Business Insider caught up with the JPMorgan Chase CEO
in the South Bronx on Tuesday, where the bank was
announcing the expansion of its
Entrepreneurs of Color Fund.
We asked him about
inflation concerns, the bank’s five year,
$20 billion dollar investment in the US, and its
healthcare initiative with Amazon and Berkshire
He also talked about the role corporations have to play
in their communities, saying
“as long as we’re doing […] well we always participate in the community, just like if you
owned a corner bakery store, you would participate in the
We also asked him why he’s said he won’t run for
office. “I just don’t think it’s my nature,” he said. “It’s not
what I’ve been trained to do, I’ve never run for office, I’ve
never thought of things like that, so I think you have to be a
sort of kind of person to be a politician.”
Jamie Dimon’s pleased with the economic progress the US has made
in recent months. But there’s still more to do.
Business Insider caught up with the JPMorgan Chase CEO in the
South Bronx on Tuesday, where the bank was
announcing the expansion of its
Entrepreneurs of Color Fund. He talked about the fund,
big bet on brick-and-mortar bank branches, and wages. The
bank in January announced it was raising wages for 22,000 US
employees who work in its branches and customer-service centers,
as part of a $20 billion investment in its US business.
He also discussed the US economy, highlighting
faster-than-expected growth and rising wages. But he said there’s
still a lot more to do, especially around infrastructure and
“America is still the greatest country on the planet,” he said.
“You know I get to travel the world and see all that. That does
not mean we don’t have some serious issues we have to fix.
The following is a lightly edited transcript of the
Matt Turner: You’re here to announce
funding for an Entrepreneurs of Color Fund here in the South
Bronx. Why are these schemes so necessary, do you think?
So, we started this when
we went to Detroit, and
we were trying to help the city of Detroit. And when you look
at what cities need, affordable housing, jobs, work skills — my
wife is working hard on work skills under a foundation called
But obviously one of the things is to get small businesses
up and running and vibrant. So, a lot of minority entrepreneurs
don’t have the back up money they need. And sometimes you get a
city contract, you get a special kind of loan, to help them grow
and to come and grow locally. So, hopefully this funding here
will kind of start the process and help accelerate local
Turner: We sat
down not far from here in May in the South Bronx when you
announced some funding for a skills initiative. A lot has changed
since May. What has has changed for the better in that time, do
Dimon: We went to the Alfred E. Smith
I hope that people watch it. There are some great schools
teaching kids great things, they have jobs when they get out
earning $40,000-$60,000 a year.
So since we last met I guess in May, the global economy has been
growing faster than people thought. The American economy has been
growing faster than people thought. That’s a good thing. And it’s
hopefully leading to wage increases and obviously jobs.
I think it’s going to entice more people back in the
workforce. So I’m a little, people worry about too much low
unemployment, I think it’s good if you get more people working, I
think it’s a good thing.
And what hasn’t changed? What
are the areas where there’s much still more work to do?
Well I think, that’s a big
question. America is still the greatest country on the planet.
You know I get to travel the world and see all that. That does
not mean we don’t have some serious issues we have to fix. And
those issues are around infrastructure, we’re unable as a
community anymore to actually build proper infrastructure on a
You know there’s a bridge that connects Staten Island to
New Jersey, it took twelve years to get the permits, and there’s
already an existing bridge which could’ve fallen down and hurt
people. So infrastructure, education, I think competitive global
taxation was important to get it done. You know, proper
If you look at a lot of regulations, we get scored by the OECD,
we’ve gone from being the least bureaucratic nation to one of the
most bureaucratic nations. It stifles small business formation.
That’s one thing. So if you look at small business formation,
it’s lower than it’s been in any other recovery. So I think a lot
of these things hold back American growth, they’ve held back
wages, they’ve held back jobs, they’ve held back incomes. And we
have to ignite that to get things going again.
Turner: JPMorgan recently announced a
$20 billion dollar investment in the US. Can you just talk me
through the thinking behind that? What led to that?
So we said when tax reform is
gonna happen, it is gonna increase the after-tax profits of
US-based companies. It’s gonna bring a lot of capital back to the
United States, which is a absolutely fabulous thing regardless of
how that capital gets used. But we were thinking about what can
we do to accelerate growth, both because of tax reform and
regulatory reform, and we actually asked all of our
It wasn’t like I did it myself.
We’re gonna do more affordable housing. We’re gonna do more
lending, little incremental lending, in LMI [lower and
middle-income] neighborhoods and mortgages. So making more
mortgage to people, so make housing affordable to people. Small
business initiatives. So this small business initiative is one of
the ones we’re doing. We’re announcing today in San Francisco,
we’ve tripled the one we’re doing in Detroit. If these things
work we might actually do more. So there are more work-skill
You know we have this thing called The Fellowship
Initiative, we get kind of troubled minority kids in high school
who may not get through and we wanna get them through, give them
a job, get them training, get them into college, and get them
through college. And so now we’re doing maybe 120 a year of that.
So to the extent we can use some of this to help society, we
wanna do it.
