Unique-Jamie Dimon charts JPMorgan growth plan into Africa By Reuters

By Nupur Anand

NEW YORK (Reuters) -JPMorgan Chase, the most important U.S. lender, plans to enter Kenya and Ivory Coast this 12 months and develop its footprint in Africa, CEO Jamie Dimon instructed Reuters.

Worldwide markets are a development space for JPMorgan, which has greater than $4.2 trillion in belongings and operates in over 100 nations. That compares with Citigroup, which does enterprise in virtually 180 nations and has the most important world footprint amongst U.S. banking giants. 

“We want to add a country or two (enter or deepen presence) in Africa, every couple of years or so,” Dimon stated by telephone from New York on Friday earlier than departing on a visit to Africa. The nations and tempo of growth haven’t beforehand been reported.  

JPMorgan faces the problem of differentiating its providing in disparate markets which can be dominated by native and regional lenders, stated Francis Mwangi, chief govt of Nairobi-based brokerage Kestrel Capital.

“To start off a commercial bank from scratch will have to take a bit of time and effort, especially in a market that is already overbanked,” he stated, citing Kenya, which has 40 industrial banks serving a inhabitants of fifty million.

Massive U.S. companies have historically struggled to compete on the continent due to geopolitical dangers, Mwangi stated, citing markets that have been beforehand topic to U.S. authorities sanctions, resembling Burundi.

Dimon will maintain conferences in Kenya, Nigeria and South Africa on the tour, Reuters reported final month. 

“This will allow us to be on the ground in these countries which gives you a lot more local knowledge and relationships,” Dimon stated.

“And when you do it, you basically will cover the government, maybe some big government enterprises and the multinationals that are going in there with traditional banking services,” he added.

In Kenya and Ivory Coast, the financial institution will concentrate on industrial and funding banking, treasury providers, and probably some lending, Dimon stated. In these two nations, it has no speedy plans to supply asset and wealth administration (AWM) providers, that are already obtainable in South Africa and Nigeria.

“We are not doing AWM now but that doesn’t mean it wouldn’t happen in the next few years,” Dimon stated.     

JPMorgan’s earlier aspirations to enter Ghana and Kenya within the final a number of 12 months have been thwarted by regulators, in keeping with media studies.

On Monday, the Central Financial institution of Kenya stated it licensed JPMorgan to ascertain a consultant workplace there.    

Previously, “the U.S. government was not very keen on banks expanding into different geographies, as this was just after the financial crisis,” Dimon stated noting the U.S. is now extra supportive. 

It’s a optimistic transfer if U.S. monetary establishments broaden overseas, and the federal government ought to help such endeavors to compete abroad, he stated, citing the broad footprint of Chinese language firms and saying that U.S. firms also needs to be in these locations.

Main world lenders have adopted differing methods for particular person sub-Saharan markets, concentrating on the fastest-growing areas whereas searching for to tell apart themselves from native and regional rivals. 

As an example, Normal Chartered (OTC:) has centered on Kenya. Its belongings below administration within the East African nation grew by 1 / 4 final 12 months to 185.5 billion Kenyan shillings ($1.4 billion), it stated.

The growth could not have a cloth affect on JPMorgan’s enterprise within the close to time period, however will probably be useful for the corporate and future leaders in the long term, Dimon stated.

JPMorgan is among the many prime 5 worldwide personal banks by belongings below supervision. 

Within the final 5 years, about 700 bankers have been concerned in increasing into 27 new places worldwide, producing $2 billion in income for its industrial and funding financial institution, executives instructed traders in Might.

JPMorgan’s revenue beat expectations within the third quarter, fueled by positive aspects in funding banking and rising curiosity funds, it reported on Friday.