Tags: jpmorgan | dimon | zero | rates

Dimon: JPMorgan Preparing for Zero Rates in US

Dimon: JPMorgan Preparing for Zero Rates in US
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Tuesday, 10 September 2019 03:44 PM

JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon reportedly said that while he doubts the wave of negative interest rates in countries around the world will reach the U.S., he’s preparing his bank for the possibility anyway.

“I don’t think we’ll have zero rates in the U.S., but we’re thinking about how to be prepared for it, just in the normal course of risk management,” Dimon said Tuesday at a conference in New York, CNBC reported.

“Obviously, you’ve got to worry about the long term effect of those interest rates,” Dimon said. “But it’s hard. There are businesses it doesn’t affect at all. And there are businesses where it just sucks into your margin and there’s very little you can do about it.”

Meanwhile, JPMorgan also lowered its outlook for 2019 net interest income by about $500 million on Tuesday, following similar moves by rival big banks Wells Fargo & Co and Citigroup Inc.

"Our (net interest income) will be a little bit lower than we told you last time," Dimon said at Barclays' Financial Services Conference in New York. "I think we told you $57.5 (billion) and I'm closer to $57 (billion) for this year."

That is a lower forecast for full-year net interest income than the bank gave in mid-July and it shows that banks with large pools of customer deposits are struggling to make as much money amid lower interest rates and an inverted yield curve.

On Monday, top brass from Citi and Wells Fargo tempered their outlooks for net interest income.

Citi now expects net interest income to be up 3% to 4% for the year, compared with prior guidance of 4% growth.

Wells Fargo lowered its projections for the second time this year. The bank's chief financial officer said it expects net interest income to fall 6% in 2019, compared with 5% stated previously.

Dimon also said JPMorgan Chase expects third-quarter trading revenues to be 10% lower than in the second quarter, while fees from mergers and acquisitions will likely be flat in comparison with the prior quarter.

© 2019 Thomson/Reuters. All rights reserved.

   
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JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon reportedly said that while he doubts the wave of negative interest rates in countries around the world will reach the U.S., he’s preparing his bank for the possibility anyway.
jpmorgan, dimon, zero, rates
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2019-44-10
Tuesday, 10 September 2019 03:44 PM
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