JPM Note 16 – Premises and equipment

The following table presents certain components of Premises and equipment. December 31, (in millions)####2023####2022 Land, buildings and leasehold improvements##$##14,862##$##13,486 Right-of-use assets(a)####7,917####7,432 Other premises and equipment(b)####7,378####6,816 Total premises and equipment##$##30,157##$##27,734


JPM Note 16 – Premises and equipment

(a)Excluded $514 million and $350 million of right-of-use assets that were recorded in Other assets at December 31, 2023 and 2022, respectively.


JPM Note 16 – Premises and equipment

(b)Other premises and equipment is comprised of internal-use software and furniture and equipment.


JPM Note 16 – Premises and equipment

JPMorgan Chase computes depreciation using the straight-line method over the estimated useful life for buildings and furniture and equipment. The Firm depreciates leasehold improvements over the lesser of the remainder of the lease term or the estimated useful life. The Firm also capitalizes certain costs associated with the acquisition or development of internal-use software. Once the software is ready for its intended use, these costs are amortized on a straight-line basis over the software’s expected useful life. The estimated useful lives range from 10 to 50 years for buildings and leasehold improvements, and 3 to 10 years for internal-use software and furniture and equipment.


JPM Note 16 – Premises and equipment

Impairment is assessed when events or changes in circumstances indicate that the carrying value of an asset may not be fully recoverable.


JPM Note 17 – Deposits

As of December 31, 2023 and 2022, noninterest-bearing and interest-bearing deposits were as follows. December 31, (in millions)####2023####2022 U.S. offices######## Noninterest-bearing (included $75,393 and $26,363 at fair value)(a)##$##643,748##$##644,902 Interest-bearing (included $573 and $586 at fair value)(a)####1,303,100####1,276,346 Total deposits in U.S. offices####1,946,848####1,921,248 Non-U.S. offices######## Noninterest-bearing (included $1,737 and $1,398 at fair value)(a)####23,097####27,005 Interest-bearing (included $681 and $273 at fair value)(a)####430,743####391,926 Total deposits in non-U.S. offices####453,840####418,931 Total deposits##$##2,400,688##$##2,340,179


JPM Note 17 – Deposits

(a)Includes structured notes classified as deposits for which the fair value option has been elected. Refer to Note 3 for further discussion.


JPM Note 17 – Deposits

As of December 31, 2023 and 2022, time deposits in denominations that met or exceeded the insured limit were as follows. December 31, (in millions)####2023####2022 U.S. offices##$##132,654##$##64,622 Non-U.S. offices(a)####90,187####77,907 Total##$##222,841##$##142,529


JPM Note 17 – Deposits

(a)Represents all time deposits in non-U.S. offices as these deposits typically exceed the insured limit.


JPM Note 17 – Deposits

As of December 31, 2023, the remaining maturities of interest-bearing time deposits were as follows. December 31, (in millions)############ ####U.S.####Non-U.S.####Total 2024##$##194,895##$##86,971##$##281,866 2025####742####180####922 2026####243####21####264 2027####140####35####175 2028####136####992####1,128 After 5 years####475####251####726 Total##$##196,631##$##88,450##$##285,081


JPM Firm as lessee

At December 31, 2023, JPMorgan Chase and its subsidiaries were obligated under a number of noncancellable leases, predominantly operating leases for premises and equipment used primarily for business purposes. These leases generally have terms of 20 years or less, determined based on the contractual maturity of the lease, and include periods covered by options to extend or terminate the lease when the Firm is reasonably certain that it will exercise those options. All leases with lease terms greater than twelve months are reported as a lease liability with a corresponding right-of-use (“ROU”) asset. None of these lease agreements impose restrictions on the Firm’s ability to pay dividends, engage in debt or equity financing transactions or enter into further lease agreements. Certain of these leases contain escalation clauses that will increase rental payments based on maintenance, utility and tax increases, which are non-lease components. The Firm elected not to separate lease and non-lease components of a contract for its real estate leases. As such, real estate lease payments represent payments on both lease and non-lease components.


JPM Firm as lessee

Operating lease liabilities and ROU assets are recognized at the lease commencement date based on the present value of the future minimum lease payments over the lease term. The future lease payments are discounted at a rate that estimates the Firm’s collateralized borrowing rate for financing instruments of a similar term and are included in accounts payable and other liabilities. The operating lease ROU assets, predominantly included in premises and equipment, also include any lease prepayments made, plus initial direct costs incurred, less any lease incentives received. Rental expense associated with operating leases is recognized on a straight-line basis over the lease term, and generally included in occupancy expense in the Consolidated statements of income.


JPM Firm as lessee

The carrying values of the Firm’s operating leases were as follows: December 31, (in millions, except where otherwise noted)############## ####2023########2022## Right-of-use assets##$####8,431##(a)##$####7,782 Lease liabilities####8,833####(b)####8,183## Weighted average remaining lease term (in years)####8.4########8.4## Weighted average discount rate####4.01##%######3.55##% Supplemental cash flow information############## Cash paid for amounts included in the measurement of lease liabilities - operating cash flows##$####1,662####$####1,613 Supplemental non-cash information############## Right-of-use assets obtained in exchange for operating lease obligations##$####2,094####$####1,435


JPM Firm as lessee

(a)Included $647 million of right-of-use assets associated with First Republic.


JPM Firm as lessee

(b)Included $712 million of lease liabilities associated with First Republic. Year ended December 31, (in millions)####2023####2022 Rental expense######## Gross rental expense##$##2,079##$##2,079 Sublease rental income####(72)####(119) Net rental expense##$##2,007##$##1,960


JPM Firm as lessee

The following table presents future payments under operating leases as of December 31, 2023: Year ended December 31, (in millions)#### 2024##$##1,685 2025####1,576 2026####1,318 2027####1,169 2028####1,015 After 2028####3,767 Total future minimum lease payments####10,530 Less: Imputed interest####(1,697) Total##$##8,833


JPM Firm as lessee

In addition to the table above, as of December 31, 2023, the Firm had additional future operating lease commitments of $420 million that were signed but had not yet commenced. These operating leases will commence between 2024 and 2026 with lease terms up to 21 years.


JPM Firm as lessor

The Firm provides auto and equipment lease financing to its customers through lease arrangements with lease terms that may contain renewal, termination and/or purchase options. The Firm’s lease financings are predominantly auto operating leases. These assets subject to operating leases are recognized in other assets on the Firm’s Consolidated balance sheets and are depreciated on a straight-line basis over the lease term to reduce the asset to its estimated residual value. Depreciation expense is included in technology, communications and equipment expense in the Consolidated statements of income. The Firm’s lease income is generally recognized on a straight-line basis over the lease term and is included in other income in the Consolidated statements of income.


JPM Firm as lessor

On a periodic basis, the Firm assesses leased assets for impairment, and if the carrying amount of the leased asset exceeds the undiscounted cash flows from the lease payments and the estimated residual value upon disposition of the leased asset, an impairment is recognized.


JPM Firm as lessor

The risk of loss on auto and equipment leased assets relating to the residual value of the leased assets is monitored through projections of the asset residual values at lease origination and periodic review of residual values, and is mitigated through arrangements with certain manufacturers or lessees.


JPM Firm as lessor

The following table presents the carrying value of assets subject to leases reported on the Consolidated balance sheets: December 31, (in millions)####2023####2022 Carrying value of assets subject to operating leases, net of accumulated depreciation##$##10,663##$##12,302 Accumulated depreciation####3,288####4,282


JPM Firm as lessor

The following table presents the Firm’s operating lease income and the related depreciation expense on the Consolidated statements of income: Year ended December 31, (in millions)####2023####2022####2021 Operating lease income##$##2,843##$##3,654##$##4,914 Depreciation expense####1,778####2,475####3,380


JPM Firm as lessor

The following table presents future receipts under operating leases as of December 31, 2023: Year ended December 31, (in millions)#### 2024##$##1,868 2025####1,158 2026####451 2027####32 2028####9 After 2028####8 Total future minimum lease receipts##$##3,526


JPM Note 19 – Accounts payable and other liabilities

Accounts payable and other liabilities consist of brokerage payables, which include payables to customers and payables related to security purchases that did not settle, as well as other accrued expenses, such as compensation accruals, credit card rewards liability, operating lease liabilities, accrued interest payables, merchant servicing payables, income tax payables and litigation reserves.


The following table presents the components of accounts payable and other liabilities. December 31, (in millions)####2023####2022 Brokerage payables##$##161,960##$##188,692 Other payables and liabilities(a)####128,347####111,449 Total accounts payable and other liabilities##$##290,307##$##300,141


(a) Includes credit card rewards liability of $13.2 billion and $11.3 billion at December 31, 2023 and 2022, respectively.


The credit card rewards liability represents the estimated cost of rewards points earned and expected to be redeemed by cardholders. The liability is accrued as the cardholder earns the benefit and is reduced when the cardholder redeems points. The redemption rate and cost per point assumptions are key assumptions to estimate the liability and the current period impact is recognized in Card Income.


Refer to Note 7, 18, 25 and 30 for additional information on accrued interest, operating lease liabilities, income taxes and litigation reserves, respectively.


