JP Morgan Chase 2010 Annual Report Download - page 33

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Notes: Deposit market share data
are related to the operations/
transactions conducted by banks
domiciled in each respective
country, including branches and
subsidiaries of foreign banks
1 Deposit market share is based
on the top eight banks in France,
top seven banks in Sweden, top
four banks in the Netherlands, top
three banks in Germany and top
two banks in Switzerland
Sources: J.P. Morgan and J.P. Morgan
Cazenove research estimates; com-
pany filings and reports; and Central
Bank and trade association data
Top 20 Countries by Gross Domestic Product
Deposit Market Share for Top 10 Banks
in Each Respective Country % Share
Canada 97 %
Mexico 93
Turkey 92
South Korea 91
Australia 90
France1 88
Brazil 85
Spain 84
Sweden1 84
Argentina 76
The Netherlands1 76
China 67
Japan 62
India 61
Russia 61
Italy 53
United Kingdom 48
United States 41
Switzerland1 35
Germany1 26
We should be concerned about American banks
losing global market share – because they are
Two facts support this contention:
U.S. investment banking services are increas-
ingly being provided by foreign banks. While
it is gratifying to see J.P. Morgan go from
nowhere to become #1 in U.S. investment
banking, it is notable how much U.S. invest-
ment banking has changed. Twenty years
ago, U.S. investment banks dominated U.S.
investment banking – occupying all of the
top 10 positions. A decade ago, they held
nine of the top 10. Last year, U.S. investment
banks held only five – half – of the top 10 slots
(see chart below).
U.S. banks also have lost significant position.
In 1989, U.S. banks represented 44 of the
50 largest financial firms in the world (by
market capitalization). More than 20 years
later, American banks now number only six
of the top 50. While much of this change
has to do with the growth of the rest of the
world, it is striking both how fast and how
dramatic the change has been.
It’s important that we make sure that American
banks stay competitive
We believe that it is good for America – the
world’s leading global economy – to have
leading global banks. Being involved in
the capital flows between corporations and
investors across the globe is a critical func-
tion. Large, sophisticated institutions will be
required to manage these flows and to inter-
mediate or invest directly if necessary. Global
markets will require sophisticated analysis,
tools and execution.
The impact of ceding this role to banks
based outside the United States could be
detrimental to the U.S. economy and to U.S.
Market-Leading Franchises — Investment Bank
U.S. Equity, Equity-Related and Debt
Rank 1990 2000 2010
1 Merrill Lynch Merrill Lynch J.P. Morgan
2 Goldman Sachs Salomon Smith Barney Barclays Capital
3 Salomon Brothers Morgan Stanley Bank of America Merrill Lynch
4 First Boston Credit Suisse Deutsche Bank
5 Morgan Stanley Goldman Sachs Goldman Sachs
6 Kidder Peabody Lehman Brothers Citi
7 Bear Stearns Chase Royal Bank of Scotland
8 Shearson Lehman J.P. Morgan UBS
9 Prudential-Bache Capital Bank of America Morgan Stanley
10 Donaldson Lufkin & Jenrette Deutsche Bank Credit Suisse
Source: Thomson Reuters. Data as of 12/31/10. Rankings based on dollar volume run on March 14, 2011
Note: Light gray font designates firms that no longer exist; orange font indicates non-U.S.-based firms