JPMorgan Chase & Co's (NYSE:JPM) average deposits were $329.8 billion last quarter, down 3% quarter-on-quarter (QoQ) and down 3% year-on-year (YoY), despite increasing both its number of branches and checking accounts from last quarter. JPMorgan attributes much of this decline to the maturation of high rate WaMu CDs.

Credit card sales were down 31% YoY and 6% QoQ and mortgage loan originations were also down 6% QoQ but up 24% YoY.

Consumer lending showed a net loss of $1.4 billion, compared to a net loss of $416 last year. Credit costs for consumer lending increased to $4 billion, compared to $200 million last year. Net income for commercial banking is down 53% YoY.

CFO Mike Cavanagh attributed some of the difficulties to weak market demand in real estate segments and expenses from loan default and foreclosures.

Both Cavanagh and CEO Jamie Dimon reiterated the long term benefits of acquiring Washing Mutual for its retail financial service business. Dimon said yesterday that the acquisition still carried substantial risk for the company in testimony before U.S. Congress panel known as the Financial Crisis Inquiry Commission.

JPMorgan reported earnings of 74 cents per share this morning, up 6 cents from a year earlier, beating analysts' expectations. However JPMorgan is trading down 2% in mid-day trading, with the S&P 500 index also down 1.2%.