JPM Note 20 – Long-term debt

JPMorgan Chase issues long-term debt denominated in various currencies, predominantly U.S. dollars, with both fixed and variable interest rates. Included in senior and subordinated debt below are various equity-linked or other indexed instruments, which the Firm has elected to measure at fair value. Changes in fair value are recorded in principal transactions revenue in the Consolidated statements of income, except for unrealized gains/(losses) due to DVA which are recorded in OCI. The following table is a summary of long-term debt carrying values (including unamortized premiums and discounts, issuance costs, valuation adjustments and fair value adjustments, where applicable) by remaining contractual maturity as of December 31, 2023. By remaining maturity at December 31, (in millions, except rates)################2023##################2022## ######Under 1 year######1-5 years########After 5 years######Total########Total## Parent company#################################### Senior debt:##Fixed rate##$##5,981####$##86,113######$##108,890####$##200,984######$##194,515## ##Variable rate####131######5,989########1,985######8,105########11,565## ##Interest rates(f)####2.52##%####2.91##%######3.72##%####3.32##%######3.06##% Subordinated debt:##Fixed rate##$##2,976####$##5,886######$##8,863####$##17,725######$##19,693## ##Variable rate####—######—########—######—########—## ##Interest rates(f)####3.88##%####4.88##%######4.69##%####4.62##%######4.50##% ##Subtotal##$##9,088####$##97,988######$##119,738####$##226,814######$##225,773## Subsidiaries#################################### Federal Home Loan Banks advances:##Fixed rate##$##13,940####$##9,269######$##37####$##23,246####(g)##$##93## ##Variable rate####4,000######14,000########—######18,000########11,000## ##Interest rates(f)####4.59##%####5.12##%######6.06##%####4.89##%######4.32##% Purchase Money Note(a):##Fixed rate##$##—####$##48,989######$##—####$##48,989########NA## ##Interest rates(f)####—##%####3.40##%######—##%####3.40##%######NA## Senior debt:##Fixed rate##$##2,958####$##11,551######$##6,236####$##20,745######$##15,383## ##Variable rate####20,933######25,336########5,779######52,048########41,506## ##Interest rates(f)####4.28##%####5.41%########1.48##%####3.91##%######2.02##% Subordinated debt:##Fixed rate##$##255####$##—######$##—####$##255######$##262## ##Variable rate####—######—########—######—########—## ##Interest rates(f)####8.25##%####—##%######—##%####8.25##%######8.25##% ##Subtotal##$##42,086####$##109,145######$##12,052####$##163,283######$##68,244## Junior subordinated debt:##Fixed rate##$##—####$##—######$##518####$##518######$##550## ##Variable rate####—######420########790######1,210########1,298## ##Interest rates(f)####—##%####6.18##%######7.45##%####7.14##%######6.33##% ##Subtotal##$##—####$##420######$##1,308####$##1,728######$##1,848## Total long-term debt(b)(c)(d)####$##51,174####$##207,553######$##133,098####$##391,825####(h)(i)##$##295,865## Long-term beneficial interests:#################################### ##Fixed rate##$##—####$##2,998######$##—####$##2,998######$##1,999## ##Variable rate####—######—########125######125########143## ##Interest rates(f)####—##%####4.74##%######3.45##%####4.69##%######2.81##% Total long-term beneficial interests(e)####$##—####$##2,998######$##125####$##3,123######$##2,142##


JPM Note 20 – Long-term debt

(a)Reflects the Purchase Money Note associated with the First Republic acquisition. Refer to Note 34 for additional information.


JPM Note 20 – Long-term debt

(b)Included long-term debt of $93.0 billion and $13.8 billion secured by assets totaling $218.5 billion and $208.3 billion at December 31, 2023 and 2022, respectively. The amount of long-term debt secured by assets does not include amounts related to hybrid instruments.


JPM Note 20 – Long-term debt

(c)Included $87.9 billion and $72.3 billion of long-term debt accounted for at fair value at December 31, 2023 and 2022, respectively.


JPM Note 20 – Long-term debt

(d)Included $12.5 billion and $10.3 billion of outstanding zero-coupon notes at December 31, 2023 and 2022, respectively. The aggregate principal amount of these notes at their respective maturities is $47.9 billion and $45.3 billion, respectively. The aggregate principal amount reflects the contractual principal payment at maturity, which may exceed the contractual principal payment at the Firm’s next call date, if applicable.


JPM Note 20 – Long-term debt

(e)Included on the Consolidated balance sheets in beneficial interests issued by consolidated VIEs. Also included amounts accounted for at fair value which were not material as of December 31, 2023 and 2022. Excluded short-term commercial paper and other short-term beneficial interests of $19.9 billion and $10.5 billion at December 31, 2023 and 2022, respectively.


JPM Note 20 – Long-term debt

(f)The interest rates shown are the weighted average of contractual rates in effect at December 31, 2023 and 2022, respectively, including non-U.S. dollar fixed- and variable-rate issuances, which excludes the effects of the associated derivative instruments used in hedge accounting relationships, if applicable. The interest rates shown exclude structured notes accounted for at fair value.


JPM Note 20 – Long-term debt

(g)As of December 31, 2023, included $23.2 billion of FHLB advances associated with First Republic. Refer to Note 34 for additional information.


JPM Note 20 – Long-term debt

(h)As of December 31, 2023, long-term debt in the aggregate of $208.2 billion was redeemable at the option of JPMorgan Chase, in whole or in part, prior to maturity, based on the terms specified in the respective instruments.


JPM Note 20 – Long-term debt

(i)The aggregate carrying values of debt that matures in each of the five years subsequent to 2023 is $51.2 billion in 2024, $53.5 billion in 2025, $48.7 billion in 2026, $26.2 billion in 2027 and $79.0 billion in 2028.


JPM 278 JPMorgan Chase & Co./2023 Form 10-K

The weighted-average contractual interest rates for total long-term debt excluding structured notes accounted for at fair value were 3.65% and 3.26% as of December 31, 2023 and 2022, respectively. In order to modify exposure to interest rate and currency exchange rate movements, JPMorgan Chase utilizes derivative instruments, primarily interest rate and cross-currency interest rate swaps, in conjunction with some of its debt issuances. The use of these instruments modifies the Firm’s interest expense on the associated debt. The modified weighted-average interest rates for total long-term debt, including the effects of related derivative instruments, were 5.20% and 4.89% as of December 31, 2023 and 2022, respectively.


JPMorgan Chase & Co. has guaranteed certain long-term debt of its subsidiaries, including structured notes. These guarantees rank pari passu with the Firm’s other unsecured and unsubordinated indebtedness. The amount of such guaranteed long-term debt and structured notes was $41.1 billion and $28.2 billion at December 31, 2023 and 2022, respectively.


The Firm’s unsecured debt does not contain requirements that would call for an acceleration of payments, maturities or changes in the structure of the existing debt, provide any limitations on future borrowings or require additional collateral, based on unfavorable changes in the Firm’s credit ratings, financial ratios, earnings or stock price.


JPM Note 21 – Preferred stock

At December 31, 2023 and 2022, JPMorgan Chase was authorized to issue 200 million shares of preferred stock, in one or more series, with a par value of $1 per share. In the event of a liquidation or dissolution of the Firm, JPMorgan Chase’s preferred stock then outstanding takes precedence over the Firm’s common stock with respect to the payment of dividends and the distribution of assets.


JPM Note 21 – Preferred stock

The following is a summary of JPMorgan Chase’s non-cumulative preferred stock outstanding as of December 31, 2023 and 2022, and the quarterly dividend declarations for the years ended December 31, 2023, 2022 and 2021. ######Shares(a)########Carrying value (in millions)####Issue date##Contractual rate in effect at December 31, 2023####Earliest redemption date(b)##Floating annualized rate(c)##########Dividend declared per share(d)###### ######December 31,########December 31,######################Year ended December 31,###### ####2023####2022####2023####2022################2023####2022####2021## Fixed-rate:########################################## Series AA####—####—##$##—##$##—##6/4/2015##—##%##9/1/2020##NA####$##—##$##—##$##305.00## Series BB####—####—####—####—##7/29/2015##—####9/1/2020##NA######—####—####307.50## Series DD####169,625####169,625####1,696####1,696##9/21/2018##5.750####12/1/2023##NA######575.00####575.00####575.00## Series EE####185,000####185,000####1,850####1,850##1/24/2019##6.000####3/1/2024##NA######600.00####600.00####600.00## Series GG####90,000####90,000####900####900##11/7/2019##4.750####12/1/2024##NA######475.00####475.00####475.00## Series JJ####150,000####150,000####1,500####1,500##3/17/2021##4.550####6/1/2026##NA######455.00####455.00####321.03##(e) Series LL####185,000####185,000####1,850####1,850##5/20/2021##4.625####6/1/2026##NA######462.52####462.52####245.39##(e) Series MM####200,000####200,000####2,000####2,000##7/29/2021##4.200####9/1/2026##NA######420.00####420.00####142.33##(e) ##Fixed-to-floating rate:######################################## Series I####—####—##$##—##$##—##4/23/2008##—##%##4/30/2018##—##%##$##—##$##375.03##$##370.38## Series Q####150,000####150,000####1,500####1,500##4/23/2013##SOFR + 3.25####5/1/2023##SOFR + 3.25######801.41####515.00####515.00##(f) Series R####150,000####150,000####1,500####1,500##7/29/2013##SOFR + 3.30####8/1/2023##SOFR + 3.30######756.73####600.00####600.00##(g) Series S####200,000####200,000####2,000####2,000##1/22/2014##6.750####2/1/2024##SOFR + 3.78######675.00####675.00####675.00## Series U####100,000####100,000####1,000####1,000##3/10/2014##6.125####4/30/2024##SOFR + 3.33######612.50####612.50####612.50## Series V####—####—####—####—##6/9/2014##—####7/1/2019##—######—####340.91####353.65## Series X####160,000####160,000####1,600####1,600##9/23/2014##6.100####10/1/2024##SOFR + 3.33######610.00####610.00####610.00## Series Z####—####—####—####—##4/21/2015##—####5/1/2020##—######—####—####401.44## Series CC####125,750####125,750####1,258####1,258##10/20/2017##SOFR + 2.58####11/1/2022##SOFR + 2.58######804.08####526.27####462.50##(h) Series FF####225,000####225,000####2,250####2,250##7/31/2019##5.000####8/1/2024##SOFR + 3.38######500.00####500.00####500.00## Series HH####300,000####300,000####3,000####3,000##1/23/2020##4.600####2/1/2025##SOFR + 3.125######460.00####460.00####460.00## Series II####150,000####150,000####1,500####1,500##2/24/2020##4.000####4/1/2025##SOFR + 2.745######400.00####400.00####400.00## Series KK####200,000####200,000####2,000####2,000##5/12/2021##3.650####6/1/2026##CMT + 2.85######365.00####365.00####201.76##(e) Total preferred stock####2,740,375####2,740,375##$##27,404##$##27,404##########################


JPM Note 21 – Preferred stock

(a)Represented by depositary shares.


JPM Note 21 – Preferred stock

(b)Each series of fixed-to-floating rate preferred stock converts to a floating rate at the earliest redemption date.


JPM Note 21 – Preferred stock

(c)Effective June 30, 2023, CME Term SOFR became the replacement reference rate for fixed-to-floating rate preferred stock issued by the Firm that formerly referenced U.S. dollar LIBOR. References in the table to “SOFR” mean a floating annualized rate equal to three-month term SOFR (plus a spread adjustment of 0.26% per annum) plus the spreads noted. The reference to “CMT” means a floating annualized rate equal to the five-year Constant Maturity Treasury (“CMT”) rate plus the spread noted.


JPM Note 21 – Preferred stock

(d)Dividends on preferred stock are discretionary and non-cumulative. When declared, dividends are declared quarterly. Dividends are payable quarterly on fixed-rate preferred stock. Dividends are payable semiannually on fixed-to-floating rate preferred stock while at a fixed rate, and payable quarterly after converting to a floating rate.


JPM Note 21 – Preferred stock

(e)The initial dividend declared is prorated based on the number of days outstanding for the period. Dividends were declared quarterly thereafter at the contractual rate.


