Dear Fellow Shareholders, | JPMorgan Chase

Dear Fellow Shareholders,

Across the globe, 2023 was yet another year of signiﬁcant challenges, from the

terrible ongoing wars and violence in the Middle East and Ukraine to mounting

terrorist activity and growing geopolitical tensions, importantly with China. Almost

all nations felt the eects last year of global economic uncertainty, including higher

energy and food prices, inﬂation rates and volatile markets. While all these events

and associated instability have serious ramiﬁcations on our company, colleagues,

clients and countries where we do business, their consequences on the world at large

— with the extreme suering of the Ukrainian people, escalating tragedy in the Middle

East and the potential restructuring of the global order — are far more important.

As these events unfold, America’s global leadership role is being challenged outside

by other nations and inside by our polarized electorate. We need to ﬁnd ways to put

aside our dierences and work in partnership with other Western nations in the name

of democracy. During this time of great crises, uniting to protect our essential

freedoms, including free enterprise, is paramount. We should remember that

America, “conceived in liberty and dedicated to the proposition that all men are

Jamie Dimon,

Chairman and

Chief Executive

Ocer

created equal,” still remains a shining beacon of hope to citizens around the world.

JPMorgan Chase, a company that historically has worked across borders and

boundaries, will do its part to ensure that the global economy is safe and secure.

In spite of the unsettling landscape, including last year’s regional bank turmoil, the

U.S. economy continues to be resilient, with consumers still spending, and the

markets currently expect a soft landing. It is important to note that the economy is

being fueled by large amounts of government deﬁcit spending and past stimulus.

There is also a growing need for increased spending as we continue transitioning to

a greener economy, restructuring global supply chains, boosting military expenditure

and battling rising healthcare costs. This may lead to stickier inﬂation and higher

rates than markets expect. Furthermore, there are downside risks to watch.

Quantitative tightening is draining more than $900 billion in liquidity from the system

annually — and we have never truly experienced the full eect of quantitative

tightening on this scale. Plus the ongoing wars in Ukraine and the Middle East

continue to have the potential to disrupt energy and food markets, migration, and

military and economic relationships, in addition to their dreadful human cost. These

signiﬁcant and somewhat unprecedented forces cause us to remain cautious.

2023 was another strong year for JPMorgan Chase, with our ﬁrm generating record

revenue for the sixth consecutive year, as well as setting numerous records in each

of our lines of business. We earned revenue in 2023 of $162.4 billion

and net income

of $49.6 billion, with return on tangible common equity (ROTCE) of 21%, reﬂecting

strong underlying performance across our businesses. We also increased our

quarterly common dividend of $1.00 per share to $1.05 per share in the third quarter

of 2023 — and again to $1.15 per share in the ﬁrst quarter of 2024 — while continuing

to reinforce our fortress balance sheet. We grew market share in several of our

businesses and continued to make signiﬁcant investments in products, people and

technology while exercising strict risk disciplines.

Throughout the year, we demonstrated the power of our investment philosophy and

guiding principles, as well as the value of being there for clients — as we always are —

in both good times and bad times. The result was continued growth broadly across

the ﬁrm. We will highlight a few examples from 2023: Consumer & Community

Banking (CCB) extended its #1 leadership positions and grew share year-over-year in

retail deposits, credit card sales and credit card outstandings (adding close to 3.6

million net new customers to the franchise); the Corporate & Investment Bank (CIB)

1 Represents managed revenue.

maintained its #1 rank in both Investment Banking and Markets and gained more

than 100 basis points of Investment Banking market share; Commercial Banking (CB)

added over 5,000 new relationships (excluding First Republic Bank), roughly doubling

the prior year’s achievement; and Asset & Wealth Management (AWM) saw record

client asset net inﬂows of $490 billion, over 20% higher than its prior record.

In 2023, we continued to play a forceful and essential role in advancing economic

growth. In total, we extended credit and raised capital totaling $2.3 trillion for our

consumer and institutional clients around the world. On a daily basis, we move nearly

$10 trillion in over 120 currencies and more than 160 countries, as well as safeguard

over $32 trillion in assets. By purchasing First Republic Bank, we brought much-

needed stability to the U.S. banking system while allowing us to give a new, secure

home to over half a million First Republic customers.

As always, we hold fast to our commitment to corporate responsibility, including

helping to create a stronger, more inclusive economy — from supporting work skills

training programs around the world to ﬁnancing aordable housing and small

businesses to making investments in cities like Detroit that show how business and

government leaders can work together to solve problems.

We have achieved our decades-long consistency by adhering to our key principles and

strategies (see sidebar on Steadfast Principles on page 5), which allow us to drive

good organic growth and promote proper management of our capital (including

dividends and stock buybacks). The charts on pages 9–15 show our performance

results and illustrate how we have grown our franchises, how we compare with our

competitors and how we look at our fortress balance sheet. Please peruse them and

the CEO letters in this Annual Report, all of which provide speciﬁc details about our

businesses and our plans for the future.

I remain proud of our company’s resiliency and of what our hundreds of thousands of

employees around the world have achieved, collectively and individually. Throughout

these challenging past few years, we have never stopped doing all the things we should

be doing to serve our clients and our communities. As you know, we are champions of

banking’s essential role in a community — its potential for bringing people together, for

enabling companies and individuals to attain their goals, and for being a source of

strength in dicult times. I often remind our employees that the work we do matters

STEADFAST PRINCIPLES WORTH REPEATING (AND ONE NEW ONE)

Looking back on the past two+ decades —

starting from my time as Chairman and

CEO of Bank One in 2000 — there is one

common theme: our unwavering dedica-

tion to help clients, communities and

countries throughout the world. It is clear

that our ﬁnancial discipline, constant

investment in innovation and ongoing

development of our people have enabled

us to achieve this consistency and com-

mitment. In addition, across the ﬁrm, we

uphold certain steadfast tenets that are

worth repeating.

First, our work has very real human

impact. While JPMorgan Chase stock is

owned by large institutions, pension

plans, mutual funds and directly by single

investors, in almost all cases the ultimate

beneﬁciaries are individuals in our com-

munities. More than 100 million people in

the United States own stocks; many, in

one way or another, own JPMorgan Chase

stock. Frequently, these shareholders are

veterans, teachers, police ocers, ﬁre-

ﬁghters, healthcare workers, retirees, or

those saving for a home, education or

retirement. Often, our employees also

bank these shareholders, as well as their

families and their companies. Your man-

agement team goes to work every day

recognizing the enormous responsibility

that we have to all of our shareholders.

Second, shareholder value can be built

only if you maintain a healthy and vibrant

company, which means doing a good job

of taking care of your customers, employ-

ees and communities. Conversely, how

can you have a healthy company if you

neglect any of these stakeholders? As we

have learned over the past few years,

there are myriad ways an institution can

demonstrate its compassion for its

employees and its communities while still

strengthening shareholder value.

Third, while we don’t run the company

worrying about the stock price in the short

run, in the long run we consider our stock

price a measure of our progress over time.

This progress is a function of continual

investments in our people, systems and

products, in good and bad times, to build

our capabilities. These important invest-

ments will also drive our company’s future

prospects and position it to grow and

prosper for decades. Measured by stock

performance, our progress is exceptional.

For example, whether looking back 10

years or even farther to 2004, when the

JPMorgan Chase/Bank One merger took

place, we have outperformed the Standard

& Poor’s 500 Index and the Standard &

Poor’s Financials Index.

Fourth, we are united behind basic princi-

ples and strategies (you can see the prin-

ciples for How We Do Business on our

website and our Purpose statement in my

letter from last year) that have helped

build this company and made it thrive.

These allow us to maintain a fortress bal-

ance sheet, constantly invest and nurture

talent, fully satisfy regulators, continually

improve risk, governance and controls,

and serve customers and clients while

lifting up communities worldwide. This

philosophy is embedded in our company

culture and inﬂuences nearly every role

in the ﬁrm.

Fifth, we strive to build enduring busi-

nesses, which rely on and beneﬁt from one

another, but we are not a conglomerate.

This structure helps generate our superior

returns. Nonetheless, despite our best

eorts, the walls that protect this com-

pany are not particularly high — and we

face extraordinary competition. I have

written about this reality extensively in the

past and cover it again in this letter. We

recognize our strengths and vulnerabili-

ties, and we play our hand as best we can.

Sixth, and this is the new one, we must be

a source of strength, particularly in tough

times, for our clients and the countries in

which we operate. We must take seriously

our role as one of the guardians of the

world’s ﬁnancial systems.

Seventh, we operate with a very important

silent partner — the U.S. government —

noting as my friend Warren Buett points

out that his company’s success is predi-

cated upon the extraordinary conditions

our country creates. He is right to say to

his shareholders that when they see the

American ﬂag, they all should say thank

you. We should, too. JPMorgan Chase is a

healthy and thriving company, and we

always want to give back and pay our fair

share. We do pay our fair share — and we

want it to be spent well and have the

greatest impact. To give you an idea of

where our taxes and fees go: In the last 10

years, we paid more than $46 billion in

federal, state and local taxes in the United

States and over $22 billion in taxes outside

of the United States. Additionally, we paid

the Federal Deposit Insurance Corporation

over $10 billion so that it has the resources

to cover failure in the American banking

sector. Our partner — the federal govern-

ment — also imposes signiﬁcant regula-

tions upon us, and it is imperative that we

meet all legal and regulatory require-

ments imposed on our company.

Eighth and ﬁnally, we know the founda-

tion of our success rests with our people.

They are the front line, both individually

and as teams, serving our customers and

communities, building the technology,

making the strategic decisions, managing

the risks, determining our investments

and driving innovation. However you view

the world — its complexity, risks and

opportunities — a company’s prosperity

requires a great team of people with

guts, brains, integrity, enormous capabili-

ties and high standards of professional

excellence to ensure its ongoing success.

2000

Jamie Dimon joins Bank

One as Chairman and

CEO

Chase Manhattan buys

J.P. Morgan & Co.,

forming J.P. Morgan

Chase & Co.

2004

Bank One merges with

J.P. Morgan Chase & Co.

2006

JPMorgan Chase holds

ﬁrst Investor Day

Asset & Wealth

Management assets

under management

exceed $1 trillion

2008

JPMorgan Chase acquires

Bear Stearns and

Washington Mutual

The collapse of the housing

and mortgage markets led to

a severe worldwide ﬁnancial

crisis, the worst since the

Great Depression. JPMorgan

Chase helped stabilize the

markets by acquiring two

failing institutions, Bear

Stearns and Washington

Mutual (WaMu). WaMu

is still the largest failure

of an insured depository

institution in the history of

the FDIC. Importantly, the

WaMu deal expanded the

bank’s network by more

than 2,200 branches,

including gaining a footprint

in California and Florida.

JPMorgan Chase ranks

#1 in investment banking

fees market share for

the ﬁrst time

2010

JPMorgan Chase

launches Chase Wealth

Management

2011

JPMorgan Chase ranks

#1 in Markets revenue

market share for the

ﬁrst time

Jamie Dimon holds his

ﬁrst bus tour from

Seattle to San Diego

JPMorgan Chase

becomes the biggest

U.S. bank by assets

2012

Chase becomes #1

credit card issuer based

on outstandings

2014

JPMorgan Chase makes

historic investment in

Detroit, which reached

$200 million in 2022

JPMorgan Chase

begins using artiﬁcial

intelligence and machine

learning for fraud

detection

2016

JPMorgan Chase

becomes the biggest

bank in the world by

market capitalization

2018

Chase credit and debit

card sales volume

surpasses $1 trillion

JPMorgan Chase

announces $30 million

investment in Greater

Paris, followed by $70

million in new commit-

ments in 2023 to create

economic opportunity

across France

JPMorgan Chase

announces branch

expansion initiative

2019

JPMorgan Chase launches

the Second Chance hiring

initiative, helping remove

barriers to employment

opportunities for people

with a criminal record

2020

JPMorgan Chase

announces its $30 billion

Racial Equity Commitment

With the goal of helping

to close the racial

wealth gap and advance

economic inclusion among

historically underserved U.S.

communities, the eﬀort

reported over $30 billion in

progress by the end of 2023.

Jamie Dimon returns to

work in the oce in June

Four modern, private

cloud-based North

American data centers

go live

2021

JPMorgan Chase ranks

#1 in retail deposits

market share at 10%

based on FDIC data,

with deposits surpassing

$1 trillion

2022

Chase becomes

the ﬁrst bank with

nationwide branches

in all lower 48 states

2023

JPMorgan Chase

acquires First Republic

Bank from the FDIC

The purchase of First

Republic helped stabilize

and strengthen the U.S.

ﬁnancial system in a time

of crisis while allowing

JPMorgan Chase to give a

new, secure home to over

half a million First Republic

customers.

FDIC = Federal Deposit Insurance Corporation

2000 2005 2010 2015 2020 2024

MAPPING OUR PROGRESS AND MILESTONES

and has impact. United by our principles and purpose, we help people and institutions

ﬁnance and achieve their aspirations, lifting up individuals, homeowners, small

businesses, larger corporations, schools, hospitals, cities and countries in all regions

of the world. What we have accomplished in the 20 years since the Bank One and

JPMorgan Chase merger is evidence of the importance of our values.

CELEBRATING THE 20

ANNIVERSARY OF THE BANK ONE/JPMORGAN CHASE

MERGER

J.P. Morgan Chase

By 2004, J.P. Morgan Chase already represented the consolidation of four of the 10

largest U.S. banks from 1990: The Chase Manhattan Corp., Manufacturers Hanover,

Chemical Banking Corp. and, most recently, J.P. Morgan & Company. And some of their

predecessor companies stretched back into the 1800s, one even into the late 1700s.

Bank One

Bank One had been even busier on the acquisition front, especially across the United

States. By 1998, then Banc One had more than 1,300 branches in 12 states when it

announced a merger with First Chicago NBD, a Chicago-based bank created just

three years earlier by the merger of First Chicago and Detroit-based NBD. Now

headquartered in Chicago, the new Bank One became the largest bank in the

Midwest, second largest among credit card companies and fourth largest in the

United States. But the merger didn’t go as planned, with Bank One issuing three

dierent earnings warnings. In March 2000, Bank One reached outside its executive

ranks, and my tenure began as Chairman and CEO, working to overhaul the company

and help bring it back to proﬁtability and growth.

The story begins ... A merger 20 years ago helped transform two giant banks

Fast forward to 2003, and another wave of consolidation was well underway in U.S.

banking. Most of the nation’s larger banks were trying to position themselves to be an

“endgame winner.” In the biggest deal, Bank of America agreed to buy FleetBoston

Financial Corp. for more than $40 billion. Those two banks — already amalgamations

of several predecessor companies — touted the breadth of their combined retail

branch network.

But they were hardly alone. In 2003, some 215 deals were announced among

U.S. commercial banks and bank holding companies for a total value of $66 billion,

according to Thomson Financial, which tracks merger data.

In July 2004, J.P. Morgan Chase and Bank One merged — as part of a 225-year

journey — to form this exceptional company of ours: JPMorgan Chase. At its merger

in 2004, the combined bank was the fourth largest bank in the world by market

capitalization. But with patient groundwork over the years — ﬁxing systems and

upgrading technology, managing the notable acquisitions of Bear Stearns and

Washington Mutual (WaMu) and continuing to reinvest, including in our talent —

we have made our company an endgame winner.

In earlier years, banks worried about their survival. While the past two decades have

brought some virtually unprecedented challenges, including the great ﬁnancial crisis

and a pandemic followed by a global shutdown, they did not stop us from

accomplishing extraordinary things. Our bank has now emerged as the #1 bank by

market capitalization.

Each of our businesses is among the best in the world, with increased market share,

strong ﬁnancial results and an unwavering focus on serving our clients, communities

and shareholders with distinction and dedication. The strengths that are embedded in

JPMorgan Chase — the knowledge and cohesiveness of our people, our long-standing

client relationships, our technology and product capabilities, our presence in more

than 100 countries and our unquestionable fortress balance sheet — would be hard to

replicate. Crucially, the strength of our company has allowed us to always be there for

clients, governments and communities — in good times and in bad times — and this

strength has enabled us to continually invest in building our businesses for the future.

You can see from the following charts what gains and improvements we have

achieved along the way.

24_JD_earnings_diluted_03

DRAFT 3.14.24–TYPESET; 4/4/24; v.24_JD_earnings_diluted_03



Net income 



Diluted earnings per share (EPS) 



Return on tangible common equity (ROTCE)

2023202220212020201920182017201620152014201320122011201020092008200720062005

$8.5

$15.4

$17.4

$19.0

$21.3

$17.9

$21.7

$24.4

$14.4

$24.7

$24.4

$26.9

$38.4

$36.4

$37.7

$49.6

$48.3

$32.5







15%

24%

22%

10%

15%

11%

13%

12%

17%

19%

14%

23%

18%

21%

13%



$4.00

$4.33

$1.35

$2.26

$3.96

$4.48

$5.19

$4.34

$5.29

$6.00

$6.31

$10.72

$15.36

$12.09

$16.23



$8.88



$9.00

$6.19

$2.35

$5.6

$11.7

$29.1

$39.1

1 Eective January 1, 2020, the Firm adopted the Financial Instruments - Credit Losses accounting guidance. Firmwide results

excluding the net impact of reserve release/(build) of ($9.3) billion and $9.2 billion for the years ending

December 31, 2020 and 2021, respectively, are non-GAAP ﬁnancial measures.

2 Adjusted net income excludes $2.4 billion from net income in 2017 as a result of the enactment of the Tax Cuts and Jobs Act.

GAAP = Generally accepted accounting principles

Adjusted net income

Net income

excluding reserve

release/build

Adjusted

ROTCE

was 13.6%

for 2017

ROTCE excluding

reserve release/build

was 19.3% for 2020

and 18.5% for 2021

Earnings, Diluted Earnings per Share and Return on Tangible Common Equity

2005–2023

($ in billions, except per share and ratio data)

4/7/24r1 3:00pm

DRAFT 3.14.24–TYPESET; 4/4/24; v.24_JD_TBVPS_03

24_JD_TBVPS_03

Tangible Book Value

and Average Stock Price per Share

2005–2023



Tangible book value 



Average stock price

2023202220212020201920182017201620152014201320122011201020092008200720062005

$60.98

$66.11

$71.53

$73.12

$86.08

$56.33

$16.45

$18.88

$21.96

$22.52

$27.09

$30.12

$33.62

$38.68

$40.72

$44.60

$48.13

$51.44

$53.56

$36.07

$43.93

$47.75

$39.83

$35.49

$40.36

$39.36

$39.22

$51.88

$58.17

$63.83

$65.62

$113.80

$106.52

$155.61

$128.13

$144.05

$110.72

$92.01

High: $170.69

Low: $123.11

1 10% compound annual growth rate since 2005.

4/7/24r1 3:00pm

24_JD_Stock_Total_Return_03

DRAFT 3/13/24 — TYPESET; 4/4/24 v. 24_JD_Stock_Total_Return_03

Stock total return analysis

Bank One S&P 500 Index S&P Financials Index

Performance since becoming CEO of Bank One

(3/27/2000—12/31/2023)

Compounded annual gain 12.1% 6.9% 4.9%

Overall gain 1,400.7% 389.7% 209.7%

JPMorgan Chase S&P 500 Index S&P Financials Index

Performance since the Bank One and JPMorgan Chase merger

(7/1/2004—12/31/2023)

Compounded annual gain 10.9% 9.8% 4.7%

Overall gain 647.3% 514.7% 146.7%

Performance for the period ended December 31, 2023

Compounded annual gain

One year 30.7% 26.3% 12.1%

Five years 15.2% 15.7% 12.0%

Ten years 14.4% 12.0% 10.0%

This chart shows actual returns of the stock, with dividends reinvested, for heritage shareholders of Bank One and JPMorgan Chase vs. the Standard & Poor’s

500 Index (S&P 500 Index) and the Standard & Poor’s Financials Index (S&P Financials Index).

1 On March 27, 2000, Jamie Dimon was hired as CEO of Bank One.

4/7/24r1 3:00pm

24_JD_client franchises_08

DRAFT 03/29/24, TYPESET; 4/9/24r1 v. 24_JD_client franchises_08

2005 2013 2022 2023

Consumer &

Community

Banking

Average deposits ($B)

Deposits market share

# of top 50 markets where

we are #1 (top 3)

Business Banking primary market

Client investment assets ($B)

Total payments volume ($T)

% of digital non-card payments

Credit card sales ($B)

Debit card sales ($B)

Debit and credit card sales volume ($B)

Credit card sales market share

Credit card loans ($B, EOP)

Credit card loans market share

Active mobile customers (M)

# of branches

# of advisors

$187

4.5%

6 (12)

4.0%

~20%

$225

15%

$142

19%

2,641

$453

7.5%

7 (22)

6.8%

$189

$1.4

45%

$419

$224

$664

21%

$128

17%

15.6

5,630

3,044

$1,163

10.9%

11 (25)

9.3%

$647

$5.6

77%

$1,065

$491

$1,555

22%

$185

17%

49.7

4,787

5,029

$1,127

11.3%

12 (26)

9.5%

$951

$5.9

79%

$1,164

$515

$1,679

23%

$211

17%

53.8

4,897

5,456

 Serve 82 million U.S. consumers and 6.4 million

small businesses

 67 million active digital customers

, including

54 million active mobile customers

 Primary bank relationships for ~80% of

consumer checking accounts

 #1 retail deposit share

 #1 deposit market share position in 4 out of the

5 largest banking markets in the country (NY, LA,

Chicago, and San Francisco), while maintaining

branch presence in all contiguous 48 U.S. states

 #1 primary bank for U.S. small businesses

 #1 U.S. credit card issuer based on sales and

outstandings

 #1 owned mortgage servicer

 #1 bank auto lender

Corporate &

Investment

Bank

Total Markets revenue

Market share

FICC

Market share

Equities

Market share

Global investment banking fees

Market share

Assets under custody (AUC) ($T)

Average client deposits ($B)

Firmwide Payments revenue ($B)

Firmwide Payments revenue rank

(share)

Firmwide average daily security

purchases and sales ($T)

2006

6.3%

7.0%

5.0%

8.7%

$10.7

$155

$4.9

9.0%

9.6%

7.9%

8.7%

$20.5

$384

$7.8

11.5%

10.8%

12.9%

7.8%

$28.6

$687

$13.9

#1 (8.1%)

$3.1

11.4%

11.0%

12.3%

8.8%

$32.4

$645

$18.2

Co-#1 (9.0%)

$3.0

 >90% of Fortune 500 companies do business

with us

 Presence in over 100 markets globally

 #1 in global investment banking fees for the 15th

consecutive year

 Consistently ranked #1 in Markets revenue since

2011

 J.P. Morgan Research ranked as the #1 Global

Research Firm, #2 Global Equity Research Team

and #1 Global Fixed Income Research Team

 #1 in USD payments volume

 27.1% USD SWIFT market share

 #1 in U.S. Merchant volume processing

 #3 Custodian globally by revenue

Commercial

Banking

# of top 75 MSAs with dedicated teams

# of bankers

New relationships (gross)

Average loans ($B)

Average deposits ($B)

Gross investment banking revenue ($B)

Multifamily lending

1,208

$48.1

$66.1

$0.6

#29

1,242

$132.0

$198.4

$1.7

2,360

2,277

$223.7

$294.2

$3.0

2,888

4,940

$268.3

$267.8

$3.4

 151 locations across the U.S. and 39 international

locations, with 16 new cities added in 2023

 $2.2B revenue from Middle Market expansion

markets, up 45% YoY

 Credit, banking and treasury services to ~34K

Commercial & Industrial clients and ~36K real

estate owners and investors

 18 specialized industry coverage teams

 #1 overall Middle Market Bookrunner in the U.S.

