JPMorgan Chase & Co., the second- biggest U.S. bank, said first-quarter profit climbed 17 percent to a record as investment-banking businesses and the $58 billion purchase of Bank One Corp. lifted revenue.

Net income rose to $2.26 billion from $1.93 billion a year earlier, JPMorgan said in a statement. Earnings per share fell to 63 cents from 92 cents because the company issued stock to buy Bank One in July. Excluding merger and legal-settlement costs, the bank earned 81 cents a share, beating the 69-cent average estimate of 18 analysts surveyed by Thomson Financial.

Investment-banking revenue rose 11 percent to $4.2 billion, led by fixed-income trading and merger advice. JPMorgan’s gains mirrored results at Wall Street securities firms such as Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc., which last month also reported record first-quarter earnings.

“It’s obviously a little bit better than we were expecting,” said Michael Nix, who helps manage more than $1 billion at Greenwood Capital in Greenwood, South Carolina. “You’ll probably continue to see pretty decent investment-banking revenue from JPMorgan.”

JPMorgan shares jumped to $35.84 in early trading from $34.95 yesterday on the New York Stock Exchange. The stock has declined 10 percent this year, compared with the benchmark Philadelphia KBW Bank Index’s 7.7 percent drop.

First-quarter revenue at JPMorgan rose 51 percent to $13.6 billion. Analysts had predicted $13.85 billion.

Investment Banking

The investment bank was JPMorgan’s most-profitable business during the first quarter, lifting operating earnings by 30 percent to $1.33 billion. The unit’s revenue of $4.2 billion beat Merrill Lynch & Co. analyst Guy Moszkowski’s $3.96 billion estimate.

Investment-banking fees jumped 43 percent to $985 million on higher demand for merger advice, and stock and bond underwriting. Trading revenue fell 3 percent to $2.2 billion, as a decline in equities offset a gain in fixed-income.

The bank said its settlement with WorldCom Inc. investors cost $558 million in the first quarter. JPMorgan last month agreed to pay $2 billion on claims it should have known WorldCom’s books were fraudulent. The company had $90 million in expenses related to the Bank One purchase. Excluding the expenses, JPMorgan would have earned $2.9 billion, or 81 cents a share.

JPMorgan also recorded a $544 million loss during the period as it adjusted its portfolio of Treasury bonds to reduce future losses as interest rates rise.

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