Jamie Dimon, the most respected big Bank CEO on Wall Street who guides JP Morgan Chase (NYSE:JPM), shared his annual shareholder letter last week and once again, Dimon mentioned the growing Fintech sector.
In 2022, Dimon addressed the looming challenge of upstart Fintechs, stating that “Banks around the world are already engaged in tough competition with each other,” but now there are “nonbanks — from payments companies and Fintechs to exchanges and Big Tech — that compete with traditional banks.”
He defended JP Morgan, claiming it had invested over $1.5 billion since 2016 in technology to pursue faster payments and is at the forefront of decentralized (DeFi) finance and blockchain technology.
In 2023, Dimon declared:
“The growing competition to banks from each other, as well as shadow banks, Fintechs and large technology companies, is intense and clearly contributing to the diminishing role of banks and public companies in the United States and the global financial system.”
In 2024, Dimon sounded the alarm bell once again, stating that the banking system is not static:
“There are startup banks, mergers, successful upstarts and fintech banks, and even Apple, which effectively acts as a bank — it holds money, moves money, lends money and so on.”
He added that the “banking system, as we know it, is shrinking relative to private markets and Fintech, which are growing and becoming increasingly competitive.”
This year, JPM’s Fintech concerns appear to be more subdued. Dimon seems to dismiss the once-concerning tech competition, explaining that they need to be just as nimble and use their “skills and capabilities to stay ahead.”
The JPM Digital Innovation team is working globally to maintain this lead. The group is “..leveraging its relationships across a global network of market-leading companies, start-ups, investors, accelerators, government bodies and universities, the team partners across the CIB’s lines of business to identify, fund, build, implement and distribute best-in-class solutions.”
JPM now states that they are rapidly evaluating Fintech offerings and building prototypes. No more deer in the headlights.
Of course, Dimon’s past statements remain valid. The bank operates a hefty real estate portfolio of bank branches, which are not needed as much as before. But what it does have is operations in over 100 countries, more than 300,000 employees, and now claims to be one of the world’s largest tech-driven companies, having spent $17 billion on tech, including investments in artificial intelligence.