In the second quarter of 2025, JP Morgan Chase reported a net profit of $15 billion, earnings per share of $5.24, revenue of $457 billion, and a return rate of 21%. The performance in this quarter was affected by tax incentives, lower interest rates, and deposit rates. However, revenue from asset management and investment banking business increased, as did market revenue. At the same time, the company faced higher expenses mainly due to increased compensation, brokerage, and distribution costs, as well as higher depreciation on auto leasing and credit costs.

In this quarter, the bank's Common Equity Tier 1 capital ratio dropped to 15%, a decrease of 40 basis points from the previous quarter, mainly due to an increase in capital distributions and a rise in risk-weighted assets (RWA). Despite completing CCAR, net profit was impacted by an increase in wholesale loans, market activities, and credit card loans. Net income in the CCB division grew by 6%, with banking and wealth management revenues increasing by 3%, primarily driven by wealth management income. Meanwhile, the CIB division reported a 9% increase in net income, mainly benefiting from higher IPC, advisory, and underwriting fees. Although payment income increased, loan income decreased due to hedging losses. Overall, the market outlook and sentiment is more optimistic.

The bank reported strong annual financial performance, particularly in the derivatives business. Its service revenue increased by 12% year on year, mainly driven by higher deposit balances and fee growth. Meanwhile, although average loans and payments decreased by 2% year on year, average deposits increased by 16%, reflecting increased activity in payment and security services. Asset and wealth management business revenue grew by 10%, primarily driven by increases in management fees, brokerage activities, and deposit balances. In addition, the corporate business reported a net profit of $170 million, including gains from tax related items. Finally, the bank updated its financial guidance, expecting net interest income (NII) and adjusted expenses to increase, primarily due to the impact of a weaker U.S. dollar.

The discussion focuses on the organic and inorganic growth strategies of bank capital, as well as the impact of the current regulatory environment on capital utilization. Optimism towards financial regulation was mentioned, emphasizing the need for regulators to comprehensively review existing systems to achieve a simpler, more efficient, more transparent, and safer financial system. It also discusses how to balance the development of public and private markets, and how to improve the system to better serve the economy and all participants.

The dialogue delved into key issues in the banking regulatory environment, especially Vice Chair Bowman's speech on ongoing regulatory warfare, emphasizing the focus on long-standing unresolved issues such as the SLR (Supplementary Leverage Ratio), as well as criticism of the G-SIB (Global Systemically Important Bank) capital requirements, noting not only conceptual deficiencies but also the potential weakening of U.S. banks' global competitiveness. Additionally, the dialogue also involved discussions on capital allocation strategies among different business areas, indicating that in the current non-capital-constrained environment, any high-quality business that aligns with risk assessment and cost-effectiveness principles will receive proper support, emphasizing the importance of organic growth.

J.P. Morgan discussed the organic growth of its risk-weighted assets (RWA), pointing out that factors driving growth include private credit, merger financing, inventory, and other aspects. At the same time, they also discussed the impact of stablecoins on the banking industry, expressed their views on the relationship between stablecoins and traditional payment systems, and emphasized the importance of participation and learning in the emerging financial technology sector. Furthermore, J.P. Morgan also explored open banking policies, advocating for customer information sharing based on customer demand and setting deadlines, while emphasizing the importance of third-party responsibility and customer protection.

In the discussion, it was mentioned that JPMorgan Chase is the largest bank in the United States and there is consideration of using its excess capital for inorganic growth (i.e. through acquisitions), particularly exploring the possibility of acquiring AI companies to strengthen its leading position in the financial services industry. Despite the consideration of acquisitions, it was also emphasized that finding suitable targets is difficult, and there is currently a preference for small-scale acquisitions.

The discussion focused on how banks are responding to competition from stablecoin companies like Circle, and why banks have not been able to form a joint issuance solution like Zelle to provide more convenient services to customers, especially when dealing with transactions from customers outside the walled gardens. It also mentioned interoperability issues related to stablecoins, deposits, and fund flows, indicating that banks are considering these issues but have not yet found clear solutions.

The discussion focuses on the current status and future expectations of the mid-sized enterprise market in the United States in the next 6 to 12 months, especially in the face of challenges such as interest rates, tariffs, and slowing consumer spending. The discussion emphasizes the importance of and growth prospects for the mid-sized enterprise market, while mentioning the diverse range of services provided by banks through innovative economics, such as lending, payment services, etc., indicating a commitment to expanding business in the mid-sized enterprise market even in a changing environment.

The company continues to monitor the credit health of consumers and commercial clients, and currently, no obvious signs of deterioration in credit quality have been observed. At the consumer level, although low-income groups are showing more pressure, overall consumer credit performance is in line with expectations, including expected default rates and unpaid bills. At the same time, despite signs of slowing consumer spending growth, it still remains positive. As for commercial clients, the company has also not found a general decline in credit quality, although individual industries may be affected by specific factors such as tariffs, the overall situation is still manageable, and the company is closely monitoring this trend.

In the conversation, the technical growth of consumer credit and Non-Performing Assets (NPAs) in the non-traditional cruise sector was discussed. This growth is mainly due to the use of company funds by home loan customers in the Los Angeles area affected by wildfires, leading to an increase in Non-Performing Assets. However, considering land value and insurance compensation, the actual expected losses are not significant.

The dialogue delved into the development strategy of banks in the retail deposit sector, especially through measures such as market positioning, pricing selection, and consumer deposit base growth, aiming to achieve a 6% increase in consumer deposits. At the same time, it analyzed the impact of different interest rate environments on deposit growth, including potential high growth in low interest rate environments and possible low growth in high interest rate environments. In addition, it also emphasized account additions, market expansion, and deepening of existing markets as key drivers of growth.

