JPMorgan ‘sure city will bounce back’
Bank to keep investing amid strong prospects for nation, president insists
JPMorgan will continue to invest in Hong Kong, betting that the city where it has been doing business for a century can recover when the economic cycle turns, and live up to its potential as a financial centre for the nation.
“We will continue to do the business that we are doing and continue growing,” said the bank’s president and chief operating officer Daniel Pinto during an interview in Hong Kong. “We are not the type of company that is going to go fully in one day and fully out the other. These are [business] cycles, and we’ve been navigating cycle after cycle over time.”
The New York-based lender began in Hong Kong in 1924 as the Equitable Eastern Banking Corporation. Including its full range of banking, wealth management and brokerage ventures on the mainland, JPMorgan counts the China region as half of its Asia-wide business.
The bank, which oversees US$2.6 trillion, said it would continue hiring in China for its asset management business.
Last year, it took full ownership of China International Fund Management, its asset management arm on the mainland.
“China is the second-biggest economy in the world and it will create opportunities, how fast or how slow those opportunities will present themselves is a matter of being prudent in that part of the cycle,” Pinto said.
China’s financial markets would develop even further over time, and JPMorgan and other international companies would play an important role in helping its financial systems continue to develop, he added.
The firm, which employs some 320,000 people worldwide, has been picking up talent at a time most banks have been making cuts. Some 80,000 members of staff are based in its Asia offices.
A steady US economy meant the company reported its best annual profit and forecast higher-than-expected interest income for 2024, even as its quarterly profit fell.
The bank also benefited from its acquisition of failed First Republic Bank last May, which brought in billions of dollars in loans and bolstered its net interest income – the difference between what banks make on loans and pay out on deposits.
But there is still room to grow, according to Pinto, because the bank’s mainland business is clearly “disproportionate” to the size of the country’s economy, he said, adding that Hong Kong would continue to be part of the growth.
“The potential for growth in China is significant, if it is possible to monetise,” he said.
“[Hong Kong’s government] needs to maintain the environment to continue to be a global financial centre in the world and create an environment for foreign companies and local companies to continue to evolve.”
To mark its centenary, JPMorgan is organising a year-long calendar of events for its staff and customers, culminating in a 5.6km charity run at the West Kowloon Cultural District on November 21.
Pinto also said JPMorgan had no plans to back out because of China-United-States tensions.
“[Geopolitical] tensions go up and down, based on how much dialogue there is or there isn’t. When [Joe] Biden and Xi [Jinping] met in San Francisco and agreed on military dialogue and the importance of the commercial relationship between the countries, the tension went down.”
Pinto added that the bank could not “ignore the secondbiggest economy in the world. Because for any company and in any industry, once you’re out, it’s very difficult to go back in.”