Share	Rankings
Global debt, equity and equity-related	10%	#1	9%	#1
Global syndicated loans	10%	#1	11%	#1
Global long-term debt (f)	9%	#1	9%	#3
Global equity and equity-related (g)	13%	#1	10%	#1
Global announced M&A (h)	24%	#3	28%	#2
U.S. debt, equity and equity-related	14%	#1	15%	#2
U.S. syndicated loans	23%	#1	24%	#1
U.S. long-term debt (f)	14%	#1	15%	#2
U.S. equity and equity-related (g)	13%	#1	11%	#1
U.S. announced M&A (h)	35%	#3	35%	#2

(a)	Results for full year 2008 include seven months of the combined Firm’s (JPMorgan Chase & Co.’s and Bear Stearns’) results and five months of 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. 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. Beginning in the fourth quarter of 2008, trading VaR includes the estimated credit spread sensitivity of certain mortgage products.
(d)	Includes VaR on derivative credit valuation adjustments (“CVA”), hedges of the CVA 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. Full year 2008 results are pro forma for the Bear Stearns merger.
(f)	Includes asset-backed securities, mortgage-backed securities and municipal securities.
(g)	Includes rights offerings; U.S. domiciled equity and equity-related transactions.
(h)	Global announced M&A is based upon rank value; all other rankings are 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 rankings for 2008 include transactions withdrawn since December 31, 2008. 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																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT
REVENUE
Lending & deposit-related fees	$	972		$	1,046		$	1,003		$	948		$	1,050			(7	)%		(7	)%	$	3,969		$	2,546			56	%
Asset management, administration and commissions		406			408			425			435			412			—			(1	)		1,674			1,510			11
Mortgage fees and related income		481			873			807			1,633			1,962			(45	)		(75	)		3,794			3,621			5
Credit card income		441			416			411			367			367			6			20			1,635			939			74
Other income		299			321			294			214			183			(7	)		63			1,128			739			53
Noninterest revenue		2,599			3,064			2,940			3,597			3,974			(15	)		(35	)		12,200			9,355			30
Net interest income		5,070			5,154			5,030			5,238			4,710			(2	)		8			20,492			14,165			45
TOTAL NET REVENUE		7,669			8,218			7,970			8,835			8,684			(7	)		(12	)		32,692			23,520			39
Provision for credit losses		4,229			3,988			3,846			3,877			3,576			6			18			15,940			9,905			61
NONINTEREST EXPENSE
Compensation expense		1,722			1,728			1,631			1,631			1,604			—			7			6,712			5,068			32
Noncompensation expense		2,499			2,385			2,365			2,457			2,345			5			7			9,706			6,612			47
Amortization of intangibles		81			83			83			83			97			(2	)		(16	)		330			397			(17	)
TOTAL NONINTEREST EXPENSE		4,302			4,196			4,079			4,171			4,046			3			6			16,748			12,077			39
Income/(loss) before income tax expense (benefit)		(862	)		34			45			787			1,062		NM			NM				4			1,538			(100	)
Income tax expense (benefit)		(463	)		27			30			313			438		NM			NM				(93	)		658		NM
NET INCOME/(LOSS)	$	(399	)	$	7		$	15		$	474		$	624		NM			NM			$	97		$	880			(89	)
FINANCIAL RATIOS
ROE		(6	)%		—	%		—	%		8	%		10	%								—	%		5	%
Overhead ratio		56			51			51			47			47									51			51
Overhead ratio excluding core deposit intangibles (a)		55			50			50			46			45									50			50
SELECTED BALANCE SHEET DATA (Period-end)
Assets	$	387,269		$	397,673		$	399,916		$	412,505		$	419,831			(3	)		(8	)	$	387,269		$	419,831			(8	)
Loans:
Loans retained		340,332			346,765			353,934			364,220			368,786			(2	)		(8	)		340,332			368,786			(8	)
Loans held-for-sale & loans at fair value (b)		14,612			14,303			13,192			12,529			9,996			2			46			14,612			9,996			46
Total loans		354,944			361,068			367,126			376,749			378,782			(2	)		(6	)		354,944			378,782			(6	)
Deposits		357,463			361,046			371,241			380,140			360,451			(1	)		(1	)		357,463			360,451			(1	)
Equity		25,000			25,000			25,000			25,000			25,000			—			—			25,000			25,000			—
SELECTED BALANCE SHEET DATA (Average)
Assets	$	395,045		$	401,620		$	410,228		$	423,472		$	423,699			(2	)		(7	)	$	407,497		$	304,442			34
Loans:
Loans retained		343,411			349,762			359,372			366,925			369,172			(2	)		(7	)		354,789			257,083			38
Loans held-for-sale & loans at fair value (b)		17,670			19,025			19,043			16,526			13,848			(7	)		28			18,072			17,056			6
Total loans		361,081			368,787			378,415			383,451			383,020			(2	)		(6	)		372,861			274,139			36
Deposits		356,464			366,944			377,259			370,278			358,523			(3	)		(1	)		367,696			258,362			42
Equity		25,000			25,000			25,000			25,000			25,000			—			—			25,000			19,011			32
Headcount		108,971			106,951			103,733			100,677			102,007			2			7			108,971			102,007			7

(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 Retail Banking’s core deposit intangibles amortization expense related to the 2006 Bank of New York transaction and the 2004 Bank One merger of $80 million, $83 million, $82 million, $83 million, and $97 million, for the quarters ending December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $328 million and $394 million for full year 2009 and 2008, respectively.

(b)

Loans at fair value consist of prime mortgages originated with the intent to sell that are accounted for at fair value and classified as trading assets on the Consolidated Balance Sheets. These loans totaled $12.5 billion, $12.8 billion, $11.3 billion, $8.9 billion, and $8.0 billion, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively. Average balances of these loans totaled $16.0 billion, $17.7 billion, $16.2 billion, $13.4 billion, and $12.0 billion, for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $15.8 billion and $14.2 billion for full year 2009 and 2008, respectively.

Page 11

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs	$	2,738		$	2,550		$	2,649		$	2,176		$	1,701			7	%		61	%	$	10,113		$	4,877			107	%
Nonperforming loans:
Nonperforming loans retained		10,611			10,091			8,792			7,714			6,548			5			62			10,611			6,548			62
Nonperforming loans held-for-sale and loans at fair value		234			242			203			264			236			(3	)		(1	)		234			236			(1	)
Total nonperforming loans (a) (b) (c)		10,845			10,333			8,995			7,978			6,784			5			60			10,845			6,784			60
Nonperforming assets (a) (b) (c)		12,098			11,883			10,554			9,846			9,077			2			33			12,098			9,077			33
Allowance for loan losses		14,776			13,286			11,832			10,619			8,918			11			66			14,776			8,918			66
Net charge-off rate (e)		3.16	%		2.89	%		2.96	%		2.41	%		1.83	%								2.85	%		1.90	%
Net charge-off rate excluding purchased credit-impaired loans (d) (e)		4.16			3.81			3.89			3.16			2.41									3.75			2.08
Allowance for loan losses to ending loans retained (e)		4.34			3.83			3.34			2.92			2.42									4.34			2.42
Allowance for loan losses to ending loans retained excluding purchased credit-impaired loans (d) (e)		5.09			4.63			4.41			3.84			3.19									5.09			3.19
Allowance for loan losses to nonperforming loans retained (a) (d) (e)		124			121			135			138			136									124			136
Nonperforming loans to total loans		3.06			2.86			2.45			2.12			1.79									3.06			1.79
Nonperforming loans to total loans excluding purchased credit-impaired loans (a)		3.96			3.72			3.19			2.76			2.34									3.96			2.34

(a)	Excludes purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans are accounted for on a pool basis, and the pools are considered to be performing.
(b)	Certain of these loans are classified as trading assets on the Consolidated Balance Sheets.
(c)	Nonperforming loans and assets excluded: (1) mortgage loans insured by U.S. government agencies of $9.0 billion, $7.0 billion, $4.2 billion, $4.2 billion, and $3.0 billion, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively; (2) real estate owned insured by U.S. government agencies of $579 million, $579 million, $508 million, $433 million, and $364 million, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively; and (3) student 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 $542 million, $511 million, $473 million, $433 million, and $437 million, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively. These amounts are excluded, as reimbursement is proceeding normally.
(d)	Excludes the impact of purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans were accounted for at fair value on the acquisition date, which incorporated management’s estimate, as of that date, of credit losses over the remaining life of the portfolio. An allowance for loan losses of $1.6 billion and $1.1 billion was recorded for these loans as of December 31, 2009 and September 30, 2009, respectively. No allowance for losses was recorded as of June 30, 2009, March 31, 2009 and December 31, 2008. To date, no charge-offs have been recorded for these loans.
(e)	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.

Page 12

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
RETAIL BANKING
Noninterest revenue	$	1,804		$	1,844		$	1,803		$	1,718		$	1,834			(2	)%		(2	)%	$	7,169		$	4,951			45	%
Net interest income		2,716			2,732			2,719			2,614			2,687			(1	)		1			10,781			7,659			41
Total net revenue		4,520			4,576			4,522			4,332			4,521			(1	)		—			17,950			12,610			42
Provision for credit losses		248			208			361			325			268			19			(7	)		1,142			449			154
Noninterest expense		2,574			2,646			2,557			2,580			2,533			(3	)		2			10,357			7,232			43
Income before income tax expense		1,698			1,722			1,604			1,427			1,720			(1	)		(1	)		6,451			4,929			31
Net income	$	1,027		$	1,043		$	970		$	863		$	1,040			(2	)		(1	)	$	3,903		$	2,982			31
Overhead ratio		57	%		58	%		57	%		60	%		56	%								58	%		57	%
Overhead ratio excluding core deposit intangibles (a)		55			56			55			58			54									56			54
BUSINESS METRICS (in billions)
Business banking origination volume	$	0.7		$	0.5		$	0.6		$	0.5		$	0.8			40			(13	)	$	2.3		$	5.5			(58	)
End-of-period loans owned		17.0			17.4			17.8			18.2			18.4			(2	)		(8	)		17.0			18.4			(8	)
End-of-period deposits:
Checking	$	121.9		$	115.5		$	114.1		$	113.9		$	109.2			6			12		$	121.9		$	109.2			12
Savings		153.4			151.6			150.4			152.4			144.0			1			7			153.4			144.0			7
Time and other		58.0			66.6			78.9			86.5			89.1			(13	)		(35	)		58.0			89.1			(35	)
Total end-of-period deposits		333.3			333.7			343.4			352.8			342.3			—			(3	)		333.3			342.3			(3	)
Average loans owned	$	17.2		$	17.7		$	18.0		$	18.4		$	18.2			(3	)		(5	)	$	17.8		$	16.7			7
Average deposits:
Checking	$	116.4		$	114.0		$	114.2		$	109.4		$	105.8			2			10		$	113.5		$	77.1			47
Savings		153.1			151.2			151.2			148.2			145.3			1			5			150.9			114.3			32
Time and other		60.3			74.4			82.7			88.2			88.7			(19	)		(32	)		76.4			53.2			44
Total average deposits		329.8			339.6			348.1			345.8			339.8			(3	)		(3	)		340.8			244.6			39
Deposit margin		3.06	%		2.99	%		2.92	%		2.85	%		2.94	%								2.96	%		2.89	%
Average assets	$	28.2		$	28.1		$	29.1		$	30.2		$	28.7			—			(2	)	$	28.9		$	26.3			10
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs	$	248		$	208		$	211		$	175		$	168			19			48		$	842		$	346			143
Net charge-off rate		5.72	%		4.66	%		4.70	%		3.86	%		3.67	%								4.73	%		2.07	%
Nonperforming assets	$	839		$	816		$	686		$	579		$	424			3			98		$	839		$	424			98
RETAIL BRANCH BUSINESS METRICS
Investment sales volume	$	5,851		$	6,243		$	5,292		$	4,398		$	3,956			(6	)		48		$	21,784		$	17,640			23
Number of:
Branches		5,154			5,126			5,203			5,186			5,474			1			(6	)		5,154			5,474			(6	)
ATMs		15,406			15,038			14,144			14,159			14,568			2			6			15,406			14,568			6
Personal bankers		17,991			16,941			15,959			15,544			15,825			6			14			17,991			15,825			14
Sales specialists		5,912			5,530			5,485			5,454			5,661			7			4			5,912			5,661			4
Active online customers (in thousands)		15,424			13,852			13,930			12,882			11,710			11			32			15,424			11,710			32
Checking accounts (in thousands)		25,712			25,546			25,252			24,984			24,499			1			5			25,712			24,499			5

(a) Retail 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 method would result in an improving overhead ratio over time, all things remaining equal. This non-GAAP ratio excludes Retail Banking’s core deposit intangibles amortization expense related to the 2006 Bank of New York transaction and the 2004 Bank One merger of $80 million, $83 million, $82 million, $83 million, and $97 million, for the quarters ending December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $328 million and $394 million for full year 2009 and 2008, respectively.