JPM Note 21 – Preferred stock

(f)The dividend rate for Series Q preferred stock became floating and payable quarterly starting on May 1, 2023; prior to which the dividend rate was fixed at 5.15% or $257.50 per share payable semiannually. The dividend rate for each quarterly dividend period commencing on August 1, 2023 is three-month term SOFR (plus a spread adjustment of 0.26% per annum) plus the spread of 3.25%.


JPM Note 21 – Preferred stock

(g)The dividend rate for Series R preferred stock became floating and payable quarterly starting on August 1, 2023; prior to which the dividend rate was fixed at 6.00% or $300.00 per share payable semiannually. The dividend rate for each quarterly dividend period commencing on August 1, 2023 is three-month term SOFR (plus a spread adjustment of 0.26% per annum) plus the spread of 3.30%.


JPM Note 21 – Preferred stock

(h)The dividend rate for Series CC preferred stock became floating and payable quarterly starting on November 1, 2022; prior to which the dividend rate was fixed at 4.625% or $231.25 per share payable semiannually. The dividend rate for each quarterly dividend period commencing on August 1, 2023 is three-month term SOFR (plus a spread adjustment of 0.26% per annum) plus the spread of 2.58%.


JPM Note 21 – Preferred stock

Each series of preferred stock has a liquidation value and redemption price per share of $10,000, plus accrued but unpaid dividends. The aggregate liquidation value was $27.7 billion at December 31, 2023.


JPM Redemptions

On October 31, 2022, the Firm redeemed all $2.9 billion of its fixed-to-floating rate non-cumulative perpetual preferred stock, Series I.


JPM Redemptions

On October 3, 2022, the Firm redeemed all $2.5 billion of its fixed-to-floating rate non-cumulative preferred stock, Series V.


JPM Redemptions

On February 1, 2022, the Firm redeemed all $2.0 billion of its fixed-to-floating rate non-cumulative preferred stock, Series Z.


JPM Redemption rights

Each series of the Firm’s preferred stock may be redeemed on any dividend payment date on or after the earliest redemption date for that series. All outstanding preferred stock series may also be redeemed following a “capital treatment event,” as described in the terms of each series. Any redemption of the Firm’s preferred stock is subject to non-objection from the Board of Governors of the Federal Reserve System (the “Federal Reserve”).


JPM Note 22 – Common stock

At December 31, 2023 and 2022, JPMorgan Chase was authorized to issue 9.0 billion shares of common stock with a par value of $1 per share.


JPM Note 22 – Common stock

Common shares issued which were reissued from treasury by the Firm during the years ended December 31, 2023, 2022 and 2021 were as follows. Year ended December 31, (in millions)##2023##2022##2021 Total issued – balance at January 1##4,104.9##4,104.9##4,104.9 Treasury – balance at January 1##(1,170.7)##(1,160.8)##(1,055.5) Repurchase##(69.5)##(23.1)##(119.7) Reissuance:###### Employee benefits and compensation plans##10.9##12.0##13.5 Employee stock purchase plans##1.0##1.2##0.9 Total reissuance##11.9##13.2##14.4 Total treasury – balance at December 31##(1,228.3)##(1,170.7)##(1,160.8) Outstanding at December 31##2,876.6##2,934.2##2,944.1


JPM Note 22 – Common stock

Effective May 1, 2022, the Firm is authorized to purchase up to $30 billion under its common share repurchase program previously approved by the Board of Directors, which was announced on April 13, 2022.


JPM Note 22 – Common stock

The following table sets forth the Firm’s repurchases of common stock for the years ended December 31, 2023, 2022 and 2021. Year ended December 31, (in millions)####2023####2022(b)####2021(c) Total number of shares of common stock repurchased####69.5####23.1####119.7 Aggregate purchase price of common stock repurchases(a)##$##9,898##$##3,122##$##18,448


JPM Note 22 – Common stock

(a)Excludes excise tax and commissions. As part of the Inflation Reduction Act of 2022, a 1% excise tax was imposed on net share repurchases effective January 1, 2023.


JPM Note 22 – Common stock

(b)In the second half of 2022, the Firm temporarily suspended share repurchases, which it resumed under its current common share repurchase program in the first quarter of 2023.


JPM Note 22 – Common stock

(c)As directed by the Federal Reserve, total net repurchases and common stock dividends in the first and second quarter of 2021 were restricted and could not exceed the average of the Firm’s net income for the four preceding calendar quarters. Effective July 1, 2021, the Firm became subject to the normal capital distribution restrictions provided under the regulatory capital framework.


JPM Note 22 – Common stock

The Board of Directors’ authorization to repurchase common shares is utilized at management’s discretion, and the timing of purchases and the exact amount of common shares that may be repurchased is subject to various factors, including market conditions; legal and regulatory considerations affecting the amount and timing of repurchase activity; the Firm’s capital position (taking into account goodwill and intangibles); internal capital generation; current and proposed future capital requirements; and alternative investment opportunities. The $30 billion common share repurchase program approved by the Board does not establish specific price targets or timetables. The repurchase program may be suspended by management at any time; and may be executed through open market purchases or privately negotiated transactions, or utilizing Rule 10b5-1 plans, which are written trading plans that the Firm may enter into from time to time under Rule 10b5-1 of the Securities Exchange Act of 1934 and which allow the Firm to repurchase its common shares during periods when it may otherwise not be repurchasing common shares — for example, during internal trading blackout periods.


JPM Note 22 – Common stock

As of December 31, 2023, approximately 61.6 million shares of common stock were reserved for issuance under various employee incentive, compensation, option and stock purchase plans, and directors’ compensation plans.


JPM Note 23 – Earnings per share

Basic earnings per share (“EPS”) is calculated using the two-class method. Under the two-class method, all earnings (distributed and undistributed) are allocated to common stock and participating securities. JPMorgan Chase grants RSUs under its share-based compensation programs, predominantly all of which entitle recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to dividends paid to holders of the Firm’s common stock. These unvested RSUs meet the definition of participating securities based on their respective rights to receive nonforfeitable dividends, and they are treated as a separate class of securities in computing basic EPS. Participating securities are not included as incremental shares in computing diluted EPS; refer to Note 9 for additional information.


JPM Note 23 – Earnings per share

Diluted EPS incorporates the potential impact of contingently issuable shares, including awards which require future service as a condition of delivery of the underlying common stock. Diluted EPS is calculated under both the two-class and treasury stock methods, and the more dilutive amount is reported. For each of the periods presented in the table below, diluted EPS calculated under the two-class method was more dilutive.


JPM Note 23 – Earnings per share

The following table presents the calculation of net income applicable to common stockholders and basic and diluted EPS for the years ended December 31, 2023, 2022 and 2021. Year ended December 31, (in millions, except per share amounts)####2023####2022####2021 Basic earnings per share############ Net income##$##49,552##$##37,676##$##48,334 Less: Preferred stock dividends####1,501####1,595####1,600 Net income applicable to common equity####48,051####36,081####46,734 Less: Dividends and undistributed earnings allocated to participating securities####291####189####231 Net income applicable to common stockholders##$##47,760##$##35,892##$##46,503 Total weighted-average basic shares outstanding####2,938.6####2,965.8####3,021.5 Net income per share##$##16.25##$##12.10##$##15.39 Diluted earnings per share############ Net income applicable to common stockholders##$##47,760##$##35,892##$##46,503 Total weighted-average basic shares outstanding####2,938.6####2,965.8####3,021.5 Add: Dilutive impact of unvested PSUs, nondividend-earning RSUs and SARs####4.5####4.2####5.1 Total weighted-average diluted shares outstanding####2,943.1####2,970.0####3,026.6 Net income per share##$##16.23##$##12.09##$##15.36


JPM Note 24 – Accumulated other comprehensive income/(loss)

AOCI includes the after-tax change in unrealized gains and losses on investment securities, foreign currency translation adjustments (including the impact of related derivatives), fair value changes of excluded components on fair value hedges, cash flow hedging activities, net gain/(loss) related to the Firm’s defined benefit pension and OPEB plans, and fair value option-elected liabilities arising from changes in the Firm’s own credit risk (DVA). Year ended December 31, (in millions)####Unrealized gains/(losses) on investment securities####Translation adjustments, net of hedges######Fair value hedges####Cash flow hedges####Defined benefit pension and OPEB plans####DVA on fair value option elected liabilities##Accumulated other comprehensive income/(loss)## Balance at December 31, 2020##$##8,180####$##(473)##$##(112)##$##2,383##$##(1,132)##$##(860)##$##7,986 Net change####(5,540)######(461)####(19)####(2,679)####922####(293)####(8,070) Balance at December 31, 2021##$##2,640##(a)##$##(934)##$##(131)##$##(296)##$##(210)##$##(1,153)##$##(84) Net change####(11,764)######(611)####98####(5,360)####(1,241)####1,621####(17,257) Balance at December 31, 2022##$##(9,124)##(a)##$##(1,545)##$##(33)##$##(5,656)##$##(1,451)##$##468##$##(17,341) Net change####5,381######329####(101)####1,724####373####(808)####6,898 Balance at December 31, 2023##$##(3,743)##(a)##$##(1,216)##$##(134)##$##(3,932)##$##(1,078)##$##(340)##$##(10,443)


(a)As of December 31, 2023 includes after-tax net unamortized unrealized gains/(losses) of $(29) million related to HTM securities that have been transferred to AFS as permitted by the new hedge accounting guidance adopted on January 1, 2023. Includes after-tax net unamortized unrealized gains/(losses) of $(895) million, $(1.3) billion, and $2.4 billion related to AFS securities that have been transferred to HTM for the years ended 2023, 2022 and 2021, respectively. Refer to Note 10 for further information.


The following table presents the pre-tax and after-tax changes in the components of OCI. ########2023############2022############2021#### Year ended December 31, (in millions)####Pre-tax####Tax effect####After-tax####Pre-tax####Tax effect####After-tax####Pre-tax####Tax effect####After-tax Unrealized gains/(losses) on investment securities:#################################### Net unrealized gains/(losses) arising during the period##$##3,891##$##(922)##$##2,969##$##(17,862)##$##4,290##$##(13,572)##$##(7,634)##$##1,832##$##(5,802) Reclassification adjustment for realized (gains)/losses included in net income(a)####3,180####(768)####2,412####2,380####(572)####1,808####345####(83)####262 Net change####7,071####(1,690)####5,381####(15,482)####3,718####(11,764)####(7,289)####1,749####(5,540) Translation adjustments(b):#################################### Translation####1,714####(95)####1,619####(3,574)####265####(3,309)####(2,447)####125####(2,322) Hedges####(1,697)####407####(1,290)####3,553####(855)####2,698####2,452####(591)####1,861 Net change####17####312####329####(21)####(590)####(611)####5####(466)####(461) Fair value hedges, net change(c):####(134)####33####(101)####130####(32)####98####(26)####7####(19) Cash flow hedges:#################################### Net unrealized gains/(losses) arising during the period####483####(114)####369####(7,473)####1,794####(5,679)####(2,303)####553####(1,750) Reclassification adjustment for realized (gains)/losses included in net income(d)####1,775####(420)####1,355####420####(101)####319####(1,222)####293####(929) Net change####2,258####(534)####1,724####(7,053)####1,693####(5,360)####(3,525)####846####(2,679) Defined benefit pension and OPEB plans, net change(e):####421####(48)####373####(1,459)####218####(1,241)####1,129####(207)####922 DVA on fair value option elected liabilities, net change:####(1,066)####258####(808)####2,141####(520)####1,621####(393)####100####(293) Total other comprehensive income/(loss)##$##8,567##$##(1,669)##$##6,898##$##(21,744)##$##4,487##$##(17,257)##$##(10,099)##$##2,029##$##(8,070)


(a)The pre-tax amount is reported in Investment securities gains/(losses) in the Consolidated statements of income.


