JP Morgan is a well known name in the financial world. JP Morgan is one of the oldest, largest and most well-known financial institutions. It was co-founded in 1799 by J. Pierpont Morgan and his father J.S. Morgan. This largest financial institution is now worth more than 2.3 trillion and counting as of 2020. Let us know When Was JP Morgan Founded?
The brand name of JP Morgan is used for the asset management, private banking and Wealth management divisions. At the same time, J.P. Morgan Chase does fiduciary activities like personal banking, wealth management and credit card services in some regions.
After a series of conglomerates and mergers, JP Morgan (originally founded in 1799) was reformed on 31st Dec 2000 when Chase Bank acquired JP Morgan. It then became JP Morgan Chase & Co. It is also publicly listed on New York Stock Exchange under the scrip name ‘NYSE: JPM’.
It is headquartered in Manhattan, New York and was incorporated in Delaware.
It has a market capitalization of more than 2.3 trillion dollars. It is also the largest hedge fund in the United States with a net worth of over 34 billion dollars.
History of JP Morgan
Beginnings-
In 1854, J.S. Morgan merged with George Peabody and Co, which was a London-based banking business. JS. Morgan soon bought out Peabody & Co and turned it into J.S. Morgan.
J.P. Morgan used his Peabody connections to bring in British funds for the capital that was to be used for the United States Industrial firms and other sectors.
In 1853, Abraham Lincoln became their customer.
Drexel Harjes and Co partnered with JP Morgan to setup their office in New York in 1868 and later in 1871, it became Drexel Morgan and Co.
When Junius died in 1890, J.P. Morgan took over the J.S. Morgan and company. After re-organizing the organization, it then became J.P. Morgan and company,
During World War I, J.P. Morgan started funding huge loans to the allies to fight the Germans and thus, profiting from the sale of ammunition and arms as well as other financial and purchasing activities.
In 1933, due to the enactment of the Glass-Steagall Act, J.P. Morgan had to separate its commercial bank and its investment banking business. After the stock market crash in 1929, people started to panic, investment banking was losing significance to commercial lending.
In 1950s, J.P. Morgan was a mid-sized bank.
In 1959, JP Morgan merged with the prestigious Guaranty Trust company of New York. This deal helped Guaranty trust inflow capital from JP Morgan while the mid-sized bank gained from the prestigious name and clients.
The Revival of JP Morgan
In 1988, JP Morgan Guaranty & Co began to operate under the exclusive brand name JP Morgan.
JP Morgan once again began operating under their exclusive brand name and by then, had started to issue commercial paper, bonds and corporate debt,
It then began to rebuild its investment banking operations.
It is the first commercial bank to underwrite a corporate debt offering in 1989.
After 1990
In the 1990s, JP Morgan emerged as a large commercial bank and investment banking organization with a strong presence in debt and equities securities underwriting.
JP Morgan to JP Morgan Chase and Co
In 2000, JP Morgan & Co merged with Chase Manhattan Bank to become JP Morgan Chase and co.
Chase Manhattan was by then growing into a leading commercial bank in the United States through a series of mergers and acquisitions made previously.
Services provided by JP Morgan Chase and What makes them unique?
Neither of its competitors Goldman Sachs or Morgan Stanley have combined both Commercial Banking with Investment Banking, following are a list of services provided by JP Morgan Chase and Co.
- Investment Banking
- Commercial Banking
- Asset Management.
- Private Banking
- Credit Cards
- Mortgage
- Loans and other Credit facilities.
- Market Research and many other financial services.
Peer Comparision for JP Morgan
- Goldman Sachs
- Morgan Stanley
- Silicon Valley Bank
- Wells Fargo
- Citi
- Nomura
- PNC Financial Services
Key Facts about JP Morgan Chase and Co
- It is one of the oldest banks with traces from 1790
- JP Morgan Chase and Co. is one of the biggest financial insitution with almost 3 trillion market capitalization.
- JP Morgan Chase and Co. offers services ranging from Investment banking to personal banking.
- It has presence in over 100 coutnries.
- The founder of JP Morgan is John Pierpont Morgan.
- Aaron Burr, John Thompson, John Pierpont Morgan, and Balthazar P. Melinck are the founders of JP Morgan Chase and company.
- It has the capability to collapse the economy of the world along with its prestige and market capitalization.
- JP Morgan started business by financing and reorganizing the railroads of the United States.
- JP Morgan had over time bought companies from various sectors and industries to become monopolies.
- JP Morgan, at one point had almost acquired assets worth 22.25 billions being the richest men in the world through which he could have bought almost 22 states of United States.
- JP Morgan company still runs today under the name of JP Morgan Chase and Co.
- JP Morgan had personally spent close to 60 Million Dollars in collecting paintings, manuscripts, rare books and sculptures.
Saving the Dollar
JP Morgan followed his fathers footsteps and was always an capitalist by nature.
In 1893, when gold caused devaluation of the dollar, JP Morgan was asked to lend 65 Million Dollars in gold to save the Treasury and the Dollar value.
After 1893, JP Morgan was mainly instrumental in reorganizing and stabilizing the businesses to make them profitable and then, taking control over them. Few major industries that were reorganized by John Pierpont Morgan are railroads, United States Steel, AT&T, General Electric and International harvestor.
This oldest, largest and leading financial instituion has not always had an easy ride however and had to undergo lots of criticism and many legal procedings in their journey.
It is interesting to see how JP Morgan continues to grow as the rise in demand for financial services are growing in this rapidly changing world.
