JPMorgan Expands Retail Banking as Other Big Banks Contract

J.P. Morgan is reportedly looking to expand its consumer banking operations in Europe.

The country’s largest bank is set to launch a digital bank in Germany in either late 2024 or early 2025, Bloomberg News reported Wednesday (Feb. 1), with plans to eventually target other European countries.

The report, which cites sources familiar with the plans, says J. P. Morgan has been hiring in Berlin, where it plans to base its consumer operations in Europe. A bank spokesperson declined to comment when reached by PYMNTS.

The Bloomberg report notes that Germany has one of the world’s most competitive banking markets. Dominated by smaller lenders and municipal-owned savings banks, there’s less pressure to generate profits.

The news follows reports from September that the bank was preparing to hire a team of retail bankers in Germany, posting jobs for a “people project lead” in international consumer banking, which described a “start-up atmosphere.” The company was also reportedly looking to hire a financial crime compliance officer “for the international consumer expansion in Germany.”

J.P. Morgan’s first foray outside the U.S. came in 2021 when it entered the British market with a digital-only retail offering.

This latest expansion comes as some of J.P. Morgan’s rivals are cutting back on their retail banking efforts.

Last year, Citigroup announced changes to its business structure as a piece of a larger strategy to shift away from global retail banking. The bank shut down its Mexican retail banking arm, Citibanamex, and sold its consumer banks in Indonesia, Malaysia, Thailand and Vietnam to Singapore’s United Overseas Bank.

Later in the year, the bank said it was exiting its retail operations in the U.K. to focus more on its wealthiest clients.

Another big bank, Goldman Sachs, has also been scaling back its consumer operations as it carried out one of the most sweeping reorganizations in its long history. That meant streamlining the company into three divisions: investment banking and trading, asset and wealth management, and transaction banking.

CEO David Solomon told analysts last year that the company’s new direct-to-consumer (D2C) strategy means that “we will focus on existing deposit customers and consumers that the bank already has access to through channels like workplace and personal wealth, rather than seeking to acquire customers on a mass scale.”