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JPMorgan Chase & Co. and Wells Fargo & Co. have long been locked in a fierce race to serve American consumers. We shoot forward.
JPMorgan now generates $ 2 billion more in revenue from its personal banking business than its rival, after nearly $ 1 billion worth of Wells Fargo just two years ago. New York's Jamie Dimon also took the lead in the loans and profits from this activity.
Nearly three years of public relations and regulatory controls hang over Wells Fargo, which has approximately 450 more branches. He is looking for a new leader after a series of scandals that killed two general managers. The San Francisco-based lender said it had halted the flow of customer foreclosures and that it was not being held back by a regulatory cap on badets, at least for the activities that were going on. he wants to continue.
The performance gap is expected to widen further in the coming months. Wells Fargo announced Friday a quarterly profit, pointing out that its net interest income could fall 5% this year. JPMorgan predicted a jump of at least 5% from its comparable figure.
"Wells is a crumbling business in need of repair," said Gerard Cbadidy, an badyst at RBC Capital Markets. "JPMorgan, on the other hand, is shooting at the eight cylinders and moving forward. We expect this performance discrepancy to continue as Wells continues to solve its problems. "
Wells Fargo shares fell 2.6% on Friday, while those of JPMorgan jumped 4.7%, the highest in three years.
Wells Fargo has reviewed account records and past complaints to address abuses, while launching advertising campaigns to regain public trust. JPMorgan appealed to consumers with new offers such as its popular Sapphire Reserve credit card.
For years, Wells Fargo has been the engine of growth by requiring agency employees to sell more products to each customer, sometimes using the slogan "Eight, that's great." The bank was forced to modify its incentives and reduce its quotas as a result of its scandals and now faces a new problem: it slips behind the main peers in terms of revenue per employee. It has the largest workforce of all US banks, with 262,100 people at the end of the first quarter. The workforce increased by 3,400 during the period.
On Sunday, Dimon praised JPMorgan's plan to open 90 branches this year (although he does the same) and congratulated the personal and commercial banking sector for raising a record number of investment badets by through offices and online. Clarifying the Congressional testimony that he gave earlier this week, he said that a woman or a member of a minority group could succeed him one day.
In Wells Fargo, consumer loans decreased $ 3.7 billion from the previous quarter. Auto loans have weakened as people have paid off their debts faster than they have taken out new loans. Loans and mortgages on credit cards also declined compared to the previous quarter, which the bank described as a seasonal move. On the positive side, mortgage applications rose from $ 48 billion to $ 64 billion, reflecting lower rates.
Acting CEO Allen Parker said he's focused on "serving our customers and supporting members of our Wells Fargo team; meet and exceed the expectations of our regulators; and continue the important transformation of the company. "
The bank said it hired an outside research firm to find its permanent replacement.
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