Page 13

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
CONSUMER LENDING
Noninterest revenue	$	795		$	1,220		$	1,137		$	1,879		$	2,140			(35	)%		(63	)%	$	5,031		$	4,404			14	%
Net interest income		2,354			2,422			2,311			2,624			2,023			(3	)		16			9,711			6,506			49
Total net revenue		3,149			3,642			3,448			4,503			4,163			(14	)		(24	)		14,742			10,910			35
Provision for credit losses		3,981			3,780			3,485			3,552			3,308			5			20			14,798			9,456			56
Noninterest expense		1,728			1,550			1,522			1,591			1,513			11			14			6,391			4,845			32
Income/(loss) before income tax expense/(benefit)		(2,560	)		(1,688	)		(1,559	)		(640	)		(658	)		(52	)		(289	)		(6,447	)		(3,391	)		(90	)
Net income/(loss)	$	(1,426	)	$	(1,036	)	$	(955	)	$	(389	)	$	(416	)		(38	)		(243	)	$	(3,806	)	$	(2,102	)		(81	)
Overhead ratio		55	%		43	%		44	%		35	%		36	%								43	%		44	%
BUSINESS METRICS (in billions)
LOANS EXCLUDING PURCHASED CREDIT-IMPAIRED LOANS (a)
End-of-period loans owned:
Home equity	$	101.4		$	104.8		$	108.2		$	111.7		$	114.3			(3	)		(11	)	$	101.4		$	114.3			(11	)
Prime mortgage		59.4			60.1			62.1			65.4			65.2			(1	)		(9	)		59.4			65.2			(9	)
Subprime mortgage		12.5			13.3			13.8			14.6			15.3			(6	)		(18	)		12.5			15.3			(18	)
Option ARMs		8.5			8.9			9.0			9.0			9.0			(4	)		(6	)		8.5			9.0			(6	)
Student loans		15.8			15.5			15.6			17.3			15.9			2			(1	)		15.8			15.9			(1	)
Auto loans		46.0			44.3			42.9			43.1			42.6			4			8			46.0			42.6			8
Other		0.7			0.8			1.0			1.0			1.3			(13	)		(46	)		0.7			1.3			(46	)
Total end-of-period loans		244.3			247.7			252.6			262.1			263.6			(1	)		(7	)		244.3			263.6			(7	)
Average loans owned:
Home equity	$	103.3		$	106.6		$	110.1		$	113.4		$	114.6			(3	)		(10	)	$	108.3		$	99.9			8
Prime mortgage		59.4			60.6			63.3			65.4			65.0			(2	)		(9	)		62.2			45.0			38
Subprime mortgage		12.8			13.6			14.3			14.9			15.7			(6	)		(18	)		13.9			15.3			(9	)
Option ARMs		8.7			8.9			9.1			8.8			9.0			(2	)		(3	)		8.9			2.3			287
Student loans		15.6			15.2			16.7			17.0			15.6			3			—			16.1			13.6			18
Auto loans		45.3			43.3			43.1			42.5			42.9			5			6			43.6			43.8			—
Other		0.7			0.9			1.0			1.5			1.5			(22	)		(53	)		1.0			1.1			(9	)
Total average loans		245.8			249.1			257.6			263.5			264.3			(1	)		(7	)		254.0			221.0			15
PURCHASED CREDIT-IMPAIRED LOANS (a)
End-of-period loans owned:
Home equity	$	26.5		$	27.1		$	27.7		$	28.4		$	28.6			(2	)		(7	)	$	26.5		$	28.6			(7	)
Prime mortgage		19.7			20.2			20.8			21.4			21.8			(2	)		(10	)		19.7			21.8			(10	)
Subprime mortgage		6.0			6.1			6.4			6.6			6.8			(2	)		(12	)		6.0			6.8			(12	)
Option ARMs		29.0			29.8			30.5			31.2			31.6			(3	)		(8	)		29.0			31.6			(8	)
Total end-of-period loans		81.2			83.2			85.4			87.6			88.8			(2	)		(9	)		81.2			88.8			(9	)
Average loans owned:
Home equity	$	26.7		$	27.4		$	28.0		$	28.4		$	28.2			(3	)		(5	)	$	27.6		$	7.1			289
Prime mortgage		20.0			20.5			21.0			21.6			21.9			(2	)		(9	)		20.8			5.4			285
Subprime mortgage		6.1			6.2			6.5			6.7			6.8			(2	)		(10	)		6.3			1.7			271
Option ARMs		29.3			30.2			31.0			31.4			31.6			(3	)		(7	)		30.5			8.0			281
Total average loans		82.1			84.3			86.5			88.1			88.5			(3	)		(7	)		85.2			22.2			284
TOTAL CONSUMER LENDING PORTFOLIO
End-of-period loans owned:
Home equity	$	127.9		$	131.9		$	135.9		$	140.1		$	142.9			(3	)		(10	)	$	127.9		$	142.9			(10	)
Prime mortgage		79.1			80.3			82.9			86.8			87.0			(1	)		(9	)		79.1			87.0			(9	)
Subprime mortgage		18.5			19.4			20.2			21.2			22.1			(5	)		(16	)		18.5			22.1			(16	)
Option ARMs		37.5			38.7			39.5			40.2			40.6			(3	)		(8	)		37.5			40.6			(8	)
Student loans		15.8			15.5			15.6			17.3			15.9			2			(1	)		15.8			15.9			(1	)
Auto loans		46.0			44.3			42.9			43.1			42.6			4			8			46.0			42.6			8
Other		0.7			0.8			1.0			1.0			1.3			(13	)		(46	)		0.7			1.3			(46	)
Total end-of-period loans		325.5			330.9			338.0			349.7			352.4			(2	)		(8	)		325.5			352.4			(8	)
Average loans owned:
Home equity	$	130.0		$	134.0		$	138.1		$	141.8		$	142.8			(3	)		(9	)	$	135.9		$	107.0			27
Prime mortgage		79.4			81.1			84.3			87.0			86.9			(2	)		(9	)		83.0			50.4			65
Subprime mortgage		18.9			19.8			20.8			21.6			22.5			(5	)		(16	)		20.2			17.0			19
Option ARMs		38.0			39.1			40.1			40.2			40.6			(3	)		(6	)		39.4			10.3			283
Student loans		15.6			15.2			16.7			17.0			15.6			3			—			16.1			13.6			18
Auto loans		45.3			43.3			43.1			42.5			42.9			5			6			43.6			43.8			—
Other		0.7			0.9			1.0			1.5			1.5			(22	)		(53	)		1.0			1.1			(9	)
Total average loans owned (b)		327.9			333.4			344.1			351.6			352.8			(2	)		(7	)		339.2			243.2			39

(a)

Purchased credit-impaired loans represent loans acquired in the Washington Mutual transaction for which a deterioration in credit quality occurred between the origination date and JPMorgan Chase’s acquisition date. These loans were initially recorded at fair value and accrete interest income over the estimated life of the loan when cash flows are reasonably estimable, even if the underlying loans are contractually past due.

(b)

Total average loans include loans held-for-sale of $1.7 billion, $1.3 billion, $2.8 billion, $3.1 billion, and $1.8 billion, for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $2.2 billion and $2.8 billion for full year 2009 and 2008, respectively.

Page 14

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
CONSUMER LENDING (continued)
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs excluding purchased credit-impaired loans: (a)
Home equity	$	1,177		$	1,142		$	1,265		$	1,098		$	770			3	%		53	%	$	4,682		$	2,391			96	%
Prime mortgage		568			525			481			312			195			8			191			1,886			526			259
Subprime mortgage		452			422			410			364			319			7			42			1,648			933			77
Option ARMs		29			15			15			4			—			93		NM				63			—		NM
Auto loans		148			159			146			174			207			(7	)		(29	)		627			568			10
Other		116			79			121			49			42			47			176			365			113			223
Total net charge-offs		2,490			2,342			2,438			2,001			1,533			6			62			9,271			4,531			105
Net charge-off rate excluding purchased credit-impaired loans: (a)
Home equity		4.52	%		4.25	%		4.61	%		3.93	%		2.67	%								4.32	%		2.39	%
Prime mortgage		3.81			3.45			3.07			1.95			1.20									3.05			1.18
Subprime mortgage		14.01			12.31			11.50			9.91			8.08									11.86			6.10
Option ARMs		1.32			0.67			0.66			0.18			—									0.71			—
Auto loans		1.30			1.46			1.36			1.66			1.92									1.44			1.30
Other		3.11			2.08			3.15			1.25			1.08									2.39			0.93
Total net charge-off rate excluding purchased credit-impaired loans (b)		4.05			3.75			3.84			3.12			2.32									3.68			2.08
Net charge-off rate — reported:
Home equity		3.59			3.38			3.67			3.14			2.15									3.45			2.23
Prime mortgage		2.85			2.58			2.30			1.46			0.89									2.28			1.05
Subprime mortgage		9.49			8.46			7.91			6.83			5.64									8.16			5.49
Option ARMs		0.30			0.15			0.15			0.04			—									0.16			—
Auto loans		1.30			1.46			1.36			1.66			1.92									1.44			1.30
Other		3.11			2.08			3.15			1.25			1.08									2.39			0.93
Total net charge-off rate — reported (b)		3.03			2.80			2.87			2.33			1.74									2.75			1.89
30+ day delinquency rate excluding purchased credit-impaired loans (c) (d) (e)		5.93			5.85			5.22			4.73			4.21									5.93			4.21
Nonperforming assets (f) (g)	$	11,259		$	11,068		$	9,868		$	9,267		$	8,653			2			30		$	11,259		$	8,653			30
Allowance for loan losses to ending loans retained		4.27	%		3.74	%		3.23	%		2.83	%		2.36	%								4.27	%		2.36	%
Allowance for loan losses to ending loans retained excluding purchased credit-impaired loans (a)		5.04			4.56			4.34			3.79			3.16									5.04			3.16

(a)	Excludes the impact of purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans were accounted for at fair value on the acquisition date, which incorporated management’s estimate, as of that date, of credit losses over the remaining life of the portfolio. An allowance for loan losses of $1.6 billion and $1.1 billion was recorded for these loans as of December 31, 2009 and September 30, 2009, respectively. No allowance for losses was recorded as of June 30, 2009, March 31, 2009 and December 31, 2008. To date, no charge-offs have been recorded for these loans.
(b)	Average loans held-for-sale of $1.7 billion, $1.3 billion, $2.8 billion, $3.1 billion, and $1.8 billion, for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $2.2 billion and $2.8 billion for full year 2009 and 2008, respectively, were excluded when calculating the net charge-off rate.
(c)	Excluded mortgage loans that are insured by U.S. government agencies of $9.7 billion, $7.7 billion, $5.1 billion, $4.9 billion, and $3.5 billion, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively. These amounts are excluded, as reimbursement is proceeding normally.
(d)	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 $942 million, $903 million, $854 million, $770 million, and $824 million, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively. These amounts are excluded, as reimbursement is proceeding normally.
(e)	The delinquency rate for purchased credit-impaired loans was 27.79%, 25.56%, 23.37%, 21.36%, and 17.89%, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively.
(f)	Nonperforming assets excluded: (1) mortgage loans insured by U.S. government agencies of $9.0 billion, $7.0 billion, $4.2 billion, $4.2 billion, and $3.0 billion, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively; (2) real estate owned insured by U.S. government agencies of $579 million, $579 million, $508 million, $433 million, and $364 million, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively; and (3) student 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 $542 million, $511 million, $473 million, $433 million, and $437 million, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively. These amounts are excluded, as reimbursement is proceeding normally.
(g)	Excludes purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans are accounted for on a pool basis, and the pools are considered to be performing.

Page 15

JPMORGAN CHASE & CO.
RETAIL FINANCIAL SERVICES
FINANCIAL HIGHLIGHTS, CONTINUED
(in billions, except where otherwise noted)

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
CONSUMER LENDING (continued)
Origination volume:
Mortgage origination volume by channel
Retail	$	12.3		$	13.3		$	14.7		$	13.6		$	7.6			(8	)%		62	%	$	53.9		$	41.1			31	%
Wholesale (a)		3.4			3.4			2.4			2.6			3.8			—			(11	)		11.8			29.4			(60	)
Correspondent		17.2			18.4			20.2			17.0			13.3			(7	)		29			72.8			55.5			31
CNT (negotiated transactions)		1.9			2.0			3.8			4.5			3.4			(5	)		(44	)		12.2			43.0			(72	)
Total mortgage origination volume		34.8			37.1			41.1			37.7			28.1			(6	)		24			150.7			169.0			(11	)
Home equity		0.4			0.5			0.6			0.9			1.7			(20	)		(76	)		2.4			16.3			(85	)
Student loans		0.6			1.5			0.4			1.7			1.0			(60	)		(40	)		4.2			6.9			(39	)
Auto		5.9			6.9			5.3			5.6			2.8			(14	)		111			23.7			19.4			22
Application volume:
Mortgage application volume by channel
Retail	$	17.4		$	17.8		$	23.0		$	32.7		$	24.2			(2	)		(28	)	$	90.9		$	89.1			2
Wholesale (a)		3.7			4.7			4.3			3.7			8.8			(21	)		(58	)		16.4			63.0			(74	)
Correspondent		22.3			23.0			26.7			27.3			21.2			(3	)		5			99.3			82.5			20
Total mortgage application volume		43.4			45.5			54.0			63.7			54.2			(5	)		(20	)		206.6			234.6			(12	)
Average mortgage loans held-for-sale & loans at fair value (b)		16.2			18.0			16.7			14.0			12.2			(10	)		33			16.2			14.6			11
Average assets		366.8			373.5			381.1			393.3			395.0			(2	)		(7	)		378.6			278.1			36
Third-party mortgage loans serviced (ending)		1,082.1			1,098.9			1,117.5			1,148.8			1,172.6			(2	)		(8	)		1,082.1			1,172.6			(8	)
Third-party mortgage loans serviced (average)		1,088.8			1,104.4			1,128.1			1,155.0			1,169.0			(1	)		(7	)		1,119.1			810.9			38
MSR net carrying value (ending)		15.5			13.6			14.6			10.6			9.3			14			67			15.5			9.3			67
Ratio of MSR net carrying value (ending) to third-party mortgage loans serviced (ending)		1.43	%		1.24	%		1.31	%		0.92	%		0.79	%								1.43	%		0.79	%
SUPPLEMENTAL MORTGAGE FEES AND RELATED INCOME DETAILS (in millions)
Production revenue	$	(192	)	$	(70	)	$	284		$	481		$	62			(174	)	NM			$	503		$	898			(44	)
Net mortgage servicing revenue:
Operating revenue:
Loan servicing revenue		1,221			1,220			1,279			1,222			1,366			—			(11	)		4,942			3,258			52
Other changes in MSR asset fair value		(657	)		(712	)		(837	)		(1,073	)		(843	)		8			22			(3,279	)		(2,052	)		(60	)
Total operating revenue		564			508			442			149			523			11			8			1,663			1,206			38
Risk management:
Changes in MSR asset fair value due to inputs or assumptions in model		1,762			(1,099	)		3,831			1,310			(6,950	)	NM			NM				5,804			(6,849	)	NM
Derivative valuation adjustments and other		(1,653	)		1,534			(3,750	)		(307	)		8,327		NM			NM				(4,176	)		8,366		NM
Total risk management		109			435			81			1,003			1,377			(75	)		(92	)		1,628			1,517			7
Total RFS net mortgage servicing revenue		673			943			523			1,152			1,900			(29	)		(65	)		3,291			2,723			21
Mortgage fees and related income		481			873			807			1,633			1,962			(45	)		(75	)		3,794			3,621			5
Ratio of annualized loan servicing revenue to third-party mortgage loans serviced (average)		0.44	%		0.44	%		0.45	%		0.43	%		0.46	%								0.44	%		0.40	%
MSR revenue multiple (c)		3.25x			2.82x			2.91x			2.14x			1.72x									3.25x			1.98x

(a)	Includes rural housing loans sourced through brokers and underwritten under U.S. Department of Agriculture guidelines.
(b)	Loans at fair value consist of prime mortgages originated with the intent to sell that are accounted for at fair value and classified as trading assets on the Consolidated Balance Sheets. Average balances of these loans totaled $16.0 billion, $17.7 billion, $16.2 billion, $13.4 billion, and $12.0 billion, for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $15.8 billion and $14.2 billion for full year 2009 and 2008, respectively.
(c)	Represents the ratio of MSR net carrying value (ending) to third-party mortgage loans serviced (ending) divided by the ratio of annualized loan servicing revenue to third-party mortgage loans serviced (average).

