New York, December 06, 2017 -- Moody's Investors Service affirmed the A3 long-term senior debt
rating of JPMorgan Chase & Co. (JP Morgan) and the ratings
of several subsidiaries, including the Aa2 deposit rating of JPMorgan
Chase Bank, N.A. The outlook on all ratings is stable.
Please see below for a complete list of other Rating Actions and Rating
Affirmations.
RATINGS RATIONALE
The ratings affirmation reflects the industry-leading competitive
position of each of JP Morgan's four franchises, the diversity
of its business mix, and the resulting strength and stability of
its earnings. The bank's credit profile is also bolstered
by a sound capital base and liquidity profile.
The ratings also incorporate the risks inherent in JPMorgan's Corporate
and Investment Bank (CIB), which accounted for 44% of earnings
in the past year and one-third of the balance sheet at September
30, 2017. These risks have been partially mitigated by the
more stable earnings streams from JP Morgan's consumer, commercial
and wealth management operations, which have generated steady earnings
to buffer the volatility expected in CIB results over the cycle.
The CIB also benefits from a reliable stream of transaction and securities
services revenues that comprised 22% of CIB revenues in the past
year. The balance of this business mix has allowed JPMorgan to
maintain one of the highest baseline credit assessments (a3) amongst banks
with significant global capital market activities.
JPMorgan ranks amongst the most diversified and profitable financial institutions
globally. These superior results reflect the diversification of
JP Morgan's earnings, the favorable competitive position of
its franchises and the consistency of management's execution.
This robust profitability has allowed the bank to absorb occasional costs
associated with legacy positions, litigation, restructuring
and regulation, while maintaining business investment. JP
Morgan has been able to do this without the need to set up non-core
units or take extraordinary charges, in contrast to many peers.
As a result, JP Morgan's franchises rest on a solid foundation
as evidenced by consistently healthy key performance indicators of market
share and growth.
JP Morgan is also among the world's most complex banks. This
results in heightened risk management, governance and succession
challenges compared to most banks with simpler business models and more
transparent and granular risk profiles.
Rating Outlook
The outlook on all ratings is stable.
Factors that Could Lead to an Upgrade
Upward pressure may develop on JP Morgan's a3 BCA and the associated ratings,
if the firm continues to demonstrate peer-leading and sustainable
profitability even under a more challenging operating environment or if
the firm's reliance on capital markets earnings declines while adapting
a simplified business model. Under our advanced LGF framework,
upward rating pressure could develop for holding company senior debt as
well as bank-level senior and subordinated debt if there is a sustained
increase in the thickness of the holding company senior debt stack relative
to Moody's LGF loss assumptions.
Factors that Could Lead to a Downgrade
Downward pressure could develop on the baseline credit assessment in the
event of a marked increase in risk appetite or a major risk control failure.
Other Rating Actions and Rating Affirmations
Chase Bank USA NA
The baseline credit assessment of Chase Bank USA N.A. was
lowered to baa3 from baa2, reflecting reduced liquid resources at
the entity. All ratings of Chase Bank USA were affirmed (including
its Aa3 issuer rating), reflecting its solid position in the U.S.
Credit card industry resulting in strong profitability, partly offset
by the monoline nature of the entity and vulnerabilities from a single
asset class concentration. The affirmation of the a3 adjusted BCA
reflects Moody's assumption of the very high likelihood of support
from the parent, given the strategic importance of Chase Bank USA
to JP Morgan's consumer franchise.
A Baa2 (hyb) junior subordinated debt rating was assigned to JPMorgan
Chase & Co. in anticipation of upcoming liquidation of seven
capital trusts effective December 18, 2017.
The following ratings were affirmed.
Affirmations:
..Issuer: JPMorgan Chase & Co.