(b)Reclassifications of pre-tax realized gains/(losses) on translation adjustments and related hedges are reported in other income/expense in the Consolidated statements of income. During the year ended December 31, 2023, the Firm reclassified a net pre-tax loss of $(3) million to other revenue, $(35) million related to the net investment hedge loss, and a $32 million gain related to cumulative translation adjustment, including the impact of the acquisition of CIFM. During the year ended December 31, 2022, the Firm reclassified a net pre-tax loss of $(8) million. During the year ended December 31, 2021, the Firm reclassified a net pre-tax loss of $(7) million.


(c)Represents changes in fair value of cross-currency swaps attributable to changes in cross-currency basis spreads, which are excluded from the assessment of hedge effectiveness and recorded in other comprehensive income. The initial cost of cross-currency basis spreads is recognized in earnings as part of the accrual of interest on the cross-currency swaps.


(d)The pre-tax amounts are primarily recorded in noninterest revenue, net interest income and compensation expense in the Consolidated statements of income.


(e)During the year ended December 31, 2022, a remeasurement of the Firm’s U.S. principal defined benefit plan in the third quarter, was required as a result of a pension settlement. The remeasurement resulted in a net decrease of $1.4 billion in pre-tax AOCI. Refer to Note 8 for further information.


JPM Note 25 – Income taxes

JPMorgan Chase and its eligible subsidiaries file a consolidated U.S. federal income tax return. JPMorgan Chase uses the asset and liability method to provide for income taxes on all transactions recorded in the Consolidated Financial Statements. This method requires that income taxes reflect the expected future tax consequences of temporary differences between the carrying amounts of assets or liabilities for book and tax purposes. Accordingly, a deferred tax asset or liability for each temporary difference is determined based on the tax rates that the Firm expects to be in effect when the underlying items of income and expense are realized. JPMorgan Chase’s expense for income taxes includes the current and deferred portions of that expense. A valuation allowance is established to reduce deferred tax assets to the amount the Firm expects to realize.


JPM Note 25 – Income taxes

Due to the inherent complexities arising from the nature of the Firm’s businesses, and from conducting business and being taxed in a substantial number of jurisdictions, significant judgments and estimates are required to be made. Agreement of tax liabilities between JPMorgan Chase and the many tax jurisdictions in which the Firm files tax returns may not be finalized for several years. Thus, the Firm’s final tax-related assets and liabilities may ultimately be different from those currently reported.


JPM Effective tax rate and expense

The following table presents a reconciliation of the applicable statutory U.S. federal income tax rate to the effective tax rate. Effective tax rate############## Year ended December 31,##2023######2022####2021## Statutory U.S. federal tax rate##21.0##%####21.0##%##21.0##% Increase/(decrease) in tax rate resulting from:############## U.S. state and local income taxes, net of U.S. federal income tax benefit##2.8######3.5####3.0## Tax-exempt income##(0.9)######(0.9)####(0.9)## Non-U.S. earnings##1.5######0.4####0.1## Business tax credits##(4.4)######(5.4)####(4.2)## Other, net##(0.4)######(0.2)####(0.1)## Effective tax rate##19.6##%##(a)##18.4##%##18.9##%


JPM Effective tax rate and expense

(a) Income tax expense associated with the First Republic acquisition was reflected in the estimated bargain purchase gain, which resulted in a reduction in the Firm’s effective tax rate.


JPM Effective tax rate and expense

The following table reflects the components of income tax expense/(benefit) included in the Consolidated statements of income. ######Income tax expense/(benefit)######## Year ended December 31, (in millions)####2023######2022####2021 Current income tax expense/(benefit)############## U.S. federal##$##8,973####$##5,606##$##2,865 Non-U.S.####4,355######2,992####2,718 U.S. state and local####3,266######2,630####1,897 Total current income tax expense/(benefit)####16,594######11,228####7,480 Deferred income tax expense/(benefit)############## U.S. federal####(3,475)######(2,004)####3,460 Non-U.S.####35######(154)####(101) U.S. state and local####(1,094)######(580)####389 Total deferred income tax  expense/(benefit)####(4,534)######(2,738)####3,748 Total income tax expense##$##12,060####$##8,490##$##11,228


JPM Effective tax rate and expense

Total income tax expense includes $68 million of tax benefits in 2023, $331 million of tax benefits in 2022, and $69 million of tax expenses in 2021, resulting from the resolution of tax audits.


JPM Tax effect of items recorded in stockholders’ equity

The preceding table does not reflect the tax effect of certain items that are recorded each period directly in stockholders’ equity, which are predominantly reflected in OCI as disclosed in Note 24. For the year ended December 31, 2023, stockholders’ equity also reflected the tax effect associated with the Firm’s adoption of the TDR accounting guidance recognized in retained earnings. Refer to Note 1 for further information.


JPM Results from U.S. and non-U.S. earnings

The following table presents the U.S. and non-U.S. components of income before income tax expense. Year ended December 31, (in millions)####2023####2022####2021 U.S.##$##46,868##$##34,626##$##50,126 Non-U.S.(a)####14,744####11,540####9,436 Income before income tax expense##$##61,612##$##46,166##$##59,562


(a)For purposes of this table, non-U.S. income is defined as income generated from operations located outside the U.S.


The Firm will recognize any U.S. income tax expense it may incur on global intangible low tax income as income tax expense in the period in which the tax is incurred.


JPM Affordable housing tax credits

The Firm recognized $2.0 billion of tax credits and other tax benefits associated with investments in affordable housing projects within income tax expense for the year ended 2023, and $1.8 billion and $1.7 billion for the years ended 2022 and 2021, respectively. The amount of amortization of such investments reported in income tax expense was $1.6 billion, $1.4 billion and $1.3 billion, respectively. The carrying value of these investments, which are reported in other assets on the Firm’s Consolidated balance sheets, was $14.6 billion and $12.1 billion at December 31, 2023 and 2022, respectively. The amount of commitments related to these investments, which are reported in accounts payable and other liabilities on the Firm’s Consolidated balance sheets, was $6.8 billion and $5.4 billion at December 31, 2023 and 2022, respectively.


JPM Deferred taxes

Deferred income tax expense/(benefit) reflects the differences between assets and liabilities measured for financial reporting purposes versus income tax return purposes. Deferred tax assets are recognized if, in management’s judgment, their realizability is determined to be more likely than not. If a deferred tax asset is determined to be unrealizable, a valuation allowance is established. The significant components of deferred tax assets and liabilities are reflected in the following table, the net deferred tax assets are reflected in other assets on the Firm’s Consolidated balance sheets. December 31, (in millions)####2023######2022 Deferred tax assets########## Allowance for loan losses##$##5,809####$##5,193 Employee benefits####1,247######1,342 Accrued expenses and other####9,887##(a)####8,577 Non-U.S. operations####860######1,148 Tax attribute carryforwards####290######365 Gross deferred tax assets####18,093######16,625 Valuation allowance####(183)######(198) Deferred tax assets, net of valuation allowance##$##17,910####$##16,427 Deferred tax liabilities########## Depreciation and amortization##$##779####$##2,044 Mortgage servicing rights, net of hedges####1,794######1,864 Leasing transactions####2,254######2,843 Other, net####2,935######3,801 Gross deferred tax liabilities####7,762######10,552 Net deferred tax assets##$##10,148####$##5,875


JPM Deferred taxes

(a) Includes the estimated net deferred tax asset associated with the First Republic acquisition. The allocation of the tax basis to individual assets may be refined during the measurement period, which could result in an impact to the gross deferred tax assets and liabilities.


JPM Deferred taxes

JPMorgan Chase has recorded deferred tax assets of $290 million at December 31, 2023 in connection with tax attribute carryforwards. State and local capital loss carryforwards were $1.2 billion, U.S. federal NOL carryforwards were $586 million, non-U.S. NOL carryforwards were $570 million, and other U.S. federal tax attributes were $118 million. If not utilized, a portion of the U.S. federal NOL carryforwards and other U.S. federal tax attributes will expire between 2026 and 2037 whereas others have an unlimited carryforward period. Similarly, certain non-U.S. NOL carryforwards will expire between 2026 and 2040 whereas others have an unlimited carryforward period. The state and local capital loss carryforwards will expire in 2026 and 2027.


JPM Deferred taxes

The valuation allowance at December 31, 2023, was due to the state and local capital loss carryforwards and certain non-U.S. deferred tax assets, including NOL carryforwards.


JPM Unrecognized tax benefits

At December 31, 2023, 2022 and 2021, JPMorgan Chase’s unrecognized tax benefits, excluding related interest expense and penalties, were $5.4 billion, $5.0 billion and $4.6 billion, respectively, of which $3.9 billion, $3.8 billion and $3.4 billion, respectively, if recognized, would reduce the annual effective tax rate. Included in the amount of unrecognized tax benefits are certain items that would not affect the effective tax rate if they were recognized in the Consolidated statements of income. These unrecognized items include the tax effect of certain temporary differences, the portion of gross state and local unrecognized tax benefits that would be offset by the benefit from associated U.S. federal income tax deductions, and the portion of gross non-U.S. unrecognized tax benefits that would have offsets in other jurisdictions. JPMorgan Chase evaluates the need for changes in unrecognized tax benefits based on its anticipated tax return filing positions as part of its U.S. federal and state and local tax returns. In addition, the Firm is presently under audit by a number of taxing authorities, most notably by the Internal Revenue Service, as summarized in the Tax examination status table below. The evaluation of unrecognized tax benefits as well as the potential for audit settlements make it reasonably possible that over the next 12 months the gross balance of unrecognized tax benefits may increase or decrease by as much as approximately $1.1 billion. The change in the unrecognized tax benefit would result in a payment or income statement recognition.


