JP Morgan is a global leader in financial services with assets of $2.6 trillion and operations worldwide. Founded in New York City in 1799, the Manhattan Co. has a long history. They excel in investment banking, financial services for consumers and small businesses, commercial banking, financial transactions processing and asset management.
They have some of the best mobile banking and finance technology along with one of the most trusted and elite investment banks. Consumers across major cities make a beeline to their commercial banks.
JPMorgan Chase continues to evolve and expand more than 200 years after it was founded as the Manhattan Company. Its current name was derived from a merger between two banks in 2000. The bank’s total assets increased significantly over the next decade, which helped to make it the largest commercial bank in the United States. Several of these acquisitions occurred at the height of the 2008 financial crisis.
JPMorgan executed two major acquisitions during that period at the request of the US government to help avoid a system-wide collapse of the US financial industry.
According to the latest annual ranking of top lenders by global regulators, JPMorgan Chase (JPM.N) has once again been named the world’s most critical bank for the health of the financial system. The Financial Stability Board (FSB), a group of regulators from G20 countries, published its latest table of the world’s 30 most systemic banks on Tuesday. JPMorgan is now in a higher bucket than its closest competitors based on how systemic, international, interconnected, and complex they are. While it was also the world’s most systemic lender last year, the bank is now alone in the next bucket up, which had been empty.
Getting listed in the table means holding additional capital and undergoing more intense supervision to avoid a repeat of taxpayer bailouts during the financial crisis. In practice, lenders typically hold capital buffers that are already above FSB requirements. As of the end of September, JPMorgan had a core equity ratio of 12.9% of capital to risk-weighted assets, well above the Federal Reserve’s minimum of 11.3%.
JPMorgan now faces a capital surcharge of 2.5%, up from 2% last year. The US banks have attacked the FSB capital surcharges aggressively, unsuccessfully, but they are unlikely to succeed under President Joe Biden. Nevertheless, the FSB raised the prospect of relief for eurozone banks in terms of how their exposure to other countries in the block is determined.
The lenders in the eurozone argue that they are all regulated by the European Central Bank under the EU’s banking union, so their exposure to other eurozone countries should not be considered ‘cross-border’ and subject to tougher regulations.
As part of its list of most systemic lenders, the FSB said on Tuesday that the Basel Committee, which writes global bank capital rules, will assess cross-border exposures within the banking union shortly.
