JPMorgan Chase & Co., the second biggest American bank, said quarterly profit fell 13% on costs from its July purchase of Bank One Corp. and a slump in bond trading.

The drop in fixed-income trading revenue led to a 10% decline in investment-banking income, which accounted for almost a third of the profit during the quarter.

“They’re terrible results,” said the president, James Dimon, who joined the company with the Bank One acquisition, on a conference call with investors. “We don’t feel good about it.”

Third-quarter net income slipped to $1.42 billion, or 39 cents a share, from $1.63 billion, or 78 cents, a year ago, the New York-based company said in a statement. Excluding acquisition costs, JPMorgan would have earned $2.2 billion, or 60 cents a share. The average estimate of 14 analysts was 74 cents, according to Thomson Financial.

JPMorgan’s results mirrored those of Wall Street firms such as Morgan Stanley and Citigroup Inc., which also reported a drop in debt-trading revenue. The company bought Bank One in part to bolster its consumer and commercial-banking businesses and cushion profit from swings in trading results and demand for investment banking services.

Shares of JPMorgan fell 73 cents to $37.25 in composite trading on the New York Stock Exchange. The stock has climbed 1.4% this year, besting the 24-member Philadelphia KBW Banks Index’s 1.1% decline.

“I don’t feel warm and fuzzy about the quarter,” said Hilary Hayes, who helps manage $4.5 billion, including JPMorgan shares at Victory SBSF Capital Management. “They definitely missed the number.”

JPMorgan’s chief executive officer, William Harrison, 61, bought Chicago-based Bank One for $57 billion in July, adding about 1,800 branches in 14 states. His successor, Mr. Dimon, 48, is slated to replace him in 2006.

Mr. Dimon, who was CEO of Bank One, is in charge of extracting expenses from the combined company. He said “the merger is going as well as any merger could possibly be going.”

The bank plans to shed about $3 billion in annual costs, including about $400 million in 2004. JPMorgan, which said in July it would eliminate 12,000 jobs, ended the third quarter with 162,200 employees. It began the year with 167,500.

JPMorgan racked up $741 million in merger-related costs during the third quarter, including $279 million to conform the combined bank to tougher accounting standards.

The bank said it still expects pretax costs from the acquisition of $4 billion. JPMorgan will record $1.1 billion of the total this year, less than its previous estimate of $1.5 billion.

The Bank One acquisition boosted JPMorgan’s assets to $1.4 trillion, second to New York-based Citigroup. Total revenue swelled to $12.5 billion from $7.78 billion.

Profit in JPMorgan’s investment bank slid to $627 million as revenue fell 3% to $2.7 billion.

The decline in bond, currency and commodities trading reduced profit by 10 cents a share in the quarter, Glenn Schorr, a UBS Securities LLC analyst wrote in a note to clients.

Revenue from the company’s fixed income markets unit fell 23 percent to $1.1 billion, JPMorgan said. Equity markets revenue helped offset that decline, rising 46% to $455 million.

“It’s not a surprise to me that they would miss on fixed-income trading,” said Anton Schutz, who helps manage $250 million at Burnham Financial Services Funds. “It sounds a lot like Morgan Stanley and Citigroup.”

Fixed-income trading revenue fell 44% to $657 million. Mr. Dimon said on the call that a drop in client order flow as well as losses from its own trading positions contributed to the decline.

“Obviously we were on the wrong side of a few markets,” he said.