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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly report pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the quarterly period ended Commission file 
SeptemberJune 30, 20192020
 number1-5805 
JPMorgan Chase & Co.
(Exact name of registrant as specified in its charter)
Delaware 13-2624428
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. employer
identification no.)
    
383 Madison Avenue,  
New York,New York 10179
(Address of principal executive offices) 
(Zip Code)

Registrant’s telephone number, including area code: (212) 270-6000
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stockJPMThe New York Stock Exchange
Depositary Shares, each representing a one-four hundredth interest in a share of 5.45% Non-Cumulative Preferred Stock, Series PJPM PR AThe New York Stock Exchange
Depositary Shares, each representing a one-four hundredth interest in a share of 6.125% Non-Cumulative Preferred Stock, Series YJPM PR FThe New York Stock Exchange
Depositary Shares, each representing a one-four hundredth interest in a share of 6.10% Non-Cumulative Preferred Stock, Series AAJPM PR GThe New York Stock Exchange
Depositary Shares, each representing a one-four hundredth interest in a share of 6.15% Non-Cumulative Preferred Stock, Series BBJPM PR HThe New York Stock Exchange
Depositary Shares, each representing a one-four hundredth interest in a share of 5.75% Non-Cumulative Preferred Stock, Series DDJPM PR DThe New York Stock Exchange
Depositary Shares, each representing a one-four hundredth interest in a share of 6.00% Non-Cumulative Preferred Stock, Series EEJPM PR CThe New York Stock Exchange
Depositary Shares, each representing a one-four hundredth interest in a share of 4.75% Non-Cumulative Preferred Stock, Series GGJPM PR JThe New York Stock Exchange
Alerian MLP Index ETNs due May 24, 2024AMJNYSE Arca, Inc.
Guarantee of Callable Step-Up Fixed Rate Notes due April 26, 2028 of JPMorgan Chase Financial Company LLCJPM/28The New York Stock Exchange
Guarantee of Cushing 30 MLP Index ETNs due June 15, 2037 of JPMorgan Chase Financial Company LLCPPLNNYSE Arca, Inc.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒

Accelerated filer☐
    
Non-accelerated filer☐Smaller reporting company☐
    
  Emerging growth company☐
    
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

 
Number of shares of common stock outstanding as of SeptemberJune 30, 2019: 3,136,484,9242020: 3,047,604,487
 


FORM 10-Q
TABLE OF CONTENTS
Part I – Financial information
Page
Item 1.
Financial Statements.
 
 
Consolidated Financial Statements – JPMorgan Chase & Co.:
 
 
Consolidated statements of income (unaudited) for the three and ninesix months ended SeptemberJune 30, 20192020 and 20182019
8093
 
Consolidated statements of comprehensive income (unaudited) for the three and ninesix months ended SeptemberJune 30, 20192020 and 20182019
8194
 
Consolidated balance sheets (unaudited) at SeptemberJune 30, 20192020 and December 31, 20182019
8295
 
Consolidated statements of changes in stockholders’ equity (unaudited) for the three and ninesix months ended SeptemberJune 30, 20192020 and 20182019
8396
 
Consolidated statements of cash flows (unaudited) for the ninesix months ended SeptemberJune 30, 20192020 and 20182019
8497
 
Notes to Consolidated Financial Statements (unaudited)
8598
 
Report of Independent Registered Public Accounting Firm
165188
 
Consolidated Average Balance Sheets, Interest and Rates (unaudited) for the three and nine months ended SeptemberJune 30, 20192020 and 20182019
166189
 
Glossary of Terms and Acronyms and Line of Business Metrics
168191
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
 
 
Consolidated Financial Highlights
3
 
Introduction
4
 
Executive Overview
5
 
Consolidated Results of Operations
1013
 
Consolidated Balance Sheets and Cash Flows Analysis
1518
 
Off-Balance Sheet Arrangements
1821
 
Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures
1922
 
Business Segment Results
2124
 
Enterprise-WideFirmwide Risk Management
4448
 
Capital Risk Management
4549
 
Liquidity Risk Management
5055
 
Consumer Credit Portfolio
5662
 
Wholesale Credit Portfolio
6067
 
Investment Portfolio Risk Management
6979
 
Market Risk Management
7080
 
Country Risk Management
7585
Operational Risk Management
86
Estimations and Model Risk Management
87
 
