JPMorgan: Q3 Call Highlights on Card Marketing, IB Revenues, Tapering & Inflation

(Free on Substack) Company Update (JPM US) (Neutral)

A version of this was also published on my Twitter account.

Introduction: We highlight some JPMorgan (“JPM”) management comments from the Q3 2021 earnings call today (October 13) on Card marketing, Investment Banking revenues, central bank “tapering” and inflation, as a supplement to our review of the results.

Card Marketing Expenses To Stay Elevated

JPM is likely to continue to compete aggressively in Cards. In terms of JPM’s Cards value proposition, management expressed the intent to “take it up another notch” with airport lounges, its acquisition of cxLoyalty (a loyalty program operator), etc. Management confirmed that part of the drop in Card Income (down $642m from Q2) is due to higher card marketing spend, which will “remain elevated” and will likely “ticks up a little bit sequentially”. (There was also an $180m adjustment to rewards liability.) JPM’s Cards business has been expanding in the premium segment and American Express, the main competitor there, saw its shares closed down…