Jamie Dimon says coronavirus crisis is ‘wake up call’ for a more inclusive economy
JPMorgan Chase CEO Jamie Dimon said Tuesday in a memo that the coronavirus crisis should be used to build an economy that offers opportunities for "dramatically more people."
The memo, issued ahead of his bank’s annual shareholder meeting, served as an update to the New York-based lender’s response to the pandemic. Dimon also detailed the steps his firm has taken to support customers and employees since the crisis began two months ago, as well as his thinking about returning employees to work sites.
“It is my fervent hope that we use this crisis as a catalyst to rebuild an economy that creates and sustains opportunity for dramatically more people, especially those who have been left behind for too long,” Dimon said. “The last few months have laid bare the reality that, even before the pandemic hit, far too many people were living on the edge.”
Since the coronavirus pandemic took hold in the U.S., 36.5 million people have filed unemployment claims, and the toll has hit lower-income workers hardest: Nearly 40% of households with incomes of less than $40,000 have reported a job loss, the Federal Reserve said last week. Even for those with jobs, the crisis exposed another disparity: While office workers have mostly been able to work from their homes, lower-paid work is more likely to require in-person activities, putting those employees at greater risk of infection.
“Unfortunately, low-income communities and people of color are being hit the hardest, exacerbating the health and economic inequities that were already unacceptably pronounced before the virus took over,” Dimon said.
“An inclusive economy – in which there is widespread access to opportunity – is a stronger, more resilient economy,” he added. “This crisis must serve as a wake-up call and a call to action for business and government to think, act and invest for the common good and confront the structural obstacles that have inhibited inclusive economic growth for years.”
Dimon said he would soon share his ideas on how the rehiring of workers and reopening of small businesses could help create a more inclusive economy.
As for the shareholder meeting, which was held online because of the pandemic, all of the bank’s directors were elected with at least 84% of the vote.
In opening remarks for the event, Dimon — who had emergency heart surgery in March — said that he was in “good health” and happy to have returned to the helm of JPMorgan.
Read the full memo here:
An Update on JPMorgan Chase’s Response to COVID-19
May 19, 2020
The impacts of the COVID-19 pandemic continue to reverberate within our neighborhoods, workplaces and homes and throughout our economy. In my annual letter to shareholders last month, we described the actions our firm is taking to support our employees, customers and communities. Things are changing quickly, so I wanted to update you on our recent efforts. I also want to share how we are thinking about and preparing for not only the safe re-opening of our economy, but also laying the foundation for an inclusive recovery that unlocks economic opportunity for more people.
From the outset, our priority has been to continue to provide uninterrupted service to our clients and customers, while supporting and providing a safe work environment for our employees and helping those communities hit hard by the COVID-19 pandemic.
Responding to the needs of our customers and clients
To help customers who have told us they are struggling financially, we have made it easy to enroll in a payment assistance program. To date, we have provided assistance to over 1.5 million customer accounts, including delaying payments and refunding fees across our business banking, home lending, credit card, deposit and auto lease and loan accounts. And, we are quickly and prudently putting our capital and liquidity to work to help our clients – large and small – weather the crisis, pay their workers and bills, and provide the essential goods and services on which we all depend.
Included in this, are hundreds of thousands of homeowners we’ve helped by delaying their mortgage payments for at least three months. They won’t be charged a late fee or penalty during this time. We are also available to discuss extensions for many customers who need more time to recover, and upon request and if eligible, we can add the option to move missed payments to the end of their mortgage term.
In March and April, we approved more than $45 billion in new credit for our clients impacted by COVID-19. This included more than $6 billion to hospitals and healthcare companies, educational institutions, nonprofits and state and local governments. For example, we worked with NewYork-Presbyterian Health System – which has seen a significant increase in overnight patients as a result of COVID-19 – to increase their line of credit so they could acquire vital medical supplies and equipment and bring on additional staff.
We’ve also assisted our corporate clients in raising capital, including many in industries that have been hard hit by the pandemic, from healthcare to travel and transportation. Year to date, we’ve helped clients raise $664 billion in investment grade financing, and also provided $104 billion of high yield financing.
Additionally, during the first 60 days of the crisis, we extended $950 million in new loans for our small business clients, such as Kids Klub Child Development Centers, which offer preschool, daycare and after school programming. The Los Angeles-based company was in the middle of constructing a new location in Seattle when the crisis hit. We worked with them to accelerate access to critically needed funds to finish construction and continue paying their 200 employees while they closed down and revamped their centers to provide care for children of essential workers. We’ve also worked to help as many of our customers as possible receive loans through the SBA’s Paycheck Protection Program (PPP). For example, we helped the Jupiter Hotel in Portland, Oregon maintain its workforce as they converted 81 rooms into a shelter for homeless individuals with underlying health conditions or respiratory symptoms but who have not tested positive for COVID-19. We also helped the South Florida Cancer Association keep drivers on their payroll who transport underprivileged people to their radiation and chemotherapy treatments.
