three years ago, JPMorgan Became the first bank to have branches in all 48 contiguous states. Now, the company is expanding with the goal of reaching more Americans in smaller towns.
JPMorgan Chase recently announced a new target Billion dollar branch expansion plan This ensures that half of the population in the lower 48 states is covered within “driving time.” That requires opening new locations in sparsely populated areas, a focus for Chairman and CEO Jamie Dimon as he embarks on his 14th annual bus tour on Monday.
Dimon’s first stop is Iowa, where the bank plans to open 25 more branches by 2030.
“From promoting community development to helping small businesses and teaching financial management skills and tools, we strive to extend the full power of our company to all the communities we serve,” Dimon said in a statement.
He also will travel to Minnesota, Nebraska, Missouri, Kansas and Arkansas this week. Chase Consumer Banking CEO Jennifer Roberts said the bank plans to open more than 125 new branches in the six states.
“Our branch share is still very low, in the single digits, and we know that in order to really optimize our investment in these communities, we need a higher branch share,” Roberts told CNBC. Roberts and Day Take a bus trip through the Midwest together.
Roberts said the aim was to achieve “optimum branch share” which in some newer markets would be equivalent to “more than double” current levels.
At the bank’s investor day in May, Roberts said the company was targeting a 15% deposit share and that expanding bank branch coverage was a key part of that strategy. She said the company’s deposit share gains of 220 basis points between 2019 and 2023 were 80 from branches less than 10 years old. In other words, nearly 40% of deposit share gains can be related to investments in new physical branches.
As it expands its brick-and-mortar operations, JPMorgan is bucking the banking industry’s broader trend of closing branches. Prolonged higher interest rates have created headwinds across the industry due to funding costs, with banks choosing to reduce branch sizes to offset some macro pressures.
According to statistics, the U.S. banking industry closed a net 229 branches in the first quarter, compared with only 59 in the previous quarter. Standard & Poor’s Global market intelligence data. FuGuo bank and Bank of America There were the largest number of net branch closures, while J.P. Morgan was the most active net open institution.
According to FDIC research compiled by KBW, bank branch growth peaked in 2007 on the eve of the financial crisis. Deposit capture. This long reckoning has intensified during the pandemic, when banks reported little change in operating capacity even as physical branches were temporarily closed, the report said.
But JPMorgan Chase, the largest bank in the United States, made a record $50 billion. Profit in 2023 – the most ever for Bank of America. As a result, the company is in a unique position when it comes to physical spending, while other companies are choosing to be more cautious.
When it comes to prioritizing sites for new branches, Roberts said it’s a “balance of art and science.” She said the bank would consider factors such as population growth, the number of small businesses in a community, whether there are new corporate headquarters, new suburbs being built or new roads.
Even in smaller cities, foot traffic is a key factor.
“I always joke, if there’s a Chick-fil-A there, we want to be there,” Roberts said. “Because wherever Chick-fil-A goes, it’s always successful and busy.”