JPM Unrecognized tax benefits

The following table presents a reconciliation of the beginning and ending amount of unrecognized tax benefits. Year ended December 31, (in millions)####2023####2022####2021 Balance at January 1,##$##5,043##$##4,636##$##4,250 Increases based on tax positions related to the current period####1,440####1,234####798 Increases based on tax positions related to prior periods####37####123####393 Decreases based on tax positions related to prior periods####(1,110)####(824)####(657) Decreases related to cash settlements with taxing authorities####(9)####(126)####(148) Balance at December 31,##$##5,401##$##5,043##$##4,636


JPM Unrecognized tax benefits

After-tax interest expense/(benefit) and penalties related to income tax liabilities recognized in income tax expense were $229 million, $141 million and $174 million in 2023, 2022 and 2021, respectively.


JPM Unrecognized tax benefits

At December 31, 2023 and 2022, in addition to the liability for unrecognized tax benefits, the Firm had accrued $1.6 billion and $1.3 billion, respectively, for income tax-related interest and penalties.


JPM Tax examination status

JPMorgan Chase is continually under examination by the Internal Revenue Service, by taxing authorities throughout the world, and by many state and local jurisdictions throughout the U.S. The following table summarizes the status of tax years that remain subject to income tax examination of JPMorgan Chase and its consolidated subsidiaries by significant jurisdictions as of December 31, 2023. ##Periods under examination##Status JPMorgan Chase – U.S.##2011 – 2013##Field examination of amended returns; certain matters at Appellate level JPMorgan Chase – U.S.##2014 - 2020##Field examination of original and amended returns; certain matters at Appellate level JPMorgan Chase – New York State##2012 - 2014##Field Examination JPMorgan Chase – New York City##2015 - 2017##Field Examination JPMorgan Chase – U.K.##2011 – 2020##Field examination of certain select entities


JPM Restricted cash and other restricted assets

Certain of the Firm’s cash and other assets are restricted as to withdrawal or usage. These restrictions are imposed by various regulatory authorities based on the particular activities of the Firm’s subsidiaries.


The business of JPMorgan Chase Bank, N.A. is subject to examination and regulation by the OCC. The Bank is a member of the U.S. Federal Reserve System, and its deposits in the U.S. are insured by the FDIC, subject to applicable limits.


The Firm is required to maintain cash reserves at certain non-US central banks.


The Firm is also subject to rules and regulations established by other U.S. and non U.S. regulators. As part of its compliance with the respective regulatory requirements, the Firm’s broker-dealer activities are subject to certain restrictions on cash and other assets.


The following table presents the components of the Firm’s restricted cash: December 31, (in billions)####2023####2022 Segregated for the benefit of securities and cleared derivative customers####10.3####18.7 Cash reserves at non-U.S. central banks and held for other general purposes####9.3####8.1 Total restricted cash(a)##$##19.6##$##26.8


(a)Comprises $18.2 billion and $25.4 billion in deposits with banks, and $1.4 billion and $1.4 billion in cash and due from banks on the Consolidated balance sheets as of December 31, 2023 and 2022, respectively.


Also, as of December 31, 2023 and 2022, the Firm had the following other restricted assets: •Cash and securities pledged with clearing organizations for the benefit of customers of $40.5 billion and $42.4 billion, respectively. •Securities with a fair value of $20.5 billion and $31.7 billion, respectively, were also restricted in relation to customer activity.


JPM Intercompany funds transfers

Restrictions imposed by U.S. federal law prohibit JPMorgan Chase Bank, N.A., and its subsidiaries, from lending to JPMorgan Chase & Co. (“Parent Company”) and certain of its affiliates unless the loans are secured in specified amounts. Such secured loans provided by any banking subsidiary to the Parent Company or to any particular affiliate, together with certain other transactions with such affiliate (collectively referred to as “covered transactions”), must be made on terms and conditions that are consistent with safe and sound banking practices. In addition, unless collateralized with cash or US Government debt obligations, covered transactions are generally limited to 10% of the banking subsidiary’s total capital, as determined by the risk-based capital guidelines; the aggregate amount of covered transactions between any banking subsidiary and all of its affiliates is limited to 20% of the banking subsidiary’s total capital.


JPM Intercompany funds transfers

The Parent Company’s two principal subsidiaries are JPMorgan Chase Bank, N.A. and JPMorgan Chase Holdings LLC, an intermediate holding company (the “IHC”). The IHC generally holds the stock of JPMorgan Chase’s subsidiaries other than JPMorgan Chase Bank, N.A. and its subsidiaries. The IHC also owns other assets and provides intercompany loans to the Parent Company. The Parent Company is obligated to contribute to the IHC substantially all the net proceeds received from securities issuances (including issuances of senior and subordinated debt securities and of preferred and common stock).


JPM Intercompany funds transfers

The principal sources of income and funding for the Parent Company are dividends from JPMorgan Chase Bank, N.A. and dividends and extensions of credit from the IHC. In addition to dividend restrictions set forth in statutes and regulations, the Federal Reserve, the OCC and the FDIC have authority under the Financial Institutions Supervisory Act to prohibit or to limit the payment of dividends by the banking organizations they supervise, including the Parent Company and its subsidiaries that are banks or bank holding companies, if, in the banking regulator’s opinion, payment of a dividend would constitute an unsafe or unsound practice in light of the financial condition of the banking organization. The IHC is prohibited from paying dividends or extending credit to the Parent Company if certain capital or liquidity “thresholds” are breached or if limits are otherwise imposed by the Parent Company’s management or Board of Directors.


JPM Intercompany funds transfers

At January 1, 2024, the Parent Company’s banking subsidiaries could pay, in the aggregate, approximately $20 billion in dividends to their respective bank holding companies without the prior approval of their relevant banking regulators. The capacity to pay dividends in 2024 will be supplemented by the banking subsidiaries’ earnings during the year.


JPM Note 27 – Regulatory capital

The Federal Reserve establishes capital requirements, including well-capitalized standards, for the Firm as a consolidated financial holding company. The OCC establishes similar minimum capital requirements and standards for the Firm’s principal IDI subsidiary, JPMorgan Chase Bank, N.A.


JPM Note 27 – Regulatory capital

The capital rules under Basel III establish minimum capital ratios and overall capital adequacy standards for large and internationally active U.S. bank holding companies and banks, including the Firm and JPMorgan Chase Bank, N.A. Two comprehensive approaches are prescribed for calculating RWA: a standardized approach (“Basel III Standardized”), and an advanced approach (“Basel III Advanced”). For each of the risk-based capital ratios, the capital adequacy of the Firm and JPMorgan Chase Bank, N.A. is evaluated against the lower of the Standardized or Advanced approaches compared to their respective regulatory capital ratio requirements.


JPM Note 27 – Regulatory capital

The three components of regulatory capital under the Basel III rules are as illustrated below:


JPM Note 27 – Regulatory capital

Under the risk-based capital and leverage-based guidelines of the Federal Reserve, JPMorgan Chase is required to maintain minimum ratios for CET1 capital, Tier 1 capital, Total capital, Tier 1 leverage and the SLR. Failure to meet these minimum requirements could cause the Federal Reserve to take action. JPMorgan Chase Bank, N.A. is also subject to these capital requirements established by its primary regulators.


JPM Note 27 – Regulatory capital

The following table presents the risk-based regulatory capital ratio requirements and well-capitalized ratios to which the Firm and JPMorgan Chase Bank, N.A. were subject as of December 31, 2023 and 2022. ######Standardized capital ratio requirements##########Advanced capital ratio requirements##########Well-capitalized ratios#### ##BHC(a)(b)######IDI(c)####BHC(a)(b)######IDI(c)####BHC(d)######IDI(e)## ##Risk-based capital ratios############################ CET1 capital##11.4##%####7.0##%##11.0##%####7.0##%##NA######6.5##% Tier 1 capital##12.9######8.5####12.5######8.5####6.0##%####8.0## Total capital##14.9######10.5####14.5######10.5####10.0######10.0##


JPM Note: The table above is as defined by the regulations issued by the Federal Reserve, OCC and FDIC and to which the Firm and JPMorgan Chase Bank, N.A. are subject.

(a)Represents the regulatory capital ratio requirements applicable to the Firm. The CET1, Tier 1 and Total capital ratio requirements each include a respective minimum requirement plus a GSIB surcharge of 4.0% as calculated under Method 2; plus a 2.9% SCB for Basel III Standardized ratios and a fixed 2.5% capital conservation buffer for Basel III Advanced ratios. The countercyclical buffer is currently set to 0% by the federal banking agencies.


(b)For the period ended December 31, 2022, the CET1, Tier 1, and Total capital ratio requirements under Basel III Standardized applicable to the Firm were 12.0%, 13.5% and 15.5%, respectively; the Basel III Advanced CET1, Tier 1, and Total capital ratio requirements applicable to the Firm were 10.5%, 12.0%, and 14.0%, respectively. SCB for Basel III Standardized ratio for 2022 was 4.0%.


(c)Represents requirements for JPMorgan Chase Bank, N.A. The CET1, Tier 1 and Total capital ratio requirements include a fixed capital conservation buffer requirement of 2.5% that is applicable to JPMorgan Chase Bank, N.A. JPMorgan Chase Bank, N.A. is not subject to the GSIB surcharge.


(d)Represents requirements for bank holding companies pursuant to regulations issued by the Federal Reserve.


(e)Represents requirements for JPMorgan Chase Bank, N.A. pursuant to regulations issued under the FDIC Improvement Act.


The following table presents the leverage-based regulatory capital ratio requirements and well-capitalized ratios to which the Firm and JPMorgan Chase Bank, N.A. were subject as of December 31, 2023 and 2022. ######Capital ratio requirements(a)########Well-capitalized ratios#### ##BHC######IDI####BHC(b)####IDI## Leverage-based capital ratios################## Tier 1 leverage##4.0##%####4.0##%##NA####5.0##% SLR##5.0######6.0####NA####6.0##


(a)Represents minimum SLR requirement of 3.0%, as well as supplementary leverage buffer requirements of 2.0% and 3.0% for BHC and JPMorgan Chase Bank, N.A., respectively.


(b)The Federal Reserve's regulations do not establish well-capitalized thresholds for these measures for BHCs.


JPM CECL Regulatory Capital Transition

Beginning January 1, 2022, the $2.9 billion CECL capital benefit, provided by the Federal Reserve in response to the COVID-19 pandemic, is being phased out at 25% per year over a three-year period. As of December 31, 2023, the Firm’s CET1 capital reflected the remaining $1.4 billion benefit associated with the CECL capital transition provisions.


JPM CECL Regulatory Capital Transition

Similarly, as of January 1, 2023, the Firm has phased out 50% of the other CECL capital transition provisions which impacted Tier 2 capital, adjusted average assets, total leverage exposure and RWA, as applicable.


