by Rich Edwards Aug 4, 2023

The Data Imperative and Dimon on Regulation

The business side of data and the view from atop JPMorgan

Dimon cold on M&A for JPMorgan

For this first Friday in August and the beginning of the end of summer, we have two thought provoking pieces. First is a look at the growing need for banks to make data a part of their business, not just technical strategy. Also, we look at an interview with JPMorgan’s Jamie Dimon and his take on the Fed’s performance and the bank’s lack of interest in further acquisitions.

1. “Data management provides the scaffolding within which banks can elevate value”

Celent analyst Colline Kerr writes on the evolving requirements for banking data governance. One of the key points is recognizing data strategy as a business imperative and not solely an IT or compliance concern.

Business leaders have a key role in shaping data management strategy as they seek to monetize data assets to support business growth. This will play an increasingly significant role as data volumes and complexity increase to support new analytics use cases, innovative products and services, and of course, AI.

And that last point is a critical one. The business model of banking, as custodians of value, is emerging. Your ability to differentiate your services and stay relevant to your communities will increasingly depend on your knowledge, insight, and data of the markets you serve. Most of that resides in the unstructured (i.e., not tabular/spreadsheet data) 1st party data at your exclusive disposal.

Having a plan for compliance and protection of data is not enough. You must also prepare to leverage your unique insights to better serve your customers and members than any other institution, large or small, or tech company. This is the key to winning in the near and far future.

2. Jamie Dimon - Long on America

JP Morgan Chief Jamie Dimon appeared on CNBC as part of his annual bus tour, visiting this year the Northwest US (full transcript here). He discussed his views on the FED, overall regulation, banking capital requirements specifically, and the Jeffrey Epstein litigation.

From the transcript on plans for further acquisitive growth, and a salty take on the auctioning of failed banks:

Do you have an appetite to do any more deals?

DIMON: Not really. I mean they don’t want us to which I think is fine, you know, they don’t, they don’t want big banks to do other deals to make them bigger which I think is fine. If you said again this goes back to regulations but I also don’t think that the FDI—you know, the public should know, we pay for the FDIC, it’s a mutual insurance thing so Silicon Valley Bank is probably going to cost us $2.5 to $3 billion and you know so I don’t want whatever happens when the next bank comes bid in, I want to make sure that bid is a reasonable bid and not where you know $10 billion extra is being given to a small bank. That is not fair to anybody so I think they need some clear rules about if you want to do resolution, recovery and I also think we made a huge mistakes on Silicon Valley Bank. I hope that regulators are gonna be looking at that one day, with one place, we created a crisis and we created a melting cube that maybe didn’t have to happen.

A clip specifically on his view of (over?) regulation and growth:

That’s a wrap for this week. I hear you can find real gems at thrift stores (RIP #27). How’d we do here? One click to let us know:

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