Page 16

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT
REVENUE
Credit card income	$	931		$	916		$	921		$	844		$	862			2	%		8	%	$	3,612		$	2,768			30	%
All other income		(46	)		(85	)		(364	)		(197	)		(272	)		46			83			(692	)		(49	)	NM
Noninterest revenue		885			831			557			647			590			6			50			2,920			2,719			7
Net interest income		4,263			4,328			4,311			4,482			4,318			(2	)		(1	)		17,384			13,755			26
TOTAL NET REVENUE		5,148			5,159			4,868			5,129			4,908			—			5			20,304			16,474			23
Provision for credit losses		4,239			4,967			4,603			4,653			3,966			(15	)		7			18,462			10,059			84
NONINTEREST EXPENSE
Compensation expense		336			354			329			357			335			(5	)		—			1,376			1,127			22
Noncompensation expense		938			829			873			850			979			13			(4	)		3,490			3,356			4
Amortization of intangibles		122			123			131			139			175			(1	)		(30	)		515			657			(22	)
TOTAL NONINTEREST EXPENSE		1,396			1,306			1,333			1,346			1,489			7			(6	)		5,381			5,140			5
Income/(loss) before income tax expense/(benefit)		(487	)		(1,114	)		(1,068	)		(870	)		(547	)		56			11			(3,539	)		1,275		NM
Income tax expense/(benefit)		(181	)		(414	)		(396	)		(323	)		(176	)		56			(3	)		(1,314	)		495		NM
NET INCOME/(LOSS)	$	(306	)	$	(700	)	$	(672	)	$	(547	)	$	(371	)		56			18		$	(2,225	)	$	780		NM
Memo: Net securitization income/(loss)	$	17		$	(43	)	$	(268	)	$	(180	)	$	(261	)	NM			NM			$	(474	)	$	(183	)		(159	)
FINANCIAL METRICS
ROE		(8	)%		(19	)%		(18	)%		(15	)%		(10	)%								(15	)%		5	%
Overhead ratio		27			25			27			26			30									27			31
Percentage of average managed outstandings:
Net interest income		10.36			10.15			9.93			9.91			9.17									10.08			8.45
Provision for credit losses		10.30			11.65			10.60			10.29			8.42									10.71			6.18
Noninterest revenue		2.15			1.95			1.28			1.43			1.25									1.69			1.67
Risk adjusted margin (a)		2.21			0.45			0.61			1.05			2.00									1.07			3.94
Noninterest expense		3.39			3.06			3.07			2.98			3.16									3.12			3.16
Pretax income/(loss) (ROO) (b)		(1.18	)		(2.61	)		(2.46	)		(1.92	)		(1.16	)								(2.05	)		0.78
Net income/(loss)		(0.74	)		(1.64	)		(1.55	)		(1.21	)		(0.79	)								(1.29	)		0.48
BUSINESS METRICS
Charge volume (in billions)	$	86.9		$	82.6		$	82.8		$	76.0		$	96.0			5			(9	)	$	328.3		$	368.9			(11	)
Net accounts opened (in millions) (c)		3.2			2.4			2.4			2.2			4.3			33			(26	)		10.2			27.9			(63	)
Credit cards issued (in millions)		145.3			146.6			151.9			159.0			168.7			(1	)		(14	)		145.3			168.7			(14	)
Number of registered internet customers (in millions)		32.3			31.3			30.5			33.8			35.6			3			(9	)		32.3			35.6			(9	)
Merchant acquiring business (d)
Bank card volume (in billions)	$	110.4		$	103.5		$	101.4		$	94.4		$	135.1			7			(18	)	$	409.7		$	713.9			(43	)
Total transactions (in billions)		4.9			4.5			4.5			4.1			4.9			9			—			18.0			21.4			(16	)

(a)	Represents total net revenue less provision for credit losses.
(b)	Pretax return on average managed outstandings.
(c)	Results for full year 2008 included approximately 13 million credit card accounts acquired by JPMorgan Chase in the Washington Mutual transaction.
(d)	The Chase Paymentech Solutions joint venture was dissolved effective November 1, 2008. JPMorgan Chase retained approximately 51% of the business and operates the business under the name Chase Paymentech Solutions. For the period January 1, 2008, through October 31, 2008, the data presented represents activity for the Chase Paymentech Solutions joint venture and beyond that date, the data presented represents activity for Chase Paymentech Solutions.

Page 17

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
SELECTED BALANCE SHEET DATA (Period-end)
Loans:
Loans on balance sheets	$	78,786		$	78,215		$	85,736		$	90,911		$	104,746			1	%		(25	)%	$	78,786		$	104,746			(25	)%
Securitized loans		84,626			87,028			85,790			85,220			85,571			(3	)		(1	)		84,626			85,571			(1	)
Managed loans	$	163,412		$	165,243		$	171,526		$	176,131		$	190,317			(1	)		(14	)	$	163,412		$	190,317			(14	)
Equity	$	15,000		$	15,000		$	15,000		$	15,000		$	15,000			—			—		$	15,000		$	15,000			—
SELECTED BALANCE SHEET DATA (Average)
Managed assets	$	184,535		$	192,141		$	193,310		$	201,200		$	203,943			(4	)		(10	)	$	192,749		$	173,711			11
Loans:
Loans on balance sheets	$	77,759		$	83,146		$	89,692		$	97,783		$	98,790			(6	)		(21	)	$	87,029		$	83,293			4
Securitized loans		85,452			86,017			84,417			85,619			88,505			(1	)		(3	)		85,378			79,566			7
Managed average loans	$	163,211		$	169,163		$	174,109		$	183,402		$	187,295			(4	)		(13	)	$	172,407		$	162,859			6
Equity	$	15,000		$	15,000		$	15,000		$	15,000		$	15,000			—			—		$	15,000		$	14,326			5
Headcount		22,676			22,850			22,897			23,759			24,025			(1	)		(6	)		22,676			24,025			(6	)
MANAGED CREDIT QUALITY STATISTICS
Net charge-offs	$	3,839		$	4,392		$	4,353		$	3,493		$	2,616			(13	)		47		$	16,077		$	8,159			97
Net charge-off rate (a)		9.33	%		10.30	%		10.03	%		7.72	%		5.56	%								9.33	%		5.01	%
Managed delinquency rates
30+ day (a)		6.28	%		5.99	%		5.86	%		6.16	%		4.97	%								6.28	%		4.97	%
90+ day (a)		3.59			2.76			3.25			3.22			2.34									3.59			2.34
Allowance for loan losses (b)	$	9,672		$	9,297		$	8,839		$	8,849		$	7,692			4			26		$	9,672		$	7,692			26
Allowance for loan losses to period-end loans (b) (c)		12.28	%		11.89	%		10.31	%		9.73	%		7.34	%								12.28	%		7.34	%
KEY STATS — WASHINGTON MUTUAL ONLY
Managed loans	$	19,653		$	21,163		$	23,093		$	25,908		$	28,250			(7	)		(30	)	$	19,653		$	28,250			(30	)
Managed average loans		20,377			22,287			24,418			27,578			27,703			(9	)		(26	)		23,642			6,964			239
Net interest income (d)		17.12	%		17.04	%		17.90	%		16.45	%		14.87	%								17.11	%		14.87	%
Risk adjusted margin (d) (e)		(0.66	)		(4.45	)		(3.89	)		4.42			4.18									(0.93	)		4.18
Net charge-off rate (f)		20.49			21.94			19.17			14.57			12.09									18.79			12.09
30+ day delinquency rate (f)		12.72			12.44			11.98			10.89			9.14									12.72			9.14
90+ day delinquency rate (f)		7.76			6.21			6.85			5.79			4.39									7.76			4.39
KEY STATS — EXCLUDING WASHINGTON MUTUAL
Managed loans	$	143,759		$	144,080		$	148,433		$	150,223		$	162,067			—			(11	)	$	143,759		$	162,067			(11	)
Managed average loans		142,834			146,876			149,691			155,824			159,592			(3	)		(11	)		148,765			155,895			(5	)
Net interest income (d)		9.40	%		9.10	%		8.63	%		8.75	%		8.18	%								8.97	%		8.16	%
Risk adjusted margin (d) (e)		2.62			1.19			1.34			0.46			1.62									1.39			3.93
Net charge-off rate		8.64			9.41			8.97			6.86			5.29									8.45			4.92
30+ day delinquency rate		5.52			5.38			5.27			5.34			4.36									5.52			4.36
90+ day delinquency rate		3.13			2.48			2.90			2.78			2.09									3.13			2.09

(a)	Results reflect the impact of purchase accounting adjustments related to the Washington Mutual transaction and the consolidation of the Washington Mutual Master Trust.
(b)	Based on loans on balance sheets (“reported basis”).
(c)	Includes $1.0 billion, $3.0 billion and $5.0 billion of loans at December 31, 2009, September 30, 2009, and June 30, 2009, respectively, held by the Washington Mutual Master Trust, which were consolidated onto the Card Services balance sheet at fair value during the second quarter of 2009. No allowance for loan losses was recorded for these loans as of December 31, 2009, September 30, 2009, and June 30, 2009. Excluding these loans, the allowance for loan losses to period-end loans was 12.43%, 12.36% and 10.95%, respectively.
(d)	As a percentage of average managed outstandings.
(e)	Represents total net revenue less provision for credit losses.
(f)	Excludes the impact of purchase accounting adjustments related to the Washington Mutual transaction and the consolidation of the Washington Mutual Master Trust.

Page 18

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT DATA (a)
Credit card income
Reported	$	1,306		$	1,201		$	1,215		$	1,384		$	1,553			9	%		(16	)%	$	5,106		$	6,082			(16	)%
Securitization adjustments		(375	)		(285	)		(294	)		(540	)		(691	)		(32	)		46			(1,494	)		(3,314	)		55
Managed credit card income	$	931		$	916		$	921		$	844		$	862			2			8		$	3,612		$	2,768			30
Net interest income
Reported	$	2,271		$	2,345		$	2,353		$	2,478		$	2,408			(3	)		(6	)	$	9,447		$	6,838			38
Securitization adjustments		1,992			1,983			1,958			2,004			1,910			—			4			7,937			6,917			15
Managed net interest income	$	4,263		$	4,328		$	4,311		$	4,482		$	4,318			(2	)		(1	)	$	17,384		$	13,755			26
Total net revenue
Reported	$	3,531		$	3,461		$	3,204		$	3,665		$	3,689			2			(4	)	$	13,861		$	12,871			8
Securitization adjustments		1,617			1,698			1,664			1,464			1,219			(5	)		33			6,443			3,603			79
Managed total net revenue	$	5,148		$	5,159		$	4,868		$	5,129		$	4,908			—			5		$	20,304		$	16,474			23
Provision for credit losses
Reported	$	2,622		$	3,269		$	2,939		$	3,189		$	2,747			(20	)		(5	)	$	12,019		$	6,456			86
Securitization adjustments		1,617			1,698			1,664			1,464			1,219			(5	)		33			6,443			3,603			79
Managed provision for credit losses	$	4,239		$	4,967		$	4,603		$	4,653		$	3,966			(15	)		7		$	18,462		$	10,059			84
BALANCE SHEETS — AVERAGE BALANCES (a)
Total average assets
Reported	$	102,748		$	109,362		$	111,722		$	118,418		$	118,290			(6	)		(13	)	$	110,516		$	96,807			14
Securitization adjustments		81,787			82,779			81,588			82,782			85,653			(1	)		(5	)		82,233			76,904			7
Managed average assets	$	184,535		$	192,141		$	193,310		$	201,200		$	203,943			(4	)		(10	)	$	192,749		$	173,711			11
CREDIT QUALITY STATISTICS (a)
Net charge-offs
Reported	$	2,222		$	2,694		$	2,689		$	2,029		$	1,397			(18	)		59		$	9,634		$	4,556			111
Securitization adjustments		1,617			1,698			1,664			1,464			1,219			(5	)		33			6,443			3,603			79
Managed net charge-offs	$	3,839		$	4,392		$	4,353		$	3,493		$	2,616			(13	)		47		$	16,077		$	8,159			97
Net charge-off rates
Reported		11.34	%		12.85	%		12.03	%		8.42	%		5.63	%								11.07	%		5.47	%
Securitized		7.51			7.83			7.91			6.93			5.48									7.55			4.53
Managed net charge-off rate		9.33			10.30			10.03			7.72			5.56									9.33			5.01

(a) JPMorgan Chase uses the concept of “managed basis” 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 and those not sold. Thus, in its disclosures regarding managed receivables, JPMorgan Chase 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 19

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT
REVENUE
Lending & deposit-related fees	$	279		$	269		$	270		$	263		$	242			4	%		15	%	$	1,081		$	854			27	%
Asset management, administration and commissions		35			35			36			34			32			—			9			140			113			24
All other income (a)		149			170			152			125			102			(12	)		46			596			514			16
Noninterest revenue		463			474			458			422			376			(2	)		23			1,817			1,481			23
Net interest income		943			985			995			980			1,103			(4	)		(15	)		3,903			3,296			18
TOTAL NET REVENUE		1,406			1,459			1,453			1,402			1,479			(4	)		(5	)		5,720			4,777			20
Provision for credit losses		494			355			312			293			190			39			160			1,454			464			213
NONINTEREST EXPENSE
Compensation expense		183			196			197			200			164			(7	)		12			776			692			12
Noncompensation expense		351			339			327			342			324			4			8			1,359			1,206			13
Amortization of intangibles		9			10			11			11			11			(10	)		(18	)		41			48			(15	)
TOTAL NONINTEREST EXPENSE		543			545			535			553			499			—			9			2,176			1,946			12
Income before income tax expense		369			559			606			556			790			(34	)		(53	)		2,090			2,367			(12	)
Income tax expense		145			218			238			218			310			(33	)		(53	)		819			928			(12	)
NET INCOME	$	224		$	341		$	368		$	338		$	480			(34	)		(53	)	$	1,271		$	1,439			(12	)
MEMO:
Revenue by product:
Lending	$	639		$	675		$	684		$	665		$	611			(5	)		5		$	2,663		$	1,743			53
Treasury services		645			672			679			646			759			(4	)		(15	)		2,642			2,648			—
Investment banking		108			99			114			73			88			9			23			394			334			18
Other		14			13			(24	)		18			21			8			(33	)		21			52			(60	)
Total Commercial Banking revenue	$	1,406		$	1,459		$	1,453		$	1,402		$	1,479			(4	)		(5	)	$	5,720		$	4,777			20
IB revenue, gross (b)	$	328		$	301		$	328		$	206		$	241			9			36		$	1,163		$	966			20
Revenue by business:
Middle Market Banking	$	760		$	771		$	772		$	752		$	796			(1	)		(5	)	$	3,055		$	2,939			4
Commercial Term Lending (c)		191			232			224			228			243			(18	)		(21	)		875			243			260
Mid-Corporate Banking		277			278			305			242			243			—			14			1,102			921			20
Real Estate Banking (c)		100			121			120			120			131			(17	)		(24	)		461			413			12
Other (c)		78			57			32			60			66			37			18			227			261			(13	)
Total Commercial Banking revenue	$	1,406		$	1,459		$	1,453		$	1,402		$	1,479			(4	)		(5	)	$	5,720		$	4,777			20
FINANCIAL RATIOS
ROE		11	%		17	%		18	%		17	%		24	%								16	%		20	%
Overhead ratio		39			37			37			39			34									38			41

(a)	Revenue from investment banking products sold to Commercial Banking (“CB”) clients and commercial card revenue is included in all other income.
(b)	Represents the total revenue related to investment banking products sold to CB clients.
(c)	Includes total net revenue on net assets acquired in the Washington Mutual transaction starting in the period ending December 31, 2008.