Critical Accounting Estimates Used by the Firm
7688
 
Accounting and Reporting Developments
7891
 
Forward-Looking Statements
7992
Item 3.
Quantitative and Qualitative Disclosures About Market Risk.
176200
Item 4.
Controls and Procedures.
176200
Part II – Other information
 
Item 1.
Legal Proceedings.
176200
Item 1A.
Risk Factors.
176200
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds.
176201
Item 3.
Defaults Upon Senior Securities.
177201
Item 4.
Mine Safety Disclosures.
177201
Item 5.
Other Information.
177201
Item 6.
Exhibits.
177202


JPMorgan Chase & Co.
Consolidated financial highlights (unaudited)
As of or for the period ended, (in millions, except per share, ratio, headcount data and where otherwise noted)

As of or for the period ended, (in millions, except per share, ratio, headcount data and where otherwise noted)

  Nine months ended Sept. 30,
As of or for the period ended, (in millions, except per share, ratio, headcount data and where otherwise noted)

  Six months ended June 30,
3Q19
2Q19
1Q19
4Q18
3Q18
 2019
2018
2Q20
1Q20
4Q19
3Q19
2Q19
 2020
2019
Selected income statement dataSelected income statement data   Selected income statement data   
Total net revenue(a)Total net revenue(a)$29,341
$28,832
$29,123
$26,109
$27,260
 $87,296
$82,920
Total net revenue(a)$32,980
$28,192
$28,285
$29,291
$28,747
 $61,172
$57,823
Total noninterest expense(a)Total noninterest expense(a)16,422
16,341
16,395
15,720
15,623
 49,158
47,674
Total noninterest expense(a)16,942
16,791
16,293
16,372
16,256
 33,733
32,604
Pre-provision profit(b)Pre-provision profit(b)12,919
12,491
12,728
10,389
11,637
 38,138
35,246
Pre-provision profit(b)16,038
11,401
11,992
12,919
12,491
 27,439
25,219
Provision for credit lossesProvision for credit losses1,514
1,149
1,495
1,548
948
 4,158
3,323
Provision for credit losses10,473
8,285
1,427
1,514
1,149
 18,758
2,644
Income before income tax expenseIncome before income tax expense11,405
11,342
11,233
8,841
10,689
 33,980
31,923
Income before income tax expense5,565
3,116
10,565
11,405
11,342
 8,681
22,575
Income tax expenseIncome tax expense2,325
1,690
2,054
1,775
2,309
 6,069
6,515
Income tax expense878
251
2,045
2,325
1,690
 1,129
3,744
Net incomeNet income$9,080
$9,652
$9,179
$7,066
$8,380
 $27,911
$25,408
Net income$4,687
$2,865
$8,520
$9,080
$9,652
 $7,552
$18,831
   
Earnings per share dataEarnings per share data   Earnings per share data   
Net income: BasicNet income: Basic$2.69
$2.83
$2.65
$1.99
$2.35
 $8.17
$7.04
Net income: Basic$1.39
$0.79
$2.58
$2.69
$2.83
 $2.17
$5.48
Diluted Diluted2.68
2.82
2.65
1.98
2.34
 8.15
7.00
 Diluted1.38
0.78
2.57
2.68
2.82
 2.17
5.46
Average shares: BasicAverage shares: Basic3,198.5
3,250.6
3,298.0
3,335.8
3,376.1
 3,248.7
3,416.5
Average shares: Basic3,076.3
3,095.8
3,140.7
3,198.5
3,250.6
 3,086.1
3,274.3
Diluted Diluted3,207.2
3,259.7
3,308.2
3,347.3
3,394.3
 3,258.0
3,436.2
 Diluted3,081.0
3,100.7
3,148.5
3,207.2
3,259.7
 3,090.8
3,283.9
   
