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Ruechelle Marish M. Cauguiran POLSTR W 6:00-9:00pm

JPMorgan Chase & Co. Company Overview JPMorgan Chase & Co. (JPMorgan Chase) is a financial holding company, providing investment banking, consumer and commercial banking services. The company provides financial services to consumers, small businesses, large corporation, institutional and government clients across the world under its J.P. Morgan, Chase and WaMu brands. It also offers financial transaction processing, asset management, and private equity services. The bank and non-bank activities of the company operate nationally, through overseas branches and subsidiaries, representative offices and subsidiary foreign banks. JPMorgan Chase is headquartered in New York, the US.

Key Information Web Address: www.jpmorganchase.com Financial year-end: December Number of Employees: 245,192 (Oct 2014) Source : GlobalData

SWOT ANALYSIS STRENGTHS

WEAKNESSES

Market Presence Adequate Capital Robust Business Performance

Decline in Financial Performance

OPPURTUNITIES

THREATS

Positive Outlook for Global Wealth Market Strategic Initiatives

Competition Low Interest Rate Environment

JPMorgan Chase is one of the leading providers of financial services in the world. The company has well diversified operations and strong from a wide network infrastructure of ATMs and banking branches. The company’s strong capital adequacy and strong market position are its major strengths. The company’s exposure to the current economic imbalances and intense competition may impact the company’s performance. However, the company’s strategic initiatives,

Ruechelle Marish M. Cauguiran POLSTR W 6:00-9:00pm and possible economic growth in emerging markets could present new growth opportunities to the company.

Strengths Strength - Adequate Capital JPMorgan Chase has a good capital base ensuring capital adequacy to its organic and inorganic growth with both secured and unsecured natures of its lending. The good capital management initiatives and moderate risk weighted asset (RWA) growth have enabled the bank to strengthen its capital position. Total deposits increased to US$1.3 trillion in FY2013, indicating an increase of 8% from FY2012. Total stockholders’ equity in FY2013 was US$211.2 billion. It reported high quality liquid assets of US$522 billion. The company reported tier1 capital ratio of 11.9%, total capital ratio of 14.4%, tier 1 leverage ratio of 7.1 and tier 1 common capital ratio of 10.7% in FY2013. Such a sound capital management initiative strengthens the company’s business profile, which in turn would enable it to carry out new growth and expansion plans. Strength - Robust Business Performance The company reported strong performance during the FY2013 with strong lending and deposit growth. Its Consumer & Business Banking within Consumer & Community Banking was ranked first in deposit growth for the second year in a row and 1st in customer satisfaction among the largest banks for the second year in a row as measured by The American Customer Satisfaction Index. In Card, Merchant Services & Auto, credit card sales volume increased by 10% in FY2013. The Corporate & Investment Bank maintained its first ranking in Global Investment Banking Fees and reported record assets under custody of US$20.5 trillion at December 31, 2013. Commercial Banking loans increased nearly US$137.1 billion, an increase of 7% compared with the prior year. Asset Management segment of the company posted nineteen consecutive quarters of positive net long-term client flows into assets under management. In the FY2013, the Asset Management segment reported loan balances of US$95.4 billion. Strength - Market Presence JPMorgan Chase is one of the leading diversified financial services providers groups in the world with total assets of US$2.4 trillion. The company offers its services to nearly 50% of US households, nearly 80% of Fortune 500 companies, and 60% of the world’s largest pensions, sovereigns and central banks. The company has on the ground operations in 60 countries and serves clients in over 100 countries around the world. Its Consumer & Business Banking business operates through an established network of over 5,630 branches and more than 19,211 ATMs. The company is one of the largest credit card issuers with over US$127.8 billion in credit card loans. Through its Merchant Services business, Chase Paymentech Solutions, Card is a global leader in payment processing and merchant acquiring. The company is also one of the global leaders in investment and wealth management with total assets under supervision of US$2.4 trillion. The company has wide geographical operations leading to greater benefits, improved profit margins, economies of scale, and recognition on a worldwide basis. Geographically, the company has

Ruechelle Marish M. Cauguiran POLSTR W 6:00-9:00pm divides its business operations in four business segments, namely Europe/Middle East and Africa, Asia and Pacific, Latin America and the Caribbean, and North America. For the FY2013, the company reported 75.2% of revenue from North America; 16.1% from Europe/Middle East and Africa; 6.4% from Asia and Pacific; and 2.3% from Latin America and the Caribbean. Geographical diversity enables the group to mitigate risks associated with overdependence on a specific market. It bestows the group with a wide customer base, strong brand presence and growth opportunities across emerging markets.