.... Commercial Paper, Affirmed P-2
.... Issuer Rating, Affirmed A3,
Stable
....Subordinate Medium-Term Note Program,
Affirmed (P)Baa1
....Senior Unsecured Shelf, Affirmed
(P)A3
....Pref. Non-Cumulative Shelf,
Affirmed (P)Baa3
....Subordinate Shelf, Affirmed (P)Baa1
....Pref. Stock Non-cumulative
Preferred Stocks, Affirmed Baa3 (Hyb)
....Subordinate Regular Bond/Debentures,
Affirmed Baa1
....Senior Unsecured Medium-Term Note
Program, Affirmed (P)A3
....Short-Term Senior Unsecured Medium-Term
Note Program , Affirmed (P)P-2
....Senior Unsecured Regular Bond/Debentures,
Affirmed A3, Stable
....Senior Unsecured Regular Bond/Debenture,
Affirmed (P)A3
..Issuer: JPMorgan Chase Bank, N.A.
.... Adjusted Baseline Credit Assessment,
Affirmed a3
.... Baseline Credit Assessment, Affirmed
a3
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
....Short-Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Issuer Rating, Affirmed Aa3,
Stable
.... Short-Term Deposit Rating,
Affirmed P-1
....Subordinate Bank Note Program, Affirmed
(P)A1
....Subordinate Medium-Term Note Program,
Affirmed (P)A1
....Short -Term Medium-Term
Note Program, Affirmed (P)P-1
....Short-Term Senior Unsecured Medium-Term
Note Program, Affirmed (P)P-1
....Senior Unsecured Short-Term Bank
Note Program, Affirmed P-1
....Senior Unsecured Bank Note Program,
Affirmed (P)Aa3
....Senior Unsecured Deposit Note/Takedown,
Affirmed Aa2, Stable
....Senior Unsecured Short-Term Medium-Term
Note Program, Affirmed (P)P-1
....Senior Unsecured Medium-Term Note
Program, Affirmed (P)Aa3
....Senior Unsecured Regular Bond/Debentures,
Affirmed Aa3, Stable
....Long-Term Deposit Rating,
Affirmed Aa2, Stable
..Issuer: JPMorgan Chase Bank, N.A.,
Paris Branch
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short-Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Short-Term Deposit Rating,
Affirmed P-1
....Long-Term Deposit Rating,
Affirmed Aa2 STA
..Issuer: Morgan Guaranty Trust Company of New York
....Senior Unsecured Regular Bond/Debenture,
Affirmed Aa3 STA
..Issuer: J.P. Morgan Securities plc
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short-Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Issuer Rating, Affirmed A1 STA
.... Short-Term Issuer Rating,
Affirmed P-1
..Issuer: J.P. Morgan Securities,
LLC
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short-Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Issuer Rating, Affirmed A1 STA
.... Short-Term Issuer Rating,
Affirmed P-1
....Commercial Paper, Affirmed P-1
..Issuer: BANK ONE Capital III
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: BANK ONE CORPORATION (assumed by JPMorgan
Chase & Co.)
....Subordinate Regular Bond/Debenture,
Affirmed Baa1
..Issuer: Bank One, Michigan
....Subordinate Regular Bond/Debenture,
Affirmed A1
..Issuer: Chase Bank USA, National Association
.... Adjusted Baseline Credit Assessment,
Affirmed a3
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short-Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Issuer Rating, Affirmed Aa3,
Stable
.... Short-Term Deposit Rating,
Affirmed P-1
....Subordinate Bank Note Program, Affirmed
(P)A1
....Senior Unsecured Bank Note Program,
Affirmed (P)Aa3
....Short-Term Senior Unsecured Bank
Note Program, Affirmed (P)P-1
....Short-Term Senior Unsecured Bank
Note Program, Affirmed P-1
....Senior Unsecured Regular Bond/Debentures,
Affirmed Aa3, Stable
....Long-Term Deposit Rating,
Affirmed Aa2, Stable
..Issuer: Chase Capital II
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: Chase Capital III
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: Chase Capital VI
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: First Chicago NBD Capital I
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: J.P. Morgan & Co.
