According to Forbes, 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.
In the meantime, Wells Fargo is still recuperating from a series of scandals, which started in 2016 with the revelation that employees had opened fake accounts in the retail banking units. That resulted in a record fine, the ousting of key executives — including the CEO — and an overhaul of the corporate culture at the company. The scandal also hurt Wells Fargo’s stock price and reputation. In addition, the lender recently agreed to pay $2.09 billion in penalties to settle claims related to mortgage loans that the bank processed before the last recession, and has faced sanctions over auto insurance policy commissions after making thousands of people take on auto insurance they didn’t want or need.
One thing to consider: Loans are likely to be depressed over the next few quarters as the Federal Reserve stays hawkish over interest rates. However, Forbes pointed out that “growth rate should normalize once the Fed is done with the rate hikes and the interest rate environment stabilizes — something we believe will happen around mid-2020.”