JPM CECL Regulatory Capital Transition

The following tables present risk-based capital metrics under both the Basel III Standardized and Basel III Advanced approaches and leverage-based capital metrics for JPMorgan Chase and JPMorgan Chase Bank, N.A. As of December 31, 2023 and 2022, JPMorgan Chase and JPMorgan Chase Bank, N.A. were well-capitalized and met all capital requirements to which each was subject. December 31, 2023 (in millions, except ratios)########Basel III Standardized############Basel III Advanced###### ####JPMorgan  Chase & Co.######JPMorgan  Chase Bank, N.A.######JPMorgan  Chase & Co.########JPMorgan  Chase Bank, N.A.## Risk-based capital metrics:(a)########################## CET1 capital##$##250,585####$##262,030####$##250,585######$##262,030## Tier 1 capital####277,306######262,032######277,306########262,032## Total capital####308,497######281,308######295,417####(b)####268,392## Risk-weighted assets####1,671,995######1,621,789######1,669,156####(b)####1,526,952## CET1 capital ratio####15.0##%####16.2##%####15.0##%######17.2##% Tier 1 capital ratio####16.6######16.2######16.6########17.2## Total capital ratio####18.5######17.3######17.7########17.6## December 31, 2022 (in millions, except ratios)########Basel III Standardized############Basel III Advanced###### ####JPMorgan  Chase & Co.######JPMorgan  Chase Bank, N.A.######JPMorgan  Chase & Co.########JPMorgan  Chase Bank, N.A.## Risk-based capital metrics:(a)########################## CET1 capital##$##218,934####$##269,668####$##218,934######$##269,668## Tier 1 capital####245,631######269,672######245,631########269,672## Total capital####277,769######288,433######264,583########275,255## Risk-weighted assets####1,653,538######1,597,072######1,609,773########1,475,602## CET1 capital ratio####13.2##%####16.9##%####13.6##%######18.3##% Tier 1 capital ratio####14.9######16.9######15.3########18.3## Total capital ratio####16.8######18.1######16.4########18.7##


JPM CECL Regulatory Capital Transition

(a)The capital metrics reflect the CECL capital transition provisions.


JPM CECL Regulatory Capital Transition

(b)Includes the impacts of certain assets associated with First Republic to which the Standardized approach has been applied as permitted by the transition provisions in the U.S. capital rules. Three months ended (in millions, except ratios)########December 31, 2023############December 31, 2022#### ####JPMorgan Chase & Co.######JPMorgan Chase Bank, N.A.######JPMorgan Chase & Co.######JPMorgan Chase Bank, N.A.## Leverage-based capital metrics:(a)######################## Adjusted average assets(b)##$##3,831,200####$##3,337,842####$##3,703,873####$##3,249,912## Tier 1 leverage ratio####7.2##%####7.9##%####6.6##%####8.3##% Total leverage exposure##$##4,540,465####$##4,038,739####$##4,367,092####$##3,925,502## SLR####6.1##%####6.5##%####5.6##%####6.9##%


JPM CECL Regulatory Capital Transition


JPM CECL Regulatory Capital Transition

(b)Adjusted average assets, for purposes of calculating the leverage ratios, includes quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill, inclusive of estimated equity method goodwill, and other intangible assets.


JPM other commitments

JPMorgan Chase provides lending-related financial instruments (e.g., commitments and guarantees) to address the financing needs of its customers and clients. The contractual amount of these financial instruments represents the maximum possible credit risk to the Firm should the customer or client draw upon the commitment or the Firm be required to fulfill its obligation under the guarantee, and should the customer or client subsequently fail to perform according to the terms of the contract. Most of these commitments and guarantees have historically been refinanced, extended, cancelled, or expired without being drawn or a default occurring. As a result, the total contractual amount of these instruments is not, in the Firm’s view, representative of its expected future credit exposure or funding requirements.


JPM other commitments

To provide for expected credit losses in wholesale and certain consumer lending-related commitments, an allowance for credit losses on lending-related commitments is maintained. Refer to Note 13 for further information regarding the allowance for credit losses on lending-related commitments.


JPM other commitments

The following table summarizes the contractual amounts and carrying values of off-balance sheet lending-related financial instruments, guarantees and other commitments at December 31, 2023 and 2022. The amounts in the table below for credit card and home equity lending-related commitments represent the total available credit for these products. The Firm has not experienced, and does not anticipate, that all available lines of credit for these products will be utilized at the same time. The Firm can reduce or cancel credit card lines of credit by providing the borrower notice or, in some cases as permitted by law, without notice. In addition, the Firm typically closes credit card lines when the borrower is 60 days or more past due. The Firm may reduce or close HELOCs when there are significant decreases in the value of the underlying property, or when there has been a demonstrable decline in the creditworthiness of the borrower.


JPM Notes to consolidated financial statements

##################Off–balance sheet lending-related financial instruments, guarantees and other commitments################## ################Contractual amount##############Carrying value(h)(i)###### ############2023############2022####2023######2022## By remaining maturity as of December 31, (in millions)####Expires in 1 year or less####Expires after 1 year through 3 years####Expires after 3 years through 5 years####Expires after 5 years####Total####Total############ Lending-related#################################### Consumer, excluding credit card:#################################### Residential Real Estate(a)##$##6,917##$##7,175##$##6,493##$##9,540##$##30,125##$##21,287####678##(j)####75## Auto and other####12,247####159####—####2,872####15,278####12,231####148##(j)####—## Total consumer, excluding credit card####19,164####7,334####6,493####12,412####45,403####33,518####826######75## Credit card(b)####915,658####—####—####—####915,658####821,284####—######—## Total consumer(c)####934,822####7,334####6,493####12,412####961,061####854,802####826######75## Wholesale:#################################### Other unfunded commitments to extend credit(d)####125,478####175,190####179,046####23,812####503,526####440,407####2,797##(j)(k)####2,328##(k) Standby letters of credit and other financial guarantees(d)####13,775####10,478####3,628####991####28,872####27,439####479######408## Other letters of credit(d)####4,084####222####82####—####4,388####4,134####37######6## Total wholesale(c)####143,337####185,890####182,756####24,803####536,786####471,980####3,313######2,742## Total lending-related##$##1,078,159##$##193,224##$##189,249##$##37,215##$##1,497,847##$##1,326,782##$##4,139####$##2,817## Other guarantees and commitments#################################### Securities lending indemnification agreements and guarantees(e)##$##283,664##$##—##$##—##$##—##$##283,664##$##283,386##$##—####$##—## Derivatives qualifying as guarantees####1,693####364####11,657####40,848####54,562####59,180####89######649## Unsettled resale and securities borrowed agreements####94,920####186####—####—####95,106####116,975####—######(2)## Unsettled repurchase and securities loaned agreements####60,170####554####—####—####60,724####66,407####—######(7)## Loan sale and securitization-related indemnifications:#################################### Mortgage repurchase liability####NA####NA####NA####NA####NA####NA####76######76## Loans sold with recourse####NA####NA####NA####NA####803####820####24######28## Exchange & clearing house guarantees and commitments(f)####265,887####—####—####—####265,887####191,068####—######—## Other guarantees and commitments (g)####9,216####1,516####314####4,028####15,074####8,634####38######53##


(a)Includes certain commitments to purchase loans from correspondents.


(b)Also includes commercial card lending-related commitments primarily in CB and CIB.


(c)Predominantly all consumer and wholesale lending-related commitments are in the U.S.


(d)As of December 31, 2023 and 2022, reflected the contractual amount net of risk participations totaling $88 million and $71 million, respectively, for other unfunded commitments to extend credit; $8.2 billion at both periods for standby letters of credit and other financial guarantees; and $589 million and $512 million, respectively, for other letters of credit. In regulatory filings with the Federal Reserve these commitments are shown gross of risk participations.


(e)As of December 31, 2023 and 2022, collateral held by the Firm in support of securities lending indemnification agreements was $300.3 billion and $298.5 billion, respectively. Securities lending collateral primarily consists of cash, G7 government securities, and securities issued by U.S. GSEs and government agencies.


(f)As of December 31, 2023 and 2022, includes guarantees to the Fixed Income Clearing Corporation under the sponsored member repo program and commitments and guarantees associated with the Firm’s membership in certain clearing houses.


(g)As of December 31, 2023 and 2022, primarily includes unfunded commitments related to certain tax-oriented equity investments, other equity investment commitments. and unfunded commitments to purchase secondary market loans.


(h)For lending-related products, the carrying value includes the allowance for lending-related commitments and the guarantee liability; for derivative-related products, and lending-related commitments for which the fair value option was elected, the carrying value represents the fair value.


(i)For lending-related commitments, the carrying value also includes fees and any purchase discounts or premiums that are deferred and recognized in accounts payable and other liabilities on the Consolidated balance sheets. Deferred amounts for revolving commitments and commitments not expected to fund, are amortized to lending- and deposit-related fees on a straight line basis over the commitment period. For all other commitments the deferred amounts remain deferred until the commitment funds or is sold.


(j)As of December 31, 2023, includes fair value adjustments associated with First Republic for residential real estate lending-related commitments totaling $630 million, for auto and other lending-related commitments totaling $148 million and for other unfunded commitments to extend credit totaling $1.1 billion. Refer to Note 34 for additional information.


(k)As of December 31, 2022, included net markdowns on held-for-sale positions related to unfunded commitments in the bridge financing portfolio.


JPM Other unfunded commitments to extend credit

Other unfunded commitments to extend credit generally consist of commitments for working capital and general corporate purposes, extensions of credit to support commercial paper facilities and bond financings in the event that those obligations cannot be remarketed to new investors, as well as committed liquidity facilities to clearing organizations. The Firm also issues commitments under multipurpose facilities which could be drawn upon in several forms, including the issuance of a standby letter of credit.


JPM Guarantees

U.S. GAAP requires that a guarantor recognize, at the inception of a guarantee, a liability in an amount equal to the fair value of the obligation undertaken in issuing the guarantee. U.S. GAAP defines a guarantee as a contract that contingently requires the guarantor to pay the guaranteed party based upon: (a) changes in an underlying asset, liability or equity security of the guaranteed party; or (b) a third party’s failure to perform under a specified agreement. The Firm considers the following off–balance sheet arrangements to be guarantees under U.S. GAAP: standby letters of credit and other financial guarantees, securities lending indemnifications, certain indemnification agreements included within third-party contractual arrangements, certain derivative contracts and the guarantees under the sponsored member repo program.