 Approximately 28,000 incremental aordable

housing units ﬁnanced in 2023

Asset & Wealth

Management

JPMAM LT funds AUM performed

above peer median (10Y)

Client assets ($T)

Traditional assets ($T)

30,31

Alternatives assets ($B)

30,32

Average deposits ($B)

Average loans ($B)

# of Global Private Bank client advisors

Global Private Bank (Euromoney)

$1.1

$1.0

$74

$42

$27

1,484

80%

$2.3

$1.9

$207

$135

$83

2,512

90%

$4.0

$3.4

$372

$261

$216

3,137

83%

$5.0

$4.4

$411

$216

$220

3,515

 166 funds with a 4/5 star rating

 Business with 59% of the world’s largest pension

funds, sovereign wealth funds and central banks

 #2 in 5-year cumulative net client asset ﬂows

 Positive client asset ﬂows in 2023 across all

regions and channels, with strength in liquidity,

ﬁxed income, equity, custody and brokerage

 #2 in Active ETF AUM and ﬂows

 #1 in Institutional Money Market Funds AUM

 54% of Asset Management AUM managed by

female and/or diverse portfolio managers

NA = Not available USD = U.S. dollar

NM = Not meaningful YoY = Year-over-year

AUM = Assets under management M = Millions

EOP = End of period B = Billions

FICC = Fixed income, currencies and commodities T = Trillions

JPMAM = J.P. Morgan Asset Management K = Thousands

MSA = Metropolitan statistical area

For footnoted information, refer to pages 60-61 in this Annual Report.

Client Franchises Built Over the Long Term

4/8/24r1 1:00pm

DRAFT 3/4/24–TYPESET; 4/4/24 v. 24_JD_new_renew_04

New and Renewed Credit and Capital for Our Clients

2005–2023

($ in billions)

1 Government, government-related and nonproﬁts available starting in 2019; included in Corporate clients and Small Business, Middle Market and Commercial clients for prior years.



Corporate clients



Small Business, Middle Market and Commercial clients



Consumers



Government, government-related and nonproﬁts

2023202220212020201920182017201620152014201320122011201020092008200720062005

$1,088

$167

$312

$1,115

$136

$243

$1,158

$167

$252

$1,392

$222

$252

$1,264

$1,519

$281

$309

$275

$274

$1,494

$1,577

$1,866

$1,820

$2,102

$1,693

$399

$265

$2,357

$1,619

$430

$258

$2,307

$1,789

$480

$227

$2,496

$1,346

$440

$226

$333

$288

$216

$250

$615

$2,345

$3,186

$2,410

$1,294

$463

$244

$262

$641

$1,926

$1,329

$205

$239

$590

$2,265

$1,231

$331

$2,263

$1,443

$368

$233

$2,044

$1,621

$326

$197

$2,144

$1,567

~$1,900 estimated

4/7/24r1 3:00pm

24_JD_new_renew_04

DRAFT 3/4/24 TYPESET; 4/4/24 v. 24_JD_assets entrusted_03

1 Represents assets under management, as well as custody, brokerage, administration and deposit accounts.

2 Represents activities associated with the safekeeping and servicing of assets.

Assets Entrusted to Us by Our Clients

2005–2023

2023202220212020201920182017201620152014201320122011201020092008200720062005

$16.9

$18.8

$20.5

$13.2

$10.7

$13.9

$15.9

$14.9

$16.1

$20.5

$19.9

$20.5

$23.5

$23.2

$26.8

$33.2

$32.4

$31.0

$28.6



Client assets 



Wholesale deposits 



Consumer deposits

2023202220212020201920182017201620152014201320122011201020092008200720062005

$1,883

$730

$398

$2,061

$755

$439

$2,329

$824

$464

$2,376

$861

$503

$2,353

$2,427

$722

$757

$558

$618

$3,255

$3,617

$3,740

$3,633

$3,802

$3,781

$4,240

$1,186

$1,209

$959

$1,132

$5,926

$6,580

$5,292

$1,306

$1,095

$7,693

$4,488

$1,314

$1,148

$6,950

$3,258

$844

$718

$4,820

$2,740

$792

$679

$4,211

$2,783

$784

$660

$4,227

$3,011

$1,881

$558

$372

$2,811

$1,743

$573

$365

$2,681

$1,415

$648

$361

$2,424

$1,513

$520

$221

$2,254

$1,296

$425

$214

$1,935

$1,107

$364

$191

$1,662

2023202220212020201920182017201620152014201320122011201020092008200720062005

$16.9

$18.8

$20.5

$13.2

$10.7

$13.9

$15.9

$14.9

$16.1

$20.5

$19.9

$20.5

$23.5

$23.2

$26.8

$33.2

$32.4

$31.0

$28.6



Client assets 



Wholesale deposits 



Consumer deposits

2023202220212020201920182017201620152014201320122011201020092008200720062005

$1,883

$730

$398

$2,061

$755

$439

$2,329

$824

$464

$2,376

$861

$503

$2,353

$2,427

$722

$757

$558

$618

$3,255

$3,617

$3,740

$3,633

$3,802

$3,781

$4,240

$1,186

$1,209

$959

$1,132

$5,926

$6,580

$5,292

$1,306

$1,095

$7,693

$4,488

$1,314

$1,148

$6,950

$3,258

$844

$718

$4,820

$2,740

$792

$679

$4,211

$2,783

$784

$660

$4,227

$3,011

$1,881

$558

$372

$2,811

$1,743

$573

$365

$2,681

$1,415

$648

$361

$2,424

$1,513

$520

$221

$2,254

$1,296

$425

$214

$1,935

$1,107

$364

$191

$1,662

Deposits and client assets

($ in billions)

Assets under custody

($ in trillions)

4/7/24r1 3:00pm

24_JD_assets entrusted_03.eps

JPMorgan Chase Exhibits Strength in Both Eciency and Returns When Compared

with Large Peers and Best-in-Class Peers

Eciency Returns

Overhead ratio

ROTCE

JPMorgan Chase

Eciency Returns

JPM 2023

overhead ratio

Best-in-class peer

overhead ratio

JPM 2023

ROTCE

Best-in-class all

banks ROTCE

4,6

Best-in-class

GSIB ROTCE

5,6

Consumer &

Community

Banking

50% 50%

COF-DC & CB

38% 28%

BAC–CB

28%

BAC–CB

Corporate &

Investment

Bank

59% 55%

BAC-GB & GM

13% 16%

BAC-GB & GM

16%

BAC-GB & GM

Commercial

Banking

35% 39%

FITB

20% 19%

WFC–CB

19%

WFC–CB

Asset & Wealth

Management

64% 63%

NTRS-WM & ALLIANZ-AM

31% 58%

MS-WM & IM

58%

MS-WM & IM

GSIB = Global systemically important banks

ROTCE = Return on tangible common equity

For footnoted information, refer to page 61 in this Annual Report.

**FOOTNOTES –MOVED TO BACK PAGE

24_JD_best-in-class_peers_07

DRAFT 4/5/24 – TYPESET: 4/8/24r1 v. 24_JD_best-in-class_peers_07

77%

75%

72%

67%

66%

54%

BAC

WFC

JPM

13%

21%

WFC

BAC

JPM

4/8/24r1 1:00pm

24_JD_daily payment_05.eps

DRAFT 4/5/24: TYPESET 4/6/24r2 v. 24_JD_daily payment_05

Daily Payment Volume

(# in millions, average)

Daily Merchant Acquiring Transactions

(# in millions, average)

1 Based on Firmwide data using regulatory reporting guidelines prescribed by the Federal Reserve for US Title 1 planning purposes; includes internal

settlements, global payments to and through third-party processors and banks, and other internal transfers.

T = Trillions

More than

double 2010

20232022202120202019201820172016 20232022202120202019201820172016

113.4

124.8

90.1

102.4

82.4

72.1

62.3

55.0

52.6

56.6

45.7

49.2

39.3

37.4

34.6

32.7

20232022202120202019201820172016 20232022202120202019201820172016

113.4

124.8

90.1

102.4

82.4

72.1

62.3

55.0

52.6

56.6

45.7

49.2

39.3

37.4

34.6

32.7

$9.7T

average daily

value processed

4/7/24r1 3:00pm

24_JD_fortress balance_10

Our Fortress Balance Sheet

2005–2023



Cash, deposits with banks, and investment securities ($B)



Average loans/Cash, deposits with banks, and investment securities (%)



Liquid assets ($B)



Average loans/Liquid assets (%)

2023202220212020201920182017201620152014201320122011201020092008200720062005

90%

132%

136%

192%

152%

159%

350%

311%

387%

80%

106%

110%

118%

129%

115%

86%

70%

63%

77%

$804

$547

$510

$366

$450

$371

$137

$146

$106

$921

$745

$786

$768

$755

$860

$1,652

$1,447

$1,437

$1,430

2023202220212020201920182017201620152014201320122011201020092008200720062005

Tangible Common Equity (Average)

($ in trillions)

$124

$136

$149

$80

$56

$49

$63

$95

$111

$161

$170

$180

$185

$183

$187

$203

$230

$191

$204

10.1%

11.0%

10.7%

7.3%

7.0% 7.0%7.0%

8.8%

9.8%

10.2%

11.6%

12.2% 12.1%

12.0%

12.4%

15.0%

13.1%13.1%

13.2%

Tangible Common Equity (Average)

($ in trillions)



Tangible common equity (average) ($B)



CET1 (%)

9.0% CAGR

since 2005

Tangible Common Equity (Average)

($ in billions)

Liquid Assets

($ in billions)

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2 015 2 016 2017 2018 2019 2020 2021 2022 2023

Net income applicable to common

stockholders ($B)

$8.5 $14.4 $14.9 $4.7 $8.8 $15.8 $17.6 $19.9 $16.6 $20.1 $22.4 $22.6 $22.6 $30.7 $34.6 $27.4 $46.5 $35.9 $47.8

Capital returned to common

stockholders ($B)

$6.3 $5.0 $9.5 ($11.8) ($6.4) $1.1 $10.8 $4.5 $9.2 $9.6 $10.8 $14.4 $22.0 $27.9 $34.0 $16.3 $28.5 $13.2 $19.8

ROTCE (%) 15% 24% 22% 6% 10% 15% 15% 15% 11% 13% 13% 13% 12% 17% 19% 14% 23% 18% 21%

DRAFT 3/4/24 – TYPESET: 4/7/24r1 v. 24_JD_fortress balance_10

**FOOTNOTES –MOVED TO BACK PAGE

CAGR = Compound annual growth rate

CET1 = Common equity Tier 1

ROTCE = Return on tangible common equity

For footnoted information, refer to page 61 in this Annual Report.

4/10/24r1 3:45pm

Within this letter, I discuss the following:

INTRODUCTION

• Summary of our 2023 results and the principles that guide us

— Steadfast principles worth repeating (and one new one)

— Mapping our progress and milestones

• Celebrating the 20th anniversary of the Bank One/JPMorgan Chase merger

• Financial performance

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

• The critical impact of artiﬁcial intelligence

• Our journey to the cloud

• Acquiring First Republic Bank and its customers

• Navigating in a complex and potentially dangerous world

• Our extensive community outreach eorts, including diversity, equity and inclusion

— What we learned: A ﬁve-point action plan to move forward on the climate challenge

— Powering economic growth in Florida

• Giving the bank regulatory and supervisory process a serious review

• Protecting the essential role of market making (trading)

STAYING COMPETITIVE IN THE SHRINKING PUBLIC MARKETS

• The pressure of quarterly earnings compounded by bad accounting and bad decisions

• The hijacking of annual shareholder meetings

• The undue inﬂuence of proxy advisors

• The beneﬁts and risks of private credit

• A bank’s strength: Providing ﬂexible capital

MANAGEMENT LESSONS:

THINKING, DECIDING AND TAKING ACTION — DELIBERATELY AND WITH HEART

• Beneﬁting from the OODA loop

• Decision making and acting (have a process)

• The secret sauce of leadership (have a heart)

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD:

STRATEGY AND POLICY MATTER

• Coalescing the Western world — A uniquely American task

• Strengthening our position with a comprehensive, global economic security strategy

• Providing strong leadership globally and eective policymaking domestically

— Manager’s Journal: “A Politician’s Dream Is a Businessman’s Nightmare”

• Out of the labyrinth, with focus and resolve

— We should have more faith in the amazing power of our freedoms

— How we can help lift up our low-income citizens and mend America’s torn social fabric

Page 2

Page 5

Page 6

Page 7

Page 9

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Page 18

Page 19

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Page 26

Page 28

Page 30

Page 33

Page 36

Page 37

Page 38

Page 39

Page 40

Page 41

Page 42

Page 44

Page 45

Page 47

Page 50

Page 52

Page 55

Page 56

Page 57

Update on Speciﬁc Issues Facing

Our Company

Each year, I try to update you on some of the most

important issues facing our company. First and

foremost may well be the impact of artiﬁcial intel-

ligence (AI).

While we do not know the full eect or the precise

rate at which AI will change our business — or how

it will aect society at large — we are completely

convinced the consequences will be extraordinary

and possibly as transformational as some of the

major technological inventions of the past several

hundred years: Think the printing press, the steam

engine, electricity, computing and the Internet,

among others.

THE CRITICAL IMPACT OF ARTIFICIAL

INTELLIGENCE

Since the ﬁrm ﬁrst started using AI over a decade

ago, and its ﬁrst mention in my 2017 letter to

shareholders, we have grown our AI organization

materially. It now includes more than 2,000 AI/

machine learning (ML) experts and data scientists.

We continue to attract some of the best and

brightest in this space and have an exceptional

ﬁrmwide AI/ML and Research department with

deep expertise.

We have been actively using predictive AI and ML

for years — and now have over 400 use cases in

production in areas such as marketing, fraud and

risk — and they are increasingly driving real busi-

ness value across our businesses and functions.

We’re also exploring the potential that generative

AI (GenAI) can unlock across a range of domains,

most notably in software engineering, customer

service and operations, as well as in general

employee productivity. In the future, we envision

GenAI helping us reimagine entire business work-

ﬂows. We will continue to experiment with these

AI and ML capabilities and implement solutions in

a safe, responsible way.

While we are investing more money in our AI capa-

bilities, many of these projects pay for themselves.

Over time, we anticipate that our use of AI has the

potential to augment virtually every job, as well as

impact our workforce composition. It may reduce

certain job categories or roles, but it may create

others as well. As we have in the past, we will

aggressively retrain and redeploy our talent to

make sure we are taking care of our employees

if they are aected by this trend.

Finally, as a global leader across businesses and

regions, we have large amounts of extraordinarily

rich data that, together with AI, can fuel better

insights and help us improve how we manage risk

and serve our customers. In addition to making

sure our data is high quality and easily accessible,

we need to complete the migration of our analyti-

cal data estate to the public cloud. These new data

platforms oer high-performance compute power,

which will unlock our ability to use our data in

ways that are hard to contemplate today.

Recognizing the importance of AI to our

business, we created a new position called

Chief Data & Analytics Ocer that sits on our

Operating Committee.

Elevating this new role to the Operating Committee

level — reporting directly to Daniel Pinto and me —

reﬂects how critical this function will be going for-

ward and how seriously we expect AI to inﬂuence

our business. This will embed data and analytics

into our decision making at every level of the com-

pany. The primary focus is not just on the technical

aspects of AI but also on how all management can

— and should — use it. Each of our lines of business

has corresponding data and analytics roles so we

can share best practices, develop reusable solutions

that solve multiple business problems, and continu-

ously learn and improve as the future of AI unfolds.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

Clearly, AI comes with many risks, which need

to be rigorously managed.

We have a robust, well-established risk and control

framework that helps us proactively stay in front

of AI-related risks, particularly as the regulatory

landscape evolves. And we will, of course, continue

to work hard with our regulators, clients and sub-

ject matter experts to make sure we maintain the

highest ethical standards and are transparent in

how AI helps us make decisions; e.g., to counter

bias among other things.

You may already be aware that there are bad

actors using AI to try to inﬁltrate companies’ sys-

tems to steal money and intellectual property or

simply to cause disruption and damage. For our

part, we incorporate AI into our toolset to counter

these threats and proactively detect and mitigate

their eorts.

OUR JOURNEY TO THE CLOUD

Getting our technology to the cloud — whether the

public cloud or the private cloud — is essential to

fully maximize all of our capabilities, including the

power of our data. The cloud oers many beneﬁts:

1) it accelerates the speed of delivery of new ser-

vices; 2) it simultaneously reduces the cost of com-

pute power and enables, when needed, an extraor-

dinary amount of compute capability — called

burst computing; 3) it provides that compute capa-

bility across all of our data; and 4) it allows us to

be able to constantly and quickly adopt new tech-

nologies because updated cloud services are con-

tinually being added — more so in the public cloud,

where we beneﬁt from the innovation that all

cloud providers create, than in the private cloud,

where innovation is only our own.

Of course, we are learning a lot along the way.

For example, we know we should carefully pick

which applications and which data go to the public

cloud versus the private cloud because of the

expense, security and capabilities required. In

addition, it is critical that we eventually use multi-

ple clouds to avoid lock-in. And we intend to main-

tain our own expertise so that we’re never reliant

on the expertise of others even if that requires

additional money.

We invested approximately $2 billion to build four

new, modern, private cloud-based, highly reliable

and ecient data centers in the United States (we

have 32 data centers globally). To date, about 50%

of our applications run a large part of their pro-

cessing in the public or private cloud. Approxi-

mately 70% of our data is now running in the pub-

lic or private cloud. By the end of 2024, we aim to

have 70% of applications and 75% of data moved

to the public or private cloud. The new data cen-

ters are around 30% more ecient than our exist-

ing legacy data centers. Going to the public cloud

can provide 30% additional eciency if done cor-

rectly (eciency improves when your data and

applications have been modiﬁed, or “refactored,”

to enable new cloud services). We have been con-

stantly updating most of our global data centers,

and by the end of this year, we can start closing

some that are larger, older and less ecient.

ACQUIRING FIRST REPUBLIC BANK AND

ITS CUSTOMERS

The purchase of First Republic Bank was not some-

thing that we would have done just for ourselves.

But the regulators relied on us to step forward (we

worked hand in hand with the Federal Reserve, the

Federal Deposit Insurance Corporation (FDIC) and

the U.S. Treasury), and the purchase of First

Republic helped stabilize and strengthen the U.S.

ﬁnancial system in a time of crisis.

The acquisition of a major company entails a lot of

complexity. People tend to focus on the ﬁnancial

and economic outcomes, which is a reasonable

thing to do. And in the case of First Republic,

the numbers look rather good. We recorded an

accounting gain of $3 billion on the purchase, and

we told the world we expected to add more than

$500 million to earnings annually, which we now

believe will be closer to $2 billion. However, these

results mask some of the true costs. First, approxi-

mately one-third of the incremental earning was

simply deploying excess capital and liquidity, which

doesn’t require purchasing a $300 billion bank —

we simply could have bought $300 billion of

assets. Second, as soon as the deal was

announced, approximately 7,600 of our employees

went from working on tasks that would beneﬁt the

future of JPMorgan Chase to working on the

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

merger integration. Overall, the integration

involves eectively combining more than 165

systems (e.g., statement, deposit, accounting and

human resources) and consolidating policies, risk

reporting, and other various rules and procedures.

We hope to have most of the integration done by

the middle of 2024.

Fortunately, we were very familiar and comfort-

able with all of the assets we were acquiring from

First Republic. What we didn’t take on was First

Republic’s excessive interest rate exposure — one

of the reasons it failed — which we eectively

hedged within days of the acquisition.

Our people did a great job of respectfully manag-

ing this transition, knowing that circumstances

were particularly tough for our new colleagues,

whom we tried to welcome with open arms. We did

everything we could to redeploy individuals whose

jobs were lost because of the merger (we directly

hired over 5,000 people). Our approach has always

been to go into an acquisition knowing we can

learn things from other teams, and in this case,

we did: First Republic had done an outstanding job

serving high-net-worth clients and venture capital-

ists, and we are developing what is eectively a

new business for us following First Republic’s ser-

vicing model. We will serve these high-net-worth

clients through a single point of contact, supported

by a concierge service model, across our distribu-

tion channels — including more than 20 new

J.P. Morgan branded branches.