Market and per common share dataMarket and per common share data   Market and per common share data   
Market capitalizationMarket capitalization369,133
357,479
328,387
319,780
375,239
 369,133
375,239
Market capitalization286,658
274,323
429,913
369,133
357,479
 286,658
357,479
Common shares at period-endCommon shares at period-end3,136.5
3,197.5
3,244.0
3,275.8
3,325.4
 3,136.5
3,325.4
Common shares at period-end3,047.6
3,047.0
3,084.0
3,136.5
3,197.5
 3,047.6
3,197.5
Book value per shareBook value per share75.24
73.88
71.78
70.35
69.52
 75.24
69.52
Book value per share76.91
75.88
75.98
75.24
73.88
 76.91
73.88
Tangible book value per share (“TBVPS”)(a)
60.48
59.52
57.62
56.33
55.68
 60.48
55.68
Tangible book value per share (“TBVPS”)(b)
Tangible book value per share (“TBVPS”)(b)
61.76
60.71
60.98
60.48
59.52
 61.76
59.52
Cash dividends declared per shareCash dividends declared per share0.90
0.80
0.80
0.80
0.80
 2.50
1.92
Cash dividends declared per share0.90
0.90
0.90
0.90
0.80
 1.80
1.60
   
Selected ratios and metricsSelected ratios and metrics   Selected ratios and metrics   
Return on common equity (“ROE”)(b)
15%16%16%12%14% 15%14%
Return on tangible common equity (“ROTCE”)(a)(b)
18
20
19
14
17
 19
18
Return on common equity (“ROE”)(c)
Return on common equity (“ROE”)(c)
7%4%14%15%16% 6%16%
Return on tangible common equity (“ROTCE”)(b)(c)
Return on tangible common equity (“ROTCE”)(b)(c)
9
5
17
18
20
 7
20
Return on assets(b)
Return on assets(b)
1.30
1.41
1.39
1.06
1.28
 1.37
1.31
Return on assets(b)
0.58
0.40
1.22
1.30
1.41
 0.50
1.40
Overhead ratioOverhead ratio56
57
56
60
57
 56
57
Overhead ratio51
60
58
56
57
 55
56
Loans-to-deposits ratioLoans-to-deposits ratio62
63
64
67
65
 62
65
Loans-to-deposits ratio51
55
61
62
63
 51
63
Liquidity coverage ratio (“LCR”) (average)Liquidity coverage ratio (“LCR”) (average)115
113
111
113
115
 115
115
Liquidity coverage ratio (“LCR”) (average)117
114
116
115
113
 117
113
Common equity Tier 1 (“CET1”) capital ratio(c)
12.3
12.2
12.1
12.0
12.0
 12.3
12.0
Tier 1 capital ratio(c)
14.1
14.0
13.8
13.7
13.6
 14.1
13.6
Total capital ratio(c)
15.9
15.8
15.7
15.5
15.4
 15.9
15.4
Tier 1 leverage ratio(c)
7.9
8.0
8.1
8.1
8.2
 7.9
8.2
Supplementary leverage ratio (“SLR”)6.3
6.4
6.4
6.4
6.5
 6.3
6.5
Common equity Tier 1 (“CET1”) capital ratio(d)
Common equity Tier 1 (“CET1”) capital ratio(d)
12.4
11.5
12.4
12.3
12.2
 12.4
12.2
Tier 1 capital ratio(d)
Tier 1 capital ratio(d)
14.3
13.3
14.1
14.1
14.0
 14.3
14.0
Total capital ratio(d)
Total capital ratio(d)
16.7
15.5
16.0
15.9
15.8
 16.7
15.8
Tier 1 leverage ratio(d)
Tier 1 leverage ratio(d)
6.9
7.5
7.9
7.9
8.0
 6.9
8.0
Supplementary leverage ratio (“SLR”)(d)
Supplementary leverage ratio (“SLR”)(d)
6.8
6.0
6.3
6.3
6.4
 6.8
6.4
   