We also very importantly increased wages, minimum wages, in
the major cities to $18 an hour. That’s $36,000 a year. And
remember our folks already get medical, full medical, full
dental, pension, 401k. So we try to take care of our people. And
we also reduced the deductible for lower-paid employees, those
making less than $60,000 a year, because we did all this research
and the people don’t have the wherewithal to take care of a
That problem could be your car needs to be fixed, but it
also very often is medical. And so if you do your wellness stuff
now, if you take care of yourself, if you don’t smoke, we give
you kind of benefits and the deductible effectively goes to zero.
So we’ve kind of really made it easier for folks to get proper
Turner: In terms of the tax reform and
regulatory reform, what was holding you back from doing that
before, that investment? Is it that tax reform accelerated it and
it was something you would’ve done eventually?
We announced opening 400
branches and the regulators, the regulators weren’t actually
asking banks to expand. They wanted banks almost not to expand,
and therefore, with some regulatory reform, with tax reform, it
gives you a lot of reason to say, ‘Y
ou know what,
let’s be more ambitious and aggressive when growing.’
So we announced we’re gonna be opening 400 branches in cities
we’re not in, like Washington D.C. and Philadelphia and Boston.
And when we go into a city, remember, we come in just like you
saw here. It’s not just that we have a branch, but we have small
business lenders there, we usually do philanthropy there, we
usually have middle-market companies, private banking, credit
card, mortgages, LMI [lower and middle-income]. We put branches
in LMI neighborhoods. So expansion’s a good thing and we’re gonna
hopefully expand more in America.
Turner: You mentioned wages. You chose to
do hourly wage increase as opposed to the
one-time bonuses a lot of other companies did. So what was
your thinking behind that and doing it that way?
We already had a one-time
bonus. Years ago we put in place, we’d ask how many people don’t
put money into a 401k and therefore don’t get the match. It was
surprising, something like 40,000-50,000 people. And they don’t
do it because they couldn’t afford it. It wasn’t because they
didn’t want the match. So when we found out that many, many years
ago we started making contributions in their 401k. Again folks
making under $60,000 dollars a year. So we’re looking at more
permanent wages and things that we could afford to do.
remember that opening those 400 branches is
also 5,000 jobs.
I wanted to come to the
branches in a moment. Just on the inflation aspect, because you
mentioned it a moment ago, the market correction that we had last
was at least triggered by fears around inflation and wage
growth that was higher than expected. How much of a concern
should that be going forward?
If you’d asked me in May I
would’ve told you that, sometime down the road, if we’re going a
little bit faster than we think, people are gonna be afraid of
wages and inflation. And it’s kind of so predictable, okay? So
the important thing is the higher growth.
Spencer Platt/Getty Images
You know, now you’re climbing the wall of worry. Okay, we have
higher growth, wages may be going up, we all wanted it, but the
flip side of that is that interest rates may go up and inflation
may be a little higher than people think. I think the job growth
and the employment growth is more important than that. Of course
the markets always readjust to changing expectations, and now the
expectations change. You also have central banks reversing the
purchase of bonds and those are legitimate concerns but again if
you have jobs and wages that’s more important.
Turner: And in terms of the speed and severity
of the correction last week was that a concern for you?
Turner: Do you just think that’s
Dimon: I know it will shock your public. I
spend almost no time worrying about something like that. We serve
clients, markets fluctuate. Markets will always fluctuate.
Markets have always fluctuated. You know, to me, again, the
important thing’s the economy. You know if you add inflation and
then growth is declining, yeah then you should be much more
worried. But it’s not about the stock market, it’s about the
people and their jobs.
Turner: You mentioned the branches. You’re
opening in 400 new locations. What was the thinking there? That
seems like a contrarian bet
when a lot of other people are closing branches right now. So
what was the thinking there and what will those branches allow
you to do going forward?
Dimon: Branches are still critical to
business, okay? Remember, this may be surprising to some but the
average branch, 25% of the business is small businesses,
literally from the immediate community, who need access to a
branch, cash, currency, checks, et cetera.
The branches are getting smaller so the nature of branch is
changing. The amount of tellers is coming down so the operational
nature is changing. But you have more mortgage loan officers,
more small business officers, more investment officers, helping
people. So yeah, branches are important to opening accounts.
Those are important to serving governments. If you can’t take
deposits locally, generally you can’t serve the government
locally, by law.
They’re important to middle-market customers. They like to
have a branch there for their employees and stuff like that. So,
they’re still a critical part. These branches we’re talking about
are in cities where we are not. So we’re kind of, you know, we’re
expanding our wings a little bit and going to places we are
Turner: And you mentioned healthcare. JP
Morgan’s announced an initiative with Amazon and Berkshire
Hathaway. How did that come about and what are you hoping to
Dimon: Look, America has an issue, okay?
We spend 17% of our GDP in healthcare. You know we have the best
of all worlds, some of the best healthcare in the world. And the
worst of all worlds. We don’t do very good preventive medicine.
