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JPMorgan to Close Foreign Retail Clients' Investment Accounts

JPMorgan (JPM) plans to shut investment accounts for foreign retail clients as the bank wants to focus more on domestic core business.

In order to increase focus toward core domestic business, JPMorgan Chase & Co. JPM has decided to shut investment accounts for retail clients that do not live in the United States, per Bloomberg.

Elizabeth Seymour, a spokeswoman for JPMorgan informed, “After careful review, we’ve decided to no longer service Chase retail investment accounts to non-U.S. residents.”

According to people familiar with the matter, retail customers, residing in about 50 countries outside the United States, will no longer be allowed to keep their investment accounts with International Financial Services with the bank. However, these customers will not be barred from keeping deposit accounts with the bank.

Notably, the company’s private-bank customers will not be affected by this change. According to a person familiar with the matter, less than 1% of the banks’ retail investment accounts and assets are likely to be affected.

The bank’s division that handles and serves retail clients had nearly $283.7 billion in client investment assets at the end of June, according to a filing.

JPMorgan has already begun informing some of its affected clients of the planned exit. According to Bloomberg, which has seen a notice issued by Chase Wealth Management, JPMorgan has already informed its retail clients in Mexico about the change and has told those clients that it is planning to close investment accounts and might liquidate the account assets if they are not moved by Nov 1, 2018.

This decision of JPMorgan is expected to enhance its long-term efficiency. In fact, driven by higher rates and rising loan demand, the company remains well positioned for top-line growth in the future.

Notably, the company’s efforts to expand into new markets and focus on strengthening the card business will likely benefit its financials.

A few stocks from the same industry as JPMorgan are Comerica Incorporated CMA, SunTrust Banks, Inc. STI and KeyCorp KEY.

Comerica’s earnings estimates for the current year have been revised upward over the past 60 days. Its shares have gained more than 30% over the past year.

SunTrust has also been witnessing upward earnings estimate revision for the current year over the past 60 days. Its shares have gained nearly 24% in the past 12 months.

KeyCorp’s earnings estimates for the current year have been revised upward over the past 60 days. Its shares have gained more than 17% over the past year.

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JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report
 
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