JPMorgan prepares for overseas retail expansion with Germany hiring spree

FRANKFURT, Sept 5 (Reuters) – JPMorgan plans to hire a team of retail bankers in Germany as the biggest U.S. lender prepares to expand its international consumer business in search of more stable revenue streams.

In its first such foray outside of the US, JPMorgan entered the UK market with a digital-only retail offering last year and executives have signaled their aim is to expand it to… ‘other countries. Read more

JPMorgan is now monitoring the success of the rollout before deciding exactly where and how much it will offer the business elsewhere, a senior executive told Reuters.

Hires in Germany could be used in different locations, the person said on condition of anonymity, as JPMorgan’s plans have not yet been finalized.

On Thursday, JPMorgan posted a job posting for a “people project managerin international consumer banking. “Join us in Berlin as we begin this exciting chapter in the continued growth of our business,” he wrote, providing hires with a “start-up atmosphere.”

Among more than 80 other recent German job postings on its website, JPMorgan is looking for financial crime compliance officer “for the international expansion of consumption in Germany”.

A spokesperson for JPMorgan declined to comment on job postings or plans to expand its consumer business.

Nils Wilm, a banking recruiter in Germany, said JPMorgan’s job postings clearly point to retail banking expansion.

U.S. banks have sought to offset lucrative but sometimes volatile investment banking returns with steadier revenues, despite facing a competitive consumer market dominated by local incumbents, where margins are thin.

Banks, which are already suffering from a drop in business transactions, could also see their retail operations struggle to grow as unemployment rises, inflation bites and consumers tighten spending.

THE BATTLE IS ON

JPMorgan’s top executives acknowledge that banks have struggled in the past in retail banking outside of their home markets, but say the digital age has changed that.

“It’s going to be a battle,” Jamie Dimon, longtime chief executive of JPMorgan, told investors in May.

Sanoke Viswanathan, JPMorgan’s managing director for international consumer growth initiatives, said at the same event, “There’s a huge digital disruption happening around the world, and it’s opening up a window of opportunity for us.”

JPMorgan, whose EU hub is in Germany’s financial hub of Frankfurt, has become one of Germany’s largest advisory banks in recent years and is expanding to target more mid-sized companies that form the backbone of Europe’s largest economy. Read more

It has hired 200 people in Germany so far this year for its wider business, but a retail push would mark a new front in another saturated market dominated by local savings banks and well-known brands like Deutsche Bank and Commerzbank.

In another publication, JPMorgan advertises a deputy general counsel with knowledge of the laws and regulations for products and services “in Germany for retail consumers”.

Deutsche Bank analysts said in a note last week that while JPMorgan seemed likely to expand its retail business in the EU, “why does it make sense to expand retail banking across world when other banks have not been able to do so and the global regulatory burden is high?”

JPMorgan expects to lose $450 million on its international consumer business in 2022, according to slides that accompanied a presentation earlier this year, with the company expected to break even in five or six years. Read more

Some of the job openings are based in Berlin, a technology hub that underscores the digital nature of JPMorgan’s business.

Achim Oelgarth, director of the East German Banking Association, said the German capital, home to online bank N26 and an IT division of Deutsche Bank, was a “centre of gravity” for tech talent.

Editing by Sabine Wollrab, Elisa Martinuzzi and Alexander Smith

Our standards: The Thomson Reuters Trust Principles.