Discussed the significant enhancement in commercial loan growth in the second quarter, especially in relation to regional economic activities. At the same time, explored measures that regulatory authorities may take to encourage banks to lend more actively in the future, in line with the goals of the Finance Minister.

The discussion focused on how to improve the banking business by increasing the liquidity, flexibility, and reducing risks in the banking system, especially for community banks. It mentioned the restrictive impact of Liquidity Coverage Ratio (LCR) and the change from 100% to 70% in the loan-to-deposit ratio, exploring the possibility of restoring this ratio to 85% while maintaining the safety and soundness of the banking system. Additionally, it also mentioned the potential for optimizing loan costs.

The conversation discussed the necessity of promoting the development of the securitization market, especially pointing out that excessive securitization, loan, and service requirements have led to higher mortgage costs, which particularly affect low-income individuals. At the same time, the possibility of acquiring private credit companies was mentioned, although currently there is a reserved attitude towards this, if the right price, products, and cultural fit are encountered, this option will still be considered. Additionally, concerns were raised about the overvaluation of the current private credit market and the open attitude towards potential acquisition opportunities in the future that may naturally fit.

In the discussion, JP Morgan explored the impact of simplifying regulatory structures on capital and liquidity constraints, and how this may affect their Return on Common Equity (RoCE). They mentioned that while simplifying regulatory structures may provide opportunities for companies to optimize capital usage, the intense market competition and the attractiveness of high returns may attract new competitors, so it cannot be simply assumed that this will directly increase company returns. Additionally, the discussion also involved the increase in market activity at the end of the quarter, analyzing whether this is related to reduced uncertainty in tariff policies and tax laws. JP Morgan expressed a cautiously optimistic view on the sustainability of market activity, pointing out that while some risk factors have eased, global political and economic risks still exist.

The conversation mainly revolves around how banks adjust their balance sheets to cope with expected interest rate changes, as well as the impact of regulatory policies such as the Supplementary Leverage Ratio (SLR) adjustment on banks' asset allocation and business expansion. The discussion points out that banks find it difficult to fully hedge against already priced interest rate cuts, but can reduce volatility by adjusting their asset portfolios. At the same time, changes in regulatory policies aim to encourage banks to increase their holdings of low-risk assets, but actual asset growth needs to consider supply and demand dynamics and returns.

The discussion focused on the necessity of amending the existing fixed rules in the financial system, pointing out that these rules have not achieved the expected goals in practice, but have instead had a negative impact on the system. The proposed amendments were supported, with the belief that they will help enhance the resilience of the system, especially in addressing potential market pressures in the future. Additionally, the discussion also touched on the impact of the proposals on market participants and the potential effects on low-risk market intermediaries, emphasizing the importance of thoroughly reviewing and amending all rules in the financial system.

Discuss the impact of recent sapphire price changes on market reactions, as well as its strategic significance and growth opportunities in the credit card field. Emphasize the enhancement of customer value propositions through this change, and the leading position in the market based on the ratio of customer value to annual fees.

During the discussion, the performance of the company in a competitive market environment was mentioned, emphasizing the optimal state of the product at the current stage. At the same time, the significant changes in quarterly performance were analyzed, attributed to market fluctuations and the effective use of the company's balance sheet. In addition, the discussion also involved the transformation of investment banking business, the resilience of market revenue, and the importance of capital and other resources being heavily invested in income growth, reflecting the company's adaptability to market dynamics and response strategies.

The conversation discussed whether regional banks are facing pressure from business and corporate clients to deal with the impact of tariffs. The banks stated that they have not yet felt any pressure in terms of loans.

In a discussion among executives in the banking industry, they explored market competition pressure, capital allocation strategies, and stock buyback plans. They mentioned that the market environment is highly competitive, with frequent price negotiations, and expressed confidence in advancing projects amid market uncertainties. In addition, the discussion also involved the management of the Common Equity Tier 1 (CET 1) ratio, pointing out that although the capital return rate is high, caution is needed in managing capital growth to avoid excessive accumulation of excess capital. Regarding stock buybacks, the executives mentioned that they are not inclined to buy back at high prices, but will adjust their strategies flexibly according to market conditions.

Senior bank executives emphasized the importance of organic growth in their discussions, pointing out that expanding customer base and business scope through initiatives such as opening branches, developing international middle-market business, and strengthening payment systems are key to enhancing profitability. They also discussed the positive impact of the current market environment on banking operations, including high interest rates, active trading activities, robust capital markets, and strong consumer and wholesale credit conditions, while expressing caution about the sustainability of these favorable conditions. The executives believe that despite the current strong performance, one should not be overly optimistic but instead continue to invest and maintain competitiveness to prepare for possible future changes and challenges.

Jeremy mentioned that in the market business, opportunities for fixed income and securitization products have decreased, especially in the latter half of the quarter, compared to emerging markets and macroeconomic sectors, these businesses appear relatively calm.

During the discussion, the company's sales and trading departments were mentioned for their strong performance over several consecutive quarters. The discussion focused on whether this performance growth was due to a special market environment or more lasting business improvements. While part of the performance growth can be attributed to the effective use of resources and capital, it is also important to consider that this growth is accompanied by resource inputs. The discussion also involved expectations for future performance, including the possibility of market normalization and the potential for continued growth opportunities.

Market business, due to its relatively independent and not strongly cyclical income characteristics, is described as encompassing both financing services and customer orientation. However, market business still faces volatility and risks, which require hedging and management through various strategies.

In this discussion, analysts raised questions about the significant growth of CNI loans in banks but the decrease in net interest income and loan income in commercial and investment banks, pointing out that this phenomenon is inconsistent with typical financial expectations. It was mentioned in the discussion that this contradiction may be caused by hedging operations, a large increase in assets at the end of the quarter, and other market factors working together.