JPMorgan’s Jamie Dimon aims to grow Minnesota footprint, views stock market ‘like the weather’

JPMorgan Chase CEO Jamie Dimon, who was in the Twin Cities Tuesday boosting the bank’s Midwest expansion, is expecting the Federal Reserve to cut interest rates at its next meeting, but isn’t so sure the cut will move the needle much for investors and borrowers.

Calls for the Fed to take action have intensified this week after the Dow Jones Industrial index plunged over 1,000 points and the S&P 500 had its worst day in two years on Monday.

Federal Reserve Chair Jerome Powell in July said an interest-rate cut could be on the table in September, which would be the central bank’s first rate cut in four years. Some experts assume coming down from a 23-year high of 5.3% would reduce borrowing costs for consumers and businesses, including mortgage and auto-loan rates

“I don’t think it’s going to make that much of a difference at all,” Dimon said. “It’s more psychological now, the reduced rates. They haven’t done it for years, but you’ve already had it in your mind.”

Other factors, mainly government policies, will play a larger role in the nation’s economy and individual financial stability in the coming months and possibly years, Dimon said. While sitting inside a room with reporters at a bank branch in Edina, Dimon said the next White House administration must enact policies that expand the economy by encouraging investments, making mortgages cheaper, increasing the nation’s labor force and incentivizing business.

“If the government does a better job, it’ll help Minnesota,” he said.

The CEO of the nation’s largest bank — which managed $3.9 trillion in assets in 2023 and generated $162.4 billion in revenue — pointed to skill development among people who earn near the bottom 20% of income, saying job growth is known to reduce homelessness and crime and create home formation.

“I would be more for the earning of tax credit that would put more income into the hands of the people who need it the most, and they spend it on their families and in their communities without government micromanaging what they’re doing all the time,” he said. “You can use this for food and for this and for that.”

More short-term elements, like rate cuts or bad days on Wall Street, don’t register as high, Dimon said.

“I don’t react to things like that,” Dimon said, regarding the stark drop in stocks on Monday. “I look at some of those things like the weather.”

The markets recovered on Tuesday but left a lingering question of whether the economy might become more stressed.

“Are we going for a soft landing or a hard landing, I don’t know,” Dimon said. “I think the odds of a soft landing are less than what other people think, so I’m a little more prepared for that if we have a slightly tougher time.”

Chase’s share of the Twin Cities banking market has grown since the company opened its first branch in Minneapolis in 2019, albeit within a competitive environment that includes by Minneapolis-based U.S. Bank, Wells Fargo and dozens of credit unions and charter banks.

Chase’s presence, in any market, is good for competitors, as it forces them to “clean up their act,” Dimon said. The strategies of other banks didn’t seem to be a concern for the CEO.

“I don’t really care what other people do,” he said. “Competition is usually a good thing. Some of that is a good thing for not just consumers but for the competitors.”

Chase’s emergence in Minnesota was part of an expansion to open 400 branches across the U.S., particularly in markets where it did not previously have a major retail presence. It has since grown to more than 30 branches in the Twin Cities region, and Dimon expects to get up to 50 or more.

The bank has more than 90 ATMs in the Twin Cities, close to 600 employees, 600,000 banking customers and over 30,000 small business clients. The bank has also made $17.9 million in philanthropic contributions between 2019 and 2023.

“Minnesota has great companies, great innovation, great capability as do a lot of the states, may not be as broad as in Minnesota, but if you have universities, you generally have businesses around it from the skills the university generates,” he said.