JPMorgan to Close 300 Bank Branches as Customers Transition to Online Banking


JPMorgan Chase executives made their case Tuesday why the bank should remain whole, even as the banking giant continues to pare down some businesses.

“Scale has always defined the winner in banking,” JPMorgan’s Chief Financial Officer Marianne Lake told investors and analysts Tuesday in New York.

But even as Lake boasted that bigger is better, the bank said it plans to close 300 retail branches during the next two years. The move comes as customers move to online banking.

JPMorgan also announced plans to shed $100 billion in large deposits by the end of the year so it can meet new capital requirement rules that penalize banks for large, uninsured deposits that are viewed as unstable by regulators.

The cutbacks come as 29 “global systemically important banks,” or GSIBs, brace for new capital requirements to be unveiled later this year.

The impending rules have pressured banks like JPMorgan to cut costs and shore up their cash cushions. They also prompted questions whether JPMorgan, the largest and most complex financial bank by some measures, would be better off in pieces.

In January, Goldman Sachs analyst Richard Ramsden said JPMorgan should split itself into pieces due to the new capital rules being imposed by federal regulators.

But JPMorgan executives, including CEO Jamie Dimon, insist the the $225 billion bank should remain whole in order to better compete.

“We look the way we look, we are the size we are, we are as global as we are because clients want it” that way, Lake said on Tuesday.

Other cuts announced Tuesday include plans to “aggressively pursue” cost reductions of $2.8 billion in the investment bank business. The bank has already identified the costs it plans to cut “action by action over the next three years,” said Daniel Pinto, head of the investment bank.

Click here to continue reading.

SOURCE: USA Today – Kaja Whitehouse

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s