Third quarter earnings presentations can on occasions be a tad tame and attract less interest than full year earnings and interims.

Not so at Chase.
In particular from a retail banking perspective.

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The retail unit of JPMorgan Chase deservedly took centre stage, driving the bank’s third quarter growth with a 16% rise in net income.

Other retail banking highlights included:

  • Increased revenue and market share gains in its credit card division, largely thanks to its mass-affluent segment Chase Sapphire Reserve card;
  • average core loan growth of 7.5% year-on-year;
  • Chase now ranks number 1 in total US deposits and in deposit growth, driven by strong consumer deposit growth up 9%;
  • Client investment assets, credit card sales and merchant volumes were all up 13%, and
  • Mortgage lending up 12% and business banking, card and auto loans and leases were each up 7%.

As CEO Jamie Dimon summed up “the U.S. consumer remains healthy.”

As for the analyst Q&A session, one question (and more pertinently one answer) stood out.

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Asked by an analyst from Wells Fargo a question many have pondered:

“Why do you still need 5,200 branches? Isn’t this a good time to close branches when deposit competition isn’t as tough as it might be in the future?”

Marianne Lake, Chase CFO responded:

“Branches still matter. 75% of our growth in deposits came from customers who have been using our branches, that on average a customer comes into our branches multiple times in the quarter.

“I know that all sounds like old news, but it’s still new news or current news, so the branch distribution network matters.

“Customer preferences are changing and we are not being complacent to that. So net for the year, we’ll be down about 125 branches. We’ve closed more than that, consolidated some and added some, so we’re not being complacent to the consumer preference story, but branches still matter a lot and we’re building out all of the other sort of omni-channel pieces, as you know, so that we have the complete offering.

“If the customer behaviours start changing in a more accelerated fashion, we will respond accordingly.”