JP Morgan Chase 2014 Annual Report Download - page 54

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Everything starts with our clients
Selecting the best clients is absolutely
critical to the value of our franchise
and is deeply embedded in our cul-
ture. We seek clients that are highly
reputable, share our risk philosophy,
have strong management teams and
work in preferred industries we truly
understand. We believe that we are
judged by the company we keep,
and, as such, our fantastic client
franchise is the foundation for our
entire business.
With our global reach and broad-
based capabilities, we empower our
bankers to be there for our clients
with advice, capital and industry
insights. By knowing their business,
supporting their ambitions and
understanding their challenges, we
are able to best serve our clients and
build strong relationships.
Trust and relationships are often rein-
forced in times of trouble. That was
the case for one of our clients, a large
beverage distributor based in the
Seattle area. A few years ago, an unex-
pected industry sales tax increase
caused the company to lose a signifi-
cant portion of revenue within a short
time period. The family-run business
needed patience to execute a long-
term recovery plan and avoid dra-
matic job reductions. During this
stressful and challenging period, our
beverage industry bankers consis-
tently met with senior managers at
the company to provide advice and
guidance while they developed their
plan. In 2014, the company success-
fully completed its turnaround. Stay-
ing with our clients through times
like this, and earning their trust and
gratitude, is the reason we come to
work each day. We pride ourselves on
our relationship focus and the loyal
support we provide our clients.
Real competitive advantages
Our clients rely on our industry-
leading capabilities and comprehen-
sive services that no other commer-
cial bank can provide. As part of
JPMorgan Chase, CB is uniquely
positioned with access to the #1
investment bank, a leading asset
management business, comprehen-
sive payments and treasury services,
and an extensive branch footprint.
Today, our typical client uses nine
of our products and services, and it
is common to see our longer-term
relationships use more than 20.
When our clients seek to make more
ecient payments, generate better
reporting, and securely process trans-
actions from their own customers,
we leverage our market-leading com-
mercial payments platforms. In 2014,
less than 30% of our clients utilized
our commercial card and merchant
services capabilities. We believe we
can double the usage rates of both
of these products over time.
Collaborating with the Corporate &
Investment Bank (CIB) enables us to
bring dierentiated advice and market
access to our clients. In 2014, CB rela-
tionships generated a record $2 billion
in investment banking revenue, repre-
senting 35% of the CIB’s North Ameri-
can investment banking revenue and
reaching the revenue target we set in
Commercial Banking
Our commitment is to be the best
commercial bank by helping our
clients succeed and by making a
positive dierence in our communi-
ties. In 2014, this meant investing in
our business and controls, remaining
focused on our clients, and continu-
ing to execute our proven strategy
with discipline and patience.
For the year, Commercial Banking
(CB) delivered strong results, earning
$2.6 billion of net income on revenue
of $6.9 billion. Our continued expense
discipline and exceptional credit
performance helped us achieve a
return on equity of 18%. We are quite
proud of these results as our business
continues to navigate changes in the
regulatory landscape and adapt to
shifting market pressures.
The drivers of our success remain
consistent over time: We have an
outstanding client franchise, real
competitive advantages and a sus-
tainable growth plan. I’m proud to
convey our progress for 2014 and
share our exciting plans for 2015.
Douglas Petno