JPMorgan Chase is stepping up its search for acquisition targets as competition intensifies from financial technology firms and other new rivals.
The effort is being driven by “perhaps a greater sense of urgency,” Chief Financial Officer Jennifer Piepszak said Thursday at a virtual investor conference. “There are businesses like asset management where scale matters even more than it did a year ago. And then other businesses where the need to move quickly and to innovate quickly to keep up with competition is certainly accelerating.”
Chief Executive Jamie Dimon told investors a year ago that the firm was aggressively looking at acquisitions across its business lines, and that it could buy anything except another U.S. bank. Since then, competitor Morgan Stanley has announced two major deals —
the takeover of E-Trade Financial Corp. and the asset manager Eaton Vance.
“There are businesses like asset management where scale matters even more than it did a year ago. And then other businesses where the need to move quickly and to innovate quickly to keep up with competition is certainly accelerating,” JPMorgan Chase CFO Jennifer Piepszak said.
In December, Dimon told M&A bankers to call him with creative ideas for mergers and acquisitions. He mentioned asset management in particular as an area where takeovers would make sense for the New York-based company.
In the wide-ranging presentation, Piepszak also said the bank has generated more trading revenue this year than in the same period of 2020. But the CFO said she didn’t want to make predictions for the first quarter because “we’re heading into a much more challenging” comparison to year-earlier figures for March.
The bank generated what at the time was a record $7.23 billion trading stocks and bonds in last year’s first three months, as the business benefited from markets being whipsawed by the pandemic.
On the economy, the CFO said inflation is “getting a lot of attention — that’s a risk we’re starting to really think about.”
She said “portions of the economy are very strong,” pointing to higher savings rates among consumers.