Page 20

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
SELECTED BALANCE SHEET DATA (Period-end)
Loans:
Loans retained	$	97,108		$	101,608		$	105,556		$	110,923		$	115,130			(4	)%		(16	)%	$	97,108		$	115,130			(16	)%
Loans held-for-sale & loans at fair value		324			288			296			272			295			13			10			324			295			10
Total loans		97,432			101,896			105,852			111,195			115,425			(4	)		(16	)		97,432			115,425			(16	)
Equity		8,000			8,000			8,000			8,000			8,000			—			—			8,000			8,000			—
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	129,948		$	130,316		$	137,283		$	144,298		$	149,815			—			(13	)	$	135,408		$	114,299			18
Loans:
Loans retained		99,794			103,752			108,750			113,568			117,351			(4	)		(15	)		106,421			81,931			30
Loans held-for-sale & loans at fair value		386			297			288			297			329			30			17			317			406			(22	)
Total loans		100,180			104,049			109,038			113,865			117,680			(4	)		(15	)		106,738			82,337			30
Liability balances (a)		122,471			109,293			105,829			114,975			114,113			12			7			113,152			103,121			10
Equity		8,000			8,000			8,000			8,000			8,000			—			—			8,000			7,251			10
MEMO:
Loans by business:
Middle Market Banking	$	34,794		$	36,200		$	38,193		$	40,728		$	42,613			(4	)		(18	)	$	37,459		$	42,193			(11	)
Commercial Term Lending (b)		36,507			36,943			36,963			36,814			37,039			(1	)		(1	)		36,806			9,310			295
Mid-Corporate Banking		13,510			14,933			17,012			18,416			18,169			(10	)		(26	)		15,951			16,297			(2	)
Real Estate Banking (b)		11,133			11,547			12,347			13,264			13,529			(4	)		(18	)		12,066			9,008			34
Other (b)		4,236			4,426			4,523			4,643			6,330			(4	)		(33	)		4,456			5,529			(19	)
Total Commercial Banking loans	$	100,180		$	104,049		$	109,038		$	113,865		$	117,680			(4	)		(15	)	$	106,738		$	82,337			30
Headcount		4,151			4,177			4,228			4,545			5,206			(1	)		(20	)		4,151			5,206			(20	)
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs	$	483		$	291		$	181		$	134		$	118			66			309		$	1,089		$	288			278
Nonperforming loans:
Nonperforming loans retained (c)		2,764			2,284			2,090			1,531			1,026			21			169			2,764			1,026			169
Nonperforming loans held-for-sale & loans at fair value		37			18			21			—			—			106			NM			37			—			NM
Total nonperforming loans:		2,801			2,302			2,111			1,531			1,026			22			173			2,801			1,026			173
Nonperforming assets		2,989			2,461			2,255			1,651			1,142			21			162			2,989			1,142			162
Allowance for credit losses:
Allowance for loan losses		3,025			3,063			3,034			2,945			2,826			(1	)		7			3,025			2,826			7
Allowance for lending-related commitments		349			300			272			240			206			16			69			349			206			69
Total allowance for credit losses		3,374			3,363			3,306			3,185			3,032			—			11			3,374			3,032			11
Net charge-off rate		1.92	%		1.11	%		0.67	%		0.48	%		0.40	%								1.02	%		0.35	%
Allowance for loan losses to period-end loans retained		3.12			3.01			2.87			2.65			2.45									3.12			2.45
Allowance for loan losses to average loans retained		3.03			2.95			2.79			2.59			2.41									2.84			3.04	(d)
Allowance for loan losses to nonperforming loans retained		109			134			145			192			275									109			275
Nonperforming loans to total period-end loans		2.87			2.26			1.99			1.38			0.89									2.87			0.89
Nonperforming loans to total average loans		2.80			2.21			1.94			1.34			0.87									2.62			1.10	(d)

(a)	Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities loaned or sold under repurchase agreements.
(b)	Includes loans acquired in the Washington Mutual transaction starting in the period ended December 31, 2008.
(c)	Allowance for loan losses of $581 million, $496 million, $460 million, $352 million, and $208 million were held against nonperforming loans retained for the periods ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively.
(d)	Average loans in the calculation of this ratio were adjusted to include $44.5 billion of loans acquired in the Washington Mutual transaction as if the transaction occurred on July 1, 2008. Excluding this adjustment, the unadjusted allowance for loan losses to average loans retained and nonperforming loans to total average loans ratios would have been 3.45% and 1.25%, respectively, for the period ended December 31, 2008.

Page 21

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT
REVENUE
Lending & deposit-related fees	$	330		$	316		$	314		$	325		$	304			4	%		9	%	$	1,285		$	1,146			12	%
Asset management, administration and commissions		675			620			710			626			748			9			(10	)		2,631			3,133			(16	)
All other income		212			201			221			197			268			5			(21	)		831			917			(9	)
Noninterest revenue		1,217			1,137			1,245			1,148			1,320			7			(8	)		4,747			5,196			(9	)
Net interest income		618			651			655			673			929			(5	)		(33	)		2,597			2,938			(12	)
TOTAL NET REVENUE		1,835			1,788			1,900			1,821			2,249			3			(18	)		7,344			8,134			(10	)
Provision for credit losses		53			13			(5	)		(6	)		45			308			18			55			82			(33	)
Credit reimbursement to IB (a)		(30	)		(31	)		(30	)		(30	)		(30	)		3			—			(121	)		(121	)		—
NONINTEREST EXPENSE
Compensation expense		668			629			618			629			628			6			6			2,544			2,602			(2	)
Noncompensation expense		704			633			650			671			692			11			2			2,658			2,556			4
Amortization of intangibles		19			18			20			19			19			6			—			76			65			17
TOTAL NONINTEREST EXPENSE		1,391			1,280			1,288			1,319			1,339			9			4			5,278			5,223			1
Income before income tax expense		361			464			587			478			835			(22	)		(57	)		1,890			2,708			(30	)
Income tax expense		124			162			208			170			302			(23	)		(59	)		664			941			(29	)
NET INCOME	$	237		$	302		$	379		$	308		$	533			(22	)		(56	)	$	1,226		$	1,767			(31	)
REVENUE BY BUSINESS
Treasury Services (b)	$	918		$	919		$	934		$	931		$	1,068			—			(14	)	$	3,702		$	3,779			(2	)
Worldwide Securities Services (b)		917			869			966			890			1,181			6			(22	)		3,642			4,355			(16	)
TOTAL NET REVENUE	$	1,835		$	1,788		$	1,900		$	1,821		$	2,249			3			(18	)	$	7,344		$	8,134			(10	)
FINANCIAL RATIOS
ROE		19	%		24	%		30	%		25	%		47	%								25	%		47	%
Overhead ratio		76			72			68			72			60									72			64
Pretax margin ratio (c)		20			26			31			26			37									26			33
SELECTED BALANCE SHEET DATA (Period-end)
Loans (d)	$	18,972		$	19,693		$	17,929		$	18,529		$	24,508			(4	)		(23	)	$	18,972		$	24,508			(23	)
Equity		5,000			5,000			5,000			5,000			4,500			—			11			5,000			4,500			11
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	36,589		$	33,117		$	35,520		$	38,682		$	55,515			10			(34	)	$	35,963		$	54,563			(34	)
Loans (d)		18,888			17,062			17,524			20,140			31,283			11			(40	)		18,397			26,226			(30	)
Liability balances (e)		250,695			231,502			234,163			276,486			336,277			8			(25	)		248,095			279,833			(11	)
Equity		5,000			5,000			5,000			5,000			4,500			—			11			5,000			3,751			33
Headcount		26,609			26,389			27,252			26,998			27,070			1			(2	)		26,609			27,070			(2	)

(a)	The IB credit portfolio group manages certain exposures on behalf of clients shared with TSS. TSS reimburses IB for a portion of the total cost of managing the credit portfolio. IB recognizes this credit reimbursement as a component of noninterest revenue.
(b)	Reflects an internal reorganization for escrow products, from Worldwide Securities Services to Treasury Services revenue of $39 million, $38 million, $46 million, $45 million, and $75 million for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $168 million and $224 million for full year 2009 and 2008, respectively.
(c)	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.
(d)	Loan balances include wholesale overdrafts, commercial card and trade finance loans.
(e)	Liability balances include deposits and deposits swept to on-balance sheet liabilities such as commercial paper, federal funds purchased and securities loaned or sold under repurchase agreements.

Page 22

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, Retail 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																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
TSS FIRMWIDE DISCLOSURES
Treasury Services revenue — reported (a)	$	918		$	919		$	934		$	931		$	1,068			—	%		(14	)%	$	3,702		$	3,779			(2	)%
Treasury Services revenue reported in Commercial Banking		645			672			679			646			759			(4	)		(15	)		2,642			2,648			—
Treasury Services revenue reported in other lines of business		57			63			63			62			82			(10	)		(30	)		245			299			(18	)
Treasury Services firmwide revenue (a) (b)		1,620			1,654			1,676			1,639			1,909			(2	)		(15	)		6,589			6,726			(2	)
Worldwide Securities Services revenue (a)		917			869			966			890			1,181			6			(22	)		3,642			4,355			(16	)
Treasury & Securities Services firmwide revenue (b)	$	2,537		$	2,523		$	2,642		$	2,529		$	3,090			1			(18	)	$	10,231		$	11,081			(8	)
Treasury Services firmwide liability balances (average) (c) (d)	$	289,024		$	261,059		$	258,312		$	289,645		$	312,559			11			(8	)	$	274,472		$	264,195			4
Treasury & Securities Services firmwide liability balances (average) (c)		373,166			340,795			339,992			391,461			450,390			9			(17	)		361,247			382,947			(6	)
TSS FIRMWIDE FINANCIAL RATIOS
Treasury Services firmwide overhead ratio (e)		54	%		52	%		51	%		53	%		44	%								53	%		50	%
Treasury & Securities Services firmwide overhead ratio (e)		66			62			59			63			52									62			57
FIRMWIDE BUSINESS METRICS
Assets under custody (in billions)	$	14,885		$	14,887		$	13,748		$	13,532		$	13,205			—			13		$	14,885		$	13,205			13
Number of:
US$ ACH transactions originated (in millions)		975			965			978			978			1,006			1			(3	)		3,896			4,000			(3	)
Total US$ clearing volume (in thousands)		29,493			28,604			28,193			27,186			29,346			3			1			113,476			115,742			(2	)
International electronic funds transfer volume (in thousands) (f)		53,354			48,533			47,096			44,365			47,734			10			12			193,348			171,036			13
Wholesale check volume (in millions)		514			530			572			568			572			(3	)		(10	)		2,184			2,408			(9	)
Wholesale cards issued (in thousands) (g)		27,138			26,977			25,501			23,757			22,784			1			19			27,138			22,784			19
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs/(recoveries)	$	—		$	—		$	17		$	2		$	—			—			—		$	19		$	(2	)		NM
Nonperforming loans		14			14			14			30			30			—			(53	)		14			30			(53	)
Allowance for credit losses:
Allowance for loan losses		88			15			15			51			74			487			19			88			74			19
Allowance for lending-related commitments		84			104			92			77			63			(19	)		33			84			63			33
Total allowance for credit losses		172			119			107			128			137			45			26			172			137			26
Net charge-off/(recovery) rate		—	%		—	%		0.39	%		0.04	%		—	%								0.10	%		(0.01	)%
Allowance for loan losses to period-end loans		0.46			0.08			0.08			0.28			0.30									0.46			0.30
Allowance for loan losses to average loans		0.47			0.09			0.09			0.25			0.24									0.48			0.28
Allowance for loan losses to nonperforming loans		NM			107			107			170			247									NM			247
Nonperforming loans to period-end loans		0.07			0.07			0.08			0.16			0.12									0.07			0.12
Nonperforming loans to average loans		0.07			0.08			0.08			0.15			0.10									0.08			0.11

(a)	Reflects an internal reorganization for escrow products, from Worldwide Securities Services to Treasury Services revenue, of $39 million, $38 million, $46 million, $45 million, and $75 million, for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $168 million and $224 million for full year 2009 and 2008, respectively.
(b)	TSS firmwide revenue includes FX revenue recorded in TSS and FX revenue associated with TSS customers who are FX customers of IB. However, some of the FX revenue associated with TSS customers who are FX customers of IB are not included in TS and TSS firmwide revenue. These amounts were $162 million, $154 million, $191 million, $154 million, and $271 million, for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $661 million and $880 million for full year 2009 and 2008, respectively.
(c)	Firmwide liability balances include liability balances recorded in Commercial Banking.
(d)	Reflects an internal reorganization for escrow products, from Worldwide Securities Services to Treasury Services liability balances, of $15.5 billion, $13.9 billion, $14.9 billion, $18.2 billion, and $22.3 billion for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and $15.6 billion and $21.5 billion for full year 2009 and 2008, respectively.
(e)	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 IB for TSS-related FX activity are not included in this ratio.
(f)	International electronic funds transfer includes non-U.S. dollar ACH and clearing volume.
(g)	Wholesale cards issued include domestic commercial, stored value, prepaid and government electronic benefit card products.