NAVIGATING IN A COMPLEX AND

POTENTIALLY DANGEROUS WORLD

In the policy section, we talk about how we may be

entering one of the most treacherous geopolitical

eras since World War II. And I have written in the

past about high levels of debt, ﬁscal stimulus,

ongoing deﬁcit spending and the unknown eects

of quantitative tightening (which I am more wor-

ried about than most) so I won’t repeat those

views here. However, the impacts of these geopo-

litical and economic forces are large and some-

what unprecedented; they may not be fully under-

stood until they have completely played out over

multiple years. In any case, JPMorgan Chase must

be prepared for the various potential impacts and

outcomes on our company and our people.

We remain wary of economic prognosticating.

While all companies essentially budget on a base

case forecast, we are very careful not to run our

business that way. Instead, we look at a range of

potential outcomes for which we need to be pre-

pared. Geopolitical and economic forces have an

unpredictable timetable — they may unfold over

months, or years, and are nearly impossible to put

into a one-year forecast. They also have an unpre-

dictable interplay: For example, the geopolitical

situation may end up having virtually no eect on

the world’s economy or it could potentially be its

determinative factor.

We have ongoing concerns about persistent

inﬂationary pressures and consider a wide

range of outcomes to manage interest rate

exposure and other business risks.

Many key economic indicators today continue

to be good and possibly improving, including

inﬂation. But when looking ahead to tomorrow,

conditions that will aect the future should be

considered. For example, there seems to be a large

number of persistent inﬂationary pressures, which

may likely continue. All of the following factors

appear to be inﬂationary: ongoing ﬁscal spending,

remilitarization of the world, restructuring of

global trade, capital needs of the new green econ-

omy, and possibly higher energy costs in the future

(even though there currently is an oversupply of

gas and plentiful spare capacity in oil) due to a lack

of needed investment in the energy infrastructure.

In the past, ﬁscal deﬁcits did not seem to be

closely related to inﬂation. In the 1970s and early

1980s, there was a general understanding that

inﬂation was driven by “guns and butter”; i.e.,

ﬁscal deﬁcits and the increase to the money

supply, both partially driven by the Vietnam War,

led to increased inﬂation, which went over 10%.

The deﬁcits today are even larger and occurring in

boom times — not as the result of a recession —

and they have been supported by quantitative

easing, which was never done before the great

ﬁnancial crisis. Quantitative easing is a form of

increasing the money supply (though it has many

osets). I remain more concerned about quantita-

tive easing than most, and its reversal, which has

never been done before at this scale.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

Equity values, by most measures, are at the high

end of the valuation range, and credit spreads are

extremely tight. These markets seem to be pricing

in at a 70% to 80% chance of a soft landing —

modest growth along with declining inﬂation and

interest rates. I believe the odds are a lot lower

than that. In the meantime, there seems to be an

enormous focus, too much so, on monthly inﬂation

data and modest changes to interest rates. But the

die may be cast — interest rates looking out a year

or two may be predetermined by all of the factors

I mentioned above. Small changes in interest rates

today may have less impact on inﬂation in the

future than many people believe.

Therefore, we are prepared for a very broad range

of interest rates, from 2% to 8% or even more,

with equally wide-ranging economic outcomes —

from strong economic growth with moderate inﬂa-

tion (in this case, higher interest rates would result

from higher demand for capital) to a recession

with inﬂation; i.e., stagﬂation. Economically, the

worst-case scenario would be stagﬂation, which

would not only come with higher interest rates but

also with higher credit losses, lower business

volumes and more dicult markets. Under these

many dierent scenarios, our company would

continue to perform at least okay. Importantly,

being prepared means we can continue to help our

clients no matter what the future portends.

The mini banking crisis of 2023 is over, but

beware of higher rates and recession — not

just for banks but for the whole economy.

When we purchased First Republic in May 2023

following the failure of two other regional banks,

Silicon Valley Bank (SVB) and Signature Bank, we

thought that the current banking crisis was over.

Only these three banks were osides in having

the toxic combination of extreme interest rate

exposure, large unrealized losses in the

held-to-maturity (HTM) portfolio and highly

concentrated deposits. Most of the other regional

banks did not have these problems. However, we

stipulated that the crisis was over provided that

interest rates didn’t go up dramatically and we

didn’t experience a serious recession. If long-end

rates go up over 6% and this increase is accompa-

nied by a recession, there will be plenty of stress —

not just in the banking system but with leveraged

companies and others. Remember, a simple 2

percentage point increase in rates essentially

reduced the value of most ﬁnancial assets by 20%,

and certain real estate assets, speciﬁcally oce

real estate, may be worth even less due to the

eects of recession and higher vacancies. Also

remember that credit spreads tend to widen,

sometimes dramatically, in a recession.

Finally, we should also consider that rates have

been extremely low for a long time — it’s hard to

know how many investors and companies are truly

prepared for a higher rate environment.

We seek to be engaged globally and carefully

manage complex countries and geopolitical

issues.

JPMorgan Chase does business in more than 100

countries, and we have people on the ground in

over 60 countries. In almost all those locations, we

do research on their economy, their markets and

their companies; we bank their government insti-

tutions and their companies; and we bank multina-

tional corporations, including the U.S. multina-

tional corporations within their borders. This is a

critical role — not only in helping those countries

grow and improve but also in expanding the global

economy.

Many of these countries are quite complex with dif-

ferent laws, customs and regulations. We are occa-

sionally asked why we bank certain companies and

even certain countries, particularly when countries

have some laws and customs that are counter to

many of the values held in the United States.

Here’s why:

• The U.S. government sets foreign policy. And

when it does, we salute. Wherever we do busi-

ness, we follow the law of the United States, as it

applies in that country (in addition to the laws of

the country itself), in all respects. Think of trade

rules, sanctions, anti-money laundering and the

Foreign Corrupt Practices Act, among others. By

and large, these things help improve those coun-

tries. In most cases, the U.S. government does

not want us to leave because it agrees, gener-

ally, that the engagement of American business

enhances our relationships with other countries

and helps those countries themselves.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

• Engagement makes the world a better place.

We all should want the world to continue to

improve. Isolation and lack of engagement do

not accomplish that goal. While we believe that

it makes sense for the United States to push for

constant improvement around the world — from

advocating for human rights to ﬁghting corrup-

tion — this is rarely accomplished through coer-

cion, and, in fact, is enhanced by engagement.

• We need to be prepared for emerging

challenges and position ourselves to under-

stand them. We created a new role — Head of

Asia Paciﬁc Policy and Strategic Competitiveness

— to focus speciﬁcally on key policy issues

critical to the ﬁrm’s (and, in fact, the country’s)

competitiveness, such as trade restrictions,

supply chains and infrastructure. We also cre-

ated a new strategic security forum to focus on

emerging and evolving risks, including trade

wars, pandemics, cybersecurity and actual

wars, to name just a few.

OUR EXTENSIVE COMMUNITY

OUTREACH EFFORTS, INCLUDING

DIVERSITY, EQUITY AND INCLUSION

JPMorgan Chase makes an extraordinary eort as

part of our “normal” day-to-day outreach to

engage with individual clients, small and midsized

businesses, large and multinational ﬁrms, govern-

ment ocials, regulators and the press in cities all

around the world. This dialogue is part of the nor-

mal course of business but it is also part of build-

ing trust and putting down roots in a community.

We believe that companies, and banks in particu-

lar, must earn the trust of the communities and

countries in which they operate. We believe — and

we are unashamed about this — that it is our obliga-

tion to help lift up the communities and countries in

which we do business. We believe that doing so

enhances business and the general economic

well-being of those communities and countries and

also enhances long-term shareholder value. JPMor-

gan Chase thrives when communities thrive.

This approach is integral to what we do, in great

scale, around the world — and it works. We are

quite clear that whether our eorts are inspired by

the goodness of our hearts (as philanthropy or

venture-type investing) or good business, we try

to measure the actual outcomes.

It’s also interesting to point out that many of our

eorts were spawned from our work around

Advancing Black Pathways, Military and Veterans

Aairs, and our work in Detroit. While we’ve

banked Detroit for more than 90 years, our $200

million investment in its economic recovery over

the last decade demonstrated that investing in

communities is a smart business strategy. We are

one of the largest banks in Detroit, from consumer

banking to investment banking, and it’s quite clear

that not only did our eorts help Detroit, but they

also helped us gain market share. The extent of

Detroit’s remarkable recovery was recently high-

lighted when Moody’s upgraded the city’s credit

rating to investment grade — an extraordinary

achievement just over 10 years after the city ﬁled

the largest municipal bankruptcy in U.S. history.

For JPMorgan Chase, Detroit was an incubator for

developing models that help us hone how we

deploy our business resources, philanthropic capi-

tal, skilled volunteerism, and low-cost loans and

equity investments, as well as how we identify top

talent to drive successful business and societal

improvements. I hope that, as shareholders, you

are proud of our focus on promoting opportunity

for all, both within and outside our organization,

which includes economic opportunity. Some of our

initiatives are listed below.

• Business Resource Groups. To deepen our cul-

ture of inclusion in the workplace, we have 10

Business Resource Groups (BRG) across the com-

pany to connect more than 160,000 participat-

ing employees around common interests, as well

as to foster networking and camaraderie.

Groups welcome anyone — allies and those with

shared anities alike. For example, some of our

largest BRGs are Access Ability (employees with

disabilities and caregivers), Adelante (Hispanic

and Latino employees), BOLD (Black employees),

NextGen (early career professionals), PRIDE

(LGBTQ+ employees) and Women on the Move.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

• Women on the Move. At JPMorgan Chase, they

sure are! Women represent 28% of our ﬁrm’s

senior leadership globally. In fact, our major

lines of business — CCB, AWM and CIB, which

would be among Fortune 1000 companies on

their own — are all run by women (one with a

co-head who is male). More than 10 years ago, a

handful of senior women at the company, on

their own, started this global, ﬁrmwide, inter-

nally focused organization called Women on the

Move. It was so successful that we expanded the

initiative beyond the company; it now empowers

clients and consumers, as well as women

employees and their allies, to build their

careers, grow their businesses and improve

their ﬁnancial health. The Women on the Move

BRG has more than 70,000 employees globally.

• Advancing Black Pathways. This comprehensive

program, which just reached the ﬁve-year mark,

focuses on strengthening the economic founda-

tion of Black communities because we know that

opportunity is not always created equally. The

program does so by, among other accomplish-

ments, helping to diversify our talent pipeline,

providing opportunities for Black individuals to

enter the workforce and gain valuable experi-

ence, and investing in the ﬁnancial success of

Black Americans through a focus on ﬁnancial

health, homeownership and entrepreneurship.

An important part of the program’s work is

achieved through our investment in Historically

Black Colleges and Universities (HBCU). We now

partner with 18 schools across the United States

to boost recruitment connections, expand

career pathways for Black students and other

students, and support their long-term develop-

ment and ﬁnancial health. As a measure of the

program’s success, in four years we have made

nearly 400 hires into summer and full-time

analyst and associate roles at the ﬁrm.

• Military and Veterans Aairs. This ﬁrmwide

eort sponsors recruitment, mentorship and

development programs to support the military

members and veterans working at JPMorgan

Chase. Back in 2011, we joined with 10 other com-

panies to launch the Veteran Jobs Mission (VJM),

whose membership has since grown to more than

300 companies representing various industries

across the United States and has hired over

900,000 veterans and military spouses. In 2023,

VJM announced the creation of its Advisory

Board, which is composed of 14 corporate lead-

ers, to provide strategic direction and oversight

of VJM as it continues to expand its commitment

to support economic opportunities for veterans

and military spouses, including its goal to hire 2

million veterans and 200,000 military spouses by

2030. JPMorgan Chase alone has hired in excess

of 18,000 veterans since 2011 and currently

employs more than 3,100 military spouses.

• Creating opportunity for people with disabili-

ties. The ﬁrm’s Oce of Disability Inclusion

continues to lead strategy and initiatives aimed

at advancing economic opportunity for people

with disabilities. In 2023, we joined lawmakers

and business leaders in Washington, D.C., to

show support for passage of the Supplemental

Security Income (SSI) Savings Penalty

Elimination Act. Modernizing the SSI program,

by updating asset limits for the ﬁrst time in

nearly 40 years, would allow millions of people

with disabilities who receive SSI beneﬁts the

opportunity to build their savings without put-

ting their essential beneﬁts at risk. We also

provided business coaching to more than 370

entrepreneurs with disabilities.

• Virtual call centers. When we sought to expand

our customer service specialists program across

the United States, we turned to Detroit, launch-

ing our ﬁrst virtual call center in 2022. Invest-

ments in Detroit’s workforce development

infrastructure helped us hire 90 virtual cus-

tomer service specialists for a program that

has outperformed many of our traditional call

centers around the world. Following this suc-

cess, we expanded our hiring eorts and this

virtual program to Baltimore to create new jobs

that jump-start careers. And now we’re evaluat-

ing the possibility of expanding even further.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

• Entrepreneurs of Color Fund. A critical chal-

lenge we have seen in so many communities is

that traditional lending standards render too

many entrepreneurs — particularly entrepre-

neurs of color and those serving these commu-

nities — ineligible for credit. In response, we

helped launch the Entrepreneurs of Color Fund

(EOCF) in Detroit, a lending program designed to

help aspiring small business owners gain access

to critical resources needed for growth that are

often not equitably available — capital, technical

assistance and mentorship, among others.

These challenges aren’t unique to Detroit so we

worked with community development ﬁnancial

institutions to replicate the EOCF program in

10 markets across the United States in 2023,

deploying more than 2,900 loans and $176

million in capital to underserved entrepreneurs

across the country.

• Senior business consultants. To help entrepre-

neurs and small businesses make the transition

from community lending to accessing capital

from traditional ﬁnancial institutions, we created

a new job — senior business consultant — to

provide support. Senior business consultants in

branches that focus on underserved communi-

ties oer coaching and help business owners

with everything from navigating access to credit

to managing cash ﬂow to generating eective

marketing. Since 2020, these consultants have

mentored more than 5,500 business owners,

helping them improve their operations, grow

revenue and network with others in the local

business community.

• AdvancingCities. The organizing principles that

deﬁne the business and community investments

we make and how we best achieve an overall

impact in local economies were heavily inﬂu-

enced by our experience in Detroit. Seeing

Detroit’s comeback begin to take shape several

years ago, we created AdvancingCities to repli-

cate this model for large-scale investments to

other cities around the world. From San Fran-

cisco to Paris to Greater Washington, D.C., we’ve

applied what we learned in Detroit to communi-

ties where conditions are opportune for success

and require deeper investments — where com-

munity, civic and business leaders have come

together to solve problems and get results.

• JPMorgan Chase Service Corps. Ten years ago,

we launched the JPMorgan Chase Service Corps

to strengthen the capacity-building of nonproﬁt

partners. We brought employees from around

the world to Detroit to assist with its recovery —

from creating a scoring model for a nonproﬁt to

helping prioritize neighborhoods for develop-

ment funding to devising an implementation

plan for an integrated talent management

system. Since that time, the Service Corps has

expanded, with more than 1,500 JPMorgan

Chase employees contributing 100,000 hours

to support over 300 nonproﬁts globally.

• Community Centers/Branches and Community

Managers. A local bank branch, especially in a

low-income neighborhood, can be successful

only when it ﬁts the community’s needs. That is

why over the last several years we have shifted

our approach to how we oer access to ﬁnancial

health education, as well as low-cost products

and services to help build wealth. Since 2019,

we have opened 16 Community Center branches,

often in areas with larger Black, Hispanic or

Latino populations, and have plans to open

three more by the end of 2024. These branches

have more space to host grassroots community

events, small business mentoring sessions and

ﬁnancial health seminars, which have been

well-attended — to date, over 400,000 people

have taken advantage of the ﬁnancial education

seminars. In each of these Community Center

branches, we hired a Community Manager (who

acts as a local ambassador) to build relation-

ships with community leaders, nonproﬁts and

small businesses. The Community Manager

concept and practice have become so successful

that we have also placed these managers in

many of our traditional branches in underserved

communities. We now have 149 Community

Managers throughout our branch network.

• Work skills development. Detroit showed us

how talent in communities is often overlooked.

We saw this in the early days of our investment

when we visited our partners at Focus: HOPE, a

training program designed to help Detroiters

develop skills for high-demand jobs. Quickly, it

became clear that the training and education

system in Detroit was disconnected from

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

employers and their talent needs. By investing

in programs like Focus: HOPE, we have been

able to help bridge local skills gaps by training

people for in-demand jobs in communities like

Dallas, Miami and Washington, D.C. Between

2019 and 2023, we supported more than 2 mil-

lion people through our extensive learning and

career programming around the world.

• Increasing our rural investment. We are proud

to be the only bank with branches in all 48 con-

tiguous states, which include many rural com-

munities. Nearly 17 million consumers living in

rural areas hold over $100 billion in deposits

with us and $175 billion in loans. We are also a

leading wholesale lender in these communities,

helping to fuel local economies through relation-

ships with local companies, governments, hospi-

tals and universities. Since 2019, we have made

material progress in extending our footprint to

reach more rural Americans, including expand-

ing our branch network into 13 new states with

large rural populations. Now we are raising the

bar. With our new strategy, we have a goal to

have a branch available to serve 50% of a state’s

population within an acceptable driving dis-

tance, including in heavily rural states such as

Alabama and Iowa. This focus is part of our

recently announced plan to build an additional

500 branches and hire 3,500 employees over

the next three years. Through this expansion,

we will partner across lines of business and our

Corporate Responsibility organization to help

advance inclusive economic growth and bring

the full force of the ﬁrm to America’s heartland.

We’ve nearly completed our ﬁve-year, $30

billion Racial Equity Commitment — it will now

become a permanent part of our business.

What began in 2020 as a ﬁve-year, $30 billion

commitment is now transforming into a consistent

business practice for our lines of business in

support of Black, Hispanic, Latino and other

underserved communities. By the end of 2023,

we reported over $30 billion in progress toward

our original goal. However, our focus is not on

how much money is deployed — but on long-term

impact and outcomes. And going forward, these

programs will be embedded in our business-

as-usual operating system.

• Aordable rental housing. Through our

Aordable Housing Preservation program, we

approved program funding to date of approxi-

mately $21 billion in loans to incentivize the

preservation of over 190,000 aordable housing

rental units across the United States. Addition-

ally, we ﬁnanced approximately $5 billion for the

construction and rehabilitation of aordable

rental housing.

• Homeownership. In 2023, we expanded our

$5,000 Chase Homebuyer Grant program to

include over 15,000 majority Black, Hispanic and

Latino communities — and in January 2024, we

increased our grant amount to $7,500 in select

markets. Since our grant program began in

2021, we have provided about 8,600 grants

totaling $43 million. We also have provided

home purchase and reﬁnance loans in 2023

worth over $4.6 billion for more than 14,000

Black, Hispanic and Latino households across

the economic spectrum.

• Small business. The Business Card Special

Purpose Credit Program, launched in January

2023, has provided over 10,900 cards, totaling

over $43 million in available credit lines to

underserved entrepreneurs and communities

across the United States.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

• Supplier diversity. In 2023, our ﬁrm spent

approximately $2.3 billion directly with diverse

suppliers — an increase of 10% over 2022. As a

part of our racial equity commitment, over $450

million was spent in 2023 with more than 190

Black-, Hispanic- and Latino-owned businesses.

• Minority depository institutions and commu-

nity development ﬁnancial institutions. To

date, we have invested more than $110 million in

equity in diverse ﬁnancial institutions and pro-

vided over $260 million in incremental ﬁnancing

to community development ﬁnancial institutions

to support communities that lack access to tradi-

tional ﬁnancing. JPMorgan Chase also helped

these institutions build their capacity so they

can provide a greater number of critical services

like mortgages and small business loans.

We’re thoughtfully continuing our diversity,

equity and inclusion eorts.

Of course, JPMorgan Chase will conform as the

laws evolve. We will scour our programs, our words

and our actions to make sure they comply.

That said, we think all the eorts mentioned

above will remain largely unchanged. And, in fact,

around the world, cities and communities where

we do business applaud these eorts. We also

believe our initiatives make us a more inclusive

company and lead to more innovation, smarter

decisions and better ﬁnancial results for us and

for the economy overall.

We are often asked in particular about “equity”

and what that word means. To us, it means equal

treatment, equal opportunity and equal access …

not equal outcomes. There is nothing wrong with

acknowledging and trying to bridge social and eco-

nomic gaps, whether they be around wealth or

health. We would like to provide a fair chance for

everyone to succeed — regardless of their back-

ground. And we want to make sure everyone who

works at our company feels welcome.

We want to articulate how we weigh in on

social issues and what it means for our

customers.

Before I comment about culture issues, I have a

confession to make: I am a full-throated, red-

blooded, patriotic, free-enterprise (properly regu-

lated, of course) and free-market capitalist. Our

company is frequently asked to take a position on

an issue, rule or legislation that might be consid-

ered “cultural.” When that happens, we take a

deep breath and study the matter. Many of the

laws in question have many speciﬁc requirements,

some of which you would agree with but not oth-

ers. But we are being asked to support the entire

law. In cases like these, we simply make our own

statement that reﬂects our educated view and val-

ues; however, we do not give our voice to others.

We believe in the values of democracy, including

freedom of speech and expression, and are

staunchly against discrimination and hate. We

have not turned away — and will not turn away —

customers because of their political or religious

aliations nor would we tell customers how they

should spend their money.

Our commitment to these ideals is also reﬂected in

our employees. The talent at our ﬁrm is a vibrant

mix of cultures, beliefs and backgrounds. We are,

of course, fully committed to freedom of speech.

