JPMorgan today underlined its credentials as one of the great survivors of the credit crunch as the US banking giant announced it still made a profit in the last quarter of 2008.

Chief executive Jamie Dimon unveiled fourth-quarter profits of $702 million (£482 million), beating analysts' expectations, but down 77% on the same period a year ago.

Full-year profits slumped 64% to $5.6 billion, down from 2007's record earnings of $15.6 billion. JPMorgan wrote off $3.58 billion in losses and investments in the fourth quarter, which Dimon described as “very disappointing”. He also set aside $4.1 billion in reserves to cover possible further losses.

Despite the flagship investment banking division recording a $2.36 billion loss in the quarter, annual pay and bonuses totalled $7.701 billion for the 28,000-strong IB division, around $276,000 per employee, down only 11% on 2007.

Bank insiders said overall compensation figures were skewed because of big redundancy costs and an increase in total staffing following the takeovers of Bear Stearns and Washington Mutual.

Bonuses are understood to have been slashed by around 50% across the bank, with many staff receiving none this year. Dimon, who collected a $14.5 million bonus last year as part of his $27.7 million pay package, has signalled he won't accept a bonus. A spokesman declined to comment. The bank's overall performance compares favourably with rivals, although without one-off benefits associated with last year's takeovers JPMorgan would have posted a small fourth-quarter loss.

This week German bank Deutsche gave an early warning that it would report a thumping loss of €4.8 billion (£4.4 billion) in the last quarter.

US rivals Goldman Sachs and Morgan Stanley, the first two big Wall Street banks to announce fourth-quarter earnings, had losses of $2.12 billion and $2.2 billion respectively.

Dimon, dubbed “the king of Wall Street” because he successfully steered JPMorgan through the meltdown, warned: “The worst of the economic situation is not yet behind us. It looks as if it will continue to deteriorate for most of 2009.

“We expect consumer loans and credit cards to continue to get worse.”