JPMorgan’s Wealth Target: 6,500 Advisors by Year-End
JPMorgan Chase Chief Executive Jamie Dimon is bullish on wealth management, expecting to increase the banking giant’s force to 6,500 by the end of the year, he wrote in the company’s annual report filed on Thursday.
The number would represent an addition of about 300 wealth advisors, or a 6% annualized growth rate since 2016.
The New York-based bank company spreads its advisors across a wide range of functions and expertise. The majority are bank branch-based advisors in its mass-affluent Chase Private Client group, with about 2,800 additional advisers on JPMorgan Private Bank or J.P. Morgan Securities teams servicing high- and ultra-high-net worth clients.
The bank’s in-branch and private bankers are paid salaries supplemented by bonuses, unlike the smaller group of traditional brokers that Chase inherited from Bear, Stearns during the financial crisis of 2008.
J.P. Morgan has revved up its hiring efforts in the brokerage unit, and was an aggressive recruiter of Morgan Stanley brokers in the short grace period after that firm announced its intention to withdraw from the Protocol for Broker Recruiting in late 2017.
“We are expanding our footprint to capture more of the opportunity across the U.S. wealth management spectrum,” Dimon, 63, wrote in his annual letter.
The largest U.S. bank’s wealth management businesses cumulatively generated $6.9 billion in 2018, or 6.2% of the company’s total revenue of $111.5 billion.
The company is not breaking out growth targets for particular areas of its wealth business, a J.P. Morgan spokesman said. In 2018, the ranks of private bankers and J.P. Morgan Securities brokers rose by 260 advisors.
Dimon’s growth aspirations would still put J.P. Morgan well below the advisory ranks of rivals. Morgan Stanley has about 16,000 brokers and Bank of America some 18,000 spread among its Merrill Lynch wealth and its traditional private banking units.
Both companies, however, have been tightening expense controls and pulling back on recruiting, as has UBS, which employs about 6,300 advisors in the U.S.
Mary Callahan Erdoes, chief executive of J.P. Morgan’s asset and wealth management division, said in February that the company manages around 8% of the $4 trillion-asset ultra-high net worth market in the U.S., around 1% of the country’s $10 trillion of high-net worth assets and around 4% of its $20 trillion of mass-affluent assets.
“We consistently attract, train and cultivate many of the top investment managers and advisors in our industry, proudly retaining more than 95% of our top talent over the last several years,” Erdoes wrote in the 2019 annual report. “We will continue to expand our footprint across the U.S. and other high-growth areas, such as China.”