By Tom Sims
FRANKFURT (Reuters) -JPMorganChase said on Thursday that it would launch its Chase digital retail bank in Germany in the second quarter of next year.
The announcement marks 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.
JPMorgan already launched Chase in Britain in 2021. Germany represents its second European market.
Spain’s Banco Bilbao Vizcaya Argentaria SA has also announced plans to launch a digital bank in Germany.
Germany is a challenging market due to a fragmented landscape with what analysts say are too many banks. The entrants 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.
JPMorgan – drawn to Germany’s large wealthy customer base, stable regulatory environment, and fintech scene – has become one of the largest banks in Germany.
The nation is the U.S. bank’s third-largest source of revenue after the U.S. and Britain.
The Chase bank will be based in Berlin.
“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 chief executive, told investors in 2022.
(Reporting by Tom Sims, editing by Thomas Seythal, Ludwig Burger and Tomasz Janowski)
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