JPMorgan Chase & Co., the nation's largest bank, is taking a long-term approach in its Minnesota expansion, one of its top executives said Friday.
As JPMorgan Chase expands in Minnesota, exec says there's no rush to get big
The nation's biggest bank is taking a slow approach in Minnesota and looking far into the future, a top executive says.
October 25, 2019 at 11:43PM
The company in Minneapolis this summer opened the first of an expected two dozen Minnesota branches. And over the past year, it has stepped up hiring in the small commercial bank office it has had in downtown Minneapolis since 2005.
"None of these bankers have near-term hurdles to clear," said Douglas Petno, chief executive of commercial banking for JPMorgan Chase. "We're going to be here in 100 years. We've been in New York City for 225 years, been here for 14. That's really the horizon that we're taking."
The Twin Cities and Minnesota are dominated by U.S. Bank and Wells Fargo, descendants of some of the state's oldest banking companies. But over the last few years, several of the big banks with roots in other parts of the country, such as Bank of America and PNC Financial, have entered the state.
A decision about two years ago at JPMorgan Chase to open retail banks, which serve consumers, in Minnesota and 15 other states had a spillover effect on the commercial side that Petno leads. "Having a big retail presence is a big benefit" to the commercial bank because the ATMs and branches raise awareness of the presence of JPMorgan Chase, he said.
"Even though there are some really great banks in town, there's a way for us to build a really nice business here," he said. "We don't rush and do something silly. We don't try to grow unnaturally. If we pick the right clients and we prove our value, it should be an enduring business."
The commercial bank now has 27 people, up about 60% from a year ago. It recently hired bankers who specialize in working with life science and technology companies.
"Our core capabilities fit the demographics of the market," said David Rudolph, the company's regional manager.
The bank's scale and its ability to invest in new technology — its tech spending will exceed $11 billion this year — are key selling points as it reaches out to new business customers.
"Long gone are the days where you'd pick your bank by who gave you the best deposit pricing or who had the cheapest wires," Petno said. "It's who is adding value and helping you optimize your financial profile, how it makes payments to consumers and other businesses, manages payables, payroll."
The firm hosted executives from a broad array of local companies at several events Thursday and Friday, and Petno asked them about business performance, hiring and economic outlook. He said he learned the labor market is ultratight and that firms have raised wages but still find it hard to fill jobs. More broadly, the firm is still optimistic about economic performance in the U.S. even as some market indicators suggest weakness may lie ahead.
"We also like to remind our clients that not every economic cycle needs to look like the [2008] financial crisis," Petno said. "There's not a real red flashing light anywhere we can see, certainly in the U.S. economy, that suggests we're heading in that direction."
Evan Ramstad • 612-673-4241
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