NRIM - JPMorgan Strategic Buyouts Aid Amid Fee Income Woes | Benzinga
JPMorgan Chase & Co. (NYSE: JPM) remains well-positioned for growth on the back of higher rates, strategic acquisitions and restructuring initiatives, and a resurgence in global deal-making activities. However, challenges in improving fee income because of high mortgage rates and volatile capital market revenues are woes.
JPMorgan's net interest income (NII) and net yield on interest-earning assets are likely to experience decent growth as the Federal Reserve is expected to keep interest rates high in the near term. However, rising funding and deposit costs will continue to exert pressure on both to some degree. Though NII dipped in 2020 and 2021 amid the low interest rate environment, the metric reflected a five-year (2018-2023) compound annual growth rate (CAGR) of 10.1%. This rise was partially driven by the First Republic Bank's acquisition in 2023. Similarly, net yield on interest-earning assets expanded to 2.70% in 2023 from 2% in 2022. The uptrend for both metrics continued during the first quarter of 2024 on a year-over-year basis. The company projects NII in 2024 to rise roughly 2.5% to approximately $92 billion.
Despite the rapid growth of mobile and online banking options, JPM remains focused on its footprint expansion in new regions. In February 2024, the company announced plans to open more than 500 new branches by 2027 to strengthen its position as the bank with the largest branch network and a presence ...