JPMorgan chases branch expansion because mobile banking can’t replace brick and mortar
Branchin’ out… JPMorgan Chase announced plans to add 500+ new branch locations by 2027, targeting “low-to-moderate income and rural communities,” plus cities including Boston, Charlotte, and Philly. America’s biggest bank by assets already has the US’s largest branch network, with nearly 5K locations in 48 states. Now JPM hopes to expand into markets where it’s less represented (picture: under 5% of branch market share).
Tellers wanted: JPM also plans to renovate ~1.7K of its existing US branches and hire 3.5K+ employees to support its expansion.
Big deposit energy: JPMorgan raked in record profit last year, and holds more than $2T worth of deposits, up nearly 2X from a decade ago. Its expansion could help it achieve its goal of holding a fifth of all US deposits (up from 12% now).
Life on autopay… The rise of mobile banking (and other app-y fintech options) kicked off the decline of physical bank locations, which have shrunk by a fifth since 2009 — with 2.5K+ branches shuttered last year alone. Nearly half of Americans prefer to bank on their phones, and even OGs like JPM and Bank of America have invested heavily in sleek apps and remote customer support. But the decline of brick and mortar has worsened the US’s banking gap: 7M+ households are unbanked, and 64% of those are in Black, Hispanic, and Latino communities.
IRL relationships still matter… especially when it comes to serious business like $$. While online banking can handle a lot of transactions, it’s unlikely to replace physical locations. Banks know some customers want the security of face-to-face help, plus services like safe-deposit boxes, cashier’s checks, and ATMs. It’s why they’re still investing in IRL: Bank of America has plans to open locations in nine new markets and four states.