Close Menu
  • Home
  • Finance News
  • Personal Finance
  • Investing
  • Cards
    • Credit Cards
    • Debit
  • Insurance
  • Loans
  • Mortgage
  • More
    • Save Money
    • Banking
    • Taxes
    • Crime
What's Hot

How A $1 Raise Could Trigger A $1,000 Spike In Student Loan Payments Under GOP Plan

May 8, 2025

SHOP, PTON, TPR, APP and more

May 8, 2025

The banking industry isn’t ready to fight AI-enabled deepfakes

May 8, 2025
Facebook X (Twitter) Instagram
Facebook X (Twitter) Instagram
Smart SpendingSmart Spending
Subscribe
  • Home
  • Finance News
  • Personal Finance
  • Investing
  • Cards
    • Credit Cards
    • Debit
  • Insurance
  • Loans
  • Mortgage
  • More
    • Save Money
    • Banking
    • Taxes
    • Crime
Smart SpendingSmart Spending
Home»Finance News»JPMorgan Chase boosting buybacks after Dimon called stock expensive
Finance News

JPMorgan Chase boosting buybacks after Dimon called stock expensive

January 16, 2025No Comments3 Mins Read
Facebook Twitter LinkedIn Telegram Pinterest Tumblr Reddit WhatsApp Email
JPMorgan Chase boosting buybacks after Dimon called stock expensive
Share
Facebook Twitter LinkedIn Pinterest Email

CEO of Chase Jamie Dimon looks on as he attends the seventh “Choose France Summit”, aiming to attract foreign investors to the country, at the Chateau de Versailles, outside Paris, on May 13, 2024. 

Ludovic Marin | Via Reuters

JPMorgan Chase executives said the bank would increase share buybacks so that a mounting pile of tens of billions of dollars in excess cash doesn’t grow further.

Fresh off a record year for profit and revenue, JPMorgan is facing questions over what CFO Jeremy Barnum admitted was a “high-class problem”: the bank has, by some estimates, roughly $35 billion in money that it doesn’t need to satisfy regulators, or what analysts call “excess capital.”

“We would like to not have the excess grow from here,” Barnum told analysts Wednesday. “Given the amount of organic capital generation that we’re producing, it means that — unless we find in the near term, opportunities for organic deployment or otherwise — it means more capital return through buybacks.”

The bank has heard it from investors and analysts who want to know what JPMorgan intends to do with the cash. The biggest American bank by assets has stockpiled earnings in preparation for the Basel 3 regulatory rules that would’ve required more capital, but Wall Street analysts now believe that the incoming Trump administration is likely to propose something far gentler.

Back in May, when the question came up at his bank’s annual investor day, CEO Jamie Dimon bristled at the notion of scaling up purchases of his stock, which was then trading near a 52-week high of $205.88.

See also  Here Are The Most Expensive ZIP Codes In Atlanta

“I want to make it really clear, OK? We’re not going to buy back a lot of stock at these prices,” Dimon said at the time.

That’s because the company’s valuation was too rich, even in its own eyes, Dimon said: “Buying back stock of a financial company greatly in excess of two times tangible book is a mistake. We aren’t going to do it.”

The bank’s stock has only appreciated since: A share trades hands for 22% more now than when Dimon made those remarks.

In fending off calls to whittle down its cash pile by more than it deems necessary, JPMorgan has hinted at the risk of rockier times ahead. Since at least 2022, Dimon and others have warned of the possibility of a recession just ahead, but it has yet to arrive, leaving the end of an economic cycle still on the horizon.

Barnum returned to the subject on Wednesday, telling reporters that there was a “tension” between the risks in the economy and high asset prices in the market; the bank therefore had to prepare for a “wide range of scenarios,” he said.

A sharp economic downturn would give the bank the opportunity to deploy more of that estimated $35 billion in excess cash through loans, according to Portales Partners analyst Charles Peabody.

“I think JPMorgan will be disciplined in not pissing away capital,” Peabody said. “The best time to take market share is coming out a recession, because your competitors are somewhat impaired. And I expect he will pull back on buybacks from current levels, despite pressure from shareholders to do more.”

See also  Alibaba rose on China AI hopes. Where analysts see the stock heading

Source link

boosting buybacks called Chase Dimon expensive JPMorgan stock
Share. Facebook Twitter Pinterest LinkedIn Tumblr Telegram Email
Previous ArticleWhat A Breach Of Covenant Is & How To Avoid It
Next Article Trump Backs Special Tech Work Visas. What About Nurses And Care Aides?

Related Posts

How A $1 Raise Could Trigger A $1,000 Spike In Student Loan Payments Under GOP Plan

May 8, 2025

SHOP, PTON, TPR, APP and more

May 8, 2025

Student loan interest rates for 2025-26: Expert estimate

May 8, 2025
Add A Comment
Leave A Reply Cancel Reply

Top Posts

Biden forgives $4.28 billion in student debt for 54,900 PSLF borrowers

December 20, 2024

NVDA, BOX, DLTR, F and more

March 5, 2025

Stocks making the biggest moves premarket: WBA, AVGO, GAP, HPE

March 9, 2025
Ads Banner

Subscribe to Updates

Subscribe to Get the Latest Financial Tips and Insights Delivered to Your Inbox!

Stay informed with our finance blog! Get expert insights, money management tips, investment strategies, and the latest financial news to help you make smart financial decisions.

We're social. Connect with us:

Facebook X (Twitter) Instagram YouTube
Top Insights

How A $1 Raise Could Trigger A $1,000 Spike In Student Loan Payments Under GOP Plan

May 8, 2025

SHOP, PTON, TPR, APP and more

May 8, 2025

The banking industry isn’t ready to fight AI-enabled deepfakes

May 8, 2025
Get Informed

Subscribe to Updates

Subscribe to Get the Latest Financial Tips and Insights Delivered to Your Inbox!

© 2025 Smartspending.ai - All rights reserved.
  • Contact
  • Privacy Policy
  • Terms & Conditions

Type above and press Enter to search. Press Esc to cancel.