Selected balance sheet data (period-end)Selected balance sheet data (period-end)   Selected balance sheet data (period-end)   
Trading assetsTrading assets$495,875
$523,373
$533,402
$413,714
$419,827
 $495,875
$419,827
Trading assets$526,042
$548,580
$411,103
$495,875
$523,373
 $526,042
$523,373
Investment securities394,251
307,264
267,365
261,828
231,398
 394,251
231,398
Investment securities, net of allowance for credit lossesInvestment securities, net of allowance for credit losses558,791
471,144
398,239
394,251
307,264
 558,791
307,264
LoansLoans945,218
956,889
956,245
984,554
954,318
 945,218
954,318
Loans978,518
1,015,375
959,769
945,218
956,889
 978,518
956,889
Core loans899,572
908,971
905,943
931,856
899,006
 899,572
899,006
Average core loans900,567
905,786
916,567
907,271
894,279
 907,581
877,774
Total assetsTotal assets2,764,661
2,727,379
2,737,188
2,622,532
2,615,183
 2,764,661
2,615,183
Total assets3,213,115
3,139,431
2,687,379
2,764,661
2,727,379
 3,213,115
2,727,379
DepositsDeposits1,525,261
1,524,361
1,493,441
1,470,666
1,458,762
 1,525,261
1,458,762
Deposits1,931,029
1,836,009
1,562,431
1,525,261
1,524,361
 1,931,029
1,524,361
Long-term debtLong-term debt296,472
288,869
290,893
282,031
270,124
 296,472
270,124
Long-term debt317,003
299,344
291,498
296,472
288,869
 317,003
288,869
Common stockholders’ equityCommon stockholders’ equity235,985
236,222
232,844
230,447
231,192
 235,985
231,192
Common stockholders’ equity234,403
231,199
234,337
235,985
236,222
 234,403
236,222
Total stockholders’ equityTotal stockholders’ equity264,348
263,215
259,837
256,515
258,956
 264,348
258,956
Total stockholders’ equity264,466
261,262
261,330
264,348
263,215
 264,466
263,215
HeadcountHeadcount257,444
254,983
255,998
256,105
255,313
 257,444
255,313
Headcount256,710
256,720
256,981
257,444
254,983
 256,710
254,983
   
Credit quality metricsCredit quality metrics   Credit quality metrics   
Allowance for credit losses$14,400
$14,295
$14,591
$14,500
$14,225
 $14,400
$14,225
Allowances for loan losses and lending-related commitmentsAllowances for loan losses and lending-related commitments$34,301
$25,391
$14,314
$14,400
$14,295
 $34,301
$14,295
Allowance for loan losses to total retained loansAllowance for loan losses to total retained loans1.42%1.39%1.43%1.39%1.39% 1.42%1.39%Allowance for loan losses to total retained loans3.32%2.32%1.39%1.42%1.39% 3.32%1.39%
Allowance for loan losses to retained loans excluding purchased credit-impaired loans(d)
1.32
1.28
1.28
1.23
1.23
 1.32
1.23
Nonperforming assetsNonperforming assets$5,343
$5,260
$5,616
$5,190
$5,034
 $5,343
$5,034
Nonperforming assets$8,440
$6,421
$4,497
$5,343
$5,260
 $8,440
$5,260
Net charge-offsNet charge-offs1,371
1,403
1,361
1,236
1,033
 4,135
3,620
Net charge-offs1,560
1,469
1,494
1,371
1,403
 3,029
2,764
Net charge-off rateNet charge-off rate0.58%0.60%0.58%0.52%0.43% 0.59%0.52%Net charge-off rate0.64%0.62%0.63%0.58%0.60% 0.63%0.59%
Effective January 1, 2020, the Firm adopted the Financial Instruments – Credit Losses (“CECL”) accounting guidance. Refer to Note 1 for further information.
(a)TBVPS and ROTCE are non-GAAP financial measures. ReferIn the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to Explanation and Reconciliationbe a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures on pages 19–20 for a further discussion of these measures.current presentation.
(b)Quarterly ratiosPre-provision profit, TBVPS and ROTCE are based upon annualized amounts.
(c)The Basel III capital rules became fully phased-in effective January 1, 2019. During 2018, the required capital measures were subject to the transitional rules and as of December 31, 2018 and September 30, 2018, were the same on a fully phased-in and on a transitional basis. Refer to Key performance measures on page 59 and Capital Risk Management on pages 85-94 of JPMorgan Chase’s 2018 Form 10-K and pages 45–49 of this Form 10-Q for additional information on theseeach non-GAAP financial measures.
(d)Excludes the impact of residential real estate purchased credit-impaired Tangible common equity (“PCI”TCE”) loans,is also a non-GAAP financial measure. Refer to Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures on pages 19–20, and the Allowance for credit losses on pages 67–6822-23 for a further discussion of these measures.
(c)Quarterly ratios are based upon annualized amounts.
(d)Reflects the relief provided by the Federal Reserve Board in response to the COVID-19 pandemic, including the CECL capital transition provisions that became effective in the first quarter of 2020. As of June 30, 2020, the SLR reflects the temporary exclusions of U.S. Treasury securities and deposits at Federal Reserve Banks. Refer to Regulatory Developments Relating to the COVID-19 Pandemic on pages 11-12 and Capital Risk Management on pages 49-54 of this Form 10-Q for additional information. Refer to Capital Risk Management on pages 85-92 of JPMorgan Chase’s 2019 Form 10-K for additional information on the Firm’s capital metrics.

