JPMorgan invests for new age of competition amid AI fears

• Key insight: CEO Jamie Dimon said Monday night that the bank has to invest big to stay ahead of technology competitors, which have “badly beat” JPMorgan in the past.
• What’s at stake: In a presentation to investors, the company said that the current landscape is the most competitive for banks since before the global financial crisis.
• Forward look: Current rumblings in the private-credit market could be a bellwether for a larger credit cycle down the line, Dimon said.

JPMorganChase is operating in the most competitive banking environment in at least 20 years, CEO Jamie Dimon said Monday, as he sought to justify the megabank’s plan to increase spending by $9 billion this year.

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America’s largest bank is ramping up its investments in artificial intelligence and other technologies as it vies for business with other traditional banks, payments companies and private credit firms. The environment that’s been favoring the industry recently has meant that competitors are fighting for consumer clients and loans, as well as commercial business.

Dimon and his top deputies laid out what they see as the competitive threats during a two-hour-long update for investors on Monday night.

JPMorgan’s longtime CEO said the $4.4 trillion-asset company has lost market share to companies like PayPal and Stripe in the past. Now, JPMorgan will invest tens of millions of dollars in a tech feature if it will move the bank forward, Dimon said.

“We got beat badly, so we should be very cautious of that,” he said. “When we do a lot of this investing we’re talking about … .we try to be very disciplined about it, but we have to compete at that level, too. We can’t just put our head in the sand and say that doesn’t affect us.”

Opportunities and threats from AI

JPMorgan estimates that its 2026 expenses will total $105 billion, $20 billion of which will be for technology. The projection marks a 10% rise from the $96 billion the company spent in 2025, One-quarter of the $9 billion increase will be from tech and “tech-adjacent” investments.

JPMorgan has traditionally increased its spending at a rapid pace, but the projected increase in 2026 is large even by its standards. From 2024 to 2025, its expenses rose by 4.6%.

Dimon said Monday that it’s difficult to measure the company’s investments in AI, or their payoff. He noted that 150,000 JPMorgan employees use its internal large language model each week, and they have said they save four hours per day from the technology.

The bank is focusing its AI efforts on areas such as customer service and internal technology for software engineers, said Chief Financial Officer Jeremy Barnum.

But the bank isn’t just dealing with AI internally. In recent weeks, AI innovation has spooked investors, who fear the technology could pose a threat to software companies and, to a lesser extent, their creditors.

Dimon said that, in the bigger picture, AI will likely create more productivity, but it could also spell trouble for consumers who are laid off across the economy.

“Laying those people off will cause a problem, even if it creates more productivity in society,” Dimon said. “And that’s why society has got to think this through a little bit. It may happen faster than we can adjust to it … and therefore, we should be prepared.”

JPMorgan’s exposure to the recently hard-hit software sector is relatively small, Barnum said. Asset managers and private-credit firms, though, are major players in the software industry, and their stock prices have been walloped this month because of that exposure.

JPMorgan’s stock was down more than 4% on Monday, also on concerns about how AI will impact its business.

Private-credit jitters

Troy Rohrbaugh, co-CEO of JPMorgan’s commercial and investment bank, said that despite the recent unease, there’s still plenty of capital being deployed in the private-credit ecosystem.

“We’re in the heart of the ecosystem,” Rohrbaugh said. “We’re doing a lot of financing. We’re doing a lot of lending. …We really have a competitive advantage because we have all these ancillary products that we want to do with these clients. The people that are just lending don’t.”

Doug Petno, the other co-CEO of the commercial and investment bank, said that lending is “an outcome, not the strategy,” in JPMorgan’s private-credit business. The company’s executives have reiterated multiple times in the last year that the bank is deepening its stake in the growing area due to increasing client demand for debt and credit solutions.

JPMorgan announced a year ago that it would allocate $50 billion from its balance sheet, along with nearly $15 billion from multiple co-lenders, to expand its private-credit business. At the time, the bank had deployed more than $10 billion across more than 100 private-credit transactions in the previous four years.

Rohrbaugh said Monday that, as of the end of 2025, the bank had deployed almost $14 billion.

He added that while both traditional banks and nonbank lenders have room to grow in private credit, JPMorgan has a competitive edge because of the other services it can provide clients.

But even though private-credit firms have been taking the hit amid AI jitters on Wall Street, JPMorgan doesn’t think that credit distress is siloed to software companies in the long term, Rohrbaugh said.

“I’m shocked that people are shocked,” he said. “I mean the reality is, in this environment, as the world gets more volatile, as you get towards the end of the cycle, these outcomes should be expected.”

The first chips to fall?

Rohrbaugh added that while the damage may be isolated now, “that could quite easily change,” though he thinks JPMorgan is prepared “both from managing our own portfolio” and “from the opportunity it potentially gives us and others.”

Last fall, a number of banks, including JPMorgan, took credit hits from nonbank loan exposure to seemingly isolated incidents of fraud. At the time, Dimon famously said: “When you see one cockroach, there are probably more.”

On Monday night, Dimon expressed similar concern, saying that some of the big bets certain companies are making now, while they’re on the front foot, may come back to bite them.

“There will be a cycle one day,” Dimon said. “I don’t know when there’s going to be a cycle. I don’t know what confluence of events will cause that cycle. My anxiety is high over it. I’m not assuaged by the fact that asset prices are high. In fact, I think the assets are the risk.”