There are things that you can say that would be

permitted under freedom of speech but would not

be allowed under our Code of Conduct. For exam-

ple, we do not allow intimidation, threats or highly

prejudicial behavior or speech. Our Code of Con-

duct clearly stipulates that certain statements and

behavior, while allowed under freedom of speech,

can lead to disciplinary action at our company —

from being reprimanded to being ﬁred.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

WHAT WE LEARNED: A FIVE-POINT ACTION PLAN TO MOVE FORWARD

ON THE CLIMATE CHALLENGE

In May 2023, we gathered with knowledgeable and inﬂuential

people from the energy industry writ large to the government

and ﬁnancial services arena in Scottsdale, Arizona, for an

action forum. The goal was to explore various aspects of the

climate challenge and try to devise eective solutions that

could help lead to meaningful progress. The climate challenge

is immense and complex. Addressing it requires more than

making simplistic statements and rules; rather, energy

systems and global supply chains need to be transformed

across virtually all industries. And there is also a deep need

for new research and development. Energy systems and

supply chains provide the foundation of the global economy

and must be treated with care.

At the same time, the opportunity here is immense. The

investment required to meet climate goals — estimated at over

$5 trillion annually — could generate economywide growth and

opportunity at a scale the world has not seen since the

Industrial Revolution.

The task for industry, policymakers and ﬁnance is to help

formulate solutions that support the transition to a low-carbon

economy, balancing aordable, reliable access to energy with

generating economic growth.

To ﬁnd a way forward, we sought input from diverse

stakeholders in pursuit of a North Star. In Scottsdale and in

discussions with clients across industries about what’s needed

to achieve a low-carbon economy, these ﬁve action steps and

reforms were top of mind:

• Supportive government policy and leadership to advance

the transition. Policy that promotes favorable economic

conditions to make the transition viable is a critical ﬁrst step

for clients. This includes government leadership via

mandates, incentives or subsidies to support jobs and

investment in the transition; actions on permitting and

interconnection reform; and regulatory clarity and

certainty, especially around long-term investments. As one

vital example, current grid infrastructure is insucient to

accommodate the growth in renewables.

• Public/private partnerships in scaling bankable projects.

Scaling investments needs to happen both for commercially

proven technologies (e.g., wind and solar) and for emerging

technologies (e.g., green hydrogen, sustainable aviation fuel

and carbon capture). Developing “bankable” clean energy

projects will require the application of smart ﬁnancial tools,

as well as further policy support. It will take public/private

partnerships and innovation to create catalytic forms of

capital that can step into these gaps, absorb ﬁrst-mover

risks and provide the necessary funding. The cost of capital

is too high for some companies — and public funds ought

to be deployed in a smart way that eectively attracts

private capital.

• Public education and engagement. Without question, clients

told us that public commitment to and investment in energy-

related infrastructure is one of the most important parts of

combating the climate crisis and running their businesses.

Supporting the buildout of energy-related infrastructure with

speed and scale is critical. Public acceptance of building and

advancing the infrastructure needed to meet climate goals is

at the heart of progress. While the energy transition is poised

to deliver beneﬁts to communities across the world, securing

acceptance and support to build clean energy infrastructure

at scale is challenging. Access to job-creating renewable

energy projects can help rural communities thrive by

advancing local economies. Ensuring public support and

social license to operate requires better engagement

strategies, including widespread stakeholder education about

the beneﬁts of these technologies for local communities.

• Communication about concrete successes. Across

industries, market participants need to do a better job of

celebrating and championing concrete successes and

tangible milestones. This includes highlighting success

stories around emerging technologies and the complex

nature of the carbon transition. Stakeholders also should

better convey the beneﬁts of clean energy — across all

technologies — to help combat misinformation and foster a

more informed dialogue.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

• Work skills training. Businesses depend on healthy, thriving

communities so the carbon transition needs to work for

everyone. This includes helping to ensure that workers are

trained in the skills for the future, such as through improved

engineering schools and job training programs. Work across

the entire supply chain is essential to moving at pace. As one

example, the U.S. Bureau of Labor Statistics estimates we will

need more than 70,000 additional electricians per year

through 2031; it is currently unclear how the market will

meet that demand. If the deployment of heat pumps and

electric vehicle chargers accelerates, demand for electricians

will be even higher. A concerted focus to train electricians

can help the United States meet some of its climate goals

while providing well-paying jobs that do not require a four-

year college degree. Also, broadly speaking, businesses are

in a better position to make investments with conﬁdence

when labor requirements across the value chain — from

design and manufacturing to installation — are satisﬁed.

We recently reconsidered certain memberships.

JPMorgan Chase recently exited Climate Action 100+ and the

Equator Principles. “Why?” we are asked. While we don’t

necessarily disagree with some of the principles many

organizations have, we make our own business decisions. We

think we have some of the best-in-class environmental, social

and risk standards because we have invested in our own

in-house experts and matured our own risk management

processes over the years. As a result, we are going to go our

own way and make our own independent decisions, gathering

the best learnings of experts in the ﬁeld, and, of course, we

will follow all legal requirements.

We are engaged but recognize our role: three more

important points.

First, everyone should understand that conquering the climate

problem needs proper government action, particularly around

taxes, permitting, grids, infrastructure building and proper

coordination of policies — we are not there yet. Second, there is

no known technology that can ﬁll the gap between our

“aspirations” and the current trajectory of the world. We hope

and believe that this will be found (for example, through carbon

capture, improved batteries, hydrogen or other measures). This

new technology will also require proper government research

and development funding, as the eort cannot be accomplished

by private enterprise alone. And third, we are going to use the

word “commitment” much more reservedly in the future,

clearly dierentiating between aspirations we are actively

striving toward and binding commitments.

For JPMorgan Chase to play the right role in tackling the

climate challenge, we have organized a special group around

the green economy and related infrastructure investment.

This group will coordinate and inform our work across all

established industry groups (from auto to real estate, energy,

agriculture and others) and includes hundreds of employees

devoted to these eorts.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

POWERING ECONOMIC GROWTH IN FLORIDA

From Tallahassee to Miami and from Tampa to Palm Bay,

JPMorgan Chase has been committed to Florida for more than

130 years and has enjoyed being the bank for all communities.

Each year, we contribute billions of dollars to the economy, hire

and train local residents, help to revitalize neighborhoods and

remove barriers to opportunity for Floridians across the state.

Our partnerships with businesses, nonproﬁts, government

entities and community organizations have enabled us to drive

sustainable impact and help them achieve their goals. We

couldn’t be more proud to help make opportunity happen

in Florida.

This year, we forged a relationship with Inter Miami CF, one of

the most recognizable sports teams in the world. Through this

partnership and the newly named Chase Stadium, we’re

continuing to contribute to South Florida and its local

communities. In Tampa, home to nearly 6,000 of our

employees, we’re triggering an additional $210 million in

economic activity and creating over 660 local construction jobs

through the renovation of our Highland Oaks campus and

downtown Tampa oce. We’re proud that one-third of all

Floridians do business with us through deposits, credit cards or

a mortgage. Through each of our investments across the state,

we’re ensuring that residents have the resources and tools they

need to thrive.

Our support to government, higher education, healthcare

and nonproﬁt organizations:

• We serve over 150 government, higher education, healthcare

and nonproﬁt clients throughout the state, and over the last

ﬁve years, we have provided more than $20.2 billion in credit

and capital to them.

• Our clients range from the city of Jacksonville to the Orlando

Utilities Commission, the University of South Florida, Broward

Health and the District School Board of Pasco County — a

decades-long client.

• We are the lead treasury bank for the Wounded Warrior

Project, one of the largest veteran service organizations in

the United States. Headquartered in Jacksonville, the

organization caters to wounded veterans and service

members who served in the military on or after 9/11.

Our support to investment and middle-market banking

clients:

• Over the last ﬁve years, we have provided in excess of $318

billion in credit and capital to local clients, such as utility,

technology and tourism companies.

• We have more than 12,500 large and midsized clients across

the state.

Our support to local ﬁnancial ﬁrms:

• Over the last ﬁve years, we have provided more than $24

billion in credit and capital for ﬁnancial institutions, such as

local banks, insurance companies, asset managers and

securities ﬁrms.

• We bank over 50 of Florida’s regional, midsized and

community banks, helping them play an essential role

in maintaining the state’s economy and serve local

communities.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

Our support to small business:

• At the end of 2023, balances for loans extended to Florida’s

small businesses totaled more than $1.2 billion — funds being

used to help those businesses scale and grow, contribute to

the economy and create local jobs.

• Across the state, we have over 654,000 small business

customers.

• In 2023, our bankers and senior business consultants spent

more than 375,000 hours advising and supporting Florida

business owners.

Our support to consumer banking needs:

• We operate 1,445 ATMs and 410 branches across the state.

• In 2023, we supported more than 6.1 million customers with

mortgages, auto loans and savings, checking and credit card

accounts, giving JPMorgan Chase one of the largest

consumer banking market shares in the state.

• We managed more than $70 billion in investment and annuity

assets for local clients.

Our business and community investments:

• Over the last ﬁve years, we have committed nearly $65

million in philanthropic support, including:

— $3 million to The Miami Foundation’s Resilient 305:

Building Prosperity Collaborative to increase access to

quality jobs and develop small businesses through training,

investments and capacity-building.

— $1.6 million to the Community Justice Project, which

empowers community-based legal advocates to help delay

displacement and improve conditions for housing stability

for renters across nine Florida counties.

• In 2022, we committed $10 million over ﬁve years to Tech

Equity Miami to advance equal access to tech skills, careers

and education, including:

— A $1 million investment to Florida Memorial University,

South Florida’s only HBCU, to help traditionally

underresourced students pursue a career in technology.

Our support as a local employer:

• We employ more than 14,000 residents throughout the state,

including nearly 1,900 veterans and over 660 people with a

criminal background who deserve a second chance.

• In Florida, the average salary of our employees is more than

$87,000 (plus a starting comprehensive annual beneﬁts

package worth nearly $17,600) compared with the statewide

per capita income of nearly $40,300.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

GIVING THE BANK REGULATORY AND

SUPERVISORY PROCESS A SERIOUS

REVIEW

The Dodd-Frank Wall Street Reform and Consumer

Protection Act (Dodd-Frank) was ﬁnished 14 years

ago, and we believe it accomplished a lot of good

things. But it’s been quite a while since then, and

we’re still debating some very basic issues. It’s

time to take a serious, hard, honest look at what

has been done and what can be improved.

It’s good to remember that the United States has

the best ﬁnancial system in the world, with diversi-

ﬁed, deep and experienced institutions, from

banks, pension plans, hedge funds and private

equity to individual investors. It has healthy public

and private markets, transparency, rule of law and

deep research. The best banking system in the

world is a critical part of this, and, integrated with

the overall ﬁnancial system, is foundational to the

proper allocation of capital, innovation and the

fueling of America’s growth engine.

This is not about JPMorgan Chase — we believe we

can manage through whatever is thrown our way.

This is about the impact on all parts of the system

— from smaller banks to larger regional banks that

may not have the resources to handle all of these

regulatory requirements. It’s also about the eect

on the ﬁnancial markets and the economy from the

rapidly growing shadow banking system, as well as

the ultimate impact on the customers, clients and

communities we serve. This is about what’s right

for the system.

The banking and ﬁnancial system is

innovative, dynamic and constantly changing.

The banking system is not static: There are startup

banks, mergers, successful upstarts and ﬁntech

banks, and even Apple, which eectively acts as a

bank — it holds money, moves money, lends money

and so on. Nonbanks are competing with tradi-

tional banks, and, in general, this dynamism and

churn are good for innovation and invention — with

success and failure simply part of the robust pro-

cess. Innovation runs across payments systems,

budgeting, digital access, product extensions, risk

and fraud prevention, and other services. Dierent

institutions play dierent roles, and, importantly,

small banks and big banks serve completely dier-

ent strategic functions. Large banks bank multina-

tional corporations around the world, make

healthy markets, and wield technology and a prod-

uct set that are the best in the world. A small bank

simply cannot bank these same multinational gov-

ernments and safely move the amount of money

and securities that large banks do. Regional and

community banks have exceptional local knowl-

edge and presence and are critical in serving

thousands of towns and certain geographies.

It is also important to recognize that the banking

system as we know it is shrinking relative to pri-

vate markets and ﬁntech, which are growing and

becoming increasingly competitive. And remember

that many of these new players do not have the

same transparency or need to abide by the exten-

sive rules and regulations as traditional banks,

even if they oer similar products — this often

gives them signiﬁcant advantage.

To deal with this ﬂuid environment, banks of all

sizes develop their own strategies, whether to

specialize, expand geographically or embark on

mergers and acquisitions. There are certain banking

services where economies of scale are a competitive

advantage, but not all banks need to become bigger

to gain this beneﬁt (there are many highly success-

ful banks that are smaller). What is clear is that

banks should be allowed to pursue their individual

strategies, including mergers and acquisitions, as

they see ﬁt. Overall, this process should be allowed

to happen — it’s part of the natural and healthy

course of capitalism — and it can be done without

harming the American taxpayer or economy.

While we all want a strong banking and ﬁnancial

system, we should step back and assess how all the

regulatory steps we have taken measure up against

the goals we all share. Since Dodd-Frank was signed

into law in 2010, thousands of rules and reporting

requirements written by 10+ dierent regulatory

bodies in the United States alone have been added.

And it would probably be an understatement to say

that some are duplicative, inconsistent, procyclical,

contradictory, extremely costly, and unnecessarily

painful for both banks and regulators. Many of the

rules have unintended consequences that are not

desirable and have negative impacts, such as

increasing the cost of credit for consumers (hurting

lower-income Americans the most).

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

The whole process, including the Basel III

endgame, could be much more productive,

streamlined, economical, ecient and safe.

Both regulators and banks should want the same

thing — a healthy banking system, serving its cli-

ents and striving for continuous improvement.

We all should also want the enormous beneﬁts that

would come from good collaboration between reg-

ulators and bank management teams and boards.

Over time, these relationships have deteriorated,

and, again, are increasingly less constructive.

There is little real collaboration between practi-

tioners — the banks — and regulators, who gener-

ally have not been practitioners in business. While

we acknowledge the dedication of regulators who

work with banks on a daily basis, management

teams across the industry are putting in

a disproportionate amount of time addressing

requests for extra details, documentation and

processes that extend far beyond the actual rules

— and distract both regulators and management

from more critical work. We should be more

focused on the truly important risks for the safety

of the system. And unfortunately, without collabo-

ration and sucient analysis, it is hard to be conﬁ-

dent that regulation will accomplish desired out-

comes without undesirable consequences. Instead

of constantly improving the system, we may be

making it worse. A few additional points:

• The Basel III endgame disadvantages

American banks. The Basel III endgame has

been 10 years in the making, and it still has not

been completed. In my view, many of the rules

are ﬂawed and poorly calibrated. If the Basel III

endgame were implemented in its current form,

it would hamper American banks: As proposed,

it would increase our ﬁrm’s required capital by

25%, making our requirement 30% higher than

it would be under the equivalent European

Union proposal. That means for every loan and

asset ﬁnanced in the United States by a major

American bank, that bank would have to hold

30% more capital than any international com-

petitor. The proposed regulations would also

damage market making (see the following sec-

tion). There are many other ﬂaws but suce it to

say that much of the work being done today to

analyze the eects should have been done

before the proposed rulemaking.

One of the single most important lessons from

the great ﬁnancial crisis is that there is

enormous value to having a bank that is

well-managed and has diverse revenue sources.

Yet regulation since then both punishes

consolidation and diversiﬁcation — and punishes

performance — through many features of the

GSIB surcharge.

• Built over many years, the framework is now

full of duplication. The following is only a par-

tial list: American gold-plating and conceptual

inconsistencies among Comprehensive Capital

Analysis and Review (CCAR), recovery and reso-

lution plans, liquidity requirements, global sys-

temically important bank (GSIB) requirements,

and safety and soundness principles. The many

overlapping rules contribute to the bureaucracy

that generates an extraordinary amount of

make-work (an 80,000-page CCAR and shock-

ingly another, coincidentally, 80,000-page

recovery and resolution plan).

• The new rules do virtually nothing to ﬁx what

caused the failure of SVB and First Republic.

For example, they don’t improve certain liquidity

requirements, limit HTM accounting or reduce

allowable interest rate exposure.

• The current regulatory approach to liquidity

might simply run counter to the stated intent.

Regulations should recognize the value and

importance of lending and borrowing against

good collateral and using central bank

resources, such as the discount window.

Adhering to current liquidity requirements per-

manently ties up good liquidity in a way that

makes the system more fragile and more risky.

• It is not clear what the full intent of the Basel

III endgame was — it will have unintended con-

sequences. Without real analysis of expected

outcomes, additional regulation will likely

reduce the number of banks oering certain

services and increase costs for all market partic-

ipants and activity, including loans, market

making and hedging (by farmers, airlines and

countries, among others). And new rules might

even increase consolidation as companies race

to achieve economies of scale in certain prod-

ucts and services.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

Unfortunately, some recent regulations are ending

up in court. You can imagine that no one wants to

sue their regulators. Banks would not sue if they did

not think they were right — or if they thought they

had any other recourse — which they eectively do

not. This is deﬁnitely not what anyone should want.

A more constructive relationship with regulators

would reduce confusion and uncertainty and would

lead to better outcomes for banks, their sharehold-

ers, and their clients, customers and communities.

Collaboration between banks and regulators

could improve the use of resources and create

better outcomes.

True collaboration could dramatically improve the

banking system. For example:

• Redirect enormous resources from things that

don’t matter to things that do. As mentioned, it

takes 80,000 pages to describe a CCAR test and

80,000 pages to detail recovery and resolution.

The talent and resources at the banks and

regulators could be better used elsewhere.

Such overload is distracting and takes your eye

o the ball on real, emerging risks, including

China, trade, payment systems and cybersecu-

rity, among others.

• Reduce bureaucratic processes that provoke a

tendency to herd mentality. For example, CCAR

is just a point-in-time stress test, and it can lull

you into a false sense of security — for refer-

ence, we do more than 100 stress tests each

week. On interest rate exposure, focusing on

the documentation of details may stop you from

thinking about big interest rate exposure.

Sometimes analyzing “what ifs” and fat tail risks

is better than excessive and rigid models and

documentations.

• Examine risks outside the regulatory system

that are rarely analyzed and largely unad-

dressed. These risks include data and privacy,

as well as consumer banking and payment sys-

tems, which are growing fast in the unregulated

market. In addition, there are potential risks

from private credit markets (which I talk about

later in the next section).

• Let’s imagine what’s possible with real collabo-

ration. Working together, we can improve how

the FDIC manages failing institutions, how to limit

contagion and restore conﬁdence to depositors,

how liquidity requirements can create more ﬂexi-

ble funding for banks under stress, how the bank-

ing and Federal Reserve’s payment system can

become more interoperable, how clearinghouse

risk can be reduced, how stress tests can protect

the system from a wider variety of outcomes,

how costs and therefore consumer costs can be

reduced (not increased), how anti-money laun-

dering requirements can be simpliﬁed and

improved at the same time, and how ﬁnancial

products can be brought to the unbanked.

We can ﬁx the housing and mortgage markets.

For example, mortgage regulations around orig-

ination, servicing and securitization could be

simpliﬁed, without increasing risk, in a way that

would reduce the average mortgage by 70 or 80

basis points. The Urban Institute estimates that

a reduction like this would increase mortgage

originations by 1 million per year and help

lower-income households, in particular, buy

their ﬁrst home, thereby starting them on the

best way to build household net worth.

There are many more things that can be improved

— and we really should start working on them.

We need a detailed review and probably a

complete revamp.

I know this might be wishful thinking, but now

would be a good time to step back and have a thor-

ough and candid review of the thousands of new

rules passed since Dodd-Frank. After this review, we

should ask what is it that we really want: Do we

want to try to eliminate the possibility of bank runs?

Do we want to change and create liquidity rules that

would essentially back most uninsured deposits? Do

we want the mortgage business and leveraged lend-

ing business to be inside or outside the banking sys-

tem? Do we want products that are inside and out-

side the banking system to be regulated the same

way? Do we want to reasonably give smaller banks a

leg up in purchasing a failing bank? And while Dodd-

Frank did some good things, shouldn’t we take a

look at the huge overlapping jurisdictions of various

regulators? This overlap creates diculties, not only

for banks, but for the regulators, too. Any and all of

this is achievable, and, I believe, could be accom-

plished with simpler rules and guidelines and with-

out stiﬂing our critical banking system.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

PROTECTING THE ESSENTIAL ROLE OF

MARKET MAKING (TRADING)

Before we discuss market making and ﬁnancial

markets, readers should understand that market

making occurs in almost all businesses. There are

healthy markets in farm animals, foreign prod-

ucts, commodities, energy, logistics, healthcare

and so on. Healthy markets increase customer

choice and reduce cost. They almost always

involve holding inventory and taking some risk,

which is simply a part of the process. America’s

ﬁnancial markets are the biggest in the world —

U.S. public debt and equity markets total $137

trillion, constituting the biggest “market” in the

world, and are larger than America’s gross

domestic product (GDP) of $27 trillion.

Market participants are not “Wall Street.” They are

large and small, mainly sophisticated, global inves-

tors (pension plans, mutual funds, governments

and individuals) representing retirees, veterans,

individuals, unions, federal workers and others.

They all beneﬁt from our ecient, low-cost and

transparent markets.

Some regulators seem to think that market making

is a speculative, hedge fund-like activity — and this

thinking is what might be leading them to con-

stantly increase capital requirements. The pro-

posed capital rules could fundamentally alter

market-making activities that are critical to a

thriving economy, particularly in dicult markets

when market making is even more important.

The new rules would raise capital requirements

by 50% for major banks — which could undermine

market stability, make banking services costlier

and less accessible, and push even more activity

to a less regulated banking system.

Our ﬁnancial system and markets are the best

in the world and beneﬁt ALL participants;

exceptionally good market making in the

secondary market makes our primary markets

the best in the world.

We should recognize that the United States has the

biggest, deepest and most liquid capital markets in

the world. For these markets to function, it is

critical for transparency and liquidity to be in the

secondary market. Market making provides this,

promoting the ﬂow of capital to real economy

investments and supporting all sectors of the

economy, including companies, state and local

governments, universities, hospitals, pension plans

and overall job creation. Without market making in

the secondary market, it would be extremely di-

cult for companies to raise capital through the

primary market — equity and debt oerings —

which have totaled approximately $3.6 trillion on

average over the past few years. The incredible

strength of these markets enables companies of

all sizes to grow and expand especially during times

of volatility and stress. It also enables consumers to

access cheaper credit and governments (local, state

and federal) to reduce their borrowing costs.

