JPMorgan’s Dimon sees 'extraordinary amount of complacency' as markets recover from tariff shock
He was not the only big bank boss making new warnings Monday about the coming effects on tariffs.
Citigroup (C) CEO Jane Fraser said in a blog post that "uncertainty remains."
"Companies are pausing decisions, delaying capex and holding off on hiring. Many are preparing for second- and third-order effects, from demand shocks to supplier uncertainty," she added.
She noted that "we are entering a new phase of globalization — one less defined by cooperation, and more by strategic self-interest. Long-held assumptions are being challenged, not just by tariff announcements but by a deeper confidence shock. The near-term impact is already being felt, and the long-term trajectory is being rewritten in real time."
JPMorgan did offer one sign that things may be slowing for some clients in the current quarter.
It told investors that for the second quarter it expects weaker investment banking fees "down mid teens plus or minus" compared to the second quarter of last year, according to co-CEO of the commercial and investment bank Troy Rohrbaugh. Investment bankers rely on companies making deals for their revenue.
Trading revenue is estimated to be in the "high single digits," Rohrbaugh added.
The bank did keep its full year forecast for its crucial lending revenue, net interest income. It is still projecting $90 billion, plus a potential extra $4.5 billion from trading, depending on market conditions.
"The outlook is probably slightly better than it was at first quarter earnings." CFO Jeremy Barnum said earlier in the day while also pointing out that the recent events have “slightly worsened the output, but not by enough to warrant changing guidance.”
Dimon also took time Monday to rail on the many bank rules set by Washington, saying broadly, "a lot of these calculations, as I mentioned before, are completely asinine."
The open question of who will lead JPMorgan after Dimon, whose held the role since 2006, has for years served as one of Wall Street’s great guessing games. It is also the "single biggest idiosyncratic risk factor" for JPMorgan's stock," Ebrahim Poonawala, a Bank of America analyst wrote last week.
Investors also had a chance to hear from Dimon’s top lieutenants, several of which are considered inside the bank as the most likely to succeed him one day.
"Our north star is generating alpha," said Mary Erdoes, head of asset and wealth management. "That is all we do. All day long. We obsess about every single basis point."
The bank also increased its technology spending by $1 billion from last year to $18 billion.
“We are a growth franchise, and we're gaining share broadly across businesses. We're not big braggers, but we are proud of this performance," said Marianne Lake, CEO of JPMorgan’s sprawling consumer bank.
Excluding its home lending division, Lake said her division of the bank expects a 10% reduction in headcount over the next four and a half years in light of productivity improvements from AI and other tech.
David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance.
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