Page 23

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT
REVENUE
Asset management, administration and commissions	$	1,632		$	1,443		$	1,315		$	1,231		$	1,362			13	%		20	%	$	5,621		$	6,004			(6	)%
All other income		191			238			253			69			(170	)		(20	)		NM			751			62			NM
Noninterest revenue		1,823			1,681			1,568			1,300			1,192			8			53			6,372			6,066			5
Net interest income		372			404			414			403			466			(8	)		(20	)		1,593			1,518			5
TOTAL NET REVENUE		2,195			2,085			1,982			1,703			1,658			5			32			7,965			7,584			5
Provision for credit losses		58			38			59			33			32			53			81			188			85			121
NONINTEREST EXPENSE
Compensation expense		907			858			810			800			689			6			32			3,375			3,216			5
Noncompensation expense		543			474			525			479			504			15			8			2,021			2,000			1
Amortization of intangibles		20			19			19			19			20			5			—			77			82			(6	)
TOTAL NONINTEREST EXPENSE		1,470			1,351			1,354			1,298			1,213			9			21			5,473			5,298			3
Income before income tax expense		667			696			569			372			413			(4	)		62			2,304			2,201			5
Income tax expense		243			266			217			148			158			(9	)		54			874			844			4
NET INCOME	$	424		$	430		$	352		$	224		$	255			(1	)		66		$	1,430		$	1,357			5
REVENUE BY CLIENT SEGMENT
Private Bank	$	723		$	639		$	640		$	583		$	630			13			15		$	2,585		$	2,565			1
Institutional		584			534			487			460			327			9			79			2,065			1,775			16
Retail		445			471			411			253			265			(6	)		68			1,580			1,620			(2	)
Private Wealth Management		331			339			334			312			330			(2	)		—			1,316			1,387			(5	)
Bear Stearns Private Client Services (a)		112			102			110			95			106			10			6			419			237			77
Total net revenue	$	2,195		$	2,085		$	1,982		$	1,703		$	1,658			5			32		$	7,965		$	7,584			5
FINANCIAL RATIOS
ROE		24	%		24	%		20	%		13	%		14	%								20	%		24	%
Overhead ratio		67			65			68			76			73									69			70
Pretax margin ratio (b)		30			33			29			22			25									29			29
BUSINESS METRICS
Number of:
Client advisors (c)		1,934			1,891			1,838			1,872			1,840			2			5			1,934			1,840			5
Retirement planning services participants		1,628,000			1,620,000			1,595,000			1,628,000			1,531,000			—			6			1,628,000			1,531,000			6
Bear Stearns brokers (a)		376			365			362			359			324			3			16			376			324			16
% of customer assets in 4 & 5 Star Funds (d)		42	%		39	%		45	%		42	%		42	%		8			—			42	%		42	%		—
% of AUM in 1st and 2nd quartiles: (e)
1 year		57	%		60	%		62	%		54	%		54	%		(5	)		6			57	%		54	%		6
3 years		62	%		70	%		69	%		62	%		65	%		(11	)		(5	)		62	%		65	%		(5	)
5 years		74	%		74	%		80	%		66	%		76	%		—			(3	)		74	%		76	%		(3	)
SELECTED BALANCE SHEET DATA (Period-end)
Loans	$	37,755		$	35,925		$	35,474		$	33,944		$	36,188			5			4		$	37,755		$	36,188			4
Equity		7,000			7,000			7,000			7,000			7,000			—			—			7,000			7,000			—
SELECTED BALANCE SHEET DATA (Average)
Total assets	$	63,036		$	60,345		$	59,334		$	58,227		$	65,648			4			(4	)	$	60,249		$	65,550			(8	)
Loans		36,137			34,822			34,292			34,585			36,851			4			(2	)		34,963			38,124			(8	)
Deposits		77,352			73,649			75,355			81,749			76,911			5			1			77,005			70,179			10
Equity		7,000			7,000			7,000			7,000			7,000			—			—			7,000			5,645			24
Headcount		15,136			14,919			14,840			15,109			15,339			1			(1	)		15,136			15,339			(1	)
CREDIT DATA AND QUALITY STATISTICS
Net charge-offs	$	35		$	17		$	46		$	19		$	12			106			192		$	117		$	11			NM
Nonperforming loans		580			409			313			301			147			42			295			580			147			295
Allowance for credit losses:
Allowance for loan losses		269			251			226			215			191			7			41			269			191			41
Allowance for lending-related commitments		9			5			4			4			5			80			80			9			5			80
Total allowance for credit losses		278			256			230			219			196			9			42			278			196			42
Net charge-off rate		0.38	%		0.19	%		0.54	%		0.22	%		0.13	%								0.33	%		0.03	%
Allowance for loan losses to period-end loans		0.71			0.70			0.64			0.63			0.53									0.71			0.53
Allowance for loan losses to average loans		0.74			0.72			0.66			0.62			0.52									0.77			0.50
Allowance for loan losses to nonperforming loans		46			61			72			71			130									46			130
Nonperforming loans to period-end loans		1.54			1.14			0.88			0.89			0.41									1.54			0.41
Nonperforming loans to average loans		1.61			1.17			0.91			0.87			0.40									1.66			0.39

(a)	Bear Stearns Private Client Services was renamed to JPMorgan Securities at the beginning of 2010.
(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)	Periods prior to September 30, 2009 were revised to conform with current methodology.
(d)	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.
(e)	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.

Page 24

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

											Dec 31, 2009
											Change
	Dec 31		Sep 30		Jun 30		Mar 31		Dec 31		Sep 30				Dec 31
	2009		2009		2009		2009		2008		2009				2008
Assets by asset class
Liquidity	$	591	$	634	$	617	$	625	$	613		(7	)%			(4	)%
Fixed income		226		215		194		180		180		5				26
Equities & multi-asset		339		316		264		215		240		7				41
Alternatives		93		94		96		95		100		(1	)	��		(7	)
TOTAL ASSETS UNDER MANAGEMENT		1,249		1,259		1,171		1,115		1,133		(1	)			10
Custody / brokerage / administration / deposits		452		411		372		349		363		10				25
TOTAL ASSETS UNDER SUPERVISION	$	1,701	$	1,670	$	1,543	$	1,464	$	1,496		2				14
Assets by client segment
Institutional	$	709	$	737	$	697	$	668	$	681		(4	)			4
Private Bank		187		180		179		181		181		4				3
Retail		270		256		216		184		194		5				39
Private Wealth Management		69		71		67		68		71		(3	)			(3	)
Bear Stearns Private Client Services (a)		14		15		12		14		6		(7	)			133
TOTAL ASSETS UNDER MANAGEMENT	$	1,249	$	1,259	$	1,171	$	1,115	$	1,133		(1	)			10
Institutional	$	710	$	737	$	697	$	669	$	682		(4	)			4
Private Bank		452		414		390		375		378		9				20
Retail		355		339		289		250		262		5				35
Private Wealth Management		129		131		123		120		124		(2	)			4
Bear Stearns Private Client Services (a)		55		49		44		50		50		12				10
TOTAL ASSETS UNDER SUPERVISION	$	1,701	$	1,670	$	1,543	$	1,464	$	1,496		2				14
Assets by geographic region
U.S. / Canada	$	837	$	862	$	814	$	789	$	798		(3	)			5
International		412		397		357		326		335		4				23
TOTAL ASSETS UNDER MANAGEMENT	$	1,249	$	1,259	$	1,171	$	1,115	$	1,133		(1	)			10
U.S. / Canada	$	1,182	$	1,179	$	1,103	$	1,066	$	1,084		—				9
International		519		491		440		398		412		6				26
TOTAL ASSETS UNDER SUPERVISION	$	1,701	$	1,670	$	1,543	$	1,464	$	1,496		2				14
Mutual fund assets by asset class
Liquidity	$	539	$	576	$	569	$	570	$	553		(6	)			(3	)
Fixed income		67		57		48		42		41		18				63
Equities		143		133		111		85		92		8				55
Alternatives		9		10		9		8		7		(10	)			29
TOTAL MUTUAL FUND ASSETS	$	758	$	776	$	737	$	705	$	693		(2	)			9

(a) Bear Stearns Private Client Services was renamed to JPMorgan Securities at the beginning of 2010.

Page 25

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

	QUARTERLY TRENDS														FULL YEAR
	4Q09			3Q09		2Q09			1Q09			4Q08			2009			2008
ASSETS UNDER SUPERVISION (continued)
Assets under management rollforward
Beginning balance	$	1,259		$	1,171	$	1,115		$	1,133		$	1,153		$	1,133		$	1,193
Net asset flows:
Liquidity		(44	)		9		(7	)		19			86			(23	)		210
Fixed income		12			13		8			1			(7	)		34			(12	)
Equities, multi-asset & alternative		8			12		2			(5	)		(18	)		17			(47	)
Market / performance / other impacts		14			54		53			(33	)		(81	)		88			(211	)
TOTAL ASSETS UNDER MANAGEMENT	$	1,249		$	1,259	$	1,171		$	1,115		$	1,133		$	1,249		$	1,133
Assets under supervision rollforward
Beginning balance	$	1,670		$	1,543	$	1,464		$	1,496		$	1,562		$	1,496		$	1,572
Net asset flows		(11	)		45		(9	)		25			73			50			181
Market / performance / other impacts		42			82		88			(57	)		(139	)		155			(257	)
TOTAL ASSETS UNDER SUPERVISION	$	1,701		$	1,670	$	1,543		$	1,464		$	1,496		$	1,701		$	1,496

Page 26

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
INCOME STATEMENT
REVENUE
Principal transactions	$	715		$	1,109		$	1,243		$	(1,493	)	$	(1,620	)		(36)	%	NM		%	$	1,574		$	(3,588	)	NM		%
Securities gains		378			181			366			214			499			109			(24	)		1,139			1,637			(30	)
All other income (a)		13			273			(209	)		(19	)		685			(95	)		(98	)		58			1,673			(97	)
Noninterest revenue		1,106			1,563			1,400			(1,298	)		(436	)		(29	)	NM				2,771			(278	)	NM
Net interest income (expense)		978			1,031			865			989			868			(5	)		13			3,863			347		NM
TOTAL NET REVENUE		2,084			2,594			2,265			(309	)		432			(20	)		382			6,634			69		NM
Provision for credit losses (b)		9			62			9			—			(33	)		(85	)	NM				80			1,981			(96	)
NONINTEREST EXPENSE
Compensation expense		747			768			655			641			438			(3	)		71			2,811			2,340			20
Noncompensation expense (c)		1,058			875			1,319			345			673			21			57			3,597			1,841			95
Merger costs		30			103			143			205			181			(71	)		(83	)		481			432			11
Subtotal		1,835			1,746			2,117			1,191			1,292			5			42			6,889			4,613			49
Net expense allocated to other businesses		(1,219	)		(1,243	)		(1,253	)		(1,279	)		(1,364	)		2			11			(4,994	)		(4,641	)		(8	)
TOTAL NONINTEREST EXPENSE		616			503			864			(88	)		(72	)		22		NM				1,895			(28	)	NM
Income/(loss) before income tax expense (benefit) and extraordinary gain		1,459			2,029			1,392			(221	)		537			(28	)		172			4,659			(1,884	)	NM
Income tax expense/(benefit)		262			818			584			41			317			(68	)		(17	)		1,705			(535	)	NM
Income/(loss) before extraordinary gain		1,197			1,211			808			(262	)		220			(1	)		444			2,954			(1,349	)	NM
Extraordinary gain (d)		—			76			—			—			1,325		NM			NM				76			1,906			(96	)
NET INCOME/(LOSS)	$	1,197		$	1,287		$	808		$	(262	)	$	1,545			(7	)		(23	)	$	3,030		$	557			444
MEMO:
TOTAL NET REVENUE
Private equity	$	296		$	172		$	(1	)	$	(449	)	$	(1,107	)		72		NM			$	18		$	(963	)	NM
Corporate		1,788			2,422			2,266			140			1,539			(26	)		16			6,616			1,032		NM
TOTAL NET REVENUE	$	2,084		$	2,594		$	2,265		$	(309	)	$	432			(20	)		382		$	6,634		$	69		NM
NET INCOME/(LOSS)
Private equity	$	141		$	88		$	(27	)	$	(280	)	$	(682	)		60		NM			$	(78	)	$	(690	)		89
Corporate		1,229			1,269			993			252			1,163			(3	)		6			3,743			1,458			157
Merger-related items (e)		(173	)		(70	)		(158	)		(234	)		1,064			(147	)	NM				(635	)		(211	)		(201	)
TOTAL NET INCOME/(LOSS)	$	1,197		$	1,287		$	808		$	(262	)	$	1,545			(7	)		(23	)	$	3,030		$	557			444
Headcount		20,199			20,747			21,522			22,339			23,376			(3	)		(14	)		20,199			23,376			(14	)

(a)	Included the following significant items: a gain of $1.0 billion from the dissolution of the Chase Paymentech Solutions joint venture in the fourth quarter of 2008, a charge of $375 million for the repurchase of auction rate securities in the third quarter of 2008, $423 million representing the Firm’s share of Bear Stearns’ losses from April 8 to May 30, 2008, in the second quarter of 2008, and proceeds of $1.5 billion from the sale of Visa shares in its initial public offering in the first quarter of 2008.
(b)	The fourth and third quarters of 2008 included accounting conformity loan loss reserve provisions related to the acquisition of Washington Mutual Bank’s banking operations. An analysis of loans acquired in the transaction was substantially completed during the fourth quarter. This resulted in an increase in the purchased credit-impaired loan balances, a corresponding reduction in the non-credit-impaired portfolio and a reduction in the estimate of incurred losses related to the non-credit-impaired portfolio requiring a reduction in the accounting conformity provision for these loans. Also, the fourth quarter of 2008 includes a provision for credit losses related to the transfer of higher quality credit card loans from the legacy Chase portfolio to a securitization trust previously established by Washington Mutual.
(c)	Second quarter 2009 includes a $675 million FDIC special assessment.
(d)	JPMorgan Chase acquired the banking operations of Washington Mutual Bank for $1.9 billion. The fair value of the net assets acquired exceeded the purchase price, which resulted in negative goodwill. In accordance with U.S. GAAP for business combinations, 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.
(e)	Included accounting conformity loan loss reserve provisions, extraordinary gains and merger costs related to the Washington Mutual transaction, as well as items related to the Bear Stearns merger, including Bear Stearns’ losses, merger costs, Bear Stearns asset management liquidation costs and Bear Stearns Private Client Services broker retention expense.

