JP Morgan Chase 2015 Annual Report Download - page 67

65
Commercial & Industrial
To bring clients deeper sector exper-
tise and to better manage our risk,
we’ve expanded our specialized
industry model. Today, we have 15
key dedicated industry teams work-
ing with more than 9,000 clients and
covering 12,000 prospects. Our clients
clearly benefit from our sector-specific
knowledge and focused coverage.
As a result, we’ve seen meaningful
gains in market share across these
important segments.
2015 marked the sixth year of our
Middle Market expansion strategy.
Through this eort, we’ve added
nearly 2,000 clients, and in 2015, we
generated record revenue of $351
million across our expansion mar-
kets. In these new regions, we are
building organically – banker by
banker, client by client – essentially
creating a nice-sized bank from
scratch, ending 2015 with nearly $11
billion of loans and over $8 billion
in deposits. Last year, we opened
new oces in Fresno, California;
Greenville, South Carolina; Hartford,
Connecticut; and Wilmington,
Delaware. We expect to further
expand our footprint in 2016.
Commercial Real Estate
With continued focus and discipline,
we believe we’re building a commer-
cial real estate business that is dier-
entiated from our competitors. Our
franchise consists of three well-
coordinated businesses: Commercial
Term Lending, Real Estate Banking
and Community Development Bank-
ing. Together, our real estate teams
originated $32 billion in loans in
2015, up 28% from the prior year.
As the industry moves through the
real estate cycle, we believe we can
continue to grow our portfolio safely
by adding high-quality clients in large,
established markets. In the next three
years, there will be over $1 trillion of
commercial real estate maturities that
will drive future originations. We
see real opportunities to capture addi-
tional market share in targeted geo-
graphic areas while maintaining our
credit and pricing discipline.
A real source of pride across our com-
pany is our Community Development
Banking (CDB) business. In 2015, the
CDB team financed nearly 100 proj-
ects that created more than 10,000
units of aordable housing. One in
particular, the Alice Grith Commu-
nity, located on Candlestick Point in
San Francisco, started its fourth phase
of construction that will bring much-
needed aordable housing and ameni-
ties to the area. The eort not only
replaces a troubled public housing
complex but also creates new aord-
able units that will be linked with
services, schools and access to jobs.
Investing in our future
While our business model is proven,
we are in no way standing still. We
are driving our business forward
through investments in technology
and innovation. We see real opportu-
nity to enhance our business proc-
esses, improve our customer experi-
ence, and increase the speed and
security of our clients’ transactions.
Utilization (%) 31% 32% 30% 32% 32%
20152014201320122011
CB CAGR: 8%
CB YoY: 9%
Industry2 CAGR: 11%
$62
$74$74 $78$85
Commercial & Industrial Loan Portfolio —
Disciplined C&I Growth1
C&I loans outstanding ($ in billions, EOP)
Commercial Real Estate Loan Portfolio —
Executing Prudent Growth Strategy3
CRE loans outstanding ($ in billions, EOP)
1
CB’s C&I grouping is internally defined to include certain client segments (Middle Market, which includes nonprofit clients, and Corporate Client Banking) and will not align with regulatory definitions.
2
Industry data from FRB H.8 Assets and Liabilities of Commercial Banks in the United States — Commercial and industrial loans; includes all commercial banks, not seasonally adjusted.
3
CB’s Commercial Real Estate (CRE) grouping is internally defined to include certain client segments (REB, CTL, CDB) and will not align with regulatory definitions.
4
Industry data from FRB H.8 Assets and Liabilities of Commercial Banks in the United States — Real estate loans: Commercial real estate loans; includes all commercial banks, not seasonally adjusted.
5
Prior years’ originations have been revised to conform to current presentation.
CAGR = Compound annual growth rate YoY = Year-over-year EOP = End of period
20152014201320122011
Originations ($B
)5 $15 $22 $24 $25 $32
 Commercial Term Lending (CTL)
 Real Estate Banking (REB)
 Community Development Banking (CDB)
CB CAGR: 14%
CB YoY: 18%
Industry
4
CAGR: 6%
$50 $55
$63
$71
$83