JPMorgan Chase’s expenses increased in the third quarter as the bank invested in people and technology. 

The $3.7 trillion bank’s consumer and community banking expenses increased 7% year over year to $8.5 billion in the quarter driven by compensation, increased personnel, and spending allocated to technology and marketing, according to the earnings presentation today.

WHY IT MATTERS: JPMorgan Chase’s headcount grew 7% YoY to 308,669, according to the bank’s earnings supplement. The increase includes 4,774 employees brought on board following the May acquisition of First Republic Bank.  The growth is a result of a focus on hiring to support office and technology investments previously expressed in the bank’s Q2 earnings presentation.

BIGGER PICTURE: JPMorgan Chase has added to its team in Q3 just as other banks have announced layoffs over the past several months.  

For example, Wells Fargo decreased its headcount by 5% YoY during Q3 to 227,363, according to Wells Fargo’s Q3 2023 earnings supplements. Citigroup and Truist Financial also cut personnel. 

BY THE NUMBERS: For Q3, JPMorgan Chase reported:

• Active mobile customers increased 9% YoY to 53 million; 
• Active digital users increased 8% YoY to 67 million; and 
• Net income increased to $13.2 billion, up from $9.7 billion in Q3 2022.

NOTEWORTHY: The bank’s total revenue reached $40 billion in Q3, up 22% YoY, according to the earnings supplement.

First Republic Bank, which was acquired in May, “contributed $2.2 billion in revenue,” Chief Financial Officer Jeremy Barnum said during the bank’s Q3 earnings call.

FLASHBACK: Last year, the bank rolled out its Customer Insights platform to provide small business clients a better understanding of their customer base, Tony Wimmer, managing director and head of data and analytics for JPMorgan Payments, previously told Bank Automation News.

The platform uses machine learning to translate the data into business recommendations for the bank’s SMB clients, he said.

MARKET REACTION: JPMorgan’s stocks were down 1.7% to $148.26 at market close Thursday.

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