Page 27

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

	QUARTERLY TRENDS																			FULL YEAR
														4Q09 Change												2009 Change
	4Q09		3Q09		2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
SUPPLEMENTAL
TREASURY
Securities gains (a) (b)	$	378	$	181	$	374		$	214		$	512			109	%		(26	)%	$	1,147		$	1,652			(31	)%
Investment securities portfolio (average) (b)		353,224		339,745		336,263			265,785			159,209			4			122			324,037			113,010			187
Investment securities portfolio (ending) (b)		340,163		351,823		326,414			316,498			192,564			(3	)		77			340,163			192,564			77
Mortgage loans (average)		7,794		7,469		7,228			7,210			7,277			4			7			7,427			7,059			5
Mortgage loans (ending)		8,023		7,665		7,368			7,162			7,292			5			10			8,023			7,292			10
PRIVATE EQUITY
Private equity gains/(losses)
Direct investments
Realized gains	$	12	$	57	$	25		$	15		$	24			(79	)		(50	)	$	109		$	1,717			(94	)
Unrealized gains/(losses) (c)		224		88		16			(409	)		(1,000	)		155		NM				(81	)		(2,480	)		97
Total direct investments		236		145		41			(394	)		(976	)		63		NM				28			(763	)	NM
Third-party fund investments		37		10		(61	)		(68	)		(121	)		270		NM				(82	)		(131	)		37
Total private equity gains/(losses) (d)	$	273	$	155	$	(20	)	$	(462	)	$	(1,097	)		76		NM			$	(54	)	$	(894	)		94
Private equity portfolio information
Direct investments
Publicly-held securities
Carrying value	$	762	$	674	$	431		$	305		$	483			13			58
Cost		743		751		778			778			792			(1	)		(6	)
Quoted public value		791		720		477			346			543			10			46
Privately-held direct securities
Carrying value		5,104		4,722		4,709			4,708			5,564			8			(8	)
Cost		5,959		5,823		5,627			5,519			6,296			2			(5	)
Third-party fund investments (e)
Carrying value		1,459		1,440		1,420			1,537			805			1			81
Cost		2,079		2,068		2,055			2,082			1,169			1			78
Total private equity portfolio — Carrying value	$	7,325	$	6,836	$	6,560		$	6,550		$	6,852			7			7
Total private equity portfolio — Cost	$	8,781	$	8,642	$	8,460		$	8,379		$	8,257			2			6

(a)	All periods reflect repositioning of the Corporate investment securities portfolio, and exclude gains/losses on securities used to manage risk associated with MSRs.
(b)	Beginning in second quarter 2009, balances reflect Treasury and Chief Investment Office securities. Prior periods have been revised to conform with this change.
(c)	Unrealized gains (losses) contain 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.
(e)	Unfunded commitments to third-party private equity funds were $1.5 billion, $1.4 billion, $1.5 billion, $1.5 billion, and $1.4 billion at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively.

Page 28

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

											Dec 31, 2009
											Change
	Dec 31		Sep 30		Jun 30		Mar 31		Dec 31		Sep 30			Dec 31
	2009		2009		2009		2009		2008		2009			2008
CREDIT EXPOSURE
WHOLESALE (a)
Loans retained	$	200,077	$	213,718	$	224,080	$	230,534	$	248,089		(6)	%		(19	)%
Loans held-for-sale and loans at fair value		4,098		5,235		7,545		11,750		13,955		(22	)		(71	)
TOTAL WHOLESALE LOANS — REPORTED		204,175		218,953		231,625		242,284		262,044		(7	)		(22	)
CONSUMER (b)
Home loan portfolio — excluding purchased credit-impaired loans:
Home equity		101,425		104,795		108,229		111,781		114,335		(3	)		(11	)
Prime mortgage		66,892		67,597		68,878		71,731		72,266		(1	)		(7	)
Subprime mortgage		12,526		13,270		13,825		14,594		15,330		(6	)		(18	)
Option ARMs		8,536		8,852		9,034		8,940		9,018		(4	)		(5	)
Total home loan portfolio — excluding purchased credit-impaired loans		189,379		194,514		199,966		207,046		210,949		(3	)		(10	)
Home loan portfolio — purchased credit-impaired loans: (c)
Home equity		26,520		27,088		27,729		28,366		28,555		(2	)		(7	)
Prime mortgage		19,693		20,229		20,807		21,398		21,855		(3	)		(10	)
Subprime mortgage		5,993		6,135		6,341		6,565		6,760		(2	)		(11	)
Option ARMs		29,039		29,750		30,529		31,243		31,643		(2	)		(8	)
Total home loan portfolio — purchased credit-impaired loans		81,245		83,202		85,406		87,572		88,813		(2	)		(9	)
Other consumer:
Auto		46,031		44,309		42,887		43,065		42,603		4			8
Credit card — reported:
Credit card — reported excluding loans held by the Washington Mutual Master Trust		77,784		75,207		80,722		90,911		104,746		3			(26	)
Credit card — reported loans held by the Washington Mutual Master Trust (d)		1,002		3,008		5,014		—		—		(67	)	NM
Total credit card — reported		78,786		78,215		85,736		90,911		104,746		1			(25	)
Other loans		31,700		32,405		33,041		33,700		33,715		(2	)		(6	)
Loans retained		427,141		432,645		447,036		462,294		480,826		(1	)		(11	)
Loans held-for-sale (e)		2,142		1,546		1,940		3,665		2,028		39			6
TOTAL CONSUMER LOANS — REPORTED		429,283		434,191		448,976		465,959		482,854		(1	)		(11	)
TOTAL LOANS — REPORTED		633,458		653,144		680,601		708,243		744,898		(3	)		(15	)
Credit card — securitized		84,626		87,028		85,790		85,220		85,571		(3	)		(1	)
TOTAL LOANS — MANAGED		718,084		740,172		766,391		793,463		830,469		(3	)		(14	)
Derivative receivables		80,210		94,065		97,491		131,247		162,626		(15	)		(51	)
Receivables from customers		15,745		13,148		12,977		14,504		16,141		20			(2	)
Interests in purchased receivables		2,927		2,329		2,972		—		—		26		NM
TOTAL CREDIT-RELATED ASSETS		816,966		849,714		879,831		939,214		1,009,236		(4	)		(19	)
Wholesale lending-related commitments		347,155		343,135		343,991		363,013		379,871		1			(9	)
TOTAL	$	1,164,121	$	1,192,849	$	1,223,822	$	1,302,227	$	1,389,107		(2	)		(16	)
Memo: Total by category
Total wholesale exposure (f)	$	650,212	$	671,630	$	689,056	$	751,048	$	820,682		(3	)		(21	)
Total consumer managed loans (g)		513,909		521,219		534,766		551,179		568,425		(1	)		(10	)
Total	$	1,164,121	$	1,192,849	$	1,223,822	$	1,302,227	$	1,389,107		(2	)		(16	)
Risk profile of wholesale credit exposure:
Investment-grade	$	460,702	$	474,005	$	491,168	$	546,968	$	605,210		(3	)		(24	)
Noninvestment-grade:
Noncriticized		133,557		141,578		141,408		147,891		159,379		(6	)		(16	)
Criticized performing		26,095		27,217		26,453		25,320		22,568		(4	)		16
Criticized nonperforming		7,088		8,118		6,533		4,615		3,429		(13	)		107
Total noninvestment-grade		166,740		176,913		174,394		177,826		185,376		(6	)		(10	)
Loans held-for-sale & loans at fair value		4,098		5,235		7,545		11,750		13,955		(22	)		(71	)
Receivables from customers		15,745		13,148		12,977		14,504		16,141		20			(2	)
Interests in purchased receivables		2,927		2,329		2,972		—		—		26		NM
Total wholesale exposure	$	650,212	$	671,630	$	689,056	$	751,048	$	820,682		(3	)		(21	)

(a)	Includes Investment Bank, Commercial Banking, Treasury & Securities Services and Asset Management.
(b)	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.
(c)	Purchased credit-impaired loans represent loans acquired in the Washington Mutual transaction for which a deterioration in credit quality occurred between the origination date and JPMorgan Chase’s acquisition date. These loans were initially recorded at fair value and accrete interest income over the estimated life of the loan when cash flows are reasonably estimable even if the underlying loans are contractually past due.
(d)	Represents loans held by the Washington Mutual Master Trust, which were consolidated onto the Firm’s balance sheet at fair value during the second quarter of 2009. No allowance for loan losses was recorded for these loans as of December 31, 2009, September 30, 2009 and June 30, 2009.
(e)	Included loans for prime mortgage of $450 million, $187 million, $589 million, $825 million, and $206 million at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and other (largely student loans) of $1.7 billion, $1.4 billion, $1.4 billion, $2.8 billion, and $1.8 billion at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively.
(f)	Primarily 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.
	Note: The risk profile is based on JPMorgan Chase’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 29

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

																Dec 31, 2009
																Change
	Dec 31			Sep 30			Jun 30			Mar 31			Dec 31			Sep 30			Dec 31
	2009			2009			2009			2009			2008			2009			2008
NONPERFORMING ASSETS AND RATIOS
WHOLESALE LOANS
Loans retained	$	6,559		$	7,494		$	5,829		$	3,605		$	2,350			(12)	%		179	%
Loans held-for-sale and loans at fair value		345			146			133			57			32			136		NM
TOTAL WHOLESALE LOANS		6,904			7,640			5,962			3,662			2,382			(10	)		190
CONSUMER LOANS (a)
Home loan portfolio (includes RFS and Corporate/Private Equity):
Home equity		1,665			1,598			1,487			1,591			1,394			4			19
Prime mortgage		4,355			4,007			3,501			2,712			1,895			9			130
Subprime mortgage		3,248			3,233			2,773			2,545			2,690			—			21
Option ARMs		312			244			182			97			10			28		NM
Total home loan portfolio		9,580			9,082			7,943			6,945			5,989			5			60
Auto loans		177			179			154			165			148			(1	)		20
Credit card — reported		3			3			4			4			4			—			(25	)
Other loans		900			863			722			625			430			4			109
TOTAL CONSUMER LOANS (b) (c)		10,660			10,127			8,823			7,739			6,571			5			62
TOTAL NONPERFORMING LOANS REPORTED		17,564			17,767			14,785			11,401			8,953			(1	)		96
Derivative receivables		529			624			704			1,010			1,079			(15	)		(51	)
Assets acquired in loan satisfactions		1,648			1,971			2,028			2,243			2,682			(16	)		(39	)
TOTAL NONPERFORMING ASSETS (b)	$	19,741		$	20,362		$	17,517		$	14,654		$	12,714			(3	)		55
TOTAL NONPERFORMING LOANS TO TOTAL LOANS REPORTED		2.77	%		2.72	%		2.17	%		1.61	%		1.20	%
NONPERFORMING ASSETS BY LOB
Investment Bank	$	4,236		$	5,782		$	4,534		$	3,041		$	2,501			(27	)		69
Retail Financial Services (c)		11,864			11,641			10,351			9,582			8,841			2			34
Card Services		3			3			4			4			4			—			(25	)
Commercial Banking		2,989			2,461			2,255			1,651			1,142			21			162
Treasury & Securities Services		14			14			14			30			30			—			(53	)
Asset Management		582			422			326			319			172			38			238
Corporate/Private Equity (d)		53			39			33			27			24			36			121
TOTAL	$	19,741		$	20,362		$	17,517		$	14,654		$	12,714			(3	)		55

(a)	There were no nonperforming loans held-for-sale at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, or December 31, 2008.
(b)	Nonperforming loans and assets excluded: (1) mortgage loans insured by U.S. government agencies of $9.0 billion, $7.0 billion, $4.2 billion, $4.2 billion, and $3.0 billion, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively; (2) real estate owned insured by U.S. government agencies of $579 million, $579 million, $508 million, $433 million, and $364 million, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively; and (3) student 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 $542 million, $511 million, $473 million, $433 million, and $437 million, at December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively. These amounts are excluded, as reimbursement is proceeding normally.
(c)	Excludes home lending purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans are accounted for on a pool basis, and the pools are considered to be performing. Also excludes loans held-for-sale and loans at fair value.
(d)	Predominantly relates to held-for-investment prime mortgage.

Page 30

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
GROSS CHARGE-OFFS																									��
Wholesale loans	$	1,230		$	1,093		$	697		$	206		$	238			13	%		417	%	$	3,226		$	521			NM	%
Consumer loans (includes RFS and Corporate/Private Equity)		2,825			2,634			2,718			2,244			1,752			7			61			10,421			5,086			105
Credit card loans — reported		2,405			2,894			2,883			2,189			1,559			(17	)		54			10,371			5,157			101
Total loans — reported		6,460			6,621			6,298			4,639			3,549			(2	)		82			24,018			10,764			123
Credit card loans — securitized		1,733			1,810			1,776			1,579			1,351			(4	)		28			6,898			4,076			69
Total loans — managed		8,193			8,431			8,074			6,218			4,900			(3	)		67			30,916			14,840			108
RECOVERIES
Wholesale loans		26			35			18			15			21			(26	)		24			94			119			(21	)
Consumer loans (includes RFS and Corporate/Private Equity)		74			13			67			68			51			469			45			222			209			6
Credit card loans — reported		183			200			194			160			162			(9	)		13			737			601			23
Total loans — reported		283			248			279			243			234			14			21			1,053			929			13
Credit card loans — securitized		116			112			112			115			123			4			(6	)		455			464			(2	)
Total loans — managed		399			360			391			358			357			11			12			1,508			1,393			8
NET CHARGE-OFFS
Wholesale loans		1,204			1,058			679			191			217			14			455			3,132			402			NM
Consumer loans (includes RFS and Corporate/Private Equity)		2,751			2,621			2,651			2,176			1,701			5			62			10,199			4,877			109
Credit card loans — reported		2,222			2,694			2,689			2,029			1,397			(18	)		59			9,634			4,556			111
Total loans — reported		6,177			6,373			6,019			4,396			3,315			(3	)		86			22,965			9,835			134
Credit card loans — securitized		1,617			1,698			1,664			1,464			1,228			(5	)		32			6,443			3,612			78
Total loans — managed	$	7,794		$	8,071		$	7,683		$	5,860		$	4,543			(3	)		72		$	29,408		$	13,447			119
NET CHARGE-OFF RATES
Wholesale retained loans		2.31	%		1.93	%		1.19	%		0.32	%		0.33	%								1.40	%		0.18	%
Consumer retained loans		4.60			4.79			4.69			3.61			2.59									4.41			2.71
Total retained loans — reported		3.85			3.84			3.52			2.51			1.80									3.42			1.73
Consumer loans — managed		5.08			5.29			5.20			4.12			3.05									4.91			3.06
Total loans — managed		4.29			4.30			4.00			2.98			2.20									3.88			2.08
Consumer loans — managed excluding purchased credit-impaired loans (a)		6.05			6.29			6.18			4.90			3.62									5.85			3.22
Total loans — managed excluding purchased credit impaired loans (a)		4.84			4.85			4.51			3.36			2.46									4.37			2.15
Memo: Average Retained Loans
Wholesale loans — reported		206,846			217,952			229,105			238,689			258,770									223,047			219,612
Consumer loans — reported		428,964			440,376			456,292			471,918			475,239									449,245			347,435
Total loans — reported		635,810			658,328			685,397			710,607			734,009									672,292			567,047
Consumer loans — managed		514,416			526,393			540,709			557,537			563,744									534,623			427,001
Total loans — managed		721,262			744,345			769,814			796,226			822,514									757,670			646,613

(a) Excludes the impact of purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans were accounted for at fair value on the acquisition date, which incorporated management’s estimate, as of that date, of credit losses over the remaining life of the portfolio.

