Jp Morgan Chase & Co. · NYSE:JPM
Jp Morgan Chase & — Investor Day (February 2016)
30 slides from Jp Morgan Chase &'s investor day presentation, Feb 23, 2016
Slide 1: Asset Management
A S S E T M A N A G E M E N T Mary Erdoes, Chief Executive Officer Asset Management February 23, 2016
Slide 2: Consistent growth across a world-class franchise
AM GIM GWM Consistent growth across a world-class franchise Client-focused, fiduciary culture Strong investment 84% of 10-year long-term mutual fund AUM in top 2 quartiles1 culture Positive client asset flows every year since 2004 Consistency – high margin, high ROE, predictable growth Growt
Slide 3: 2015 highlights – Continued growth of revenue, credit balances, and top-rated funds
AM GIM 2015 highlights – Continued growth of revenue, credit balances, and top-rated GWM funds, and increasing productivity Record 2010 2015 5-yr CAGR ■ Mutual funds with a 4/5 star rating (#)1 157 231 +74 Leads with investment ■ Assets under management ($T) $1.3 $1.7 6% performance ■ Client assets
Slide 4: Diversified, predictable, capital-efficient business
AM GIM GWM Diversified, predictable, capital-efficient business Revenue ($B) Global Wealth Management (GWM) Global Investment Management (GIM) $11.4 $12.0 $12.1 $9.0 $9.6 $10.0 Revenue ROE Average equity ($B) 26% 25% 24% 23% 23% 21% ROE $6.5 $6.5 $7.0 $9.0 $9.0 $9.0 Pretax income ($B) Pretax margin
Slide 5: 2015 flows positive but below historical levels
AM GIM GWM 2015 flows positive but below historical levels JPM LT AUM flows, $B Other LT AUM flows LT MF flows $90 JPM LT AUM flows by quarter, 2015, $B $80 $16 $13 $66 $58 $11 $51 $7 $2 $1 -$4 $58 -$9 $16 $44 1Q15 2Q15 3Q15 4Q15 $36 $22 $22 $13 Global LT fund industry1 2010 2011 2012 2013 2014 2015
Slide 6: Flows across diverse channels, regions, and products
AM GIM GWM Flows across diverse channels, regions, and products ███ < $(100mm) ███ Flat ███ > $100mm LT flows by channel, region, and product ($B) Channel Region LT AUM Flows LT client asset flows Fixed Income Equity Multi-Asset Alternatives Other U.S. EMEA GWM Asia 2013 LatAm $90B $84B U.S. EMEA GI
Slide 7: Overall LT client asset flows of publicly traded companies
AM GIM GWM Overall LT client asset flows of publicly traded companies Ranking of LT client asset flows ($B) for key peers 2011-2015 2011-2015 2011 2012 2013 2014 2015 avg. flows ($B) avg. flows ($B) JPM $103 Peer 3 Peer 5 Peer 5 Peer 5 Peer 5 $971 Peer 1 JPM $101 Peer 1 JPM $100 Peer 11 JPM $832 Pee
Slide 8: Continuing to invest in people and technology through temporary headwinds
AM GIM GWM Continuing to invest in people and technology through temporary headwinds Temporary headwinds Controls uplift Account remediation Low rates Pretax margin 31% 30%+ 27% 2010 2015 2018 Controls + ~130% Flat Expenses Operations + ~30% Flat leveling off Tech production + ~10% Down ASSET MANAGE
Slide 9: Invaluable benefit from being part of JPMorgan Chase
AM GIM GWM Invaluable benefit from being part of JPMorgan Chase JPMC Asset Management #20 Fortune most admired company Brand / Marketing ~$100mm marketing spend ~$3B marketing spend 250,000 employees¹ Talent 1,400 employees to/from AM/Firm Recruited 2% of applicants for 31K jobs Products
Slide 10: GIM: Built on a foundation of exceptional investment capabilities
AM GIM GWM GIM: Built on a foundation of exceptional investment capabilities Strong investment performance: 84% of 10-year LT mutual fund AUM in top 2 quartiles1 Superior client outcomes Serve 60% of world’s largest pension funds, sovereign wealth funds, and central banks Local presence in ove
Slide 11: Leading mutual fund performance across asset classes globally
AM GIM GWM Leading mutual fund performance across asset classes globally % of 2015 MF AUM over peer median1 Global active (net of fees) Example funds LT MF AUM rank3 (3-yr performance percentile)2 3-year 5-year 10-year 2010 2015 Growth Advantage (3%)4 Equity #7 #5 82% 81% 87% Europe Equity Plus
Slide 12: 30-year proven process in US Core equities
AM GIM GWM 30-year proven process in US Core equities Information Advantage Systematic Valuation Portfolio Construction 27 U.S. career analysts DDR* quintile performance (vs. S&P 500) since 1986 inception Starts with analyst DDR rankings Initial Extended 4% opportunity set opportunity set 17 y
Slide 13: Over three decades of alternative investment innovation
AM GIM GWM Over three decades of alternative investment innovation Strengthening and evolving alternatives platform Chemical Private Equity Highbridge PEG Digital Aviva Asia-Pac Gávea HF/PE Gávea Venture Group (PEG) Principal Growth Fund Real Estate sale $221 acquisition Prtnrs. launch launch Strats
Slide 14: Strong Solutions business leveraging underlying product platforms
AM GIM GWM Strong Solutions business leveraging underlying product platforms GIM Global Solutions AUM1 JPM: 27% CAGR Industry: 13% CAGR2 2010 2014 2015 World Allocation3 EUR Moderate Allocation – Global4 Target Date Fund5 JPM Global Allocation JPM Global Income JPM Target Date suite X 2015 share % 2
Slide 15: GIM's success is driven by breadth, depth, and quality of product offering
AM GIM GWM GIM’s success is driven by the breadth, depth, and quality of our product offering 4/5-star mutual funds in largest LT active categories by AUM (top 5 managers by 4/5-star fund count in these categories)1 No rated funds in category No 4/5 star funds in category 1-2 4/5 funds in category 3
