JPMorgan Chase & Co. is eyeing European mid-sized and family-owned companies as the next area of growth for the Wall Street firm, aiming to offer them new business loans, cash management services, payment processing and other banking services.
According to Reuters, JPMorgan CEO of Commercial Banking Doug Petno said in an interview that he has a list of 1,500 handpicked customers that JPMorgan wants to become clients. While many of the owners of the firms are wealth management customers, JPMorgan wants to extend the services it offers them.
According to Reuters, JPMorgan is eyeing companies in France, Germany, Italy, the Netherlands, Spain and Britain that have revenues of about $500 million to $2 billion each. The bank is also going after firms that have recognized brands and have long been in the business as well as those who are looking to expand internationally. The report noted some of these businesses already operate in the U.S.
The move comes as JPMorgan is moving dozens of its bankers to Paris to prepare for Brexit. Petno told Reuters the list of potential customers took two years to build and was created by employees located in each country. Petno acknowledged it would take time to win clients and recruit staff but he thinks JPMorgan can create a long-lasting business in Europe similar to its commercial banking business in the U.S. That unit generated $8.6 billion in revenue for the bank last year, noted Reuters. Petno declined to disclose goals but the expansion is being planned against a backdrop in which corporate lending in Europe is one of the few banking bright spots, given low interest rates and lackluster growth. It also comes as JPMorgan has been able to gain market share in the European capital markets thanks to price cuts, a wide range of products and stepped-up marketing efforts. JPMorgan has also gained market share in U.S. credit cards, commercial lending, asset management, and securities services over the past few years, noted Reuters.