JPMorgan’s Traders Race Ahead in the Pandemic
The rising tide of pandemic relief money that’s oiling the wheels of finance has been a boon for those in the business of securities trading. Even as the wild market swings have subsided, activity has been buoyant as central banks and governments pumped trillions into economies. This may turn out to be one of the best environments for investment bankers generally, especially those who are buying and selling shares and bonds, but a standout company is emerging.
After a record trading performance in first three months of 2020, JPMorgan Chase & Co. is on course to post a 50% jump in trading revenue in the second quarter, when compared with the same period a year ago, the New York giant’s co-president, Daniel Pinto, said last week. The reserved Argentine banker, who has helped JPMorgan move to the top of Wall Street’s rankings, was “very pleased” by the performance. That tells you how well things are going.
Other trading firms are doing well too, although not as handsomely as Pinto’s employer. Bank of America Corp. expects bond- and stock-trading revenue to rise close to 10% in the period; Citigroup Inc. is seeing “very good momentum” in the fixed-income business after a 40% jump in the first quarter. Citi is still playing catch-up with its rivals in equities trading.
JPMorgan might also be edging further ahead of its European rivals on their home patch. The bank is the favored dealer in Europe for both interest-rate and credit trading, ahead of Goldman Sachs Group Inc. and Citi, according to a poll of bond investors by Greenwich Associates at the end of April. European banks barely made it into the top three in some of Greenwich’s subcategories on fixed-income trading.
“It’s a balance sheet, scale and electronification game now, and the bigger you are, the better you do,” Greenwich Associates said when the report was published. That’s propelling JPMorgan — which spends more than $11 billion a year on technology — ahead of its competitors.