Slide 16: Market leading Liquidity platform
AM GIM GWM Market leading Liquidity platform Global Money Market asset growth (USD and EUR) Consistent global MMF rankings 2006 Firm AUM ($B) 2015 Firm AUM ($B) 160 JPM 1 Fidelity $271 1 Fidelity $458 140 Industry ex. JPM 2 J.P. Morgan 246 2 J.P. Morgan 384 120 3 BlackRock 183 3 BlackRock 328 Asset
Slide 17: GWM: Superior global franchise across wealth segments
AM GIM GWM GWM: Superior global franchise across wealth segments Advice-driven wealth management based on unique integrated team model Leading with advice Experienced talent across functions and regions: average MD tenure of 15+ years Expanding product breadth & depth: >20 new alts offerings,
Slide 18: Market share gains and productivity increases in changing industry landscape
AM GIM GWM Market share gains and productivity increases in changing industry landscape Continued global growth as competitors retrench Industry-leading productivity 2006-14 client asset CAGR 2015 revenue / client advisor ($mm) JPM PB 10% market share N. America 5% 4% JPM PB $2.25 Industry JPM PB Pe
Slide 19: Uniquely positioned with UHNW clients and continuing to innovate
AM GIM GWM Uniquely positioned with UHNW clients and continuing to innovate UHNW segments growing fastest JPM PB uniquely positioned among UHNW clients Projected 2014-2019 CAGR of industry private wealth % client assets from clients with $10mm+ 12% ~90% >50% of JPM PB client assets 10% from clients
Slide 20: Innovative managed solutions extend our thematic conversations with clients
AM GIM GWM Innovative managed solutions extend our thematic conversations with clients = >$500mm raised Thematic managed investment solutions Focused US SMID Cap Focused International Select Equity Preferred Dividend Dividend income Equity Income High Dividend Opps. Securities Equity Growth Growth E
Slide 21: Continuing to advise clients on both sides of their balance sheet
AM GIM GWM Continuing to advise clients on both sides of their balance sheet Strong growth in credit book… Optimizing deposits business… Year-end spot balance ($B) Year-end spot balance ($B) Mortgages1 14-15 CAGR +10% CAGR growth Loans (ex-mortgages) +16% CAGR 113 155 107 145 146 147 99 127 87 25 29
Slide 22: Combined Asset Management and Chase Wealth Management produce strong results
AM GIM GWM Combined Asset Management and Chase Wealth Management produce strong results 2015 Client assets ($T) 2015 Revenue ($B) 2015 Pretax income ($B) Pretax margin BLK1 $4.6 UBS $18.3 BLK $4.6 40% AM CWM UBS2 $2.9 BAC $18.0 JPM3 $3.2 $1.3 $4.5 27% AM CWM JPM3,4 $2.4 $2.6 MS $17.4 UBS $4.2 23% MS
Slide 23: We are uniquely positioned in the industry and poised for continued growth
AM GIM GWM We are uniquely positioned in the industry and poised for continued growth Top investment performance Breadth and depth of offering Unmatched number of 4/5-star funds in largest US Uniquely diverse presence across asset classes and and international categories client channels around t
Slide 24: Notes appendix
Notes appendix Page 1 1. The “% of 10-year LT mutual fund AUM in top 2 quartiles” analysis represents the proportion of assets in mutual funds that are ranked in the top 2 quartiles of their respective peer category on a 10-year basis as of December 31, 2015. The sources of these percentile rankings
Slide 25: Notes appendix
Notes appendix Page 6 Source: Company filings, J.P. Morgan estimates Note: Allianz, CS, DB, and UBS figures converted at average exchange rate. 1. Long-term AUM 2. Long-term AUM, administration, brokerage, custody, and deposit 3. Long-term AUM, brokerage, and deposit 4. Long-term AUM, fee-generating
Slide 26: Notes appendix
Notes appendix Page 10 1. The “% of AUM over peer median” analysis represents the proportion of assets in mutual funds that are ranked above their respective peer category median on 3, 5, and 10 year basis as of December 31, 2015. The sources of these percentile rankings, peer category definitions f
Slide 27: Notes appendix
Notes appendix Page 11 (Top Middle) Chart shows performance of quintiles (as determined by J.P. Morgan Investment Management U.S. Equity research universe) versus the S&P 500 Index, with quintiles rebalanced monthly. Quintile performance represents the annualized returns of quintiles vs. the annuali
Slide 28: Notes appendix
Notes appendix Page 13 1. Excludes Advisory 2. Data for industry CAGR available for 2010-2014 only 3. Active only; excludes Fund of Funds; AUM / flows grouped at Portfolio Level (inclusive of all share classes); excludes Global Macro Opps fund, as it is considered internally as Liquid Alternative an
Slide 29: Notes appendix
Notes appendix Page 21 Note: Allianz, CS, DB, and UBS figures converted at average exchange rate. Balances presented at end of period exchange rate. 1. Total AUM; for Allianz reflects total AUM from third-parties 2. Total AUM, brokerage, custody, and deposit; for CS as of 09/30/15 as FY2015 disclosu
Slide 30: Forward-looking statements
Forward-looking statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of JPMorgan Chase & Co.’s management and are subject to significant risks an