It takes enormous resources to properly

support the Markets business.

JPMorgan Chase spends $700 million per year in

extensive research coverage of nearly 5,200

companies across 83 countries. This massive eort

continuously educates investors and decision

makers around the world and often leads to

improved governance and management. It also

critically complements the ﬁrm’s market-making

activities and further promotes transparency,

enabling investors to make thoughtful choices

around investing in capital markets.

I would also like our shareholders to know that

our market making is backed by approximately

$7 billion in support expenses, including over

$2 billion in technology spend alone each year.

This investment allows us to maintain global

trading systems and constantly improve upon risk

management and eciency.

JPMorgan Chase deploys approximately $70 billion

in capital to maintain our Markets franchise. This

capital supports $500 billion in securities inven-

tory (largely hedged) — and this inventory allows

us to buy and sell $2 trillion (notional) in securities

daily for our clients.

Market making entails risk but is not

particularly speculative.

The main objective of market makers is to continu-

ously quote prices and diligently manage an inven-

tory to transact at those prices, which includes

assuming certain risks to support heavy volumes

and orderly trading. Market makers have a moral

obligation to try to make markets in good times

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

and in bad. Part of our brand promise is to stand

ready as the willing buyer and seller. In this, we

have never failed. In addition, in most cases

regarding government debt, where we serve as a

government securities dealer, we are legally obli-

gated to make markets. This constant visibility into

prices provided by market makers fosters investor

conﬁdence, keeps fees low and promotes economic

growth by attracting more investors.

Many large market participants — for example,

hedge funds and high-frequency traders, among

others — have no obligation to make markets. In

fact, many of these market participants often “step

out” of the markets and dramatically reduce liquid-

ity speciﬁcally when market conditions are dicult.

Market making is not particularly speculative since

market makers generally hedge their positions, as

you will see from some real life examples of the

economics and risks. We earn revenue of approxi-

mately $100 million on a typical day. In the aver-

age year, the total is nearly $30 billion. On our

$2 trillion in notional daily trading, this amounts to

only one hundredth of a cent charged to the inves-

tor for these services — an extraordinarily low cost

compared with any other market in the world.

Now let’s take a look at the actual risk and results

versus the hypothetical risk and results. The hypo-

thetical global market shock of the CCAR stress

test has us losing $18 billion in a single day and

never recovering any of it. Let’s compare that to

actual losses under real, actual market stress.

Now consider these historical data points: First,

over the last 10 years, the ﬁrm’s market-making

business has never had a quarterly loss and has

lost money on only 30 trading days. These loss days

represent only 1% of total trading days, and the

average loss on those days was $90 million. Second,

when markets completely collapsed during the

COVID-19 pandemic (from March 2 through March

31, 2020, the stock market fell 16%, and bond

spreads gapped out dramatically), J.P. Morgan’s

market-making activities made money every day

prior to the Federal Reserve’s major interventions,

which stabilized the markets. During that entire

month, we lost money on only two days but made

$2.5 billion in Markets revenue for the month. And

third, in the worst quarter ever in the markets fol-

lowing the 2008 failure of Lehman Brothers, we lost

$1.7 billion, but we made $5.6 billion in Markets rev-

enue for the full year. The ﬁrm as a whole did not

lose money in any quarter that year. In 2009, there

was a complete recovery in Markets, and we made

$22 billion in Markets revenue.

You can see that our actual performance under

extreme stress isn’t even close to the hypothetical

losses of the stress test.

Another major fallacy is that derivatives are

objects of ﬁnancial destruction. In reality, deriva-

tives are an essential part of managing ﬁnancial

risk and are used by investors, corporations, farm-

ers, businesses, countries, governments and oth-

ers to manage their risks. And more than 85% of

derivatives are fairly basic forms of foreign

exchange or interest rate swaps.

One last fallacy is that the repo markets are all

about speculation. While it’s true that repo is used

by certain investors to leverage up their positions,

about 75% of repo is essential to normal money

market functioning, i.e., is done by broker-dealers

ﬁnancing their actual inventory positions, money

market funds investing their cash backed by highly

rated collateral and clients hedging their positions.

Market makers add conﬁdence, liquidity and

transparency to U.S. capital markets — market

making helps stabilize markets and can reduce

volatility.

In addition, more liquidity, not less liquidity, will be

needed to maintain market stability. Large banks

keep an inventory of securities they can deploy in

times of stress to help soothe markets; however,

with the implementation of new regulations, banks

now hold 70% as much inventory in securities as

they did before the 2008 ﬁnancial crisis, while the

total size of the market has almost tripled. Higher

capital requirements will accelerate this trend

even further, impacting banks’ ability to deliver

support to clients and markets in times when it is

needed the most.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

Washington’s Basel III endgame proposal

damages market making, hurts Americans

and drives activity to less transparent, less

regulated markets.

If this proposal is enacted as drafted:

• Everyday consumer goods could be impacted.

Households contending with inﬂation could also

feel the eects of higher capital requirements

on market-making activities when they shop.

From beverage companies that need to manage

aluminum costs to farms that need to protect

against environmental risks, if the cost of hedg-

ing those risks increases, it could be reﬂected in

what consumers pay for everything from a can

of soda to meat products.

• Mortgages and small business loans will be

more expensive. Consumers seeking a mort-

gage — including ﬁrst-time homebuyers and his-

torically underserved, low- to moderate-income

borrowers with smaller down payments — will

face higher interest rates or will have a tougher

time accessing one. This will occur not only

because the cost of originating and holding

these loans is higher but also because the cost

of securitizing them will rise for banks, non-

banks and government agencies. Not only that,

but the proposal will likely lead to reductions in

the size of unfunded credit card lines, which will

put pressure on FICO scores and thereby make it

more dicult for some people to access other

forms of retail credit such as mortgages. Again,

this will have the greatest impact on low- to

moderate-income borrowers who rely most

heavily on credit cards for day-to-day spending

and to build their credit history. It could even be

argued that existing regulations go too far and

that there is an opportunity to help underserved

communities by dialing down regulations that

lead to higher borrowing costs. This should be

studied and the pros and cons analyzed. The

same can be said for small business loans, which

will become more expensive and less accessible.

• Saving for retirement or college will be harder.

The cost of products that families count on to

save for retirement or college will go up as a

result of this proposal. Asset managers, money

market funds and pension funds all buy, sell

and safekeep securities and other ﬁnancial

instruments for American investors. Under the

proposed rules, the cost of banking products

used on behalf of clients each day — including

brokerage, advisory, clearing and custody

services — will go up and feed through to

customers. That will lead to lower returns on

retirement accounts, college funds and other

long-term savings.

• Government infrastructure projects and cor-

porate development will become more expen-

sive. Federal, state and local governments, as

well as corporations and other institutions, rely

on large banks for access to U.S. capital markets

to fund development. If accessing capital mar-

kets becomes more expensive, it will have a rip-

ple eect on the hiring of American workers,

investment in research and development, and

funding to build hospitals, roads and bridges,

including the planned infrastructure projects

from the Inﬂation Reduction Act (IRA).

More market activity will move to unregulated

institutions, out of sight from regulators and with-

out the same level of consumer protections that

Americans expect from their banks. Other market

participants that don’t have holistic client relation-

ships are less likely to provide liquidity to help

stabilize markets.

In volatile times, banks have been able to interme-

diate to help their clients and to work with the reg-

ulators. With new regulations, they may be less

able to do so. There have been several times in the

past few years where banks had ample liquidity

and capital but were unable to rapidly increase

their intermediation in the markets due to very

rigid liquidity and capital requirements. Finally,

the proposed rules increase the chance that the

Federal Reserve will have to step in again — and

this is not something they should want to do on a

regular basis but only in an extreme emergency.

UPDATE ON SPECIFIC ISSUES FACING OUR COMPANY

Staying Competitive in the

Shrinking Public Markets

In previous letters, I have described the diminish-

ing role of public companies in the American ﬁnan-

cial system. From their peak in 1996 at 7,300,

U.S. public companies now total 4,300 — the total

should have grown dramatically, not shrunk.

Meanwhile, the number of private U.S. companies

backed by private equity ﬁrms — which does not

include the rising number of companies owned by

sovereign wealth funds and family oces — has

grown from 1,900 to 11,200 over the last two

decades. This trend is serious and may very well

increase with more regulation and litigation

coming. Along with a frank assessment of the

regulation landscape, we really need to consider:

Is this the outcome we want?

There are good reasons for private markets, and

some good outcomes result from them. For exam-

ple, companies can stay private longer if they wish

and raise more and dierent types of capital with-

out going to the public markets. However, taking a

wider view, I fear we may be driving companies

from the public markets. The reasons are complex

and may include factors such as intensiﬁed report-

ing requirements (including investors’ growing

needs for environmental, social and governance

information), higher litigation expenses, costly

regulations, cookie-cutter board governance,

shareholder activism, less compensation ﬂexibility,

less capital ﬂexibility, heightened public scrutiny

and the relentless pressure of quarterly earnings.

Along with the universal proxy — which makes it

easier to put poorly qualiﬁed directors on a board

— the pressures to retreat from the public market

are mounting. In addition, corporate governance

principles are becoming more and more templated

and formulaic, a negative trend. For example,

proxy advisors may automatically judge directors

unfavorably if they have a long tenure on the

board, without a fair assessment of their actual

contributions or experience. Another example is

the constant battle by some proxy advisors who try

to split the chairman and CEO role when there is no

evidence this makes a company better o — in fact,

today, lead directors generally hold most of the

authorities previously assigned to the chairman.

The governance of major corporations is evolving

away from guidance by governance principles that

focus on a company’s relationship to long-term

economic value toward a bureaucratic compliance

exercise. Good corporate governance is critical, and

a little common sense would go a long way.

THE PRESSURE OF QUARTERLY

EARNINGS COMPOUNDED BY BAD

ACCOUNTING AND BAD DECISIONS

There is something very positive about detailed

and disciplined quarterly ﬁnancial and operating

reporting. But company CEOs and boards of direc-

tors should resist the undue pressure of quarterly

earnings, and it is clearly somewhat their fault

when they don’t. However, it is naïve to think that

the pressure doesn’t exist because companies that

“disappoint” can face extensive criticism, particu-

larly those with a new or young CEO. It’s possible

for companies to take short-term actions to

increase earnings, such as selling more product

cheaply at the end of a quarter, cutting certain

investments that may be terriﬁc but can show

accounting losses in the ﬁrst year or two, or just

deploying more aggressive accounting methods at

times. Once shortcuts like this begin, people all

over the company understand that it is okay to

“stretch” to meet your numbers. This could put you

on a treadmill to ruin. Obviously, a company should

not resort to these tactics, but it does happen in

the public markets — and it’s probably less likely in

the private markets.

THE HIJACKING OF ANNUAL

SHAREHOLDER MEETINGS

One of the reasons it is less desirable to be a public

company is because of the spiraling frivolousness of

the annual shareholder meeting, which has

devolved into mostly a showcase of grandstanding

and competing special interest groups. We should

STAYING COMPETITIVE IN THE SHRINKING PUBLIC MARKETS

treat shareholders with tremendous respect — and

we do. At JPMorgan Chase, we are constantly talking

with our investors — our directors, our lead director

and our corporate governance experts visit most of

our major investors whether they be direct owners

or asset managers who manage the money for oth-

ers. Meeting with your shareholders and investors is

critical, but the annual shareholder meeting itself

has become ineective. We should try to come up

with a far more constructive alternative.

THE UNDUE INFLUENCE OF PROXY

ADVISORS

There are essentially two main proxy advisors in

the United States. One is called Institutional

Shareholder Services (ISS), and the second is

called Glass Lewis. These proxy advisors started

out providing reams of data from companies to

help their institutional investor clients vote on

proxy matters (information on executive compen-

sation, stock returns, detail on directors, policies

and so on). However, they soon also began to pro-

vide advice on how shareholders should vote on

proxy matters. And, in fact, institutional investors

generally execute their voting on an ISS or Glass

Lewis platform, which often includes a clear state-

ment of the advisory service’s position.

I should also point out, because it may be relevant,

that ISS is owned by Deutsche Boerse, a German

company, and Glass Lewis is owned by Peloton

Capital, a Canadian private equity ﬁrm. I question

whether American corporate governance should be

determined by for-proﬁt international institutions

that may have their own strong feelings about what

constitutes good corporate governance.

While asset managers and institutional

investors have a ﬁduciary responsibility to

make their own decisions, it is increasingly

clear that proxy advisors have undue

inﬂuence.

Asset managers (who manage money on behalf of

others) and institutional investors (e.g., pension

plans and endowments) may rely on a variety of

information sources to support their valuation

decision-making process. While data and recom-

mendations may form pieces of the information

mosaic, their votes should ultimately be based on

an independent application of their own voting

guidelines and policies. To the extent they use rec-

ommendations from proxy advisors in their deci-

sion-making processes, they should disclose that

they do so and should be satisﬁed that the infor-

mation upon which they are relying is accurate and

relevant. However, many companies would argue

that this information is frequently not balanced,

not representative of the full view and not accu-

rate. In addition, companies complain that they

often cannot get the data corrected, and, there-

fore, a vote may go uncorrected.

Almost all asset managers receive proxy advisor

data and recommendations; while some asset man-

agers vote completely independently of this infor-

mation, the majority do not. Most asset managers

have formed corporate governance or stewardship

committees that are responsible for their voting,

and these committee positions are often held not by

portfolio managers and research analysts (i.e., the

people buying and analyzing the individual securi-

ties) but by stewardship experts. While it is good to

have stewardship experts, the reality is that many

of these committees default large portions of what

they do to proxy advisors and, more troubling, make

it harder for actual portfolio managers to override

this decision making.

Some have argued that it’s too hard and too expen-

sive to review the large number of proxies and proxy

proposals — this is both lazy and wrong. If issues are

important to a company, they should be important

to the shareholder — for the most part, only a hand-

ful of proposals are important to companies.

We are making enhancements to J.P. Morgan

Asset Management’s proxy voting processes to

amplify the role of portfolio managers and to

address the perception of asset managers’

reliance on third-party advisor voting

recommendations.

Enhancements to the ﬁrm’s internal proxy voting

process will include:

STAYING COMPETITIVE IN THE SHRINKING PUBLIC MARKETS

• More portfolio manager participation in proxy

committee decision making. The ﬁrm has sig-

niﬁcantly expanded the representation of port-

folio managers on its North American Proxy

Committee in an eort to increase the diversity

of viewpoints represented on the committee. As

part of this change, and in recognition that port-

folio managers, as ﬁduciaries, may dier in their

views on how to vote on particular proposals

depending on a mandate’s investment strategy

and guidelines, we are broadening our capabili-

ties to support voting results that may vary

across our platform.

• Diminished role of proxy advisor recommenda-

tions. J.P. Morgan Asset Management makes its

own independent proxy voting decisions (based

on deep fundamental research) and stands

behind the depth and rigor of its processes and

historical information advantage. In most cases,

the ﬁrm will only use proxy advisory ﬁrms for

research, data and technical mechanics of vote

transmission and not for outsourced recommen-

dations. By the end of 2024, J.P. Morgan Asset

Management generally will have eliminated

third-party proxy advisor voting recommenda-

tions from its internally developed voting sys-

tems. Additionally, the ﬁrm will work with third-

party proxy voting advisors to remove their

voting recommendations from research reports

they provide to J.P. Morgan Asset Management

by the 2025 proxy season.

• Other enhancements. We are working to give a

company and its management even greater

access to the ultimate decision makers; to raise

critical issues to a company as early as possible

in a constructive and proactive way; and to be

willing to tell companies how we have voted

once our decision is made rather than waiting

until votes are ﬁnally counted.

Taken together, these steps are designed to

respond to a growing perception (and, I believe,

reality) that the asset management industry gen-

erally places undue reliance on proxy advisors in

how proxies are voted. We believe these actions

will strengthen our relationships with our clients

and with companies while helping to build trust

among shareholders, investors and companies.

THE BENEFITS AND RISKS OF

PRIVATE CREDIT

I have already mentioned some of the beneﬁts of

private credit, and I’ll now mention some more.

Many people in the private credit arena are very

smart and creative and want to help the compa-

nies they invest in navigate through market shoals.

They can move quickly, discreetly and ﬂexibly.

Most generally understand that bad accounting

drives bad decisions, and their goal is to make the

right decisions for the future of the company.

On the other hand, not all players are that good.

And problems in the private credit market caused

by the bad players can leak onto the good ones,

even though private credit money is locked up for

years. If investors feel mistreated, they will cry

foul, and the government will respond by putting

a laser focus on the business. It’s a reasonable

assumption that at some point regulations will

focus on the private markets as they do on the

public markets.

This scrutiny will include a look at how private

credit values its assets, which isn’t as transparent

as public market valuations. In addition, private

market loans commonly lack liquidity in the sec-

ondary market and are not generally supported by

in-depth market research.

New ﬁnancial products that grow extremely rap-

idly often become an area of unexpected risk in

the markets. Frequently, the weaknesses of new

products, in this case private credit loans, may

only be seen and exposed in bad markets, which

private credit loans have not yet faced. When

credit spreads gap out, when interest rates go up

and when some leveraged companies suer in the

recession, we will ﬁnd out how those loans survive

stress testing. In addition, they can create a little

bit of a “credit crunch” for borrowers since it

might be hard for private creditors to roll over

loans under those conditions. Under stress condi-

tions, private creditors would have to charge exor-

bitant prices that companies simply cannot aord

in order to book the new loan at par. Banks are in a

slightly dierent position.

STAYING COMPETITIVE IN THE SHRINKING PUBLIC MARKETS

panies through good times and bad, seeking to

retain them as long-term clients across many

areas of the bank. They can and do take “losses”

that help the client maintain the franchise. But an

asset manager must act as a “ﬁduciary” of other

people’s money and cannot lend based on a moral

obligation or potential future relationship.

Recently, we have been witnessing a convergence

between the public and private markets. But it’s

too soon to say how this ultimately will play out,

particularly if we go through a recessionary cycle.

A BANK’S STRENGTH: PROVIDING

FLEXIBLE CAPITAL

Banks generally try to be there for their borrowers

in dicult times — striving to roll over loans, rene-

gotiate terms and raise additional capital. Banks

do this for multiple reasons: They normally feel an

obligation to help their clients, they have long-

term relationships and they can commonly earn

other sources of revenue from client-driven trans-

actions. Banks can also ﬂex their capital and lend-

ing base as needed by their clients. This is because

a bank can and should make decisions to help com-

STAYING COMPETITIVE IN THE SHRINKING PUBLIC MARKETS

24_JD_size of ﬁnancial sector_08

DRAFT 3/27/24TYPESET; 4/7/24r1 v. 24_JD_size of ﬁnancial sector_08

Size of the Financial Sector/Industry

($ in trillions)

**FOOTNOTES –MOVED TO BACK PAGE

2007 2010 2023

Banks in the

ﬁnancial system

Global GDP

Total U.S. debt and equity market

Total U.S. broker-dealer inventories

U.S. GSIB market capitalization

U.S. bank loans

U.S. bank liquid assets

Federal Reserve total assets

Federal Reserve RRP volume

$ 61.7

$ 54.2

$ 6.2

$ 0.9

$ 6.5

$ 1.4

$ 0.9

–

$ 65.0

$ 55.9

$ 4.1

$ 0.8

$ 6.6

$ 2.8

$ 2.4

$ <0.1

$ 92.4

$ 137.2

$ 4.9

$ 1.4

$ 12.4

$ 7.6

$ 7.7

$ 1.0

Shadow banks

Hedge fund and private equity AUM

Top 50 sovereign wealth fund AUM

Loans held by nonbanks

U.S. money market funds

U.S. private equity-backed companies (K)

U.S. publicly listed companies (K)

Nonbank share of mortgage originations

Nonbank share of leveraged lending

Global private credit AUM

1996

7.3

$ 3.1

$ 2.7

$ 15.8

$ 3.1

4.9

4.6

12%

44%

$ 0.2

$ 2.8

$ 4.1

$ 14.3

$ 3.0

6.0

4.2

54%

$ 0.3

$ 9.7

$ 12.0

$ 23.2

$ 6.4

11.3

4.3

69%

70%

$ 1.6

Sources: FactSet, S&P Global Market Intelligence, Assets and Liabilities of Commercial Banks in the United States H.8 data, Financial Accounts of the United States Z.1 data, World Federation of

Exchanges, Pitchbook, Preqin and World Bank.

AUM = Assets under management

GDP = Gross domestic product

GSIB = Global systemically important banks

RRP = Reverse repurchase agreements

K = Thousands

For footnoted information, refer to page 61 in this Annual Report.

4/7/24r1 3:00pm

I always enjoy sharing what I’ve learned from

watching others, reading and experiencing through

my own journey.

BENEFITING FROM THE OODA LOOP

The military, which often operates in extreme

intensity of life and death and in the fog and

uncertainty of war, uses the term “OODA loop”

(Observe, Orient, Decide, Act — repeat), a strategic

process of constant review, analysis, decision

making and action. One cannot overemphasize the

importance of observation and a full assessment

— the failure to do so leads to some of the greatest

mistakes, not only in war but also in business and

government.

A full assessment is critical.

To properly manage any business situation, you

need to perform a full and complete assessment

of it. In business, you have to understand your

competitors, their distribution, their economics,

their innovations, and their strengths and weak-

nesses. You also need to understand customers

and their changing preferences, along with your

own costs, your people and their skills. Then

there’s knowing how other factors ﬁt in, like tech-

nology, risk, motivations … hope you get the point.

For countries, you need a thorough grasp of their

economies, strengths and weaknesses, population

and education, access to raw materials, laws and

regulations, history and culture. Research, data

and analytics should be at a very detailed level and

constantly reassessed. Only after you complete

this diligent study can you start to make plans with

a high degree of success.