Page 31

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
SUMMARY OF CHANGES IN THE ALLOWANCE FOR LOAN LOSSES
Beginning balance	$	30,633		$	29,072		$	27,381		$	23,164		$	19,052			5	%		61	%	$	23,164		$	9,234			151	%
Acquired allowance resulting from the Washington Mutual transaction		—			—			—			—			—			—			—			—			2,535			NM
Net charge-offs		6,177			6,373			6,019			4,396			3,315			(3	)		86			22,965			9,835			134
Provision for loan losses (a)		7,166			8,029			7,923			8,617			7,434			(11	)		(4	)		31,735			21,237			49
Other (b)		(20	)		(95	)		(213	)		(4	)		(7	)		79			(186	)		(332	)		(7	)		NM
Ending balance	$	31,602		$	30,633		$	29,072		$	27,381		$	23,164			3			36		$	31,602		$	23,164			36
SUMMARY OF CHANGES IN THE ALLOWANCE FOR LENDING-RELATED COMMITMENTS
Beginning balance	$	821		$	746		$	638		$	659		$	713			10			15		$	659		$	850			(22	)
Provision for lending-related commitments		118			75			108			(21	)		(121	)		57			NM			280			(258	)		NM
Other		—			—			—			—			67			—			NM			—			67			NM
Ending balance	$	939		$	821		$	746		$	638		$	659			14			42		$	939		$	659			42
ALLOWANCE COMPONENTS AND RATIOS
ALLOWANCE FOR LOAN LOSSES
Wholesale
Asset specific	$	2,046		$	2,410		$	2,108		$	1,213		$	712			(15	)		187
Formula — based		5,099			5,631			6,284			6,691			5,833			(9	)		(13	)
Total wholesale		7,145			8,041			8,392			7,904			6,545			(11	)		9
Consumer
Asset specific		149			161			132			106			74			(7	)		101
Formula — based		24,308			22,431			20,548			19,371			16,545			8			47
Total consumer		24,457			22,592			20,680			19,477			16,619			8			47
Total allowance for loan losses		31,602			30,633			29,072			27,381			23,164			3			36
Allowance for lending-related commitments		939			821			746			638			659			14			42
Total allowance for credit losses	$	32,541		$	31,454		$	29,818		$	28,019		$	23,823			3			37
REPORTED RATIOS
Wholesale allowance for loan losses to total wholesale retained loans		3.57	%		3.76	%		3.75	%		3.43	%		2.64	%
Consumer allowance for loan losses to total consumer retained loans		5.73			5.22			4.63			4.21			3.46
Allowance for loan losses to total retained loans		5.04			4.74			4.33			3.95			3.18
MANAGED RATIOS
Consumer allowance for loan losses to total consumer retained loans excluding purchased credit-impaired loans and loans held by the Washington Mutual Master Trust (c) (d)		6.63			6.21			5.80			5.20			4.24
Allowance for loan losses to ending loans excluding purchased credit-impaired loans and loans held by the Washington Mutual Master Trust (c) (d)		5.51			5.28			5.01			4.53			3.62
Allowance for loan losses to total retained nonperforming loans (c) (e)		174			168			198			241			260
ALLOWANCE FOR LOAN LOSSES BY LOB
Investment Bank	$	3,756		$	4,703		$	5,101		$	4,682		$	3,444			(20	)		9
Retail Financial Services		14,776			13,286			11,832			10,619			8,918			11			66
Card Services		9,672			9,297			8,839			8,849			7,692			4			26
Commercial Banking		3,025			3,063			3,034			2,945			2,826			(1	)		7
Treasury & Securities Services		88			15			15			51			74			487			19
Asset Management		269			251			226			215			191			7			41
Corporate/Private Equity		16			18			25			20			19			(11	)		(16	)
Total	$	31,602		$	30,633		$	29,072		$	27,381		$	23,164			3			36

(a)	Full year 2008 includes accounting conformity loan loss provision related to the acquisition of Washington Mutual Bank’s banking operations.
(b)	Activity from the second to fourth quarter of 2009 predominantly included a reclassification related to the issuance and retention of securities from the Chase Issuance Trust.
(c)	Excludes the impact of purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans were accounted for at fair value on the acquisition date, which incorporated management’s estimate, as of that date, of credit losses over the remaining life of the portfolio. An allowance for loan losses of $1.6 billion and $1.1 billion was recorded for these loans as of December 31, 2009 and September 30, 2009, respectively. No allowance for losses was recorded as of June 30, 2009, March 31, 2009 and December 31, 2008. To date, no charge-offs have been recorded for these loans.
(d)	Excludes loans held by the Washington Mutual Master Trust, which were consolidated onto the Firm’s balance sheet at fair value during the second quarter of 2009. No allowance for loan losses was recorded for these loans as of December 31, 2009, September 30, 2009 and June 30, 2009.
(e)	Excludes consumer purchased credit-impaired loans that were acquired as part of the Washington Mutual transaction. These loans are accounted for on a pool basis, and the pools are considered to be performing.

Page 32

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
PROVISION FOR CREDIT LOSSES
LOANS
Investment Bank	$	(265	)	$	330		$	815		$	1,274		$	869			NM	%		NM	%	$	2,154		$	2,216			(3	)%
Commercial Banking		445			326			280			263			180			37			147			1,314			505			160
Treasury & Securities Services		73			1			(20	)		(20	)		27			NM			170			34			52			(35	)
Asset Management		53			37			59			34			32			43			66			183			87			110
Corporate/Private Equity (a) (b)		(2	)		(6	)		7			—			76			67			NM			(1	)		676			NM
Total wholesale		304			688			1,141			1,551			1,184			(56	)		(74	)		3,684			3,536			4
Retail Financial Services		4,228			4,004			3,841			3,877			3,578			6			18			15,950			9,906			61
Card Services — reported		2,622			3,269			2,939			3,189			2,747			(20	)		(5	)		12,019			6,456			86
Corporate/Private Equity (a)		12			68			2			—			(75	)		(82	)		NM			82			1,339			(94	)
Total consumer		6,862			7,341			6,782			7,066			6,250			(7	)		10			28,051			17,701			58
Total provision for loan losses	$	7,166		$	8,029		$	7,923		$	8,617		$	7,434			(11	)		(4	)	$	31,735		$	21,237			49
LENDING-RELATED COMMITMENTS
Investment Bank	$	84		$	49		$	56		$	(64	)	$	(104	)		71			NM		$	125		$	(201	)		NM
Commercial Banking		49			29			32			30			10			69			390			140			(41	)		NM
Treasury & Securities Services		(20	)		12			15			14			18			NM			NM			21			30			(30	)
Asset Management		5			1			—			(1	)		—			400			NM			5			(2	)		NM
Corporate/Private Equity (a)		(1	)		—			—			—			5			NM			NM			(1	)		5			NM
Total wholesale		117			91			103			(21	)		(71	)		29			NM			290			(209	)		NM
Retail Financial Services		1			(16	)		5			—			(2	)		NM			NM			(10	)		(1	)		NM
Card Services — reported		—			—			—			—			—			—			—			—			—			—
Corporate/Private Equity (a)		—			—			—			—			(48	)		—			NM			—			(48	)		NM
Total consumer		1			(16	)		5			—			(50	)		NM			NM			(10	)		(49	)		80
Total provision for lending-related commitments	$	118		$	75		$	108		$	(21	)	$	(121	)		57			NM		$	280		$	(258	)		NM
TOTAL PROVISION FOR CREDIT LOSSES
Investment Bank	$	(181	)	$	379		$	871		$	1,210		$	765			NM			NM		$	2,279		$	2,015			13
Commercial Banking		494			355			312			293			190			39			160			1,454			464			213
Treasury & Securities Services		53			13			(5	)		(6	)		45			308			18			55			82			(33	)
Asset Management		58			38			59			33			32			53			81			188			85			121
Corporate/Private Equity (a) (b)		(3	)		(6	)		7			—			81			50			NM			(2	)		681			NM
Total wholesale		421			779			1,244			1,530			1,113			(46	)		(62	)		3,974			3,327			19
Retail Financial Services		4,229			3,988			3,846			3,877			3,576			6			18			15,940			9,905			61
Card Services — reported		2,622			3,269			2,939			3,189			2,747			(20	)		(5	)		12,019			6,456			86
Corporate/Private Equity (a)		12			68			2			—			(123	)		(82	)		NM			82			1,291			(94	)
Total consumer		6,863			7,325			6,787			7,066			6,200			(6	)		11			28,041			17,652			59
Total provision for credit losses		7,284			8,104			8,031			8,596			7,313			(10	)		—			32,015			20,979			53
Credit card — securitized		1,617			1,698			1,664			1,464			1,228			(5	)		32			6,443			3,612			78
Managed provision for credit losses	$	8,901		$	9,802		$	9,695		$	10,060		$	8,541			(9	)		4		$	38,458		$	24,591			56

(a)	Includes accounting conformity provisions related to the Washington Mutual transaction in the third quarter of 2008.
(b)	Includes provision expense related to loans acquired in the Bear Stearns transaction in the second quarter of 2008.

Page 33

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

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
AVERAGE IB TRADING VAR AND CREDIT PORTFOLIO VAR - 99% CONFIDENCE LEVEL (a)
IB VaR by risk type:
Fixed income	$	171		$	243		$	249		$	218		$	276			(30	)%		(38	)%	$	221		$	181			22	%
Foreign exchange		23			30			26			40			55			(23	)		(58	)		30			34			(12	)
Equities		35			28			77			162			87			25			(60	)		75			57			32
Commodities and other		26			38			34			28			30			(32	)		(13	)		32			32			—
Diversification benefit to IB trading VaR (b)		(92	)		(134	)		(136	)		(159	)		(146	)		31			37			(131	)		(108	)		(21	)
99% IB Trading VaR (c)		163			205			250			289			302			(20	)		(46	)		227			196			16
Credit portfolio VaR (d)		41			50			133			182			165			(18	)		(75	)		101			69			46
Diversification benefit to IB trading and credit portfolio VaR (b)		(20	)		(49	)		(116	)		(135	)		(140	)		59			86			(80	)		(63	)		(27	)
99% Total IB trading and credit portfolio VaR	$	184		$	206		$	267		$	336		$	327			(11	)		(44	)	$	248		$	202			23
AVERAGE IB TRADING VAR, CREDIT PORTFOLIO VAR AND OTHER VAR - 95% CONFIDENCE LEVEL (e)
IB VaR by risk type:
Fixed income	$	121		$	182		$	179		$	158		$	194			(34	)		(38	)	$	160
Foreign exchange		14			19			16			23			32			(26	)		(56	)		18
Equities		21			19			50			97			47			11			(55	)		47
Commodities and other		17			23			22			20			21			(26	)		(19	)		20
Diversification benefit to IB trading VaR (b)		(62	)		(97	)		(97	)		(108	)		(103	)		36			40			(91	)
95% IB Trading VaR (c)		111			146			170			190			191			(24	)		(42	)		154
Credit portfolio VaR (d)		24			29			68			86			66			(17	)		(64	)		52
Diversification benefit to IB trading and credit portfolio VaR (b)		(11	)		(32	)		(60	)		(63	)		(50	)		66			78			(42	)
95% Total IB trading and credit portfolio VaR		124			143			178			213			207			(13	)		(40	)		164
Consumer Lending VaR (f)		29			49			43			108			56			(41	)		(48	)		57
Corporate Risk Management VaR (g)		78			99			111			121			76			(21	)		3			103
Diversification benefit to total other VaR (b)		(19	)		(31	)		(29	)		(61	)		(31	)		39			39			(36	)
Total other VaR		88			117			125			168			101			(25	)		(13	)		124
Diversification benefit to total IB and other VaR (b)		(67	)		(82	)		(89	)		(93	)		(56	)		18			(20	)		(82	)
Total IB and other VaR	$	145		$	178		$	214		$	288		$	252			(19	)		(42	)	$	206

(a)	Results for full year 2008 include seven months of the combined Firm’s (JPMorgan Chase & Co.’s and Bear Stearns’) results and five months of 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 therefore usually less than the sum of the risks of the positions themselves.
(c)	IB Trading VaR includes predominantly all trading activities in IB; however, particular risk parameters of certain products are not fully captured, for example, correlation risk. The 95% IB Trading VaR includes syndicated lending facilities that the Firm intends to distribute, and the credit spread sensitivities of certain mortgage products. The 99% IB Trading VaR includes the credit spread sensitivities of certain mortgage products but does not include syndicated lending facilities that the Firm intends to distribute. Both the 95% and 99% IB Trading VaR do not include the debit valuation adjustments (“DVA”) taken on derivative and structured liabilities to reflect the credit quality of the Firm.
(d)	Includes VaR on derivative credit valuation adjustments (“CVA”), hedges of the CVA 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)	In the third quarter of 2008, the Firm revised the VaR measurement to create a more comprehensive view of its market risks by adding syndicated lending facilities that the Firm intends to distribute, and the credit spread sensitivities of certain mortgage products. In addition, certain actively managed positions utilized as part of the Firm’s risk management function within Corporate and in RFS’ mortgage banking businesses have been added to IB VaR to provide a Total IB and other VaR measure. Finally, the Firm moved from using a 99% confidence level to a 95% confidence level since the 95% level provides a more stable measure of the VaR for day-to-day risk management. Results for the full year ended December 31, 2008, are not available. This section presents the results of the Firm’s VaR measure under the revised measurement using a 95% confidence level. The Firm intends to only present the VaR at this confidence level once information for five quarters and two comparative year-to-date periods are available.
(f)	Consumer Lending VaR includes the Firm’s mortgage pipeline and warehouse, MSR and all related hedges.
(g)	Corporate Risk Management VaR includes certain actively managed positions utilized as part of the Firm’s risk management function within Corporate. It does not include certain nontrading activity such as Private Equity, principal investing (e.g., mezzanine financing, tax-oriented investments, etc.) and Corporate Treasury balance sheet and capital management positions as well as longer-term corporate investments.

