• Litigation costs eat into first-quarter earnings • Investment banking arm profits fall year on year • Strong growth in retail division • Wells Fargo Q1 profit jumps to $4.2bn JP Morgan, the first Wall Street bank to report results in this closely watched earnings season, has revealed a surprise increase in revenue to $27.4bn even as legal bills and debt pinched first quarter earnings. Smaller San Francisco-based rival Wells Fargo followed JP Morgan by reporting record net income of $4.2bn (£2.63bn) for the first quarter of 2012, compared with $3.8bn for the first quarter of 2011. The New York bank reported a profit of $5.38bn for the first three months of 2012, down from $5.56bn a year earlier. The latest quarter included a loss tied to litigation expenses and changes in the value of the bank’s debt. The bank set aside $2.5bn toward its litigation costs during the first quarter mostly for mortgage-related lawsuits.