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Integration of First Republic Bank is going as per plan: JPMorgan

Since the acquisition in May, JPMorgan, the biggest lender in the US, has retained 90% of First Republic customers

According to Marianne Lake, co-CEO of JPMorgan’s consumer and community bank, the company is successfully integrating the failed First Republic Bank while also looking to grow the services it has acquired. Since the acquisition in May, JPMorgan, the biggest lender in the US, has retained 90% of First Republic customers.

“We have done the home lending integration, mortgage origination and servicing already. We are going to do the deposit migration and integration by the middle of next year,” Marianne Lake told investors at the Goldman Sachs US Financial Services Conference.

The biggest US lender to fail since 2008 was First Republic Bank. JPMorgan’s third-quarter profits exceeded Wall Street estimates due to the deal, and executives reported that the integration is progressing more smoothly than anticipated.

According to Lake, consumer spending is still strong and has returned to its pre-pandemic levels. She stated that while credit card loan growth is predicted to hit double-digit percentages in the upcoming year, it will remain below 2023 levels.

“There will likely be no change in mortgage lending. Even after dropping for three months straight, consumer confidence in the US increased in November,” Marianne Lake added.

Americans intend to purchase expensive goods like homes and cars during the next six months, while interest rates are still high. The cash buffers for the lowest-income customers are decreasing, but consumers with low credit scores are starting to exhibit signs of stress.

Separately, Lake stated that net interest income for the bank is anticipated to surpass the previous projections of the executives. She previously served as the bank’s finance chief.

According to Lake, revenue from investment banking is likely to increase by a single-digit percentage in the fourth quarter, while revenue from trading is predicted to remain unchanged.

Meanwhile, according to JPMorgan Chase, the significant surge in the US stock market over the past month is probably going to fade by the end of the year due to several intensifying economic challenges.

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