Get on the road — it builds knowledge and

culture.

I have frequently wondered about all the nonstop

road trips, client meetings, brieﬁngs, greetings,

bus trips, and visits to call centers, operating

centers and branches, regulators and government

ocials, among others: Did they make a dier-

ence? The answer is absolutely yes because they

enabled a process of constant learning, assess-

ment and modiﬁcation of best practices — gaining

insights from employees to clients to competitors.

Employees will tell you what you are doing well or

poorly if you simply ask them, and they know you

want to hear the real answer. Curiosity is a form

of humility — acknowledging that you don’t know

everything. Responding to curiosity allows other

people to speak freely. Facts and details matter

and inform a deeper and deeper analysis that

allows you to continually revise and update your

plans. This, of course, also means that you are

constantly admitting prior mistakes.

You need to shed sacred cows, seek out blind

spots and challenge the status quo.

Very often companies or individuals develop nar-

ratives based upon beliefs that are very hard to

dislodge but are often wrong — and they can lead

to terrible mistakes. A few examples will suce.

Stripe, Inc. built a payments business by working

with developers — something we never would

have imagined but might have ﬁgured out if we

had tried to seek out what others were doing in

this area. Branches were being closed, both at

Bank One and Chase, because the assumption

was that they would not be needed in the future.

We underinvested for years in the wealth man-

agement business because we were always

focused on the value of deposits versus invest-

ments. Question everything.

Management Lessons: Thinking,

Deciding and Taking Action –

Deliberately and with Heart

MANAGEMENT LESSONS: THINKING, DECIDING AND TAKING ACTION — DELIBERATELY AND WITH HEART

Use your brains to ﬁgure out the truth — not to

justify what you already think.

It’s often hard to change your own attitudes and

beliefs, especially those you may have held on to

for some time. But you must be open to it. When

you learn something that is dierent from what

you thought, it may aect many conclusions you

have, not just one. Try not to allow yourself to

become rigid or “weaponized,” where other

employees or interest groups jazz you up so much

that you become a weapon on their behalf. This

makes it much harder to see things clearly for

yourself. When people disagree with you, seek

out where they may be partially right. This opens

the door for a deeper understanding and avoids

binary thinking.

It’s hard to see certain long-term trends, but

you must try.

There is too much emphasis on short-term,

monthly data and too little on long-term trends

and on what might happen in the future that would

inﬂuence long-term outcomes. For example, today

there is tremendous interest in monthly inﬂation

data, although it seems to me that every long-term

trend I see increases inﬂation relative to the last

20 years. Huge ﬁscal spending, the trillions needed

each year for the green economy, the remilitariza-

tion of the world and the restructuring of global

trade — all are inﬂationary. I’m not sure models

could pick this up. And you must use judgment if

you want to evaluate impacts like these.

Also, a block of time as short as one year is an arti-

ﬁcial framework for judging the impact of long-

term trends that could easily play out over years.

A helpful exercise is to think “future back,” in

which you imagine dierent future outcomes,

including the ones you want, and then work back-

ward to events that are happening today (or that

might happen or that you cause to happen), closely

examining the connections between those events

and your projected or desired outcomes. Those

connections inform your risk and R&D planning.

Similarly, when companies compare the attributes

of their products and services with their competi-

tors, they usually only consider where they are

versus their competitors. But nothing is static —

they should consider where their competitors will

be in the future. Conditions are always changing,

crises are always emerging. When analyzing the

playing ﬁeld, it is better to assume that your com-

petitors are strong and are already in the process

of improving and innovating. This minimizes the

chance of arrogance leading to complacency.

DECISION MAKING AND ACTING

(HAVE A PROCESS)

There is a time for an individual to decide

and act.

Sometimes you should take the time to measure

twice and cut once. And then sometimes making a

quick decision is better than delaying. You should

try to distinguish between the two. For example,

with decisions that are hard to reverse, it’s usually

better to go slow. With other decisions where you

can test, learn, probe and change direction, it’s

often better to go fast. It’s been my experience

that it’s hard for some people to actually decide

and act. This could be from analysis paralysis, lack

of “perfect” information, fear of failure or the feel-

ing that full consensus is needed before a decision

can be reached. But whatever it is, it can slow

down and possibly seriously damage a company.

To get people to think like decision makers and

take a strong point of view, we like to ask, “What

would you do if you were king or queen for a day?”

It helps shift the direction to individual decision

making. We also ask questions like, “What would

MANAGEMENT LESSONS: THINKING, DECIDING AND TAKING ACTION — DELIBERATELY AND WITH HEART

you wish for if you knew X was going to happen?”

(for example, higher interest rates). Decision

making takes a mix of courage, grit and guts.

One exercise that I ﬁnd useful (and sometimes

painful) is to draw up a list of important decisions

that need to be made — the ones I often avoid con-

fronting. So I take time every Sunday to think

about these tough issues and almost always make

progress. Progress doesn’t always mean that you

come to the ﬁnal conclusion — sometimes it’s just a

very rational next step that can put you on a path

to the ﬁnal decision.

Try to have a good decision-making process.

Try to give yourself the time to decide. Make sure

you speak with the right people and make sure the

right people are in the room. Information should

be fully shared. People should be made very com-

fortable with open debate. Quite often, the “right”

answer is simply waiting to be found — you don’t

have to guess.

Crowdsourcing, compromise, consensus and

committees have beneﬁts and risks.

There are huge beneﬁts to crowdsourcing intelli-

gence. It is a form of full assessment, a strategy

for getting the best ideas and challenging the sta-

tus quo. We should do this for almost every major

decision. It is perfectly ﬁne on some occasions to

compromise and gain consensus, particularly on

decisions that are not critical and can easily be

reversed. Often people spend too much time

debating issues that are simply not that import-

ant; it’s better to decide and move on. Also,

before you compromise, you should know exactly

what you want to achieve and the consequences

of any tradeos. However, sometimes compro-

mise and consensus cannot work and only lead to

a feel-good decision that is probably wrong — this

could be the road to ruin.

The use of committees can be good when done

properly. For example, if our risk committees

could do a full assessment and crowdsource all

potential risks, that would lead to better decision

making. I will give one very personal and painful

example, which is when we had a major trading

scandal, called The London Whale. The scandal

was not caused by the complexity of the trade but

rather the failure to go to the proper Risk com-

mittee for a thorough review, which should have

happened but didn’t. I have no doubt that had the

trade been raised there, the ﬂaws would have

been exposed immediately, thereby dramatically

reducing or eliminating the problem. On the other

hand, the opposite can happen when a commit-

tee, with everyone staring at each other, devolves

into herd-like behavior with people looking for

conﬁrmation and ending up with a compromise

that is a poor choice.

Good leadership involves great observation and

the ability to act, but there is more …

THE SECRET SAUCE OF LEADERSHIP

(HAVE A HEART)

You need to earn trust and respect with your

employees.

You can be great at assessment, you can be bril-

liant and you may often be willing to act. But all of

that is not good enough for “complete” leadership.

To become a true leader, you need to be trusted

and you must earn your respect, every day. People

have to know that you do not have ulterior motives

and that you’re trying to do the right thing — not

trying to burnish your personal reputation. Good

people want to work for people they respect, and

they will not respect people who take all the credit

and share all the blame. People need to know that

even when you make mistakes, you’re willing to

admit them and take corrective action. And there

is more …

MANAGEMENT LESSONS: THINKING, DECIDING AND TAKING ACTION — DELIBERATELY AND WITH HEART

The importance of vision, communication and

inspiration.

The reason I’ve always hesitated to talk about

“vision” is because often it is the basic BS of

corporate speak — that somehow if you impart

your vision to people, they will take the mountain.

What it really is all about is this: After you’ve done

your full assessment and decision making, you can

then continuously educate, explain, train, simplify,

propel and ﬁght. But this only works if people

know you are in the trenches with them, if they

understand the mission and if they are there side

by side with your eort.

We know that bureaucracy can lead to politics,

corporate stasis and terrible decisions. So you can

communicate your vision about how to ﬁght

bureaucracy by telling stories about the silly things

we do — but with a smile — and then by showing

people that you will actually ﬁx the problems.

Finally, your vision needs to be clear, coherent and

consistent. Within an organization, people very

quickly pick up the pattern of management saying

one thing but doing another. Because if words and

actions are inconsistent (for example, and I could

give many, when we say we want employees to be

treated with respect, but we allow a jerk to be their

boss), conﬁdence in leadership will be eroded.

Heart cannot be overstated.

Heart matters. And it makes a dierence when

people know and see that you actually care. One

example: Many years ago when I was new to

JPMorgan Chase, I learned that the company’s

security guards had been outsourced — to save

money. Since after outsourcing, when the same

guards continued coming to work every day at the

same salary, I wondered, “How could this be?”

(FYI, this was brought to my attention by the head

of the Service Employees International Union, who

came to see me over the objection of my manage-

ment team.) The reason we were saving money is

because the healthcare beneﬁts were cut in half

for the guards and their family members (currently

worth approximately $15,000 a year), and the sav-

ings were split with us. This was a heartless thing

to do — and the second I found out, I reversed the

decision. JPMorgan Chase’s success will not be

built o the backs of our guards — it will be the

result of fair treatment of all of our employees —

and we’re thankful that many of those guards are

still with our company today.

You know heart and soul when you see it in eect

on sports teams or with “the boys in the boat” —

it’s a beautiful thing to watch. It’s not as obvious,

but it happens in business, too.

It’s essential to build trust with your

customers, constituencies and, yes, even

competitors.

Of course, I’m not bringing this up as a matter of

corporate governance or a corporation’s purpose:

A business should, over the long run, try to maxi-

mize shareholder value. It is completely obvious

that running a decent business —treating everyone

ethically and earning trust and respect in all your

communities — is not only fundamental to share-

holder value but also to a healthy society.

MANAGEMENT LESSONS: THINKING, DECIDING AND TAKING ACTION — DELIBERATELY AND WITH HEART

A Pivotal Moment for America

and the Free Western World:

Strategy and Policy Matter

In past years, I have written extensively about pub-

lic policy issues. It is important to engage in these

conversations, particularly around domestic

economic policy because policy matters. While

JPMorgan Chase can execute speciﬁc plans to

improve outcomes for customers and communi-

ties, there is no replacement for eective govern-

ment policies that add to the general well-being of

the country. A stronger and more prosperous

country will make us a stronger company.

As CEO of this company, every year I visit numer-

ous countries around the globe. I meet with for-

eign government leaders, presidents and prime

ministers, business leaders, and civic and aca-

demic experts, which allows me to learn a signiﬁ-

cant amount about how public policy is executed

around the world. It also reinforces some of the

critical values and virtues that are essential to a

healthy country.

Every time I see the American ﬂag, it reminds me

of the values and virtues of this country and its

founding principles conceived in liberty and dedi-

cated to the notion that all men and women are

created equal. Talk with someone who has recently

become a naturalized citizen or watch a ceremony

where groups of people take the oath to America,

and you will see extraordinary joy and newfound

pride. They now live free, with individual rights

protected by the Constitution and with their life

and the well-being of their family and community

protected by the U.S. military. As Americans, we

have much to be grateful for and much to defend.

If you read the newspaper from virtually any day

of any year since World War II, there is abundant

coverage on wars — hot and cold — inﬂation, reces-

sion, polarized politics, terrorist attacks, migration

and starvation. As appalling as these events have

been, the world was generally on a path to becom-

ing stronger and safer. When terrible events

happen, we tend to overestimate the eect they

will have on the global economy. Recent events,

however, may very well be creating risks that could

eclipse anything since World War II — we should

not take them lightly.

February 24, 2022 is another day in history that

will live in infamy. On that day, 190,000 Russian

soldiers invaded a free and democratic European

country — importantly, somewhat protected by the

threat of nuclear blackmail. Russia’s invasion of

Ukraine and the subsequent abhorrent attack on

Israel and ongoing violence in the Middle East

should have punctured many assumptions about

the direction of future safety and security, bringing

us to this pivotal time in history. America and the

free Western world can no longer maintain a false

sense of security based on the illusion that dicta-

torships and oppressive nations won’t use their

economic and military powers to advance their

aims — particularly against what they perceive as

weak, incompetent and disorganized Western

democracies. In a troubled world, we are reminded

that national security is and always will be para-

mount, even if its importance seems to recede in

tranquil times.

The fallout from these events should also lay to

rest the idea that America can stand alone. Of

course, U.S. leaders must always put America

ﬁrst, but global peace and order are vital to

American interests. Only America has the full

capability to lead and coalesce the Western world,

though we must do so respectfully and in partner-

ship with our allies. Without cohesiveness and

unity with our allies, autocratic forces will divide

and conquer the bickering democracies. America

needs to lead with its strengths — not only its

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

military but also its economic, diplomatic and

moral forces. And now we must do so as America’s

leadership is being challenged around the world.

There is nothing more important.

Policy and strategy matter, and it’s important

to be engaged.

In our increasingly complex world, there is a vital

interrelationship between domestic and foreign

economic policy, particularly around trade, invest-

ment, national security and other issues. And, of

course, while American voters and leadership set

U.S. foreign policy, being a constructive part of the

global conversation has become more important

than ever.

If you doubt how important public policy is for the

health of a country, you need to look no further

than the recent history of Greece, Ireland or

Singapore. Each of these countries, starting from

deeply challenging places, implemented eective

government and policies that have done a great

job of lifting up their people when many thought it

wasn’t possible. Sweden is another great example

of a country with good broad-based policies that

have succeeded at precisely what we all may want

— a dynamic, innovative, free-market economy

(Sweden actually has fewer government-owned

enterprises than America) and safety nets that

work. Conversely, you need to look no further than

North Korea or Venezuela to see the complete

destruction and havoc that terrible public policies

(often in the name of the people) can cultivate.

Strategy by its nature must be comprehensive. In

the rest of this section, I try to answer the question:

What must we do to ensure that the world stays

safe, not only for America but for freedom and

democracy? A comprehensive strategy entails four

important pillars, and we must succeed at each:

1. Maintain American leadership (including

military).

2. Achieve long-term economic success with

our allies.

3. Strengthen our nation domestically.

4. Deepen focus and resolve on addressing

our most pressing challenges.

COALESCING THE WESTERN WORLD — A

UNIQUELY AMERICAN TASK

Only America has the full capabilities of military

might, economic power and the principles that

most people around the world yearn for — based

on “liberty and justice for all” and the proposition

that all people are created equal. America

remains the bastion of freedom and the arsenal

of democracy.

There is no alternative to American leadership.

In the free and democratic Western world, and, in

fact, for many other countries, there is no real or

good alternative to America. The only other poten-

tial superpower is China. Other nations know they

can rely on the founding principles of America. If

we reach out our hand, most nations will happily

take that hand. America is still the most prosper-

ous nation on the planet, which not only can guar-

antee our military strength but also positions us to

help our allies develop and grow their nations

(though we should minimize the “our way or the

highway” type of behavior). This leadership is

needed today to help Ukraine stay free in its battle

with Russia.

Most of the world wants American leadership.

America continues to be the envy of much of the

world, and as we’ve seen with the challenges at

our borders, there is a reason people want to

come here and not to autocratic nations. If you

opened America’s borders to the rest of the world,

I have little doubt that hundreds of millions of

people would want to move here. By contrast, not

many would want to emigrate to autocratic

nations. Also, I have little doubt that if most inves-

tors across the globe could only invest in one coun-

try, they would choose the United States. Beyond

our country’s borders, people and nations around

the world understand the role that America has

played in promoting world peace — known as Pax

Americana. For the most part, Pax Americana has

kept the world relatively peaceful since World War

II and helped lead to enormous global economic

prosperity, which has helped lift 1.3 billion people

out of poverty.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

Modern America does not engage in economic

coercion or foreign wars to steal land or treasure.

The fact that some of our foreign excursions might

have been misguided does not negate this. We

helped rebuild Europe and Japan after the devas-

tation of World War II, and we, with our allies, have

helped create global institutions to maintain

peace. We are still trusted.

First and foremost, the Western world needs

unquestioned military might — peace through

strength.

“We know only too well that war comes not when

the forces of freedom are strong, but when they

are weak,” said Ronald Reagan in 1980.

So far, the Western world has done a good job in

strengthening military alliances in response to the

war in Ukraine. Ukraine is essentially the front line

that needs immediate support. Providing that sup-

port is the best way to counter autocratic forces

that would seek to weaken the Western world, par-

ticularly America. But the ongoing wars in Ukraine

and the Middle East could become far worse and

spread in unpredictable ways. Most important, the

specter of nuclear weapons — probably still the

greatest threat to mankind — hovers as the ultimate

decider, which should strike deep fear in all our

hearts. The best protection starts with an unyield-

ing resolve to do whatever we need to do to main-

tain the strongest military on the planet — a com-

mitment that is well within our economic capability.

American leadership requires not only the

military but also the full “symphony of power.”

Former Secretary of Defense Robert Gates, in his

book Exercise of Power, writes extensively in the

ﬁrst chapter about “the symphony of power.” He

makes the critical point that America has often

overused and misused military power and has

massively underused other muscles — diplomacy,

intelligence, communication (explaining to the

world the beneﬁts of democracy and free enter-

prise) and comprehensive economic policy.

America has the most extensive group of partners,

friends and allies — both military and economic —

that the world has probably ever seen. We should

put this to better use.

The American public ought to hear more about

why this is so important.

International isolationism has run through

American foreign policy throughout our history,

frequently with good reason. The chant, “Don’t get

involved in foreign wars” was often right. That

said, the American public should remember that

even after the Revolutionary War, we did, in fact,

have British and French armies on our soil. The

sinking of American merchant and passenger ships

during World War I and the surprise attack on

Pearl Harbor in World War II brought isolationism

to a close for a time. America is never far from

being dragged into terrible conﬂicts. Global wars

come to our shores whether we like it or not — we

need to stay engaged.

In perilous periods of history when our allies and

other democracies were under serious assault,

great American leaders have inspired the Ameri-

can people — through words and actions — to

stand up to help and defend them. Staying on the

sidelines during battles of autocracy and democ-

racy, between dictatorship and freedom, is simply

not an option for America today. Ukraine is the

front line of democracy. If the war goes badly

for Ukraine, you may see the splintering of Pax

Americana, which would be a disaster for the

whole free world. Ukraine’s struggle is our strug-

gle, and ensuring their victory is ensuring America

ﬁrst. It is imperative that our national leaders

explain to the American people what is at stake

and make a powerful case – with energy, consis-

tency and clarity – for our strong enduring com-

mitment to Ukraine’s survival for as long as it

takes (and it could take years).

One last point: Ukraine needs our help immediately,

but it’s important to understand that much of the

money that America is directing to Ukraine is for

purchasing weapons and equipment, most of which

will be built in America. Not only is our aid helping

Ukraine, but it is going directly to American manu-

facturers, and it is helping the country rebuild our

military industrial capacity for the next generation.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

STRENGTHENING OUR POSITION WITH

A COMPREHENSIVE, GLOBAL

ECONOMIC SECURITY STRATEGY

Sustaining America’s economic strength is a bed-

rock for our long-term military strength. There are

many things we need to do to strengthen the U.S.

economy, and I talk about that later in this section.

This discussion is about foreign economic policies

— the economic battleﬁeld.

The whole Western world is rethinking and

reimagining its military strategies and alliances.

We need to do the same for our economic strate-

gies and alliances, but we should be guided by a

comprehensive global strategy that deals with

critical issues. Done properly, such a strategy

would help strengthen, coalesce and possibly be

the glue that holds together Western democratic

alliances over decades.

Foreign economic policy involves trade and invest-

ment, export controls, secure and resilient supply

chains, and the execution of sanctions and any

related industrial policies. It must also include

development ﬁnance — think of the “Belt and Road”

eorts in China — which are critical to most develop-

ing nations. This framework should tell us not only

how to deal with our allies but also how to work with

nonaligned nations around the world. These strate-

gies should not be aimed against any one country

(such as China) but rather be focused on keeping

the world safe for democracy and free enterprise.

Economic national security is paramount —

both for the United States and for our allies.

It is a valid point that the Western world — both

government and business — essentially underesti-

mated the growing strength and potential threat of

China. It’s also true that China has been compre-

hensively and strategically focused on these eco-

nomic issues, all while we slept. But let’s not cry

over spilled milk — let’s just ﬁx it.

We missed the potential threat from three vantage

points. The ﬁrst is companies’ overreliance on

China as the sole link in their supply chain, which

can create vulnerabilities and reduces resiliency.

But to the extent this involves everyday items, like

clothes, sneakers, vaccine compounds and con-

sumer goods, this dependency is not as critical or

complex and will eventually be sorted out.

The second is the most critical. The United States

cannot rely on any potential adversaries for mate-

rials essential to our national security — think rare

earths, 5G and semiconductors, penicillin and

materials critical to essential pharmaceuticals,

among others. We also cannot be sharing vital

technologies that can enhance an adversary’s

military capabilities. The United States should

properly and narrowly deﬁne these issues and

then act unilaterally, if necessary, to ﬁx them.

The third is also complex, which is countering

unfair competition or “mercantilist” behavior in

critical industries; think electric vehicles, renew-

able energy and AI, among others. Examples of

this would be where a state, any state, uses gov-

ernment powers, capital, subsidies or other means

to dominate critical industries and deeply damage

the economic position of other nations. Weakening

a country economically can render it a virtual

“vassal state,” reliant on potential adversaries for

essential goods and services, which also weakens

it militarily. We cannot cede our important

resources and capabilities to potential adversaries.

All these issues can be resolved, though they will

take time and need devoted eort.

Every nation will have dierent national security

issues. For example, Europe in general and coun-

tries like India, Japan and Korea need reliable,

aordable and secure energy; many nations would

put food security as their top concern. This means

that we must work with our allies to accomplish

our own goals and to help them accomplish theirs.

We have extraordinary common interests in our

joint security: We must hang together — because if

we don’t, we will assuredly hang separately.

We already engage in trade — improving it is

good economics and great geopolitics.

We must have a better understanding of trade.

