JP Morgan Chase 2015 Annual Report Download - page 110

Management’s discussion and analysis
100 JPMorgan Chase & Co./2015 Annual Report
CB product revenue consists of the following:
Lending includes a variety of financing alternatives, which
are primarily provided on a secured basis; collateral
includes receivables, inventory, equipment, real estate or
other assets. Products include term loans, revolving lines of
credit, bridge financing, asset-based structures, leases, and
standby letters of credit.
Treasury services includes revenue from a broad range of
products and services that enable CB clients to manage
payments and receipts, as well as invest and manage funds.
Investment banking includes revenue from a range of
products providing CB clients with sophisticated capital-
raising alternatives, as well as balance sheet and risk
management tools through advisory, equity underwriting,
and loan syndications. Revenue from Fixed Income and
Equity Markets products used by CB clients is also included.
Investment banking revenue, gross, represents total
revenue related to investment banking products sold to CB
clients.
Other product revenue primarily includes tax-equivalent
adjustments generated from Community Development
Banking activities and certain income derived from principal
transactions.
CB is divided into four primary client segments: Middle
Market Banking, Corporate Client Banking, Commercial
Term Lending, and Real Estate Banking.
Middle Market Banking covers corporate, municipal and
nonprofit clients, with annual revenue generally ranging
between $20 million and $500 million.
Corporate Client Banking covers clients with annual
revenue generally ranging between $500 million and $2
billion and focuses on clients that have broader investment
banking needs.
Commercial Term Lending primarily provides term
financing to real estate investors/owners for multifamily
properties as well as office, retail and industrial properties.
Real Estate Banking provides full-service banking to
investors and developers of institutional-grade real estate
investment properties.
Other primarily includes lending and investment-related
activities within the Community Development Banking
business.
Selected metrics
Year ended December 31,
(in millions, except ratios) 2015 2014 2013
Revenue by product
Lending(a) $ 3,429 $ 3,358 $ 3,730
Treasury services(a) 2,581 2,681 2,649
Investment banking 730 684 575
Other(a) 145 159 138
Total Commercial Banking net
revenue $ 6,885 $ 6,882 $ 7,092
Investment banking revenue, gross $ 2,179 $ 1,986 $ 1,676
Revenue by client segment
Middle Market Banking(b) $ 2,742 $ 2,791 $ 3,015
Corporate Client Banking(b) 2,012 1,982 1,911
Commercial Term Lending 1,275 1,252 1,239
Real Estate Banking 494 495 561
Other 362 362 366
Total Commercial Banking net
revenue $ 6,885 $ 6,882 $ 7,092
Financial ratios
Return on common equity 15% 18% 19%
Overhead ratio 42 39 37
(a) Effective in 2015, Commercial Card and Chase Commerce Solutions product
revenue was transferred from Lending and Other, respectively, to Treasury
Services. Prior period amounts were revised to conform with the current
period presentation.
(b) Effective in 2015, mortgage warehouse lending clients were transferred
from Middle Market Banking to Corporate Client Banking. Prior period
revenue, period-end loans, and average loans by client segment were
revised to conform with the current period presentation.