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| - US banking giants JPMorgan Chase and Citigroup posted strong profits on Tuesday, while Wells Fargo suffered another earnings stumble and signaled cost-cutting is ahead. Shares of JPMorgan and Citigroup rallied after both banks highlighted growth in their credit card businesses as US consumers kept spending during the holiday period. The two New York giants also cited better institutional client sentiment that boosted some key trading divisions that have been weak in recent quarters. "What the fourth quarter has demonstrated is the more clarity we have on these geopolitical issues, the more of a benefit we see in terms of corporate sentiment and the prospects for good growth," Citigroup Chief Financial Officer Mark Mason said on a conference call with reporters. Besides better relations between the United States and China, Mason cited diminished uncertainty on Brexit and progress on a new US-Mexico-Canada Agreement on trade. Citigroup scored a 15 percent jump in fourth-quarter profits to $5.0 billion, while revenues rose 7.3 percent to $18.4 billion. At JPMorgan, net income surged 20.6 percent to $8.5 billion for the three months ending December 31, a period that saw revenues rise 9.0 percent to $29.2 billion. The results helped the bank score record profits and sales for the year. Chief Executive Jamie Dimon said despite the "continued high level of complex geopolitical issues" facing the global economy, the "resolution of some trade issues helped support client and market activity towards the end of the year." Dimon described the holiday season as "robust," as reflected in a 10 percent jump in credit card sales volumes. Dimon highlighted China as a key growth market, noting that last year it became the first US bank to be approved for a majority-owned securities business in the country. Following that approval, JPMorgan plans to hire staff in China, especially in corporate and investment banking, and to a lesser degree in asset management and commercial banking, Dimon said. "China will grow. We'll grow with them. We're going to do it our own way," Dimon said on a conference call with reporters. "Maybe the trade issues make it a little bit better or a little bit worse but we're going to continue to have the exact same plans." It was a much different story at Wells Fargo, where newly-installed Chief Executive Charlie Scharf has been mapping out a turnaround strategy since joining the struggling bank in October. The company, a giant in US mortgage lending, has been on the back foot since late 2016 following a fake accounts scandal, one of the regulatory problems that prompted the Federal Reserve to impose a lending cap on the bank. "During my first three months at Wells Fargo, my primary focus has been on advancing our required regulatory work with a different sense of urgency and resolve, while beginning to develop a path to improve our financial results," Scharf said in a statement. "Wells Fargo plays an important role for our country and we know that ultimately our actions and results will dictate when that trust is fully regained." Scharf said he identified "clear" opportunities to improve performance and that "our cost structure is too high." There are "many areas where we will be able to increase our rate of growth," Scharf said. "While it is too early to put time frames around these goals, we will be diligent in pursuing them and I am confident the opportunities are meaningful." Net income at Wells Fargo sank 55.4 percent to $2.5 billion, dragged lower by $1.5 billion in litigation costs, some related to the fake accounts scandal. Revenues dropped 5.2 percent to $19.9 billion. JPMorgan's share price rose 2.1 percent to $140.07 in midday trading, while Wells Fargo dropped 3.9 percent to $50.10. Citigroup gained 2.9 percent to $82.99. jmb/dg
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