THE finance company, JPMorgan Chase, has set an ambitious goal of attracting 15 per cent of the consumer deposits in the US, the chief executive officer of consumer and banking, Marianne Lake, said.
The bank had an 11.3 per cent share of US retail deposits at the end of June 2023, the latest available data showed.
The lender also wants to provide credit cards that account for 20 per cent of the spending in the country. This marks an expansion from the current 17 per cent.
“Market share is a game of inches, and it is a very powerful game. While we are not putting any timeline on it, our strategies are geared towards achieving it,” she said.
Its US retail deposits were worth US$1.1 trillion at the end of the first quarter.
Including wholesale deposits, the bank had US$1.96 trillion of deposits in the first quarter. This is up from US$1.95 trillion a year earlier. Its closest rival, Bank of America, had US$1.82 trillion at the end of first quarter.
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“We’re continuing to build our capabilities to compete and win and investing in modernizing our infrastructure and data, leveraging AI, payments and other business strategies,” Lake said.
The investments “will ensure that we continue to be the leader even five to 10 years from now”, she added.
JPMorgan acquired failed lender First Republic last year, adding US$92 billion in deposits. The purchase was made after a series of bank failures that triggered tumult in the industry, but has since subsided.
Banks that already hold at least 10 per cent of US deposits are not allowed under federal law to grow through acquisitions, with the exception of failed banks.
At the time of the First Republic purchase, critics raised concerns that JPMorgan was allowed to get bigger, even though its purchase price met the government’s standard of drawing the lowest cost from a deposit insurance fund.
“If it’s important to the ecosystem, we would step in again,” said Lake, adding she did not hope for more bank failures.
JPMorgan’s succession plans
The company is set to report its earnings on Friday (Jul 12).
Investors and analysts will be watching out for any commentary on its CEO succession plans. Lake has been named by the bank’s board as a potential successor to Jamie Dimon, who has served in the role since 2006.
While Wall Street banks have made some strides on diversity, Citigroup CEO Jane Fraser is the only woman to lead one of the US’ six biggest banks.
JPMorgan’s other potential CEO candidates are Jennifer Piepszak and Troy Rohrbaugh, co-CEOs of its commercial and investment bank, and Mary Erdoes who heads the asset and wealth management businesses, the bank’s board said.
“It will depend on facts and circumstances at the time, but sure, the next JPMorgan CEO could be a woman,” Lake said, when asked if a woman is likely to succeed Dimon.
Dimon has been vocal about regulatory proposals that would raise capital requirements for banks. Lake also took issue with rule changes, including the Consumer Financial Protection Bureau’s US$8 limit on late payment fees for credit cards, and a cap on overdraft fees.
“There are significant costs to providing access to valuable and secure banking services,” Lake said.
She added: “These proposed changes could impact the ability for banks of all sizes to continue to offer these services at the current rates.”
JPMorgan’s consumer business reported US$17.6 billion in revenue during the first quarter, comprising the biggest chunk of the company’s total revenue of US$41.9 billion. REUTERS