Weaknesses Weakness - Decline in Financial Performance The company reported a decline in its financial performance during the FY2013 as compared to FY2012. It reported an interest income of US$52,996 million as against US$56,063 million and net interest income was US$43,319 million in FY2013 as against US$44,910 in FY2012. As a result the net income declined to US$17,923 million in FY2013 compared to US$21,284 million in FY2012. The various profitability ratios of the company declined in FY2013 as against FY2012. Net profit margin, return on equity, return on assets, return on fixed assets declined to 33.8%, 48.89%, 8.48%, 0.74% and 1.79% in FY2013 as against 37.9%, 51.5%, 10.43%, 0.9% and 1.9% in FY2012 respectively.

Opportunities Opportunity - Positive Outlook for Global Wealth Market While the developed countries are struggling with the consequences of the economic downturn, the emerging economies are reporting a huge inflow of funds. According to the industry estimates, assuming moderate and stable economic growth, total household wealth is expected to rise by approximately 50% in the next five years from $223 trillion in 2012 to $330 trillion in 2017. The number of high net-worth individuals across the world is expected to increase by approximately 18 million to 46 million in 2017. China is expected to sur Japan as the second wealthiest country in the world. However, The US is forecast to remain the wealthiest country with total wealth of $89 trillion by 2017. The company generated significant income from its Asset management services. For the FY2013, the bank reported total net income from asset management segment at US$11,320 million, indicating an increase of 13.8%. Such positive outlook for the global wealth management industry could provide ample growth opportunities for the company. Opportunity - Strategic Initiatives The company undertook several strategic initiatives which will enable its increase its future economic revenue. In August 2014, the company entered into a definitive agreement with

Ruechelle Marish M. Cauguiran POLSTR W 6:00-9:00pm Lexington Partners and AlpInvest to divest its stake in about 50 pct of portfolio companies held by One Equity Partners, the company’s principal private equity unit. In July 2014, the company entered into a definitive agreement to sell its stake in the company’s Global Special Opportunities Group to Sankaty Advisors, LLC. In June 2014, the company entered into an agreement with Carlson to divest its 45% equity interest to Carlson Wagonlit Travel (CWT). During the same month, the company acquired 8.58% of shareholding interest in Legend Mining Ltd. In April 2014, the company entered into strategic investment partnership with Resolution Life Holdings Inc. and will provide it with strategic around the implementation of its multi-manager portfolio investment strategy and will help manage its US$12 billion fixed income investment portfolio. In March 2014, the company and Mercuria Energy Group reaches definitive agreement to acquire its physical commodities business.

Threats Threat - Competition JPMorgan Chase and its subsidiaries operate in a highly competitive environment. The company competes on the basis of the quality and variety of products and services, transaction execution, innovation, reputation and price. The company faces competition from other banks, brokerage firms, investment banking companies, merchant banks, hedge funds, private equity firms, insurance companies, mutual fund companies, credit card companies, mortgage banking companies, trust companies, securities processing companies, automobile financing companies, leasing companies, ecommerce and other Internet-based companies, and a variety of other financial services and advisory companies. A few of the competitors of the company are The Goldman Sachs Group, Inc., Barclays PLC, and others. Intense competition may pressurize the company on prices of products and services or may cause it to lose market share. Intense competition may have negative impact on the company’s operations as any failure to compete effectively in areas such as pricing, services and quality could negatively impact the revenue and overall performance of the company. Threat - Low Interest Rate Environment Expansion of monetary policies across various economies influenced interest rates. Owing to such policies, banks/companies offering banking and financial services witnessed lower interest margins. As a result of such compressed margins, several banks have reported a decline in their net interest income and a decline in their non-interest income. Non-interest income on asset management declined over the year as banks/companies had to waive management fees on money market funds due to low yields and invest excess liquidity in short-term, low-yield assets. Since interest rates are driven by monetary policies, economic and political conditions, and factors beyond bankers’ control, such low interest rate environment could reduce interest yields.