JPMorgan is investing $200m in bankers and traders this year
Bank of America may have a hiring freeze, Goldman Sachs may be pulling back from unnecessary recruitment and Morgan Stanley may be prepping 3,000 job cuts (still), but JPMorgan is planning substantial investments in headcount at its corporate and investment bank (CIB).
In today's investor day presentation, the bank says it's planning to invest $200m in 'revenue producers' for the CIB this year.
This follows Jamie Dimon's comment in January that he tends not to stop hiring during a recession.
Where will this $200m be spent? The presentation says the CIB has four "strategic focus areas" (Financial Sponsors, Private Capital, International, Carbon Transition) and is "investing in technology and analytics." It could possibly do with some new technology bankers (it ranks second for tech deals and first in other major sectors) and says it's been 'deepening' its presence in Asia and India, hiring "top talent to drive new economy and healthcare" and has expanded corporate banking coverage of multinationals in APAC.
As some banks struggle, JPMorgan may be a safe spot to be situated. Today's presentation also stresses the market share gains that have been made in the equities business, equity capital markets (ECM) and M&A businesses (albeit alongside declines in fixed income currencies and commodities (FICC) and debt capital markets), the likelihood that JPM will gain more share from struggling competitors and the fact that the cost of capital in the CIB is covered very handsomely.
Managing directors at US investment banks typically receive salaries of $500k, plus at least equivalent bonuses, implying that JPMorgan might be able to add 200 of them were it to invest entirely in new people at this level. Alternatively, it could always wait for people to scale the hierarchy. Today's presentation says that it takes an average of 15 years to become an MD in the investment bank.
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