JPMorgan explained why it has to keep hiring tech staff
When JPMorgan said in January 2022 that it planned to spend $12bn on technology, it prompted rare criticism from investors, who thought the bank might be getting carried away and complained that it was providing insufficient detail. Undaunted, in May 2023, the bank was referencing an even bigger number of $15.5bn of spending on "new initiatives." And in today's third quarter results, JPMorgan said extra technology staff are one reason why its headcount increased in the three months to October.
JPMorgan already has something like 56,000 people working in technology worldwide, so why does it need to hire new ones?
Speaking today, Jamie Dimon, JPMorgan CEO said it's because of all the bank's digital competitors. "It's Marcus, it's Apple, it's Chime, it's Dave, it's Stripe in payments," he said, adding that if the bank wants to be competitive it has no choice but to keep on spending.
At the same time, Dimon said JPMorgan is investing heavily in AI, which it already uses for everything from "risk, to marketing, to prospecting." A senior female member of the AI team has recently been "put" at "the table," said Dimon, without giving her name or revealing the nature of the table. He may well be referring to Manuela Veloso, the bank's head of AI research.
Dimon added that banking is an unusual use case for large language models as much of the data is not in the public domain. The unspoken implication is that banks will need to develop their own LLMs.
Despite JPMorgan's enthusiasm for technology spending, total spending on tech and communications fell 4% in the first nine months of the year and there were various cuts to the tech team in May.
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