INTRODUCTION
The following is Management’s discussion and analysis of the financial condition and results of operations (“MD&A”) of JPMorgan Chase & Co. (“JPMorgan Chase” or the “Firm”) for the thirdsecond quarter of 2019.2020.
This Quarterly Report on Form 10-Q for the thirdsecond quarter of 20192020 (“Form 10-Q”) should be read together with JPMorgan Chase’s Annual Report on Form 10-K for the year ended December 31, 20182019 (“20182019 Form 10-K”). Refer to the Glossary of terms and acronyms and line of business (“LOB”) metrics on pages 168–175191-199 for definitions of terms and acronyms used throughout this Form 10-Q.
This document contains forward-looking statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on the current beliefs and expectations of JPMorgan Chase’s management, speak only as of the date of this Form 10-Q and are subject to significant risks and uncertainties. Refer to Forward-looking Statements on page 79 of this Form 10-Q and Part I, Item 1A, Risk factors, on pages 7–28 of the 2018 Form 10-K forFor a further discussion of certain of those risks and uncertainties and the factors that could cause JPMorgan Chase’s actual results to differ materially because of those risks and uncertainties.uncertainties, refer to Forward-looking Statements on page 92 of this Form 10-Q, Part II, Item 1A, Risk Factors on pages 200-201 of this Form 10-Q and Part I, Item 1A, Risk factors, on pages 6-28 of the 2019 Form 10-K.
JPMorgan Chase & Co. (NYSE: JPM), a financial holding company incorporated under Delaware law in 1968, is a leading global financial services firm and one of the largest banking institutions in the United States of America (“U.S.”), with operations worldwide; JPMorgan Chase had $2.8$3.2 trillion in assets and $264.3$264.5 billion in stockholders’ equity as of SeptemberJune 30, 2019.2020. The Firm is a leader in investment banking, financial services for consumers and
small businesses, commercial banking, financial transaction processing and asset management. Under the J.P. Morgan and Chase brands, the Firm serves millions of customers in the U.S. and many of the world’s most prominent corporate, institutional and government clients.
JPMorgan Chase’s principal bank subsidiary is JPMorgan Chase Bank, National Association (“JPMorgan Chase Bank N.A.”), a national banking association with U.S. branches in 3238 states and Washington, D.C. as of SeptemberJune 30, 2019.2020. JPMorgan Chase’s principal nonbanknon-bank subsidiary is J.P. Morgan Securities LLC (“J.P. Morgan Securities”), a U.S. broker-dealer. The bank and non-bank subsidiaries of JPMorgan Chase operate nationally as well as through overseas branches and subsidiaries, representative offices and subsidiary foreign banks. The Firm’s principal operating subsidiary inoutside the United Kingdom (“U.K.”)U.S. is J.P. Morgan Securities plc, a U.K.-based subsidiary of JPMorgan Chase Bank, N.A.

For management reporting purposes, the Firm’s activities are organized into four major reportable business segments, as well as a Corporate segment. The Firm’s consumer business segment is Consumer & Community Banking (“CCB”). The Firm’s wholesale business segments are Corporate & Investment Bank (“CIB”), Commercial Banking (“CB”), and Asset & Wealth Management (“AWM”). Refer to Note 31 of JPMorgan Chase’s 2018 Form 10-K forFor a description of the Firm’s business segments and the products and services they provide to their respective
client bases.bases, refer to Note 26 of this Form 10-Q and Note 32 of JPMorgan Chase’s 2019 Form 10-K.