As a nation, we refuse to get into genuine trade

discussions, but this ignores the complete and

obvious truth — we already have trade relation-

ships with all these countries. Approximately 92%

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

of the world’s consumers live outside the United

States. Increased trade allows our workers and

farmers to access those markets. We should nego-

tiate trade agreements that can achieve more,

economically, for ourselves and our allies, as well

as meet all of our national security needs. While it

is appropriate to use trade to continue to nudge

allies in the right direction around human rights

and climate, this objective should be subordinated

to our national interests of long-term security.

Negotiating must be done in concert with our allied

nations so as not to cause a ﬁssure in economic

relations. This is critical — strong economic bonds

will help ensure strong military alliances. The Inﬂa-

tion Reduction Act has much good in it (more on this

later), but it angered many of our allies. To them,

the bill was by America and for America, and, sub-

sequently, they felt a need to match it so their busi-

nesses would not be disadvantaged. The terms of

the legislation could have been better negotiated

with our allies in mind, strengthening our economic

ties with the free world.

We should also immediately re-enter, if possible,

the prior negotiated Trans-Paciﬁc Partnership

agreement. Not only is it good for the economy,

but it also could be a brilliant, strategic, economic

security move — an economic alliance that binds

us with 11 other important countries (including

Australia, Chile, Japan, Malaysia, Mexico, Singa-

pore and Vietnam). Geopolitically and strategically,

this might be one of the most important moves to

counter China. While this is a challenging step, our

political leaders need to explain and lead — and

not be afraid of dealing with the tough issues. We

also need to acknowledge that there have been

real negative job impacts as a result of trade,

which are usually concentrated around certain

areas and businesses. So any new trade policy

should be combined with a greatly enhanced Trade

Adjustment Assistance program, which provides

retraining, income assistance and relocation for

those workers directly impacted by trade.

Trade is realpolitik, and the recent cancellation of

future liquiﬁed natural gas (LNG) projects is a good

example of this fact. The projects were delayed

mainly for political reasons — to pacify those who

believe that gas is bad and that oil and gas proj-

ects should simply be stopped. This is not only

wrong but also enormously naïve. One of the best

ways to reduce CO2 for the next few decades is to

use gas to replace coal. When oil and gas prices

skyrocketed last winter, nations around the world —

wealthy and very climate-conscious nations like

France, Germany and the Netherlands, as well as

lower-income nations like Indonesia, the Philippines

and Vietnam that could not aord the higher cost —

started to turn back to their coal plants. This high-

lights the importance of safe, secure and aordable

energy. Second, the export of LNG is a great eco-

nomic boon for the United States. But most import-

ant is the realpolitik goal: Our allied nations that

need secure and aordable energy resources,

including critical nations like Japan, Korea and most

of our European allies, would like to be able to

depend on the United States for energy. This now

puts them in a dicult position — they may have to

look elsewhere for such supplies, turning to Iran,

Qatar, the United Arab Emirates or maybe even

Russia. We need to minimize anything that can tear

at our economic bonds with our allies.

The strength of our domestic production of energy

gives us a “power advantage” — cheaper and more

reliable energy, which creates economic and geo-

political advantages.

Industrial policy is now necessary, but it

should be carefully constructed and limited.

In some cases, industrial policy (using government

resources to subsidize investments to help make

businesses more competitive) may be the only

solution for quickly building up the industries we

need (rare earths and semiconductors, among

others) to guarantee resilient national security.

The IRA and CHIPS Act are good examples of this

and government has to get it right.

Such policy can also be used to help combat unfair

competitive policies of nations that are using state

capitalism and state control to dominate critical

industries. However, when crafting industrial policy,

the function of government needs to be narrowly

deﬁned and kept simple; i.e., governmental jurisdic-

tion should be limited to very speciﬁc products and

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

probably to what we know works, such as tax cred-

its and, to a lesser extent, loan guarantees. And

industrial policy should include twin provisions:

1) strict limitations on political interference, like

social policies, and 2) speciﬁc permitting require-

ments, which, if not drastically improved, will badly

inhibit our ability to make investments and allow

infrastructure to be built. Adding social policy, poli-

tics and matters other than simple tax credits dra-

matically reduces the economic eciency of indus-

trial policy and creates conditions for corporate

America to feed at the trough of government

largess. We should quickly address how we can

improve on already executed legislation. We do not

want to look back and have great regrets about how

so much of this policy work failed.

There are those who argue that the U.S. govern-

ment needs much more far-reaching industrial

policy to be able to micromanage and accomplish

its many ambitious objectives. To those I say, read

further in this section about how ineective so

many government policies have been.

We should be tough, but we should engage

with China.

Over the last 20 years, China has been executing

a more comprehensive economic strategy than we

have. The country’s leaders have successfully

grown their nation and, depending on how you

measure it, have the ﬁrst or second largest econ-

omy in the world. That said, many question the

current economic focus of China’s leadership as

they don’t have everything ﬁgured out. While

China has become the largest trading partner to

many countries around the world, its own GDP per

person is $13,000. And the country continues to be

beset by many economic and domestic issues.

China has its own national security concerns. The

country is located in a very politically complex part

of the world, and many of China’s actions have

caused its neighbors (e.g., Japan, Korea, Philippines,

among others) to start to re-arm and, in fact, draw

closer to the United States. It also surprises many

Americans to hear that while our country is 100%

energy sucient, China needs to import 10 million

barrels of oil a day. It is clear that China’s new lead-

ership has set a dierent course, with a much more

intense focus on national security, military capabil-

ity and internal development. That is their right, and

we simply need to adjust to it.

America still has an enormously strong hand —

plenty of food, water and energy; peaceful neigh-

bors; and what remains the most prosperous and

dynamic economy the world has ever seen, with

a per person GDP of over $80,000 a year. Most

important, our nation is blessed with the beneﬁt of

true freedom and liberty. See the sidebar on the

amazing power of freedom later in this section.

While we may always have a complex relationship

with China (made all the more complicated and

serious by ongoing wars), the country’s vast size

and importance to so many other nations requires

us to stay engaged — thoughtfully and without

fear. At the same time, we need to build and exe-

cute our own long-term, comprehensive economic

security strategy to keep our position safe and

secure. I believe that respectful, strong and consis-

tent engagement would be best for both our coun-

tries and the rest of the world.

We need to strengthen and rebuild the

international order — we may need a new

Bretton Woods.

The international rules-based order established by

the Western world after World War II is clearly

under attack by outside forces, somewhat weak-

ened by its own failures and inability to keep up

with the increasingly complex world. This interna-

tional order relies on a web of military alliances,

trade agreements (e.g., World Trade Organization),

development ﬁnance (e.g., International Monetary

Fund and the World Bank) and related global tax

and investment policies and diplomacy organiza-

tions (e.g., United Nations), which have evolved

into a confusing and overlapping regime of poli-

cies. You can now add to it the new issues of cyber

warfare, digital trade and privacy, and global

taxes, among others.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

It might be a good idea to convene a group of like-

minded leaders to build and improve upon what

already exists. The time may be right for a reimag-

ined Bretton Woods — and by this, I mean revitaliz-

ing our global architecture. Since too many parts

of the world have been neglected, any new system

has to take into account and properly address the

needs of all nations, including areas of concen-

trated poverty.

While we hope the wars in Ukraine and in the

Middle East will end eventually (and, we hope, suc-

cessfully from the standpoint of our allies), these

other critical economic battles could possibly con-

tinue throughout our lifetime. If the Western world

is slowly split apart over the next few decades, it

will likely be the result of our failure to eectively

address crucial global economic challenges.

PROVIDING STRONG LEADERSHIP

GLOBALLY AND EFFECTIVE

POLICYMAKING DOMESTICALLY

When you travel around the United States and talk

with people of all types and persuasions, there is a

rather common refrain; namely, why are we help-

ing foreign nations with the safety of their borders

and economies when we are not doing a particu-

larly good job of protecting our own? While there is

no moral equivalency in these arguments, they are

understandable. It is clear that many Americans

feel we need to do a better job here at home

before we can focus over there. We can under-

stand why some people living in this country, who

have been neglected for decades, ask how their

government can ﬁnd the money for Ukraine and

other parts of the world but not for them. It is a

reasonable question.

From my point of view, our highly charged, emo-

tional and political domestic issues are centered

around 1) immigration and lack of border security

and 2) the fraying of the American dream, particu-

larly for low-income and rural Americans who feel

left behind amid the growing wealth and prosper-

ity of others around them. Please read the sidebar

on page 57, which I believe explains the legitimate

frustration of some of our citizens. And I agree

with them.

In the sidebar, I also explain how two policies (a

large expansion of the Earned Income Tax Credit

and focus on work skills and job outcomes at high

schools, community colleges and colleges) would

not only dramatically increase both the income

and employment opportunities for many of those

left behind but would also have the virtue of actu-

ally growing the workforce. The combined eect of

all of this would be quite a boon to our GDP.

I believe that many aected Americans are not

angry at hardworking, law-abiding immigrants

and, in fact, acknowledge the critical role immi-

grants continue to play in building this wonderful

country. Rather, they are angry that America has

not implemented proper border control and immi-

gration policies. It is astounding that many in

Congress know what to do and want to do it but

are simply unable to pass legislation because of

partisan politics. Congress did come close on a

few occasions — and I hope they keep trying.

Deliberate policies meant to drive healthy

growth are needed.

For over two decades, since 2000, America has

grown at an anemic rate of 2%. We should have

strived for and achieved 3% growth. Had we done

so, GDP per person today would be $16,000

higher, which would, in turn, have paid for better

healthcare, childcare, education and other

services. Importantly, the best way to handle

our excess deﬁcit and debt issues is to maximize

economic growth.

Growth policies include (the list could be very

long so I’ll just mention a few):

• Consistent tax policies, conducive to both

employment and capital investment. Capital

investment is the primary driver of innovation,

productivity and, therefore, growth in America.

Tax policies change too frequently, which causes

uncertainty and complicates long-term capital

investment decision making (I won’t bore you

with the details here). A bipartisan committee of

Congress is probably required to ﬁx this — and

the sooner the better.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

• Well-conceived regulations (and related

laws). This requires an ongoing concerted

eort to streamline regulations to cost eec-

tively drive better outcomes for the United

States. The last thing we need is a constant

pile-on of politically driven, fragmented poli-

cies. Please read the sidebar on the next

page, an editorial in The Wall Street Journal by

George McGovern, one of the most liberal

presidential nominees in our lifetime, in which

he clearly lays out the complexity, risks and

costs that businesses, large and small, face

every day. While he acknowledges the worthi-

ness of the goals of many regulations, he

points out their negatives. He also calls out

the “blame-shifting and scapegoating” and

“the endless exposure to frivolous claims and

high legal fees.” Not only is this state of

aairs demoralizing, but it also reduces

employment, capital investment and the for-

mation of new businesses, as well as cause

unnecessary bankruptcies. Estimates of the

regulatory costs for America are approxi-

mately $19,000 per worker, dwarﬁng the reg-

ulatory burdens in other countries. We all

want sensible regulations that make us a bet-

ter and safer nation — but this number is

astounding. We should be able to accomplish

our goals while sharply reducing needless and

wasteful expenses. And remember, it’s dis-

couraging not only to companies but to all cit-

izens who have to deal with it on a daily basis.

• Timely permits on projects large and small.

There is virtually no industry — from agricul-

ture and construction to transportation, tech-

nology, and oil and gas — or business, large or

small, that isn’t disadvantaged by the tedious

process and the length of time it takes to get

approvals for permits to get things done. This

includes federal, state and local requirements.

These bottlenecks also make investment far

more costly and slow. Timely permits would

improve infrastructure and save lives, not

endanger them.

• Proper federal government budgeting and

ﬁscal management. The staggering inability

of the government to draft and pass a proper

budget causes deep and unnecessary damage

to our growth. Some people estimate that the

waste alone (due to improper payments, over-

lapping programs, and fragmented and duplica-

tive contracts, among other things) could cost

the nation hundreds of billions of dollars annu-

ally. This uncertainty ﬁlters through virtually

every part of the American economy and should

not be accepted.

We can all forgo a little self-interest to do what

is right for our country.

Those of us who have beneﬁted the most from this

country bear even greater responsibility to do this.

It’s perfectly understandable that institutions,

including businesses, unions and industries, lobby

in Washington, D.C., to protect themselves — in

good ways and bad — but we should more regu-

larly put national interests ahead of self-interests.

It’s good to want to ensure well-paying jobs and

healthy industries. But it is not good when it

reduces competition, stops the deployment of

enhanced technology, harms eciency, creates

fake jobs or builds bridges to nowhere or damages

the general health of the economy. Doing the right

thing, the right way — which is achievable — would

be better for everyone. As former President John

F. Kennedy said, “Ask not what your country can do

for you — ask what you can do for your country.”

Celebrate American exceptionalism.

We can safely say that America is an exceptional

nation built and grounded on principles — princi-

ples of freedom of speech, freedom of religion,

free enterprise (capitalism), and the freedom and

empowerment brought to us by our democracy

through the power to elect our leaders and of our

Constitution, which makes these individual free-

doms sacrosanct. Much of the world yearns to be

here because of those principles — the right to life,

liberty and the pursuit of happiness. We should

extol those virtues while recognizing that America

has never been a perfect nation, like all other

nations. We can acknowledge our ﬂaws and strive

to constantly correct them, without denigrating

our nation.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

Let’s celebrate the shared sense of sacriﬁce

that gives us all strength.

There were very few positives from the pandemic,

but I’m mentioning one, which, unfortunately,

didn’t last, but reﬂected the best of us. In New

York City, at 7 p.m. every evening, people through-

out the city would open their windows, shouting

and screaming and banging pots and pans to show

gratitude to the essential workers — sanitation

workers, police, ﬁreﬁghters, emergency respond-

ers, nurses and doctors. Of course, these workers

were always essential, but I was hoping that spirit

and civility would become deeply embedded and

have longer lasting eects in our society.

I can understand when an individual for conscien-

tious reasons chooses not to do work that helps

our military. But I cannot understand when an

entire company takes that position. How can we

have a sense of shared sacriﬁce, when America is

home to 18 million veterans who were willing to

risk their lives for America’s safety, and yet some

companies are not even willing to use their ﬁnger-

tips to help?

For example, back in 1969 the cancellation of

the Reserve Ocers’ Training Corps programs by

the country’s most prestigious universities and

colleges likely fueled the great divide — between

elites and others in our country — that persists

today. Our strength as a nation is best served

when the best students and the best soldiers are

brought together, and we would all beneﬁt from

more civility and better teaching around basic

virtues like hard work, shared sacriﬁce, justice,

rationality and more respect for the enduring

values of American freedom and free enterprise.

Resist being “weaponized.”

We can start by trying to understand other people’s

and other voters’ points of view, even around deeply

emotional topics. We can stop insulting whole

classes of voters. We can stop name calling. We can

stop blame-shifting and scapegoating. We can stop

being petty. Politicians can cease insulting, baiting

and belittling each other, which diminishes them

and the voter. It has also become too acceptable

for some politicians to say one thing in private and

deliver a completely dierent message in public.

It would also be nice to see some cabinet members

from the opposing party. We should also stop

degrading and demonizing American business

and American institutions, which are the best in

the world, because it erodes conﬁdence in our

very country.

Social media could do more.

There is no question that social media has some

real negative eects, from the manipulation of

elections to the increasingly documented negative

eects on the mental health of children. These are

issues impacting our individual and collective

spheres, and it’s time for social media companies

to take more action to remedy these challenges —

and swiftly. Rapid advances in technology will not

only make these existing issues harder to address,

but they will likely create new ones. The current

state of the online information landscape has

wide-ranging implications on trust in institutions,

information integrity and more — and it bears on

institutions like ours, where platform policy has

increasingly widespread implications for concerns

about fraud, security and other issue spaces.

A range of tools and approaches is required to

address this complex and important situation —

and there are several measures that platform com-

panies can immediately enact, voluntarily, while

strengthening and improving their business models.

One commonsense and modest step would be for

social media companies to further empower plat-

form users’ control over what they see and how it

is presented, leveraging existing tools and features

— like the alternative feed algorithm settings some

oer today. I believe many users (not just parents)

would appreciate a greater ability to more care-

fully curate their feeds; for example, prioritizing

educational content for their children.

Platforms could also consider enhanced authenti-

cation measures; i.e., having users identify them-

selves to the platform or to a trusted third party.

This would have the virtue of increasing individual

accountability and reducing imposters, bots and

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

possibly foreign political actors on platforms. It

would have immediate beneﬁts for users who pre-

fer content from authenticated sources that take

responsibility for their postings. There are clear

competing values that need to be balanced in such

an approach, including those related to our cher-

ished right to free speech, individual privacy and

inclusion (for example, roughly 850 million people

globally don’t have a way to easily authenticate

themselves today). There are also legitimate ques-

tions as to whether authentication would be used

as a tool to chill or block speech or quash bona

ﬁde political dissenters, and real work needs to be

done to identify policy and technical solutions that

balance such risks and beneﬁts.

I oer these approaches as a starting place, under-

standing that it’s crucial to continue honest con-

versation across sectors about the immediate,

incremental improvements we can make to our

online public square, considering the high stakes

involved in how information is created and shared.

Eective measures will require time, money, learn-

ing and improvement, all in service of signiﬁcantly

enhancing the well-being, quality, and civility of

our experiences online and in the world around us.

Healthy collaboration with business is needed.

Companies big and small create jobs, pay for

employee healthcare and beneﬁts, and build

bridges, roads and hospitals. The people who work

for and run these companies care deeply about

their country — they are patriots, and they want to

see people and communities succeed and prosper.

Unfortunately, the message America hears is that

the federal government does not value business —

that business is the problem and not part of the

solution. There are fewer individuals in govern-

ment who have any signiﬁcant experience in start-

ing or running a company, which is apparent every

day in the political rhetoric that demonizes busi-

nesses and free enterprise and that damages con-

ﬁdence in America’s institutions. The relationship

between business and government, in fact, might

improve if there were more people from the busi-

ness sector working in government. Inexperience

with business is also evident from the regular lack

of transparency or curiosity from regulators as

they develop economic policies with potentially

seismic consequences for the economy.

When I travel around the country, I experience a

very dierent perspective on the street and at the

local level — I see that many governors, mayors

and city council members understand they are not

facing big challenges alone. They stand shoulder to

shoulder with our company, even when some of

their constituents disagree or are skeptical about

big banks. These government ocials know they

need partners who have the same stake in helping

successful communities thrive and who care about

building a prosperous future as much as they do.

For example, in fewer than 10 years, Detroit saw

one of the greatest turnarounds because of a

vibrant collaboration between government and

business. And businesses know they cannot suc-

ceed if individuals, families, towns and cities are

not ﬂourishing. We obviously don’t agree on every-

thing, but there is a shared belief that we must

work together. We can and should be full partners

in developing solutions to our big problems.

The federal government, regardless of which

party is in charge, needs to earn back trust

through competence and eective

policymaking.

The world is becoming more complex, more tech-

nologically competent and faster. Unfortunately,

the government simply is not built to innovate,

compete and move quickly, as in the competitive

business world. This may be the reason why gov-

ernment is becoming less eective. We need to

take action on this because the loss of trust in

government is damaging to society. We should be

brutally honest about the staggering number of

policies, systems and operations that are under-

performing: Too many ineective public schools do

not give students the skills they need to land a

well-paying job; we have over 25 million uninsured

Americans, soaring healthcare costs and too many

bad outcomes; we are unable to plan, permit and

build infrastructure eciently; our litigation

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

system is capricious and wasteful; progress on

immigration policies and reform is frustrating; lack

of ecient mortgage markets and an aordable

housing policy keep housing out of reach for many

Americans; problems plague the Department of

Veterans Aairs, the Federal Aviation Administra-

tion and the Internal Revenue Service; public uni-

versities don’t take responsibility for their costs

and are often funded by excessive student lending;

underinvestment in the electric grid results in

high costs and unreliable service; highly inecient

U.S. merchant shipping and ports; and we have

unfunded pension plans and no action on deﬁcit

spending, Social Security and Medicare. I’ll stop

here. This should be unacceptable to all of us.

We need to ﬁnd a way to bring more varied

expertise and accountability to government.

We should be more ambitious in striving for excel-

lence in government. I acknowledge that some of

the best and the brightest are in government and

the military today. Yet we should return to a govern-

ment that seeks out more of the best and the

brightest people from every background, including

the private sector, to beneﬁt from their knowledge

and experience. Government also needs to leverage

the expertise of business to address problems that

it cannot solve on its own. And to be fair, business

could use its inﬂuence to do less to further its own

interest and more to enhance the nation as a whole.

We need good government. And there are some

things only governments can do, such as oversee

the military and justice systems. And while most

innovation happens through the private sector,

there are certain types of foundational innovations

that can only be advanced by the government,

such as basic research that simply cannot be

funded by business. The Democrats want the

government to do even more and the Republicans

even less — I think we should spend more time

trying to do even better. But no one, not even my

most liberal Democratic friends, thinks that send-

ing the government another trillion a year would

be a wise use of money.

OUT OF THE LABYRINTH, WITH FOCUS

AND RESOLVE

Even America, the most prosperous nation on the

planet with its vast resources, needs to focus its

resources on the complex and dicult tasks ahead.

I hope to never read a book about How the West

Was Lost, summarized as follows: The failure to

save Ukraine and ﬁnd peace in the Middle East led

to more bickering among the allies and weakened

military alliances. This accelerated a division

within the Western world, splitting countries into

dierent economic spheres and with each nation

trying to protect its economy, trade and energy

sources. America’s economy weakened, eventually

leading to the loss of its reserve currency status.

Besotted by populism and partisanship and

crippled by bureaucracy and lack of willpower,

America failed to focus on what it needed to do

to lead and save the Western world. The enemy

was within — we just didn’t see it in time.

Paraphrasing what Winston Churchill was thought

to have said: America, after it had exhausted all

other possibilities, would do the right thing.

