JPMorgan Chase & Co. (NYSE: JPM) reported fiscal first-quarter results before markets opened Friday. The investment bank and financial services giant reported adjusted diluted earnings per share (EPS) of $1.28 on revenue of $23.9 billion. In the same period a year ago, the company reported EPS of $1.59 on revenue of $25.85 billion. First-quarter results also compare to the consensus estimates for EPS of $1.40 on revenue of $24.53 billion.

To take some of the sting out of the poor showing, JPMorgan raised its dividend from $0.38 to $0.40 a share beginning in the second quarter, and the bank will repurchase $6.5 billion in common stock beginning in the second quarter and running through the end of 2015. In other good news that was already known, the Fed has approved the bank’s capital distribution plan.

The big letdown for JPMorgan came in its mortgage banking division. Revenues were down $500 million compared with the same period a year ago, and net income was down $559 million. The provision for credit losses yielded a benefit of just $23 million, compared with a benefit of $198 million a year ago. Charge-offs fell from $452 million a year ago to $177 million, but the reduction the bank was able to claim in its allowance for loan losses this year was $200 million compared with $650 million a year ago.

Big hits to its mortgage banking business came in a $58 million loss in its mortgage production group and a pretax loss of $270 million in its mortgage servicing business. Mortgage application volumes fell 57% to $26.1 billion and were down 17% sequentially.

The bank’s CEO said:

We have growing confidence in the economy — consumers, corporations and middle market companies are in increasingly good financial shape and housing has turned the corner in most markets – and we are doing our part to support the recovery. JPMorgan Chase provided credit and raised capital of over $450 billion for our clients during the first quarter of 2014, which included $5 billion for U.S. small businesses.

Morgan increased its Basel III Tier 1 common ratio to 9.5% in the first quarter. The Basel III rules became effective on January 1, 2014. Other Basel III measures include High Quality Liquid Assets of $538 billion and a Supplementary Leverage Ratio of 5.1%

The bank did not offer guidance in its press release, but the consensus estimates call for second-quarter EPS of $1.49 on revenues of $25.01 billion. The EPS estimate for the 2014 fiscal year is now $5.87.

JPMorgan is off to a slow start on toward a profit target of $29 billion set by Bank of America Merrill Lynch analyst Erika Najarian early last month.

Shares traded about 2.7% lower in the premarket Friday, at $55.95. The current 52-week range is $46.05 to $59.82. Thomson Reuters had a consensus analyst price target of around $66.40 before the results were announced.

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