JPM Guarantees

As required by U.S. GAAP, the Firm initially records guarantees at the inception date fair value of the non-contingent obligation assumed (e.g., the amount of consideration received or the net present value of the premium receivable). For these obligations, the Firm records this fair value amount in other liabilities with an offsetting entry recorded in cash (for premiums received),


JPM Guarantees

or other assets (for premiums receivable). Any premium receivable recorded in other assets is reduced as cash is received under the contract, and the fair value of the liability recorded at inception is amortized into income as lending and deposit-related fees over the life of the guarantee contract. The lending-related contingent obligation is recognized based on expected credit losses in addition to, and separate from, any non-contingent obligation.


JPM Guarantees

Non-lending-related contingent obligations are recognized when the liability becomes probable and reasonably estimable. These obligations are not recognized if the estimated amount is less than the carrying amount of any non-contingent liability recognized at inception (adjusted for any amortization). Examples of non-lending-related contingent obligations include indemnifications provided in sales agreements, where a portion of the sale proceeds is allocated to the guarantee, which adjusts the gain or loss that would otherwise result from the transaction. For these indemnifications, the initial liability is amortized to income as the Firm’s risk is reduced (i.e., over time or when the indemnification expires).


JPM Guarantees

The contractual amount and carrying value of guarantees and indemnifications are included in the table on page 292.


JPM Guarantees

For additional information on the guarantees, see below.


JPM Standby letters of credit and other financial guarantees

Standby letters of credit and other financial guarantees are conditional lending commitments issued by the Firm to guarantee the performance of a client or customer to a third party under certain arrangements, such as commercial paper facilities, bond financings, acquisition financings, trade financings and similar transactions.


The following table summarizes the contractual amount and carrying value of standby letters of credit and other financial guarantees and other letters of credit arrangements as of December 31, 2023 and 2022.


Standby letters of credit, other financial guarantees and other letters of credit ######2023##########2022#### December 31, (in millions)####Standby letters of credit and other financial guarantees######Other letters of credit####Standby letters of credit and other financial guarantees######Other letters of credit Investment-grade(a)##$##19,694####$##3,552##$##19,205####$##3,040 Noninvestment-grade(a)####9,178######836####8,234######1,094 Total contractual amount##$##28,872####$##4,388##$##27,439####$##4,134 Allowance for lending-related commitments##$##110####$##37##$##82####$##6 Guarantee liability####369######—####326######— Total carrying value##$##479####$##37##$##408####$##6 Commitments with collateral##$##16,861####$##539##$##15,296####$##795


(a)The ratings scale is based on the Firm’s internal risk ratings. Refer to Note 12 for further information on internal risk ratings.


JPM Securities lending indemnifications

Through the Firm’s securities lending program, counterparties’ securities, via custodial and non-custodial arrangements, may be lent to third parties. As part of this program, the Firm provides an indemnification in the lending agreements which protects the lender against the failure of the borrower to return the lent securities. To minimize its liability under these indemnification agreements, the Firm obtains cash or other highly liquid collateral with a market value exceeding 100% of the value of the securities on loan from the borrower. Collateral is marked to market daily to help assure that collateralization is adequate. Additional collateral is called from the borrower if a shortfall exists, or collateral may be released to the borrower in the event of overcollateralization. If a borrower defaults, the Firm would use the collateral held to purchase replacement securities in the market or to credit the lending client or counterparty with the cash equivalent thereof.


JPM Securities lending indemnifications

The cash collateral held by the Firm may be invested on behalf of the client in indemnified resale agreements, whereby the Firm indemnifies the client against the loss of principal invested. To minimize its liability under these agreements, the Firm obtains collateral with a market value exceeding 100% of the principal invested.


JPM Derivatives qualifying as guarantees

The Firm transacts in certain derivative contracts that have the characteristics of a guarantee under U.S. GAAP. These contracts include written put options that require the Firm to purchase assets upon exercise by the option holder at a specified price by a specified date in the future. The Firm may enter into written put option contracts in order to meet client needs, or for other trading purposes. The terms of written put options are typically five years or less.


Derivatives deemed to be guarantees also includes stable value contracts, commonly referred to as “stable value products”, that require the Firm to make a payment of the difference between the market value and the book value of a counterparty’s reference portfolio of assets in the event that market value is less than book value and certain other conditions have been met. Stable value products are transacted in order to allow investors to realize investment returns with less volatility than an unprotected portfolio. These contracts are typically longer-term or may have no stated maturity, but allow the Firm to elect to terminate the contract under certain conditions.


The notional value of derivative guarantees generally represents the Firm’s maximum exposure. However, exposure to certain stable value products is contractually limited to a substantially lower percentage of the notional amount.


The fair value of derivative guarantees reflects the probability, in the Firm’s view, of whether the Firm will be required to perform under the contract. The Firm reduces exposures to these contracts by entering into offsetting transactions, or by entering into contracts that hedge the market risk related to the derivative guarantees.


The following table summarizes the derivatives qualifying as guarantees as of December 31, 2023 and 2022. (in millions)####December 31, 2023####December 31, 2022 Notional amounts######## Derivative guarantees##$##54,562##$##59,180 Stable value contracts with contractually limited exposure####32,488####31,820 Maximum exposure of stable value contracts with contractually limited exposure####1,652####2,063 Fair value######## Derivative payables####89####649


In addition to derivative contracts that meet the characteristics of a guarantee, the Firm is both a purchaser and seller of credit protection in the credit derivatives market. Refer to Note 5 for a further discussion of credit derivatives.


JPM Unsettled securities financing agreements

In the normal course of business, the Firm enters into resale and securities borrowed agreements. At settlement, these commitments result in the Firm advancing cash to and receiving securities collateral from the counterparty. The Firm also enters into repurchase and securities loaned agreements. At settlement, these commitments result in the Firm receiving cash from and providing securities collateral to the counterparty. Such agreements settle at a future date. These agreements generally do not meet the definition of a derivative, and therefore, are not recorded on the Consolidated balance sheets until settlement date. These agreements predominantly have regular-way settlement terms. Refer to Note 11 for a further discussion of securities financing agreements.


JPM Mortgage repurchase liability

In connection with the Firm’s mortgage loan sale and securitization activities with U.S. GSEs the Firm has made representations and warranties that the loans sold meet certain requirements, and that may require the Firm to repurchase mortgage loans and/or indemnify the loan purchaser if such representations and warranties are breached by the Firm.


JPM Private label securitizations

The liability related to repurchase demands associated with private label securitizations is separately evaluated by the Firm in establishing its litigation reserves.


JPM Private label securitizations

Refer to Note 30 for additional information regarding litigation.


JPM Loans sold with recourse

The Firm provides servicing for mortgages and certain commercial lending products on both a recourse and nonrecourse basis. In nonrecourse servicing, the principal credit risk to the Firm is the cost of temporary servicing advances of funds (i.e., normal servicing advances). In recourse servicing, the servicer agrees to share credit risk with the owner of the mortgage loans, such as Fannie Mae


JPM 294 JPMorgan Chase & Co./2023 Form 10-K

or Freddie Mac or a private investor, insurer or guarantor. Losses on recourse servicing predominantly occur when foreclosure sales proceeds of the property underlying a defaulted loan are less than the sum of the outstanding principal balance, plus accrued interest on the loan and the cost of holding and disposing of the underlying property. The Firm’s securitizations are predominantly nonrecourse, thereby effectively transferring the risk of future credit losses to the purchaser of the mortgage-backed securities issued by the trust. The unpaid principal balance of loans sold with recourse as well as the carrying value of the related liability that the Firm has recorded in accounts payable and other liabilities on the Consolidated balance sheets, which is representative of the Firm’s view of the likelihood it will have to perform under its recourse obligations, are disclosed in the table on page 292.


JPM Indemnification agreements – general

In connection with issuing securities to investors outside the U.S., the Firm may agree to pay additional amounts to the holders of the securities in the event that, due to a change in tax law, certain types of withholding taxes are imposed on payments on the securities. The terms of the securities may also give the Firm the right to redeem the securities if such additional amounts are payable. The Firm may also enter into indemnification clauses in connection with the licensing of software to clients (“software licensees”) or when it sells a business or assets to a third party (“third-party purchasers”), pursuant to which it indemnifies software licensees for claims of liability or damages that may occur subsequent to the licensing of the software, or third-party purchasers for losses they may incur due to actions taken by the Firm prior to the sale of the business or assets. It is difficult to estimate the Firm’s maximum exposure under these indemnification arrangements, since this would require an assessment of future changes in tax law and future claims that may be made against the Firm that have not yet occurred. However, based on historical experience, management expects the risk of loss to be remote.


JPM Merchant charge-backs

Under the rules of payment networks, in its role as a merchant acquirer, the Firm’s Merchant Services business in CIB Payments, retains a contingent liability for disputed processed credit and debit card transactions that result in a charge-back to the merchant. If a dispute is resolved in the cardholder’s favor, the Firm will (through the cardholder’s issuing bank) credit or refund the amount to the cardholder and will charge back the transaction to the merchant. If the Firm is unable to collect the amount from the merchant, the Firm will bear the loss for the amount credited or refunded to the cardholder. The Firm mitigates this risk by withholding future settlements, retaining cash reserve accounts or obtaining other collateral. In addition, the Firm recognizes a valuation allowance that covers the payment or performance risk related to charge-backs.


JPM Merchant charge-backs

For the years ended December 31, 2023, 2022 and 2021, the Firm processed an aggregate volume of $2,411.0 billion, $2,158.4 billion, and $1,886.7 billion, respectively.


JPM Clearing Services – Client Credit Risk

The Firm provides clearing services for clients by entering into securities purchases and sales and derivative contracts with CCPs, including ETDs such as futures and options, as well as OTC-cleared derivative contracts. As a clearing member, the Firm stands behind the performance of its clients, collects cash and securities collateral (margin) as well as any settlement amounts due from or to clients, and remits them to the relevant CCP or client in whole or part. There are two types of margin: variation margin is posted on a daily basis based on the value of clients’ derivative contracts and initial margin is posted at inception of a derivative contract, generally on the basis of the potential changes in the variation margin requirement for the contract.


As a clearing member, the Firm is exposed to the risk of nonperformance by its clients, but is not liable to clients for the performance of the CCPs. Where possible, the Firm seeks to mitigate its risk to the client through the collection of appropriate amounts of margin at inception and throughout the life of the transactions. The Firm can also cease providing clearing services if clients do not adhere to their obligations under the clearing agreement. In the event of nonperformance by a client, the Firm would close out the client’s positions and access available margin. The CCP would utilize any margin it holds to make itself whole, with any remaining shortfalls required to be paid by the Firm as a clearing member.


The Firm reflects its exposure to nonperformance risk of the client through the recognition of margin receivables from clients and margin payables to CCPs; the clients’ underlying securities or derivative contracts are not reflected in the Firm’s Consolidated Financial Statements.


It is difficult to estimate the Firm’s maximum possible exposure through its role as a clearing member, as this would require an assessment of transactions that clients may execute in the future. However, based upon historical experience, and the credit risk mitigants available to the Firm, management believes it is unlikely that the Firm will have to make any material payments under these arrangements and the risk of loss is expected to be remote.