Incorporated
....Subordinate Regular Bond/Debentures,
Affirmed Baa1
....Senior Unsecured Regular Bond/Debentures,
Affirmed A3, Stable
..Issuer: J.P. Morgan AG
.... Adjusted Baseline Credit Assessment,
Affirmed a3
.... Baseline Credit Assessment, Affirmed
a3
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short-Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Issuer Rating, Affirmed A1
.... Short-Term Issuer Rating,
Affirmed P-1
.... Short-Term Deposit Rating,
Affirmed P-1
....Long-Term Deposit Ratings,
Affirmed Aa2
..Issuer: J.P. Morgan Bank Canada
.... Short-Term Deposit Ratings,
Affirmed P-1
....Long-Term Deposit Ratings,
Affirmed Aa2, Stable
..Issuer: J.P. Morgan Chase Capital
XIII
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: J.P. Morgan Chase Capital
XXI
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: J.P. Morgan Chase Capital
XXIII
....Pref. Stock Preferred Stock,
Affirmed Baa2 (Hyb)
..Issuer: JP Morgan International Derivatives Ltd
....Senior Unsecured Regular Bond/Debentures,
Affirmed Aa3, Stable
..Issuer: JP MORGAN STRUCTURED PRODUCTS BV
....Senior Unsecured Medium-Term Note
Program, Affirmed (P)Aa3
....Short-Term Senior Unsecured Medium-Term
Note Program, Affirmed (P)P-1
....Senior Unsecured Regular Bond/Debenture,
Affirmed Aa3, Stable
..Issuer: JPMorgan Chase Bank, N.A.,
London Branch
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short Term Counterparty Risk Assessment,
Affirmed P-1(cr)
....Senior Unsecured Medium-Term Note
Program, Affirmed (P)Aa3
....Senior Unsecured Short Term Medium-Term
Note Program, Affirmed (P)P-1
..Issuer: JPMorgan Chase Bank, N.A.,
New York Branch
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short Term Counterparty Risk Assessment,
Affirmed P-1(cr)
....Subordinate Medium-Term Note Program,
Affirmed (P)A1
....Senior Unsecured Seniority Medium-Term
Note Program, Affirmed (P)Aa3
..Issuer: JPMorgan Chase Bank, N.A.,
Singapore Br
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short-Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Short-Term Deposit Rating,
Affirmed P-1
....Senior Unsecured Medium-Term Note
Program, Affirmed (P)Aa3
....Senior Unsecured Short Term Medium-Term
Note Program, Affirmed (P)P-1
....Long-Term Deposit Rating ,
Affirmed Aa2, Stable
..Issuer: JPMorgan Chase Bank, N.A.,
Toronto
.... Commercial Paper, Affirmed P-1
.... Counterparty Risk Assessment, Affirmed
Aa2(cr)
.... Short Term Counterparty Risk Assessment,
Affirmed P-1(cr)
.... Short-Term Deposit Rating,
Affirmed P-1
....Long-Term Deposit Rating,
Affirmed Aa2, Stable
..Issuer: JPMorgan Chase Financial Company LLC
....Senior Unsecured Medium-Term Note
Program, Affirmed (P)A3
....Senior Unsecured Regular Bond/Debentures,
Affirmed A3, Stable
..Issuer: Bear Stearns Companies LLC. (The)
.... Commercial Paper, Affirmed P-2
.... Issuer Rating, Affirmed A3 STA
.... Short-Term Issuer Rating,
Affirmed P-2
....Senior Unsecured Regular Bond/Debentures,
Affirmed A3 STA
..Issuer: Bear Stearns Global Asset Holdings,
Ltd.
....Senior Unsecured Regular Bond/Debenture,
Affirmed A3 STA
..Issuer: J.P. Morgan Australia Ltd.
.... Commercial Paper, Affirmed P-1
Assignments:
..Issuer: JPMorgan Chase & Co.
....Junior Subordinated Regular Bond/Debenture,
Assigned Baa2 (hyb)
Downgrades:
..Issuer: Chase Bank USA, National Association
.... Baseline Credit Assessment, Downgraded
to baa3 from baa2
Outlook Actions:
..Issuer: Chase Bank USA, National Association
....Outlook, Remains Stable
..Issuer: J.P. Morgan & Co.
