                                J.P. MORGAN

                                  1/14/94

              1/13/94 52-Wk-Rng FY/Q  EPS93  EPS94 PE94 NxtQtr LyQtr
J. P. Morgan    70.38   79-59   12/1   7.80   7.75  9.1   1.90  1.47 JPM

             J.P. Morgan (JPM) 70 3/8, 1994 $7.75, 1995 $8.50, Market
Performer

*  ANOTHER RECORD IN TRADING REVENUES
*  FEE INCOME IN 20+% TREND CATEGORIES
*  RAISING 1994 EST BY $0.30 TO $7.75

INVESTMENT SYNOPSIS:  J.P. Morgan's quarterly earnings of $1.92 in the
fourth quarter was the lowest on a core basis in 1992, but is probably
sustainable in this range as long as trading remains strong.  The result
was $0.22 better than forecast due to another record in trading, and
analysts are notching up their 1994 estimates again, by $0.30 to $7.75,
although the innate volatility still leaves the likely range rather
broad.  Giving them a two-multiple point premium over the money
center average would argue for an $85 one-year price target when
eyeing analysts' $8.50 1995 estimate as a guide.  ROE was 19% in the quarter.

With the adoption of fair value accounting on marketable items, book value
advanced by $1.2 billion (almost $6/share) to $47.25.  This brings the
price/book ratio down to 149%, a certainly more appealing level that is in
the mid-range of bank stocks.

FOURTH QUARTER SYNOPSIS:  The trading line rose to another record despite
general doubts about the trading environment -- at least in comparison to
the strong second and third quarters.  This again points to the diversity
of Morgan's trading businesses.  The emerging market trading side was a
substantially higher contributor and offset somewhat lower swaps trading
results and a probably less vibrant European portfolio, although succinct
detail to support this is not available.  The $606MM was triple the year-
ago trading revenues, and bested the second quarter record of $520MM.

This leads to the relevance of trading in evaluating future earnings, as
the formal trading line was nearing 40% of total revenues (excluding some
Latin back interest.)  And since some of the net interest line is also
attributable to trading we continue to believe over half of gross revenues
are functionally equivalent to the trading business and an even greater
proportion of the bottom line is from the same.  The 1994 estimate assumes
continued success in the other fee lines, which produced $470MM this
quarter, including investment management, corporate finance, credit fees,
and operational services.  This grouping advanced 22% in 1993, overall, and
we are using a 17% forward trajectory.  A tug-of-war with trading is still
possible, and analysts are using a $450MM quarterly run-rate, which would
explain why estimates reflect some near-term plateau in final quarterly
results.

The quarter contained $107MM in past due interest from Argentina, no
substantive equity gains compared to earlier quarters, more than offset
with a $120MM special charge for real estate and relocation.  The latter
reflects a writedown of downtown NYC space that had been intended for
renovation and some impact from offshore utilization changes, notably
Frankfurt.

As said, the fee businesses are still growing.  While credit fees were
flat, investment mangement was up 23% in the quarter, corporate finance was
up 21% and operational services was up 20%.

The net interest margin declined, excluding Argentina, to about 1.22%
versus 1.39% in the third quarter and the 1.79% average for 1992.  Average
earning assets sequentially declined, with loans off $518MM, investment
securities off $2.6 billion and trading assets off $2.3 billion.  The
margin decline stemmed from mix as well as rolloff of higher yielding
investment securities, which is likely to continue.  Net interest is only
26% of core revenues, however.

The loss provision was zero, which analysts expect into the foreseeable future.

                          % CHG     4Q93   3Q93    2Q93   1Q93    4Q92

Domestic Loans               -7     7879   8000    8602   8711    8486
Overseas Loans              -13    16992  17389   18414  19048   19423
Avg Loans & Leases          -11    24871  25389   27016  27759   27909
Loans to EA                         19.2   18.7    21.4   24.0    26.8
Avg Earning Assets           24   129653 135558  126471 115676  104289
NII Margin                  -18     1.55   1.39    1.46   1.64    1.73

Net Interest Income (te)     12      507    474     460    469     454
Non-Interest Income          76     1126   1076    1018    956     641
  Trading Acct               nm      606    464     520    469     200

  Corp Fin & Credit Fees     29      215    195     173    173     167
  Inv Mgmt & Opr Svcs Fees   23      255    238     233    229     208
  Other Revenue              nm       50    179      92     85      66
Security Gains               nm       32     98      98     95      45

Non-Interest Expense         37     1023    882     866    809     747
  Staff                      28      538    591     561    531     419
  Occup, Tech & Commo        64      328    192     201    182     200
  Misc                       23      157     99     104     96     128

Net Chargeoffs             0.10        6     25      13     56      50
Net Addition to Reserve      nm      (6)   (25)    (13)   (56)    (40)
Pretax Income (te)           68      642    766     710    711     383
Tax Rate - Pro Forma                  39     39      39     nm      42
Tax Rate - Reported                   36     36      36             35
Net Income                   77      392    468     431    295     221
Preferred Dividend                     5      4       4      5       5

DIV /Share                   13   $0.680 $0.600  $0.600 $0.600  $0.600
Avg Shares                         201.6  202.2   200.5  199.1   197.7
Net /Share - Diluted         75    $1.92  $2.29   $2.12  $1.47   $1.10

Common Equity                33     9095   7930    7537   7020    6814
Loan Loss Reserve                   1157   1163    1188   1202    1258
Loans & Leases (net disc)    -8    24380  24478   27618  26792   26438
NonPerforming Loans                  282    296     278    299     536
Assets                       30   133888 129285  132532 128821  103197
Reserve to Loans                    4.75   4.75    4.30   4.48    4.75
NP Loans to Total Loans             1.16   1.21    1.07   1.12    2.03
Tier 1 Ratio                         9.3    9.3     8.9    8.2     8.9
ROA                                 1.04   1.20    1.18   1.28    0.97
ROE (Common)                       19.03  23.92   23.49  24.94   12.37