Refer to Note 5 for information on the derivatives that the Firm executes for its own account and records in its Consolidated Financial Statements.


JPM Exchange & Clearing House Memberships

The Firm is a member of several securities and derivative exchanges and clearing houses, both in the U.S. and other countries, and it provides clearing services to its clients. Membership in some of these organizations requires the Firm to pay a pro rata share of the losses incurred by the organization as a result of the default of another member. Such obligations vary with different organizations. These obligations may be limited to the amount (or a multiple of the amount) of the Firm’s contribution to the guarantee fund maintained by a clearing house or exchange as part of the resources available to cover any losses in the event of a member default. Alternatively, these obligations may also include a pro rata share of the residual losses after applying the guarantee fund. Additionally, certain clearing houses require the Firm as a member to pay a pro rata share of losses that may result from the clearing house’s investment of guarantee fund contributions and initial margin, unrelated to and independent of the default of another member. Generally a payment would only be required should such losses exceed the resources of the clearing house or exchange that are contractually required to absorb the losses in the first instance. In certain cases, it is difficult to estimate the Firm’s maximum possible exposure under these membership agreements, since this would require an assessment of future claims that may be made against the Firm that have not yet occurred. However, based on historical experience, management expects the risk of loss to the Firm to be remote. Where the Firm’s maximum possible exposure can be estimated, the amount is disclosed in the table on page 292, in the Exchange & clearing house guarantees and commitments line.


JPM Sponsored member repo program

The Firm acts as a sponsoring member to clear eligible overnight and term resale and repurchase agreements through the Government Securities Division of the Fixed Income Clearing Corporation (“FICC”) on behalf of clients that become sponsored members under the FICC’s rules. The Firm also guarantees to the FICC the prompt and full payment and performance of its sponsored member clients’ respective obligations under the FICC’s rules. The Firm minimizes its liability under these guarantees by obtaining a security interest in the cash or high-quality securities collateral that the clients place with the clearing house; therefore, the Firm expects the risk of loss to be remote. The Firm’s maximum possible exposure, without taking into consideration the associated collateral, is included in the Exchange & clearing house guarantees and commitments line on page 292. Refer to Note 11 for additional information on credit risk mitigation practices on resale agreements and the types of collateral pledged under repurchase agreements.


JPM Guarantees of subsidiaries

In the normal course of business, the Parent Company may provide counterparties with guarantees of certain of the trading and other obligations of its subsidiaries on a contract-by-contract basis, as negotiated with the Firm’s


JPM Guarantees of subsidiaries

counterparties. The obligations of the subsidiaries are included on the Firm’s Consolidated balance sheets or are reflected as off-balance sheet commitments; therefore, the Parent Company has not recognized a separate liability for these guarantees. The Firm believes that the occurrence of any event that would trigger payments by the Parent Company under these guarantees is remote.


JPM Guarantees of subsidiaries

The Parent Company has guaranteed certain long-term debt and structured notes of its subsidiaries, including JPMorgan Chase Financial Company LLC (“JPMFC”), a 100%-owned finance subsidiary. All securities issued by JPMFC are fully and unconditionally guaranteed by the Parent Company and no other subsidiary of the parent company guarantees these securities. These guarantees, which rank pari passu with the Firm’s unsecured and unsubordinated indebtedness, are not included in the table on page 292 of this Note. Refer to Note 20 for additional information.


JPM Pledged assets

The Firm pledges financial assets that it owns to maintain potential borrowing capacity at discount windows with Federal Reserve banks, various other central banks and FHLBs. Additionally, the Firm pledges assets for other purposes, including to collateralize repurchase and other securities financing agreements, to cover short sales and to collateralize derivative contracts and deposits. Certain of these pledged assets may be sold or repledged or otherwise used by the secured parties and are parenthetically identified on the Consolidated balance sheets as assets pledged.


JPM Pledged assets

The following table presents the Firm’s pledged assets. December 31, (in billions)####2023####2022 Assets that may be sold or repledged or otherwise used by secured parties##$##145.0##$##110.8 Assets that may not be sold or repledged or otherwise used by secured parties (a)####244.2####114.8 Assets pledged at Federal Reserve banks and FHLBs####675.6####567.6 Total pledged assets##$##1,064.8##$##793.2


JPM Pledged assets

(a)As of December 31, 2023, included $88.4 billion of assets pledged to the FDIC associated with the First Republic acquisition. Refer to Note 34 for additional information.


JPM Pledged assets

Total pledged assets do not include assets of consolidated VIEs; these assets are used to settle the liabilities of those entities. Refer to Note 14 for additional information on assets and liabilities of consolidated VIEs. Refer to Note 11 for additional information on the Firm’s securities financing activities. Refer to Note 20 for additional information on the Firm’s long-term debt. The significant components of the Firm’s pledged assets were as follows. December 31, (in billions)####2023####2022 Investment securities##$##108.6##$##104.4 Loans####681.7####485.9 Trading assets and other####274.5####202.9 Total pledged assets##$##1,064.8##$##793.2


JPM Collateral

The Firm accepts financial assets as collateral that it is permitted to sell or repledge, deliver or otherwise use. This collateral is generally obtained under resale and other securities financing agreements, prime brokerage-related held-for-investment customer receivables and derivative contracts. Collateral is generally used under repurchase and other securities financing agreements, to cover short sales, and to collateralize derivative contracts and deposits.


JPM Collateral

The following table presents the fair value of collateral accepted. December 31, (in billions)####2023####2022 Collateral permitted to be sold or repledged, delivered, or otherwise used##$##1,303.9##$##1,346.9 Collateral sold, repledged, delivered or otherwise used####982.8####1,019.4


JPM Contingencies

As of December 31, 2023, the Firm and its subsidiaries and affiliates are defendants or respondents in numerous evolving legal proceedings, including private proceedings, public proceedings, government investigations, regulatory enforcement matters, and the matters described below. The litigations range from individual actions involving a single plaintiff to class action lawsuits with potentially millions of class members. Investigations and regulatory enforcement matters involve both formal and informal proceedings, by both governmental agencies and self-regulatory organizations. These legal proceedings are at varying stages of adjudication, arbitration or investigation, and involve each of the Firm’s lines of business and several geographies and a wide variety of claims (including common law tort and contract claims and statutory antitrust, securities and consumer protection claims), some of which present novel legal theories.


JPM Contingencies

The Firm believes the estimate of the aggregate range of reasonably possible losses, in excess of reserves established, for its legal proceedings is from $0 to approximately $1.3 billion at December 31, 2023. This estimated aggregate range of reasonably possible losses was based upon information available as of that date for those proceedings in which the Firm believes that an estimate of reasonably possible loss can be made. For certain matters, the Firm does not believe that such an estimate can be made, as of that date. The Firm’s estimate of the aggregate range of reasonably possible losses involves significant judgment, given: •the number, variety and varying stages of the proceedings, including the fact that many are in preliminary stages, •the existence in many such proceedings of multiple defendants, including the Firm, whose share of liability (if any) has yet to be determined, •the numerous yet-unresolved issues in many of the proceedings, including issues regarding class certification and the scope of many of the claims, and •the uncertainty of the various potential outcomes of such proceedings, including where the Firm has made assumptions concerning future rulings by the court or other adjudicator, or about the behavior or incentives of adverse parties or regulatory authorities, and those assumptions prove to be incorrect.


JPM Contingencies

In addition, the outcome of a particular proceeding may be a result which the Firm did not take into account in its estimate because the Firm had deemed the likelihood of that outcome to be remote. Accordingly, the Firm’s estimate of the aggregate range of reasonably possible losses will change from time to time, and actual losses may vary significantly.


JPM Contingencies

Set forth below are descriptions of the Firm’s material legal proceedings.


JPM Contingencies

1MDB Litigation. J.P. Morgan (Suisse) SA was named as a defendant in a civil litigation filed in May 2021 in Malaysia by 1Malaysia Development Berhad (“1MDB”), a Malaysian state-owned and controlled investment fund. The claim alleges “dishonest assistance” against J.P. Morgan (Suisse) SA in relation to payments of $300 million and $500 million, from 2009 and 2010, respectively, received from 1MDB and paid into an account at J.P. Morgan (Suisse) SA held by 1MDB PetroSaudi Limited, a joint venture company between 1MDB and PetroSaudi Holdings (Cayman) Limited. The Firm is challenging the validity of service and the Malaysian Court’s jurisdiction to hear the claim. In August 2023 the Court denied an application by 1MDB to discontinue its claim with permission to re-file a new claim in the future. An appeals court is scheduled in August 2024 to hear separate appeals filed by 1MDB and the Firm against that August 2023 decision. In its appeal, the Firm seeks to prevent any claim from continuing.


JPM Contingencies

In addition, in November 2023, the Federal Office of the Attorney General (OAG) in Switzerland notified J.P. Morgan (Suisse) SA that it is conducting an investigation into possible criminal liability in connection with transactions arising from J.P. Morgan (Suisse) SA’s relationship with the 1MDB PetroSaudi joint venture and its related persons for the period September 2009 through August 2015. The OAG investigation is ongoing.


JPM Contingencies

Amrapali. India’s Enforcement Directorate (“ED”) is investigating J.P. Morgan India Private Limited in connection with investments made in 2010 and 2012 by two offshore funds formerly managed by JPMorgan Chase entities into residential housing projects developed by the Amrapali Group (“Amrapali”) relating to delays in delivering or failure to deliver residential units. In August 2021, the ED issued an order fining J.P. Morgan India Private Limited approximately $31.5 million, and the Firm is appealing that order. Relatedly, in July 2019, the Supreme Court of India issued an order making preliminary findings that Amrapali and other parties, including unspecified JPMorgan Chase entities and the offshore funds that had invested in the projects, violated certain criminal currency control and money laundering provisions, and ordered the ED to conduct a further inquiry. The Firm is responding to and cooperating with the inquiry.


JPM Contingencies

Foreign Exchange Investigations and Litigation. The Firm previously reported settlements with certain government authorities relating to its foreign exchange (“FX”) sales and trading activities and controls related to those activities. Among those resolutions, in May 2015, the Firm pleaded guilty to a single violation of federal antitrust law. The Department of Labor ("DOL") granted the Firm exemptions that permit the Firm and its affiliates to continue to rely on the Qualified Professional Asset Manager exemption under


JPM 298 JPMorgan Chase & Co./2023 Form 10-K

the Employee Retirement Income Security Act (“ERISA”) through the ten-year disqualification period following the antitrust plea. The only remaining FX-related governmental inquiry is a South Africa Competition Commission matter which is currently pending before the South Africa Competition Tribunal.