Page 34

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

																Dec 31, 2009
																Change						FULL YEAR
	Dec 31			Sep 30			Jun 30			Mar 31			Dec 31			Sep 30			Dec 31							2009 Change
	2009			2009			2009			2009			2008			2009			2008			2009		2008		2008
CAPITAL RATIOS (a)
Tier 1 capital	$	132,971	(e)	$	126,541		$	122,174		$	137,144		$	136,104			5	%		(2	)%
Total capital		177,074	(e)		171,804			167,767			183,109			184,720			3			(4	)
Tier 1 common capital (b)		105,284	(e)		101,420			96,850			87,878			86,908			4			21
Risk-weighted assets		1,198,080	(e)		1,237,760			1,260,237			1,207,490			1,244,659			(3	)		(4	)
Adjusted average assets		1,933,767	(e)		1,940,689			1,969,339			1,923,186			1,966,895			—			(2	)
Tier 1 capital ratio		11.1	%(e)		10.2	%		9.7	%		11.4	%		10.9	%
Total capital ratio		14.8	(e)		13.9			13.3			15.2			14.8
Tier 1 common capital ratio (b)		8.8	(e)		8.2			7.7			7.3			7.0
Tier 1 leverage ratio		6.9	(e)		6.5			6.2			7.1			6.9
TANGIBLE COMMON EQUITY (PERIOD-END) (c)
Common stockholders’ equity	$	157,213		$	154,101		$	146,614		$	138,201		$	134,945			2			17
Less: Goodwill		48,357			48,334			48,288			48,201			48,027			—			1
Less: Other intangible assets		4,621			4,862			5,082			5,349			5,581			(5	)		(17	)
Add: Deferred tax liabilities (d)		2,538			2,527			2,535			2,502			2,717			—			(7	)
Total tangible common equity	$	106,773		$	103,432		$	95,779		$	87,153		$	84,054			3			27
TANGIBLE COMMON EQUITY (AVERAGE) (c)
Common stockholders’ equity	$	156,525		$	149,468		$	140,865		$	136,493		$	138,757			5			13		$	145,903	$	129,116		13	%
Less: Goodwill		48,341			48,328			48,273			48,071			46,838			—			3			48,254		46,068		5
Less: Other intangible assets		4,741			4,984			5,218			5,443			5,586			(5	)		(15	)		5,095		5,779		(12	)
Add: Deferred tax liabilities (d)		2,533			2,531			2,518			2,609			2,547			—			(1	)		2,547		2,369		8
Total tangible common equity	$	105,976		$	98,687		$	89,892		$	85,588		$	88,880			7			19		$	95,101	$	79,638		19
INTANGIBLE ASSETS (PERIOD-END)
Goodwill	$	48,357		$	48,334		$	48,288		$	48,201		$	48,027			—			1
Mortgage servicing rights		15,531			13,663			14,600			10,634			9,403			14			65
Purchased credit card relationships		1,246			1,342			1,431			1,528			1,649			(7	)		(24	)
All other intangibles		3,375			3,520			3,651			3,821			3,932			(4	)		(14	)
Total intangibles	$	68,509		$	66,859		$	67,970		$	64,184		$	63,011			2			9
DEPOSITS (PERIOD-END)
U.S. offices:
Noninterest-bearing	$	204,003		$	195,561		$	192,247		$	197,027		$	210,899			4			(3	)
Interest-bearing		439,104			415,122			433,862			463,913			511,077			6			(14	)
Non-U.S. offices:
Noninterest-bearing		8,082			9,390			8,291			7,073			7,697			(14	)		5
Interest-bearing		287,178			247,904			232,077			238,956			279,604			16			3
Total deposits	$	938,367		$	867,977		$	866,477		$	906,969		$	1,009,277			8			(7	)

(a)	The Federal Reserve 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 capital and leverage requirements with respect to the Bear Stearns’ risk-weighted assets and other exposures acquired. The relief ended September 30, 2009. Commencing in the second quarter of 2009, the Firm no longer adjusted its risk-based capital ratios to take into account the relief in the calculation of its risk-based capital ratios.
(b)	Tier 1 common is calculated as Tier 1 capital less qualifying perpetual preferred stock, qualifying trust preferred securities and qualifying minority interest in subsidiaries. The Firm uses the Tier 1 common capital ratio, a non-GAAP financial measure, to assess and compare the quality and composition of the Firm’s capital with the capital of other financial services companies.
(c)	Tangible common equity (“TCE”) represents common stockholders’ equity (i.e., total stockholders’ equity less preferred stock) less identifiable intangible assets (other than MSRs) and goodwill, net of related deferred tax liabilities. The Firm views TCE, a non-GAAP financial measure, as a meaningful measure of capital quality.
(d)	Represents deferred tax liabilities related to tax-deductible goodwill and to identifiable intangibles created in non-taxable transactions, which are netted with goodwill and other intangibles when calculating tangible common equity.
(e)	Estimated.

Page 35

JPMORGAN CHASE & CO.
PER SHARE-RELATED INFORMATION
(in millions, except per share and ratio data)

	QUARTERLY TRENDS																					FULL YEAR
																4Q09 Change												2009 Change
	4Q09			3Q09			2Q09			1Q09			4Q08			3Q09			4Q08			2009			2008			2008
EARNINGS PER SHARE DATA (a)
Basic earnings per share:
Income/(loss) before extraordinary gain	$	3,278		$	3,512		$	2,721		$	2,141		$	(623	)		(7	)%		NM	%	$	11,652		$	3,699			215	%
Extraordinary gain		—			76			—			—			1,325			NM			NM			76			1,906			(96	)
Net income		3,278			3,588			2,721			2,141			702			(9	)		367			11,728			5,605			109
Less: Preferred stock dividends		162			163			473			529			423			(1	)		(62	)		1,327			674			97
Less: Accelerated amortization from redemption of preferred stock issued to the U.S. Treasury (b)		—			—			1,112			—			—			—			—			1,112			—			NM
Net income applicable to common equity		3,116			3,425			1,136			1,612			279			(9	)		NM			9,289			4,931			88
Less: Dividends and undistributed earnings allocated to participating securities		164			185			64			93			47			(11	)		249			515			189			172
Net income applicable to common stockholders (c)	$	2,952		$	3,240		$	1,072		$	1,519		$	232			(9	)		NM		$	8,774		$	4,742			85
Total weighted-average basic shares outstanding		3,946.1			3,937.9			3,811.5			3,755.7			3,737.5			—			6			3,862.8			3,501.1			10
Income/(loss) before extraordinary gain per share (b)	$	0.75		$	0.80		$	0.28		$	0.40		$	(0.29	)		(6	)		NM		$	2.25		$	0.81			178
Extraordinary gain per share		—			0.02			—			—			0.35			NM			NM			0.02			0.54			(96	)
Net income per share (b)	$	0.75		$	0.82		$	0.28		$	0.40		$	0.06			(9	)		NM		$	2.27		$	1.35			68
Diluted earnings per share:
Net income applicable to common stockholders (c)	$	2,952		$	3,240		$	1,072		$	1,519		$	232			(9	)		NM		$	8,774		$	4,742			85
Total weighted-average basic shares outstanding		3,946.1			3,937.9			3,811.5			3,755.7			3,737.5			—			6			3,862.8			3,501.1			10
Add: Employee stock options and SARs (d)		28.0			24.1			12.6			3.0			—	(g)		16			NM			16.9			20.7			(18	)
Total weighted-average diluted shares outstanding (e)		3,974.1			3,962.0			3,824.1			3,758.7			3,737.5			—			6			3,879.7			3,521.8			10
Income/(loss) before extraordinary gain per share (b)	$	0.74		$	0.80		$	0.28		$	0.40		$	(0.29	)		(8	)		NM		$	2.24		$	0.81			177
Extraordinary gain per share		—			0.02			—			—			0.35			NM			NM			0.02			0.54			(96	)
Net income per share (b)	$	0.74		$	0.82		$	0.28		$	0.40		$	0.06			(10	)		NM		$	2.26		$	1.35			67
COMMON SHARES OUTSTANDING
Common shares outstanding — at period end (f)		3,942.0			3,938.7			3,924.1			3,757.7			3,732.8			—			6			3,942.0			3,732.8			6
Cash dividends declared per share	$	0.05		$	0.05		$	0.05		$	0.05		$	0.38			—			(87	)	$	0.20		$	1.52			(87	)
Book value per share		39.88			39.12			37.36			36.78			36.15			2			10			39.88			36.15			10
Dividend payout		7	%		6	%		14	%		15	%		532	%								9	%		114	%
SHARE PRICE
High	$	47.47		$	46.50		$	38.94		$	31.64		$	50.63			2			(6	)	$	47.47		$	50.63			(6	)
Low		40.04			31.59			25.29			14.96			19.69			27			103			14.96			19.69			(24	)
Close		41.67			43.82			34.11			26.58			31.53			(5	)		32			41.67			31.53			32
Market capitalization		164,261			172,596			133,852			99,881			117,695			(5	)		40			164,261			117,695			40
STOCK REPURCHASE PROGRAM
Common shares repurchased		—			—			—			—			—			—			—			—			—			—

(a)	Effective January 1, 2009, the Firm implemented new FASB guidance for participating securities, which clarifies that unvested stock-based compensation awards containing nonforfeitable rights to dividends or dividend equivalents (collectively, “dividends”) are participating securities and should be included in the EPS calculation using the two-class method. JPMorgan Chase grants restricted stock and RSUs to certain employees under its stock-based compensation programs, which entitle the recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to the dividends paid to holders of common stock. These unvested awards meet the definition of participating securities. Under the two-class method, all earnings (distributed and undistributed) are allocated to each class of common stock and participating securities, based on their respective rights to receive dividends. EPS data for the prior periods were revised as required by the guidance.
(b)	The calculation of second quarter and full year 2009 earnings per share includes a one-time non-cash reduction of $1.1 billion, or $0.27 per share, resulting from the redemption of Series K preferred stock issued to the U.S. Treasury.
(c)	Net income applicable to common stockholders for basic and diluted EPS may differ under the two-class method as a result of adding common stock equivalents for options, SARs and warrants to dilutive shares outstanding, which alters the ratio used to allocate earnings to common stockholders and participating securities for purposes of calculating diluted EPS.
(d)	Excluded from the computation of diluted EPS (due to the antidilutive effect) were options issued under employee benefit plans and (subsequent to October 28, 2008) the warrant issued under the U.S. Treasury’s Capital Purchase Program to purchase shares of the Firm’s common stock totaling 147 million, 241 million, 315 million, 363 million, and 353 million, for the quarters ended December 31, 2009, September 30, 2009, June 30, 2009, March 31, 2009, and December 31, 2008, respectively, and 266 million and 209 million for the full year ended December 31, 2009 and 2008, respectively.
(e)	Participating securities were included in the calculation of diluted EPS using the two-class method, as this computation was more dilutive than the calculation using the treasury-stock method.
(f)	On June 5, 2009, the Firm issued $5.8 billion, or 163 million shares, of its common stock at $35.25 per share; and on September 30, 2008, the Firm issued $11.5 billion, or 284 million shares, of its common stock at $40.50 per share.
(g)	Common equivalent shares have been excluded from the computation of diluted loss per share for the fourth quarter of 2008, as the effect would have been antidilutive.

Page 36

JPMORGAN CHASE & CO.

Glossary of Terms

ACH:Automated Clearing House.

Allowance for loan losses to total loans :Represents period-end Allowance for loan losses divided by retained loans.

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

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 consolidates. 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 exclude 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 through 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 investors, gross credit losses and other trust expense related to the securitized receivables, is reclassified into credit card income in the Consolidated Statements of Income.

FASB:Financial Accounting Standards Board.

Interests in purchased receivables:Represent an ownership interest in cash flows of an underlying pool of receivables transferred by a third-party seller into a bankruptcy-remote entity, generally a trust.

Investment-grade:An indication of credit quality based upon JPMorgan Chase’s internal risk assessment system. “Investment-grade” generally represents a risk profile similar to a rating of a “BBB-"/“Baa3” or better, as defined by independent rating agencies.

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 and removed from the Firm’s Consolidated Balance Sheets.

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 and, therefore, creates a repayment risk for the Firm. When the mark-to-market value is negative, JPMorgan Chase 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.

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 charge-off ratio:Represents net charge-offs (annualized) divided by average retained loans for the reporting period.

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.

Pre-provision profit:Total net revenue less noninterest expense. The Firm believes that this financial measure is useful in assessing the ability of a lending institution to generate income in excess of its provision for credit losses.

Principal transactions (revenue):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 fair value option was elected. Principal transactions revenue also includes 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.

Retained loans:Loans that are held for investment excluding loans held-for-sale and loans at fair value.

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:A measure of the dollar amount of potential loss from adverse market moves in an ordinary market environment.

Page 37

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 RETAIL 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 FEES AND RELATED INCOME COMPRISE 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) Operating revenue comprises:

—   all gross income earned from servicing third-party mortgage loans including stated service fees, excess service fees, late fees and other ancillary fees.

—   modeled servicing portfolio runoff (or time decay).

b) Risk management comprises:

—   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.

—   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.

MORTGAGE 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 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 —Dollar amount of cardmember purchases, balance transfers and cash advance activity.

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

3. Merchant acquiring business —A business that processes bank card transactions for merchants.

4. Bank card volume —Dollar amount of transactions processed for merchants.

5. Total transactions —Number of transactions and authorizations processed for merchants.

Page 38

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 loaned or 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 Servicesfirmwide metricsinclude 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 loaned or sold under repurchase agreements.

Asset Management

Assets under management:Represent assets actively managed by Asset Management on behalf of Institutional, Retail, Private Banking, Private Wealth Management and Bear Stearns Private Client Services clients. Includes Committed Capital not Called, on which we earn fees. Excludes assets managed by American Century Companies, Inc., in which the Firm has a 42% ownership interest as of December 31, 2009.

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

3.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.

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 Private Client Servicesprovides investment advice and wealth management services to high-net-worth individuals, money managers, and small corporations.

Page 39