JP Morgan Chase & Co (NYSE: JPM) has announced that it will expand its retail banking unit by hiring 1,200 bankers and opening about 120 new branches by the end of 2010.
The company’s CEO, James Dimon, made the announcement to investors during a presentation during Goldman Sach’s U.S. Financial Services Conference in New York. In his presentation, Dimon said that the bank sees “some initial signs of stability in consumer-delinquency trends, but we are not certain if this trend will continue.”
JP Morgan believes that losses related to Home Equity loans could reach $1.4 billion per quarter for the next couple of years. The company also said that it could lose as much as $600 million from prime mortgages and $500 million from sub-prime mortgages each quarter.
The bank stated that losses stemming from the bank’s Chase credit card portfolio would approach 11% of such loans by the first quarter of next year. Losses from the portfolio that the company had picked up as part of its purchase of Washington Mutual could reach as high as 24% during the next several quarters.
Loan demand is expected to remain weak and the company said that its net interest income from mortgage lending would fall by $1 billion next year from its 2009 levels. JP Morgan believes that its mortgage portfolio could shrink by 10%-15% next year to about $240 billion and then down to about $200 billion in 2011.