What I want and hope to see is a book about

How the West Was Won. As the wars in Ukraine

and the Middle East dragged on and as the fears of

the Western world mounted, America rose to the

challenge as it had in other turbulent times in

history. America coalesced with its allies to form

the alliances necessary to keep the world safe for

freedom and democracy.

I remain with a deep and abiding faith in the

strength of the enduring values of America.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

WE SHOULD HAVE MORE FAITH IN THE AMAZING POWER

OF OUR FREEDOMS

The heart and soul of the dynamism of America is human

freedom — freedom of speech, freedom of religion, free

enterprise (capitalism), and the freedom and empowerment

brought to us by our democracy through the right to elect our

leaders. Free people are at liberty to move around as they see

ﬁt, work as they see ﬁt, dream as they see ﬁt, and invest in

themselves and in the pursuit of happiness as they see ﬁt. This

freedom that people enjoy, accompanied by the freedom of

capital, is what drives the dynamism — economic and social —

of this great country.

Our civil liberties depend upon the rule of law, property rights,

including intellectual property, and restrictions on government

encroachment upon these freedoms. Our Constitution and Bill

of Rights secure our individual freedoms and reserve all rights

to the individual other than those important but limited

authorities given to the government.

The issue of individual rights is not all or none or freedom ver-

sus no freedom. There are, of course, terrible examples where

individual rights were trampled upon, and the results were dev-

astating — both for the individual and for the economy — in East

Germany, Iran, North Korea, Russia, Venezuela, to name a few.

And there are many countries that protect individual rights and

are on a spectrum closer to American values. Think of Europe,

for example. But even in some countries that have some of

these rights, a lack of dynamism — often due to bureaucracy,

weak institutions and government, and corruption — is palpable

and has clearly led to less innovation, lower growth and, in

general, a lower standard of living.

Freedom must necessarily be joined with the principle of

striving toward equal opportunity. Equal opportunity is what

allows individuals to rise to the best of their ability — it also

means unequal outcomes. Equal opportunity is the foundation

for fairness and meritocracy. The ﬁght for equality, which is a

good moral goal, should not damage the rights of the individual

and their liberties.

Democracy and freedom are cojoined — together, they make

freedom more durable. Democracy also has a self-correcting

element — every four years you get to throw out leadership if

you don’t like them (which you do not see in autocracies). But

we all know that democracy can be sloppy: Maintaining an

eective democracy is hard work. Democracy fosters open

debate and compromise, which lead to better decisions over

time (whether in government or in business). Intelligence is

eectively “crowdsourced” with constant feedback. Good public

policy comes from good debate and analytics, guided by reason

coupled with a ﬁrm understanding of what you would like the

outcomes to be and complemented with an honest assessment

of what is really happening.

Even democracies can become stagnant, bureaucratic and self-

perpetuating. Good government does many admirable things,

but admitting to mistakes is often not one of them. It takes

civically engaged citizens and a strong free press to bring

sunlight to issues and keep a nation strong.

Autocratic societies by their nature subjugate the individual to

the state. By deﬁnition they are not meritocracies — they are

more about “who you know,” and they exist to perpetuate the

existing ruling class. Their decisions are based on a completely

dierent calculation, and their decision-making process does

not encourage and, therefore, beneﬁt from open

debate. Democracy means that it is immoral to subjugate

individual freedoms to state actors other than to protect the

existence of the nation itself.

There are values that many of us hold dear, such as religion,

family and country. But none may be more important than the

freedoms that allow us to choose to live our life as we see ﬁt.

We should do more to applaud the virtue and amazing power of

our freedoms.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

HOW WE CAN HELP LIFT UP OUR LOW-INCOME CITIZENS

AND MEND AMERICA’S TORN SOCIAL FABRIC

To ﬁx problems, we must ﬁrst acknowledge them. Despite

decades of government programs and all the moralizing that

surrounds them, we have not done a particularly good job

lifting up our low-income fellow citizens. I may be wrong, but I

do believe this is tearing at the social fabric of America and is

among the root causes of the fraying of the American dream.

The gap between low-wage and well-paid workers has been

growing dramatically. From 1979 to 2019, the wage growth of

the top 10% was nearly 10 times that of the bottom 10% —

which, basically, had not increased at all. The growth of low-

income workers’ annualized real wages after the pandemic

was, for the ﬁrst time in decades, higher than the top 60%, but

that’s not enough. The net worth for the bottom 25% of

households is $20,800, and the net worth for the bottom 10%

is essentially $0. This makes it increasingly dicult for low-

wage workers to support their families. Of the 160 million

Americans working today, approximately 40 million are paid

less than $15 per hour.

Low-income individuals bear far greater burdens than the rest

of us. Nearly 40% of Americans don’t have $400 in savings to

deal with unexpected expenses, such as medical bills or car

repairs, which leads to ﬁnancial distress. More than 25 million

Americans don’t have medical insurance at all; of these, one in

ﬁve are in a family with income below the federal poverty level.

People who live in low-income neighborhoods also tend to have

worse health outcomes, including higher rates of mental health

issues, depression and suicide, and a lower life expectancy — as

many as 20 years. Finally, low-income Americans generally

experience higher unemployment and more crime.

No one can claim that the promise of equal opportunity is being

oered to all Americans through our education systems.

Students in the lowest socioeconomic bracket are 50% less

likely to attend college than those in the highest socioeconomic

groups. Many inner city schools graduate under 50% of their

students — and even those who graduate may not be well-

prepared for the workforce. In addition, boys growing up in the

bottom 10% of family income are 20 times more likely to be

incarcerated. Those who do run afoul of our justice system

generally do not get the second chance that many of them

deserve. Their exclusion from the workforce is not only unfair

to them but also results in an estimated $87 billion average

annual cost to the economy.

Too many policies that are wrong — aecting housing and

mortgage markets, healthcare, immigration, regulation,

education and student lending, to name a few — are

jeopardizing the opportunity for American citizens to succeed.

The people who suer the most, throughout all of this, are not

high-income individuals. I strongly believe that these outcomes

are destroying the concept of “fair” in America and are driving

populism and diminishing, if not eliminating, trust — not only in

government but in all our institutions. Simply put, the social

needs of far too many of our citizens are not being met. We

should never accept these outcomes — we must ﬁx them.

There are two policy changes that I believe can have a dramatic

eect on jobs, growth and equality — and they go a long way

toward repairing the frayed American dream. Let’s start by

treating all jobs with respect. Even starter jobs, which are the

ﬁrst rung on the ladder of opportunity, bring dignity and create

better social outcomes in terms of health, higher household

formation and lower crime. Of these two policy changes, one

would better utilize existing resources, and the other would

cost some money. But both would signiﬁcantly change

outcomes for low-income Americans.

The free one is so blindingly obvious that it’s almost

embarrassing to propose. Our schools (high schools,

community colleges and perhaps even four-year colleges)

should take responsibility for outcomes — they should be

judged on the quality and income level of the jobs that their

graduates and even non-graduates attain. This means providing

graduating students and other individuals with work skills (in

ﬁelds such as advanced manufacturing, cyber, data science and

technology, healthcare and so on) that will lead to better paying

jobs. These schools should work with local businesses to

replicate eective programs that are in place — because that is

where the actual jobs are now. This would be good for growth

and, as there are so many examples of successful programs, we

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

already know what to do. With nearly 9 million job openings

and just under 6 million unemployed workers in the United

States, job skills training has never been needed more. We

already spend a tremendous amount of money on education —

just not the right way.

The second step is related to the ﬁrst: Get more income to low-

paid workers. While this one would cost money, it is to me a

complete no-brainer since it is an expansion of an existing

program, the Earned Income Tax Credit (EITC), which many

Democrats and Republicans already agree upon. Today, the

EITC supplements low- to moderate-income working individuals

and couples, particularly with children and people living in rural

areas. For example, a single mother with two children earning

$9 an hour (approximately $20,000 a year) could receive a tax

credit of more than $6,000 at year-end. Workers without

children receive a very small tax credit (96% of all EITC dollars

were received by families with children). This should be

dramatically expanded, including eliminating the child

requirement from the calculation altogether. We should convert

the EITC to make it more like a negative income payroll tax,

paid monthly. Any tax credit income should not be oset by any

other beneﬁts these individuals already receive (we have to

eliminate beneﬁt “clis” that disincentivize work).

An increase in the EITC to a maximum of $10,000 would cost

tens of billions a year, but I have little doubt that these policy

changes would do more than anything else to lift up low-

income families and their communities. Well-paying jobs have

been shown to reduce crime, increase household formation,

improve health and reduce addiction. Both of these policies

would have the virtue of increasing the number of people in the

workforce. I also have little doubt that this would add to GDP.

We should attack all our other problems as well, but these two

policy changes alone would dramatically improve our low-

income neighborhoods, broadly strengthen the economy and

give more opportunity to deserving citizens. It would restore

the American Dream for many.

A PIVOTAL MOMENT FOR AMERICA AND THE FREE WESTERN WORLD: STRATEGY AND POLICY MATTER

In Closing

It’s been 20 years since the Bank One-JPMorgan Chase merger — and it’s been

an extraordinary journey. I can’t even begin to express my heartfelt appreciation

and respect for the tremendous character and capabilities of the

management team who got us through the good times and the bad times

to where we stand today. And I recognize that we all stand on the shoulders of many

others who came before us in building this exceptional company of ours.

I would also like to express my deep gratitude to the 300,000+ employees,

and their families, of JPMorgan Chase. Through these annual letters,

I hope shareholders and all readers have gained a deeper understanding

of what it takes to be an “endgame winner” in a rapidly changing world.

More important, I hope you are as proud of what we have achieved — as a business,

as a bank and as a community investor — as I am.

Thank you for your partnership.

Finally, we sincerely hope to see the world on the path to peace and prosperity.

Jamie Dimon

Chairman and Chief Executive Ocer

April 8, 2024

Footnotes

Client Franchises Built Over the Long Term (page 11)

Note: ﬁgures may not sum due to rounding

1 Certain wealth management clients were realigned from Asset & Wealth Management (AWM) to Consumer & Community Banking (CCB) in 4Q20. 2005 and 2013

amounts were not revised in connection with this realignment.

2 Federal Deposit Insurance Corporation (FDIC) Summary of Deposits survey per S&P Global Market Intelligence applies a $1 billion deposit cap to Chase and

industry branches for market share. While many of our branches have more than $1 billion in retail deposits, applying a cap consistently to ourselves and the

industry is critical to the integrity of this measurement. Includes all commercial banks, savings banks and savings institutions as deﬁned by the FDIC.

3 Barlow Research Associates, Primary Bank Market Share Database. Rolling 8-quarter average of small businesses with revenues of more than $100,000 and

less than $25 million. 2023 results include First Republic. Barlow’s 2005 Primary Bank Market Share is based on companies with revenues of more than

$100,000 and less than $10 million.

4 Total payment volumes reﬂect Consumer and Small Business customers’ digital (ACH, BillPay, PayChase, Zelle, RTP, external transfers, digital wires), non-digital

(non-digital wires, ATM, teller, checks) and credit and debit card payment outﬂows.

5 Digital non-card payment transactions includes outﬂows for ACH, BillPay, PayChase, Zelle, RTP, external transfers, and digital wires, excluding Credit and Debit

card sales. 2005 is based on internal JPMorgan Chase estimates.

6 Represents general purpose credit card (GPCC) spend, which excludes private label and Commercial Card. Based on company ﬁlings and JPMorgan Chase

estimates.

7 Represents GPCC loans outstanding, which excludes private label, American Express Company (AXP) Charge Card, Citi Retail Cards, and Commercial Card. Based

on loans outstanding disclosures by peers and internal JPMorgan Chase estimates.

8 Represents users of all web and/or mobile platforms who have logged in within the past 90 days.

9 Represents users of all mobile platforms who have logged in within the past 90 days.

10 Based on 2023 sales volume and loans outstanding disclosures by peers (AXP, Bank of America Corporation, Capital One Financial Corporation, Citigroup Inc.

and Discover Financial Services) and JPMorgan Chase estimates. Sales volume excludes private label and Commercial Card. AXP reﬂects the U.S. Consumer

segment and JPMorgan Chase estimates for AXP’s U.S. small business sales. Loans outstanding exclude private label, AXP Charge Card, Citi Retail Cards and

Commercial Card. Card loans outstanding market share has been revised to reﬂect a restatement to the 2022 reported total industry outstandings disclosed by

Nilson, which impacts annual share growth in 2023.

11 Inside Mortgage Finance, Top Owned Mortgage Servicers as of 4Q23.

12 Experian Velocity data as of FY23. Reﬂects ﬁnancing market share for new and used loan and lease units at franchised and independent dealers.

13 Coalition Greenwich Competitor Analytics (preliminary for FY23). Market share is based on JPMorgan Chase’s internal business structure and revenue. Ranks

are based on Coalition Index Banks for Markets. 2006 rank is based on JPMorgan Chase analysis.

14 Dealogic as of January 2, 2024, excludes the impact of UBS/CS merger prior to the year of the acquisition (2023).

15 Client deposits and other third-party liabilities pertain to the Payments and Securities Services businesses.

16 Firmwide Payments revenue metrics exclude the net impact of equity investments; 2005 data represents Treasury Services ﬁrmwide revenue only. All other

periods include Merchant Services revenue.

17 Coalition Greenwich Competitor Analytics (preliminary for FY23) reﬂects global ﬁrmwide Treasury Services business (CIB and CB). Market share is based on

JPMorgan Chase’s internal business structure, footprint and revenue. Ranks are based on Coalition Index Banks for Treasury Services.

18 Institutional Investor.

19 Based on third-party data.

20 The Market Share number represents US dollar payment instructions for direct payments and credit transfers processed over Society for Worldwide Interbank

Financial Telecommunications (“SWIFT”) in the countries where J.P. Morgan has sales coverage.

21 Nilson, Full Year 2023.

22 Coalition Greenwich FY23 Competitor Analytics (preliminary). Rank is based on JPMorgan Chase’s internal business structure and revenue and Coalition Index

Banks for Securities Services.

23 Data in 2005 column is as of 12/31/2006.

24 New relationships (gross) exclude impact of First Republic acquisition.

25 Includes gross revenues earned by the Firm that are subject to a revenue sharing arrangement between CB and the CIB for Investment Banking and Markets’

products sold to CB clients. This includes revenue related to ﬁxed income and equity markets products.

26 S&P Global Market Intelligence as of December 31, 2023.

27 London Stock Exchange Group, FY23.

28 Aligns with the aordable housing component of the Firm’s $30 billion racial equity commitment.

29 Percentage of active mutual fund and active ETF assets under management in funds ranked in the 1st or 2nd quartile (one, three and ﬁve years): All quartile

rankings, the assigned peer categories and the asset values used to derive these rankings are sourced from the fund rating providers. Quartile rankings are

based on the net-of-fee absolute return of each fund. Where applicable, the fund rating providers redenominate asset values into U.S. dollars. The percentage

of AUM is based on fund performance and associated peer rankings at the share class level for U.S.-domiciled funds, at a “primary share class” level to

represent the quartile ranking for U.K., Luxembourg and Hong Kong SAR funds and at the fund level for all other funds. The performance data may have been

dierent if all share classes had been included. Past performance is not indicative of future results. “Primary share class” means the C share class for European

funds and Acc share class for Hong Kong SAR and Taiwan funds. If these share classes are not available, the oldest share class is used as the primary share

class. Due to a methodology change eective September 30, 2023, prior results include all long-term mutual fund assets and exclude active ETF assets.

30 In the fourth quarter of 2020, the Firm realigned certain wealth management clients from AWM to CCB. Prior-period amounts have been revised to conform

with the current presentation.

31 Traditional assets includes Equity, Fixed Income, Multi-Asset and Liquidity AUM Brokerage, Administration and Custody assets under supervision.

32 AUM only for 2005. Prior period amounts have been restated to include changes in product categorization.

33 Source: Euromoney.

34 Percentage of active mutual fund and active ETF assets under management in funds rated 4- or 5-star: Mutual fund rating services rank funds based on their

risk adjusted performance over various periods. A 5-star rating is the best rating and represents the top 10% of industry-wide ranked funds. A 4-star rating

represents the next 22.5% of industry-wide ranked funds. A 3-star rating represents the next 35% of industry-wide ranked funds. A 2-star rating represents the

next 22.5% of industry-wide ranked funds. A 1-star rating is the worst rating and represents the bottom 10% of industrywide ranked funds. An overall

Morningstar rating is derived from a weighted average of the performance associated with a fund’s three-, ﬁve and ten- year (if applicable) Morningstar Rating

metrics. For U.S.- domiciled funds, separate star ratings are provided at the individual share class level. The Nomura “star rating” is based on three-year

risk-adjusted performance only. Funds with fewer than three years of history are not rated and hence excluded from these rankings. All ratings, the assigned

peer categories and the asset values used to derive these rankings are sourced from the applicable fund rating provider. Where applicable, the fund rating

providers redenominate asset values into U.S. dollars. The percentage of AUM is based on star ratings at the share class level for U.S.-domiciled funds, and at a

“primary share class” level to represent the star rating of all other funds, except for Japan, for which Nomura provides ratings at the fund level. The

performance data may have been dierent if all share classes had been included. Past performance is not indicative of future results.

35 Source: Company ﬁlings and JPMorgan Chase estimates. Rankings reﬂect publicly traded peer group as follows: Allianz, Bank of America, Bank of New York

Mellon, BlackRock, Charles Schwab, DWS, Franklin Templeton, Goldman Sachs, Invesco, Morgan Stanley, State Street, T. Rowe Price and UBS. JPMorgan Chase

ranking reﬂects Asset & Wealth Management client assets, U.S. Wealth Management investments and new-to-ﬁrm Chase Private Client deposits.

36 Source: iMoneynet.

37 Represents AUM in a strategy with at least one listed female and/or diverse portfolio manager. “Diverse” deﬁned as U.S. ethnic minority.

JPMorgan Chase Exhibits Strength in Both Eciency and Returns When Compared with Large Peers and

Best-in-Class Peers (page 14)

1 Bank of America Corporation (BAC), Citigroup Inc. (C), The Goldman Sachs Group, Inc. (GS), Morgan Stanley (MS) and Wells Fargo & Company (WFC).

2 Managed overhead ratio = total noninterest expense/managed revenue; revenue for GS and MS is reﬂected on a reported basis.

3 Best-in-class peer overhead ratio represents the comparable business segments of JPMorgan Chase (JPM) peers: Capital One Domestic Card and Consumer

Banking (COF-DC & CB), Bank of America Global Banking and Global Markets (BAC-GB & GM), Fifth Third Bank (FITB), Northern Trust Wealth Management

(NTRS-WM) and Allianz Group (ALLIANZ-AM).

4 Best-in-class all banks ROTCE represents implied net income minus preferred stock dividends of the comparable business segments of JPM peers, when

available, or of JPM peers on a ﬁrmwide basis when there is no comparable business segment: Bank of America Consumer Banking (BAC-CB), Bank of America

Global Banking and Global Markets (BAC-GB & GM), Wells Fargo & Company Commercial Banking (WFC-CB) and Morgan Stanley Wealth Management &

Investment Management (MS-WM & IM).

5 Best-in-class GSIB ROTCE represents implied net income minus preferred stock dividends of the comparable business segments of JPM GSIB peers, when

available, or of JPM GSIB peers on a ﬁrmwide basis when there is no comparable business segment: Bank of America Consumer Banking (BAC-CB), Bank of

America Global Banking and Global Markets (BAC-GB & GM), Wells Fargo & Company Commercial Banking (WFC-CB) and Morgan Stanley Wealth Management &

Investment Management (MS-WM & IM). WFC-CB is the only GSIB peer to disclose a comparable business segment to Commercial Banking.

6 Given comparisons are at the business segment level, where available; allocation methodologies across peers may be inconsistent with JPM’s.

Our Fortress Balance Sheet (page 15)

1 Tangible common equity 2005-2007 reﬂects common stockholders’ equity less goodwill and other intangible assets.

2 Basel III Transitional rules became eective on January 1, 2014; prior-period CET1 data is based on Basel I rules. As of December 31, 2014, the ratios represent

the lower of the Standardized or Advanced approach calculated under the Basel III Fully Phased-In basis.

3 Includes eligible High Quality Liquid Assets (HQLA) as deﬁned in the liquidity coverage ratio (LCR) rule and unencumbered marketable securities, such as equity

and debt securities, that the Firm believes would be available to raise liquidity including excess eligible HQLA securities at JPMorgan Chase Bank, N.A. that are

not transferable to nonbank aliates; for December 31, 2023 and 2022, the balance includes eligible end-of-period HQLA as deﬁned in the LCR rule, issued

December 19, 2016. For December 31, 2017–2021, the balance includes average eligible HQLA. Periods prior to 2017 represent period-end balances. December

31, 2016 and 2015 balances are under the initial U.S. rule approved on September 3, 2014. The December 31, 2014 amount is estimated prior to the eective

date of the initial rule, and under the Basel III liquidity coverage ratio (Basel III LCR) for December 31, 2013.

4 2005-2012 reﬂect cash and cash due from banks and investment securities.

5 Capital returned to common stockholders includes common dividends and net repurchases.

Size of the Financial/Sector Industry (page 39)

1 2007 and 2010 sourced from WorldBank.org annual GDP publication. 2023 is calculated using JPM Research forecasts. Figures are represented in 2015 prices.

2 Consists of cash assets and Treasury and agency securities.

3 2023 ﬁgure is as of 3Q23.

4 Top 50 fund AUM data per Sovereign Wealth Fund Institute (SWFI).

5 Loans held by nonbank entities per the FRB Z.1 Financial Accounts of the United States.

6 U.S. money market fund investment holdings of securities issued by entities worldwide.

7 Methodology updated in 2022, previous years have been restated.

8 NYSE + NASDAQ; excludes investment funds, ETF’s unit trusts and companies whose business goal is to hold shares of other listed companies; a company with

several classes of shares is only counted once.

9 Inside Mortgage Finance and JPMorgan Chase internal data; consists of Top 50 Originators (Top 40 for 2007).

10 Preqin, Dealogic, JPM Credit Research.