JPMorgan Chase & Co.’s credit grade was raised one notch by S&P Global Ratings, which pointed to the bank’s ability to weather economic shifts after years of wresting market share from rivals.
S&P boosted the New York-based parent company’s long-term issuer credit rating to A on Friday, with a stable outlook.
“The strength and consistency of JPM’s diverse franchise underpin our upgrade, and our ratings on JPM are now among the highest of banks we rate globally,” S&P said in a statement. “JPM’s strong market shares enable it to generate a high level of pricing power, client selection and economies of scale, more so than almost any other international bank.”
The firm, led by CEO Jamie Dimon, 68, reported the highest annual profit in US banking history last year and is on track to exceed that by roughly 15% for 2024, analysts’ estimates show.
Meanwhile, JPMorgan has been strengthening its balance sheet and investing in new technology “that could help lay the foundation for future profits, as well as support risk-management capabilities”, S&P wrote.
Shares of JPMorgan, which climbed 44% this year, recently got a bump as investors bet that Donald Trump’s incoming presidential administration will seek to ease regulation, juicing banks’ profits. But S&P indicated that wasn’t part of what drove its upgrade.
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“The strength of US regulation remains an important consideration in our ratings on JPM and other banks,” S&P said. It doesn’t expect “material loosening of the important enhancements made to bank regulation over several years since the global financial crisis”.
