JPMorgan Expands in Switzerland - Analyst Blog

As part of its major expansion plan, JPMorgan Chase & Co. (JPM) expects to hire more than 400 people in Switzerland, particularly in Zurich, Geneva and Zug. This was stated by Mr. Martin Schuetz, the co-head of the company in Switzerland on Wednesday.

Mr. Schuetz commented that JPMorgan will create jobs in its private banking business in Geneva by increasing its staff from the present 650 employees to 1,000 by next year. Besides private banking, the company is also planning to hire personnel in wealth management, commodities trading and industry financing businesses. In Zurich, JPMorgan plans to double its employees to 120 people by the same time frame.

JPMorgan's wealth management team in Switzerland anticipates doubling the assets under management by 2015. The company will also utilize its increased staff to provide non-core banking services to its affluent clients in Singapore and Hong Kong.   

Though banking in Switzerland has lost some of its former allure because of reduced secrecy, JPMorgan still sees big opportunities there with its low taxes and a stable economic environment. According to Mr. Schuetz, the company's customers value the advantages of low inflation, a strong currency and high service quality in Switzerland.

Booming commodity centers in Geneva and Zug are an added attraction for JPMorgan to increase its staff strength. The company also aims to serve a large number of big international firms that have their headquarters in Switzerland.

With the weakened growth prospects and tightened regulation in the U.S., many companies are looking elsewhere, in particular nations that offer increased growth prospects. In December 2010, JPMorgan announced its plan to expand its operations in London. Also recently, Deutsche Bank AG (DB) announced that it plans to create nearly 350 jobs in Zurich.

With JPMorgan's close competitor – Bank of America Corporation (BAC) – still struggling to keep itself profitable after the financial crisis, the company is taking a leap forward with its expansion plans across the world.

JPMorgan is scheduled to release its fourth quarter and fiscal year 2010 results on January 14, 2011. The Zacks Consensus Estimate is 99 cents per share for the fourth quarter and $3.84 for the full year.

Currently, JPMorgan's shares maintain a Zacks #3 Rank, which translates into a short-term ‘Hold' rating. Also considering the company's fundamentals, we have a long-term ‘Neutral' recommendation on the stock.

 
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