By Tom Sims
FRANKFURT (Reuters) -JPMorganChase will launch its Chase digital retail bank in Germany in the second quarter of next year, it said on Thursday, a bold move into the crowded banking market of Europe’s largest economy.
The U.S. banking giant has been preparing the launch in recent years with a spate of hiring, but had kept the timing under wraps. Germany would be Chase’s second European market, after its launch in Britain in 2021.
JPMorgan is already one of the largest banks in Germany, drawn to its large wealthy customer base, stable regulatory environment, and fintech scene.
But the country is a challenging market due to a fragmented landscape, with what analysts say are too many banks. Entrants on the retail side face a competitive consumer market dominated by local incumbents, where margins are thin.
Deutsche Bank, Germany’s largest bank, is trying to make its retail bank more profitable by shedding staff and branches.
Other lenders like Spain’s Banco Bilbao Vizcaya Argentaria have already launched digital banks in Germany, while ING and N26 are among big online banks long operating in the country.
The Chase bank will be based in Berlin and will start by offering savings accounts before expanding products.
“This marks a significant expansion of JPMorganChase’s footprint in the country, building on over a century of serving clients and communities there,” JPMorgan said.
Top JPMorgan executives have acknowledged that banks in the past struggled in retail banking outside their home markets, but say the digital era has changed the game.
“This is going to be a battle,” Jamie Dimon, JPMorgan’s long-standing CEO, told investors in 2022.
(Reporting by Tom Sims, editing by Thomas Seythal, Ludwig Burger, Tomasz Janowski and Jan Harvey)
