JPMorgan Chase is gearing up to spend $500 million during the next five years to boost economic opportunities in cities around the country and some outside of the U.S.
Reuters, citing JPMorgan Chase, reported the program is based on its previous efforts to invest in urban renewal, including its $150 million investment it made in Detroit in 2014. Since then it has invested $40 million in Chicago and $25 million in Washington D.C., reported Reuters.
Half of the new money will come in the form of philanthropic grants, while the other half will provide low-cost, long-term development capital including to teach job skills, finance small businesses of minorities and women, help families with their financial issues and to overhaul neighborhoods. “Businesses can and must step up to help change the status quo by creating a better future for all, no matter where they live,” Chief Executive Jamie Dimon said in a statement, reported Reuters. “It is in our best interest and the right thing to do.”
According to the report, the program is aimed at making big investments in cities where the bank thinks there are the conditions for success. JPMorgan said it plans to name a global city that will get some of the funding outside of the U.S. The report noted that this time around, the bank put in place a formal process for cities to submit bids for the financing. It is looking for proof of collaboration between public and private interests to rebuild neighborhoods in the cities that it supports, noted the report. JPMorgan expects the $500 million will be matched by $1 billion in other capital, noted Reuters.
The new philanthropic program comes as JPMorgan is poised to become the largest U.S. bank. According to a recent Forbes report, JPMorgan is already the largest U.S. bank in terms of total assets, market capitalization and total deposits. With it handing out loans at a faster pace than its rivals, JPMorgan could soon become the leader in the U.S. banking industry. It’s also the largest investment bank and third-largest custody bank in the U.S.
Data showed that the largest U.S. banks (Wells Fargo, JPMorgan, Bank of America, Citigroup and U.S. Bank) reported a combined loan portfolio of nearly $3.8 trillion worldwide in Q2 2018 — more than 38 percent of total loans handed out by all U.S. commercial banks. Citigroup’s growth in its loan portfolio was impressive, standing at 5.6 percent — more than the rate of loan growth across the industry, which is at 4.6 percent.