Incorporated
....Outlook, Remains Stable
..Issuer: J.P. Morgan AG
....Outlook, Remains Stable
..Issuer: J.P. Morgan Bank Canada
....Outlook, Remains Stable
..Issuer: JP Morgan International Derivatives Ltd
....Outlook, Remains Stable
..Issuer: JP MORGAN STRUCTURED PRODUCTS BV
....Outlook, Remains Stable
..Issuer: JPMorgan Chase & Co.
....Outlook, Remains Stable
..Issuer: JPMorgan Chase Bank, N.A.
....Outlook, Remains Stable
..Issuer: JPMorgan Chase Bank, N.A.,
London Branch
....Outlook, Remains Stable
..Issuer: JPMorgan Chase Bank, N.A.,
New York Branch
....Outlook, Remains Stable
..Issuer: JPMorgan Chase Bank, N.A.,
Singapore Br
....Outlook, Remains Stable
..Issuer: JPMorgan Chase Bank, N.A.,
Toronto
....Outlook, Remains Stable
..Issuer: JPMorgan Chase Financial Company LLC
....Outlook, Remains Stable
..Issuer: J.P. Morgan Securities plc
....Outlook, Remains Stable
..Issuer: J.P. Morgan Securities,
LLC
....Outlook, Remains Stable
..Issuer: Bear Stearns Companies LLC. (The)
....Outlook, Remains Stable
..Issuer: Bear Stearns Global Asset Holdings,
Ltd.
....Outlook, Remains Stable
..Issuer: JPMorgan Chase Bank, N.A.,
Paris Branch
....Outlook, Remains Stable
The principal methodology used in rating J.P. Morgan Securities
plc and J.P. Morgan Securities, LLC was Securities
Industry Market Makers published in September 2017. The principal
methodology used in rating JPMorgan Chase & Co., JPMorgan
Chase Bank, N.A., Bank One Corporation,
Bank One Capital III, First Chicago NBD Capital I, Bank One,
Michigan, Bear Stearns Companies LLC., Bear Stearns
Global Asset Holdings, Ltd., Chase Capital II,
Chase Capital III, Chase Capital VI, J.P. Morgan
& Co. Incorporated, J.P. Morgan Australia
Ltd., JP Morgan International Derivatives Ltd, J.P.
Morgan AG, J.P. Morgan Bank Canada , J.P.
Morgan Chase Capital XIII, J.P. Morgan Chase Capital
XXI, J.P. Morgan Chase Capital XXIII, JP MORGAN
STRUCTURED PRODUCTS BV, JPMorgan Chase Bank, N.A.,
London Branch, JPMorgan Chase Bank, N.A.,
New York Branch, JPMorgan Chase Bank, N.A.,
Paris Branch, JPMorgan Chase Bank, N.A.,
Singapore Branch, JPMorgan Chase Bank, N.A.,
Toronto, JPMorgan Chase Financial Company LLC, Chase Bank
USA, National Association was Banks published in September 2017.
Please see the Rating Methodologies page on www.moodys.com
for a copy of these methodologies.
REGULATORY DISCLOSURES
For ratings issued on a program, series or category/class of debt,
this announcement provides certain regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides certain regulatory disclosures in relation
to the credit rating action on the support provider and in relation to
each particular credit rating action for securities that derive their
credit ratings from the support provider's credit rating.
For provisional ratings, this announcement provides certain regulatory
disclosures in relation to the provisional rating assigned, and
in relation to a definitive rating that may be assigned subsequent to
the final issuance of the debt, in each case where the transaction
structure and terms have not changed prior to the assignment of the definitive
rating in a manner that would have affected the rating. For further
information please see the ratings tab on the issuer/entity page for the
respective issuer on www.moodys.com.
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this credit rating action,
and whose ratings may change as a result of this credit rating action,
the associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has issued
the rating.
Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.
Peter E. Nerby
Senior Vice President
Financial Institutions Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
Ana Arsov
MD - Financial Institutions
Financial Institutions Group
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
