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Oppenheimer turns profit as costs fall

The Associated Press, The Associated Press

NEW YORK (AP) -- Oppenheimer Holdings returned to profitability in the second quarter as compensation and other costs fell.

Shares jumped 6 percent by Friday afternoon.

The New York fund manager and investment bank reported net income of $2.4 million, or 18 cents per share, in the three months through June. In the same quarter of last year, the company reported a loss of $309,000, or 2 cents per share.

Compensation and similar expenses dropped 6 percent to $150.9 million. A variety of other costs for equipment, interest payments and technology also sank.

Revenue in the second quarter fell 5 percent to $233 million. The biggest hit came from a 26 percent drop in investment banking revenue.

Albert Lowenthal, the company's chairman and CEO, pointed to a host of problems for investors. The European debt crisis and slower growth in China as well as in the U.S. act as a drag on Oppenheimer's revenue, he said.

Total assets under management was $81.8 billion as of June 30, up from $73.9 billion the year before.

Last month, Oppenheimer Funds agreed to pay more than $35 million to settle charges from the Securities and Exchange Commission that it misled investors who invested in two of its bond funds.

Shares of Oppenheimer Holdings Inc. rose 83 cents to $14.40. The stock is down 15 percent so far in 2012.