The Firm's website is www.jpmorganchase.com. JPMorgan Chase makes available on its website, free of charge, annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as soon as reasonably practicable after it electronically files or furnishes such material to the U.S. Securities and Exchange Commission (the “SEC”) at www.sec.gov. JPMorgan Chase also makes additional information about the Firm available on the Investor Relations section of its website at https://www.jpmorganchase.com/corporate/investor-relations/investor-relations.htm.



EXECUTIVE OVERVIEW
This executive overview of the MD&A highlights selected information and does not contain all of the information that is important to readers of this Form 10-Q. For a complete description of the trends and uncertainties, as well as the risks and critical accounting estimates affecting the Firm and its various lines of business,LOBs, this Form 10-Q and the 20182019 Form 10-K should be read together and in their entirety.
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. Refer to Note 1 for further information.
Financial performance of JPMorgan ChaseFinancial performance of JPMorgan Chase        Financial performance of JPMorgan Chase        
(unaudited)
As of or for the period ended,
(in millions, except per share data and ratios)
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
2019
 2018
 Change
 2019
 2018
 Change
2020
 2019
 Change
 2020
 2019
 Change
Selected income statement data                      
Total net revenue(a)$29,341
 $27,260
 8% $87,296
 $82,920
 5%$32,980
 $28,747
 15 % $61,172
 $57,823
 6 %
Total noninterest expense(a)16,422
 15,623
 5
 49,158
 47,674
 3
16,942
 16,256
 4
 33,733
 32,604
 3
Pre-provision profit12,919
 11,637
 11
 38,138
 35,246
 8
16,038
 12,491
 28
 27,439
 25,219
 9
Provision for credit losses1,514
 948
 60
 4,158
 3,323
 25
10,473
 1,149
 NM
 18,758
 2,644
 NM
Net income9,080
 8,380
 8
 27,911
 25,408
 10
4,687
 9,652
 (51) 7,552
 18,831
 (60)
Diluted earnings per share$2.68
 $2.34
 15
 $8.15
 $7.00
 16
$1.38
 $2.82
 (51) $2.17
 $5.46
 (60)
Selected ratios and metrics                      
Return on common equity15% 14%   15% 14%  7% 16%   6% 16%  
Return on tangible common equity18
 17
   19
 18
  9
 20
   7
 20
  
Book value per share$75.24
 $69.52
 8
 $75.24
 $69.52
 8
$76.91
 $73.88
 4
 $76.91
 $73.88
 4
Tangible book value per share60.48
 55.68
 9
 60.48
 55.68
 9
61.76
 59.52
 4
 61.76
 59.52
 4
Capital ratios(a)(b)
                      
CET112.3% 12.0%   12.3% 12.0%  12.4% 12.2%   12.4% 12.2%  
Tier 1 capital14.1
 13.6
   14.1
 13.6
  14.3
 14.0
   14.3
 14.0
  
Total capital15.9
 15.4
   15.9
 15.4
  16.7
 15.8
   16.7
 15.8
  
(a)The Basel III capital rules became fully phased-in effective January 1, 2019. During 2018,In the required capital measures were subjectsecond quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.
(b)Reflects the relief provided by the Federal Reserve Board in response to the transitional rules and asCOVID-19 pandemic, including the CECL capital transition provisions that became effective in the first quarter of September 30, 2018, was the same on a fully phased-in and on a transitional basis.2020. Refer to Key performance measuresRegulatory Developments Relating to the COVID-19 Pandemic on page 59pages 11-12 and Capital Risk Management on pages 85-94 of JPMorgan Chase’s 2018 Form 10-K and pages 45–4949-54 of this Form 10-Q for additional information. Refer to Capital Risk Management on pages 85-92 of JPMorgan Chase’s 2019 Form 10-K for additional information on these measures.the Firm’s capital metrics.







