JP Morgan Chase 2014 Annual Report Download - page 47

45
$3.2 billion of expense out of CCB,
and we are on track to reduce
expenses by an additional $2 billion
by the end of 2016. Staying disci-
plined and being as ecient as pos-
sible allow us to invest back into our
businesses and create strong returns
for all of you who have chosen to
invest in our company.
CCB demonstrated significant
growth in nearly every business
in 2014.
Here are some highlights from
our businesses:
Consumer & Business Banking
Consumer & Business Banking depos-
its were up 8% to nearly half a trillion
dollars by the end of the year. We
talked about customer attrition reach-
ing historic lows – it is down 4%
since 2010. To put this in perspective,
that equates to 1 million Consumer
Banking households and an incre-
mental $15 billion in deposits.
Chase Private Client (CPC) continues
to be a notable success. We have
grown to more than 325,000 CPC
clients, up 51% from 2013. Client
investment assets were up 13%. Since
2012, we’ve tripled our net new CPC
deposits and investments, with 60%
of new investments coming from
customers who are investing with
Chase for the first time. With 55%
of auent households living within
two miles of a Chase branch or ATM,
we feel well-positioned to continue
that growth.
Business Banking loan originations
were up 28% in 2014. Loans were
up 6%, and deposits were up 12%.
And we are extremely proud that
we were the #1 Small Business
Administration lender for women
and minorities in the United States
for the third year in a row.
Mortgage
The 2014 mortgage market was one
of the most challenging we have
faced. We have been very focused on
transforming our Mortgage franchise
to a simpler, higher quality and less
volatile business. In 2014, Mortgage
originations were down 53% from
2013 due to the challenging rate
environment. But we didn’t forget
the industry lessons learned over
the past several years and remained
disciplined. We ceded some market
share to focus on our strategy of
acquiring high-quality loans. And
we actively reduced our foreclosure
inventory from roughly 170,000 in
2013 to 90,000 in 2014.
One of the lessons we learned from
the industry crisis in Mortgage is
that complexity kills. We have
reduced the number of mortgage
products from 37 to 18, and by the
end of 2015, it will be down to 15.
Yet those 15 products still will meet
97% of customers’ needs. I’m sure
the 22 products we are exiting were
developed with good intentions to
help customers, but they created
unnecessary complexity for employ-
ees and more expense and execution
risk than we needed.
Mortgage Banking also has made
tremendous progress in reducing
expenses. Mortgage expenses were
down 30% over 2013.
Credit Card and Payments
Card Services sales volume of $465.6
billion was up 11% year-over-year,
outperforming the industry for the
28th consecutive quarter. Credit
trends continue to improve, and
credit card net charge-os were
down 12% from 2013. Our Merchant
Services business processes nearly
half of the total e-commerce pay-
ment volume in the United States.
Our processing volume was $847.9
billion, up 13% year-over-year.
Payments is one of the most inter-
esting areas in our business as con-
sumers are adapting to new ways to
pay. We like our strategic position
as both a bank that issues cards for
consumers and a payment processor
for merchants. Through ChaseNet,
we also have our own network and
can complete every aspect of the
payment transaction.
One of the most exciting develop-
ments of the year was Apple PayTM.
Chase participated as both a consumer
issuer and a merchant acquirer.
Chase cardholders can register their
cards in Apple PayTM and make digi-
tal payments simply by hitting a fin-
gerprint button on their iPhone® 6.
Our merchant customers will be able
to use our software development kit
to enable payments online, in-app
and in-store. Tokenization will make
those payments safe and secure.
Auto
In Auto, we continue to grow while
maintaining our credit discipline. Our
originations volume of $27.5 billion
was up 5%, with our average loans up
4%. Here, too, we have stayed disci-
plined by retaining high credit stan-
dards. Our average FICO score on
loan originations was 32 points
higher than the industry average.
Digital
Digital is transforming our industry.
We’ve seen tremendous growth rates
in customer adoption of our digital
services. The number of customers
who are active on Chase mobile
went from 8.2 million in 2011 to
19.1 million in 2014. On average,
we added about 18,000 new mobile
users per day throughout 2014.