Since the beginning of PPP, we funded a total of more than $30 billion to over 250,000 businesses, helping to support more than 3 million employees. The average loan amount was roughly $122,000 and half of those loans went to companies with fewer than 5 employees.
Helping the most vulnerable in our communities
We are using data-driven solutions to help some of the hardest hit communities get through the pandemic – and to help them recover when it’s over. So far, this includes a $250 million global business and philanthropic commitment to support vulnerable and underrepresented communities, existing nonprofit partners and underserved small businesses.
We know that many small businesses are at risk of being locked out of the resources they desperately need to stay afloat – that’s why $200 million of our commitment is to help underserved small businesses and nonprofits access low-cost capital through community partners. For example, this includes $50 million to Grow America Fund, a Community Development Financial Institution, so they can help small businesses in underserved communities cover expenses such as rent and employee salaries.
We are also providing $50 million in philanthropic support to nonprofits working to help communities and people hit hardest by this public health crisis. For example, we provided support to enable the Healthcare Advancement Program (H-CAP) to implement new training programs focused on crisis care and infectious disease preparedness. Our firm has partnered with H-CAP over the last several years to train workers for jobs in the healthcare sector, and now these new training programs will prepare workers in New York City, Los Angeles, Chicago, Philadelphia and other cities across the U.S. to fill the shortage of clinical care professionals needed to address the COVID-19 pandemic.
And we’re also finding other ways we can help in our communities. For example, we are collaborating with Marriott and others to provide up to $10 million worth of hotel stays for healthcare professionals fighting COVID-19 in the United States. The initiative is providing free rooms to first responders in locations such as New York City, New Orleans, Chicago and Detroit.
Supporting our employees as we move toward re-opening our economy
Our employees’ safety and wellbeing is a top priority, and we’ve taken extensive steps to support them during the crisis, including extra time off for all and expanding access to medical resources, internally and externally. As we continue to address the immediate health and humanitarian impacts of the COVID-19 pandemic, the public and private sectors are developing longer-term plans to re-open our economy. Protecting people’s safety is important, which is why we must look to public health officials to guide the timing and sequencing for lifting restrictions. Securing the proper amount of equipment, testing and monitoring, hospital capacity and other tools and processes in place will be essential in giving people confidence they can safely return to work, school and other public spaces.
As we develop our strategy for returning more employees to working on-site, the two principal considerations driving our approach are using the latest data and information to do it at the right time – which may differ by region, state and country – and prioritizing the health and safety of our employees. We are working to identify what changes may be needed to achieve this objective, including reviewing our current office configurations and protocols. We are also coordinating with and seeking guidance from government entities and health authorities.
Rebuilding a more inclusive economy
In the midst of today’s uncertainties and the acute impacts – with unemployment high and little economic activity – it’s hard to plan for the future. Yet to lay the foundation for the kind of recovery we need, it is critical we do so. It is my fervent hope that we use this crisis as a catalyst to rebuild an economy that creates and sustains opportunity for dramatically more people, especially those who have been left behind for too long. The last few months have laid bare the reality that, even before the pandemic hit, far too many people were living on the edge. Unfortunately, low-income communities and people of color are being hit the hardest, exacerbating the health and economic inequities that were already unacceptably pronounced before the virus took over.
An inclusive economy – in which there is widespread access to opportunity – is a stronger, more resilient economy. This crisis must serve as a wake-up call and a call to action for business and government to think, act and invest for the common good and confront the structural obstacles that have inhibited inclusive economic growth for years. From the re-opening of small businesses to the rehiring of workers, let’s leverage this moment to think creatively about how we can mobilize to address so many issues that inhibit the creation of an inclusive economy and fray our social fabric. We look forward to sharing more ideas soon for how to do this. By doing the right thing during times of crisis, we can emerge stronger and more cohesive in its wake.
Finally, we are proud that our firm has been well equipped to quickly step up and provide significant resources and support because we entered this crisis in a position of strength. This is a direct result of the actions and investments we’ve made over many years to build a strong, resilient company. We believe it’s our responsibility to be there for the people who rely on us in times like this. This is precisely why we work so hard to be that kind of company.
Chairman and Chief Executive Officer
JPMorgan Chase & Co.