It cost too much. Warren Buffett calls it the tapeworm of
Going into deductibles was important to get you to shop a
little bit but hasn’t really worked really well. So I tell
people, JP Morgan Chase already buys a billion and half dollars
of medical, and we’re self insured. Think of this, we’re already
the insurance company, we’re already making these decisions, and
we simply wanna do a better job.
And in conversation with Warren, and someone who works for
him called Todd Combs, who’s one of my board members, who’s
exceptional, and Jeff Bezos, we said we know we can do more. We
know we can do more just thinking through every single part of
it. Both the customer-facing part so you might be able to get
look at more data on your phone and stuff like that, getting you
I mean 20% of our medical expense is at end of life and a
lot of people don’t wanna go through it, they go through it in a
hospital. So maybe we need a legal change of that. A lot of
people over-utilize certain medicines, but they also
under-utilize it. And, it’s also silly they have no wellness.
Like if you take care of yourself, I think smoking and obesity, I
forgot the number, account for 25% of all medical expenses. Well
So you know, there are ways that when you face this maybe
we can change things to make it much better for everybody. We
want happier employees, better medical outcomes, and I do think
at the end of the day that’ll actually be cheaper.
here’s a lot of talk
right now about the role that corporations have to play in their
communities, their responsibility to stakeholders beyond just
shareholders, and to quote Larry Fink, the
need for corporations to benefit society in some way. In what
way are businesses stepping up? I know about JPMorgan’s efforts
here, but more broadly in the conversations you have with CEOs
elsewhere, how are they stepping up?
I think honestly these
big companies have been doing this my whole lifetime. So I
remember I worked at American Express when I was 26 years old,
and all these companies take care of their people, they educate
their people, they’ve been philanthropic.
If you go to back to Chase and JPMorgan, you know 50 years ago
they were among the first to do things like that, and to support
medical benefits for employees, the first to support medical
benefits for gay partners, those are wonderful things. So of
course you want to be a good community citizen.
And so I think all the companies do it, I don’t know any
big company who isn’t pretty extensively involved in communities.
They all do it their own way. We’re experts in financing and
affordable housing and things like that, but other companies are
experts in technologies or drugs where they can bring different
things to the population. I’m the Chairman of the Business
Roundtable, and there’s booklet we put out about all the things
companies do on work skills initiatives, technology initiatives,
and it’s pretty extensive.
Turner: Is there a perception gap
there then? Just earlier Bronx Borough President Ruben Diaz said
he wishes that what JPMorgan here was doing was
Dimon: Yeah. I think he means here. I
think he means right here in the South Bronx, and sometimes, you
know one company can accelerate something in one place and yes,
yes we should do that.
So I’ve never been conflicted between shareholder value,
being a good community citizen, and I tell people if I don’t run
a good, healthy, vibrant company, all other bets are off. I mean
that is the number one thing. And that is the number one thing we
do even here. Small business, consumers, loans, we finance
companies and I have to do that well.
But as long as we’re doing that well we always participate
in the community, just like if you owned a corner bakery store,
you would participate in the community. You know, you might help
your local synagogue, your local church, your local mosque, you
might help the local Little League team, you might employ a
couple kids over the summer to help restock the store or repaint
it, that’s, we all do that. That’s called humanity.
It shocks me that people think that’s a surprise that we
should do that. Of course there’s some businesses out there
who’re rapacious and you know it’s all about how much money
you’re gonna make but that’s, people are that way. There are some
people, that’s the way they are. It’s all about the money. But
most big companies aren’t quite that way.
And you’ve mentioned the need
for infrastructure investment. You mentioned it again earlier.
The administration has come out with it’s plan, how confident are
you that something gets done now?
Dimon: You know first of all, let’s talk about
how bad it’s gotten. If you analyze American infrastructure we’ve
gone from, I’m talking about 20 years ago, from among the best to
among the worst of developed nations. And it’s around
regulations, bureaucracy, approval processes, financing
My God, how did we like get like that? America, the can do,
wonderful nation of America? So we’ve got to fix it. It is a wide
variety of things. So it’s not just a budget, it’s the permitting
that needs to get done, its the regulations around it, it’s all
these various things. So it’s a big deal.
Studies have come out that literally say we need, I forgot the
number, $3 trillion? But if we don’t do the $3 trillion it’ll
cost us more. Okay, it’s costing us more. And then if you believe
in, you know, carbon pollution, the FAA, we don’t have the system
most other countries have where your flights will be 20 minutes
less, and CO2 pollution would be 20% less. We can’t seem to have
the political will to do that. I mean, shame on us.
You’ve said repeatedly you
don’t want to run for office. Why do you think the question keeps
on coming up, and why are you so insistent that the answer is no,
that you don’t plan to?
Dimon: I see the question come up
with hundreds of people. I have lots of friends where it’s come
up for them too, and look, I just don’t think it’s my nature.
It’s not what I’ve been trained to do, I’ve never run for office,
I’ve never thought of things like that, so I think you have to be
a sort of kind of person to be a politician.