JPMorgan Chase tech spend falls 7% YoY to $2.1B

JPMorgan Chase decreased technology, communications, and equipment expenses year over year during the first quarter of 2023, but an increase in headcount and wage inflation saw noninterest expenses increase YoY. WHY IT MATTERS: The $3.7 trillion bank’s tech spending fell for the second straight quarter to $2.1 billion, a 7% YoY decrease, according to the bank’s earnings supplement released today. [caption id="attachment_57365520" align="alignright" width="300"] Photographer: Gabby Jones/Bloomberg [/caption] However, JPMorgan Chase did increase its noninterest expenses 5% to $20.1 billion, according to the earnings release. “Expenses of $1.3 billion were up 16% year over year, largely driven by higher compensation expense, including front office hiring and technology investments,” Chief Financial Officer Jeremy Barnum said today during the bank’s Q1 2023 earnings call. BY THE NUMBERS: JPMorgan Chase posted for Q1: Net income increased 52% YoY to $12.6 billion; Active mobile customers increased 9% YoY to 50.9 million; and Active digital users increased 8% YoY to nearly 65 million. NOTEWORTHY: JPMorgan Chase’s deposits dropped since 2022, but the fluctuation is expected to be a short-term symptom of March’s bank failures as seen in Silicon Valley Bank , Jeremy Barnum , chief financial officer at JPMorgan Chase, said during today’s earnings call. “As we sit here today, … it’s not meaningfully affecting our current outlook. We don’t see it as a major driver,” Barnum said. “In terms of the larger dynamics, it’s just a little too early to tell. But from where we are right now, the base case is no real impact.” FLASHBACK: One fintech that switched its deposits to JPMorgan Chase was payroll provider Rippling , following the March collapse of SVB. The San Francisco-based fintech was preparing to switch to JPM before SVB’s demise, with Rippling’s website stating, “We completed a long-planned transition to JPMorgan Chase to ensure that all future customer payments will succeed,” in early March. MARKET REACTION: JPMorgan’s stock was up 4.8% to $135.15 at market open today, compared with $128.85 at market close Thursday. FUTURE LOOK: On recessionary fears for the latter half of 2023, the bank expects to take a wait-and-see approach on what the Federal Reserve will do with rates and how that will affect the bank, JPMorgan Chase Chief Executive Jamie Dimon said during the earnings call. “We’re quite cautious, quite thoughtful about [a potential recession]. Obviously, the short-term rate is higher recessionary risk and then inflation coming down,” he said. “I think inflation will come down a little bit, it could easily be stickier than people think, and, therefore, the rate curve will have to go up a little bit.” [stock_market_widget type="inline" template="generic" assets="JPM" markup="{name} ({symbol}) is trading at {price} ({change_pct}) as of {last_update}" display_currency_symbol="true" api="yf"].

JPMorgan Chase tech spend falls 7% YoY to $2.1B

Mobile usership was up 9% YoY to nearly 51M

PNC to reduce costs by $400M in 2023

5 Questions with … Southern Bancorp CIO Vance Smiley

Related Posts

AI-driven ‘SaaSpocalypse’ fears overblown, experts say

Is Your Technology Supplier There for You?

Bluevine’s AI chatbot resolves 80% of customer queries

5 Questions with … Southern Bancorp CIO Vance Smiley

EMERGING FINTECH DIRECTORY

FinAi Podcast

SPONSORED

The Next Generation of Cyberthreats: Powered by AI

Build an Antifragile Strategy to Outperform the Market

How AI and Product Experts Turn Fuzzy Requirements Into Focused Dev-ready Roadmaps

Connect

Welcome Back!

Retrieve your password

Continue Reading with FinAi News Premium - Less than $2/Day

JPMorgan Chase tech spend falls 7% YoY to $2.1B

Mobile usership was up 9% YoY to nearly 51M

PNC to reduce costs by $400M in 2023

5 Questions with … Southern Bancorp CIO Vance Smiley

Related Posts

FinAi Podcast

Connect

Welcome Back!

Retrieve your password

Unlock This Article

Continue Reading with FinAi News Premium - Less than $2/Day