Bank branches, not mobile phones, are the reason JPMorgan Chase dominates in deposits

Open-door policy.
Open-door policy.
Image: Reuters/Lucas Jackson
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For the first time in more than 20 years, JPMorgan Chase has the most deposits—$1.31 trillion as of June—of any US bank. Part of how it got there was through storefront branches, with some 75% of its growth in deposits coming from customers who use them, according to Marianne Lake, the bank’s chief financial officer.

Part of the pitch for fintech startups is that they aren’t weighed down by maintaining bank branches. Mobile-phone real estate is supposed to be what mainly matters. And while JPMorgan is slowly closing physical branches—the bank has 5,174, down about 5% from a year ago—those outlets still appear to offer a type of service its newer competitors can’t provide.

Even so, Lake acknowledged in a conference call today (Oct. 12) that customer preferences are changing, as mobile banking at JPMorgan has increased 12% in the past year. And while the internet could make it easier for consumers to move their deposits to another another bank, having high-quality mobile-banking features can also make deposits “stickier.” “Customers value that convenience very highly,” Lake said.