Comparisons noted in the sections below are for the thirdsecond quarter of 2020 versus the second quarter of 2019, versus the third quarter of 2018, unless otherwise specified.
Firmwide overview
JPMorgan Chase reported strong results in the third quarter of 2019, with net income of $9.1$4.7 billion for the second quarter of 2020, or $2.68$1.38 per share, on record net revenue of $29.3$33.0 billion. The Firm reported ROE of 15%7% and ROTCE of 18%9%.
The Firm had netrecorded a number of significant items in the second quarter of 2020, including an addition to the allowance for credit losses of $8.9 billion, $678 million of markups on held-for-sale positions, including unfunded commitments, in the bridge financing portfolio in CIB and CB, and a $510 million gain in Credit Adjustments & Other in CIB driven by funding spread tightening on derivatives.
Net income of $9.1 billion, up 8%.was down 51%, driven by an increase in the provision for credit losses across the Firm.
•
Total net revenue increased 8%15%. Noninterest revenue was $19.1 billion, up 33%, largely driven by higher CIB Markets revenue and Investment Banking fees. The increase in revenue also included $678 million of markups on held-for-sale positions, including unfunded commitments, in the bridge financing portfolio in CIB and CB, and a $510 million gain in Credit Adjustments & Other in CIB driven by funding spread tightening on derivatives. Net interest income was $14.2$13.9 billion, up 2%down 4%, driven by continued balance sheet growth and mix, largely offset bywith the impact of rates.lower rates predominantly offset by higher net interest income in CIB Markets and balance sheet growth. Noninterest revenue was $15.1 billion, up 13%, and included approximately $350 million of gains related to certain loan sales in Home Lending. Excluding these gains, the increase in noninterest revenue was largely driven by results in Fixed Income Markets in the CIB, as well as Home Lending and Auto in CCB.
Noninterest expense was $16.4$16.9 billion, up 5%4%, predominantly driven by higher volume- and revenue-related expenses and investments, includingexpense, primarily compensation, and auto lease depreciation, partially offset by lower FDIC charges.
The provision for credit losses was $1.5 billion, up $566 million, largelymarketing expense in Card as a result of net reductionslower travel-related benefits and lower investments in the allowance for credit losses and net recoveries in the prior year.marketing campaigns, as well as lower structural expense.


•
The provision for credit losses was $10.5 billion, up $9.3 billion from the prior year, driven by additions to the allowance for credit losses, reflecting further deterioration and increased uncertainty in the macroeconomic outlook as a result of the impact of the COVID-19 pandemic. The addition in the wholesale allowance was $4.6 billion across multiple industry sectors, and the addition in the consumer allowance was $4.4 billion, largely in Card.
The total allowance for credit losses was $14.4$34.3 billion at SeptemberJune 30, 2019,2020, and the Firm had a loan loss coverage ratio of 1.42%3.32%, compared with 1.39% in the prior year; excludingyear, driven by the PCI portfolio,additions to allowance for credit losses and the equivalent ratio was 1.32%, compared with 1.23%adoption of CECL. The Firm’s nonperforming assets totaled $8.4 billion at June 30, 2020, an increase from $5.3 billion in the prior year. The Firm’s nonperforming assets totaled $5.3 billion at September 30, 2019, an increase from $5.0 billion in the prior year, reflecting increaseswas driven by downgrades in the wholesale portfolio related to selectacross multiple industries on client downgrades, largely offset by improved credit performancedeterioration, and the inclusion of purchased credit deteriorated loans in the consumer portfolio.mortgage portfolio, which are subject to nonaccrual loan treatment following the adoption of CECL.
Firmwide average total loans of $1.0 trillion were flat at $947 billion, or up 3% excluding4%, largely reflecting drawdowns on committed revolving credit facilities in March and higher loan balances in AWM, as well as loans originated under the impact of certainSmall Business Administration’s (“SBA”) Paycheck Protection Program (“PPP”). The loan salesgrowth was partially offset by lower loan balances in Home Lending.Lending and Card.
Firmwide average deposits of $1.9 trillion were up 25%, reflecting significant inflows across the Firm, primarily driven by the COVID-19 pandemic, as customers and clients looked to remain liquid as a result of market conditions.
 
Selected capital-related metrics
The Firm’s CET1 capital was $188$191 billion, and the Standardized and Advanced CET1 ratios were 12.3%12.4% and 13.1%13.2%, respectively.
The Firm’s supplementary leverage ratio (“SLR”)SLR was 6.3%6.8%. As of June 30, 2020, the SLR reflects the temporary exclusions of U.S. Treasury securities and deposits at September 30, 2019.Federal Reserve Banks, as required by the Federal Reserve’s interim final rule issued on April 1, 2020. The Firm’s SLR excluding the temporary relief was 5.7%.
The Firm continued to grow tangible book value per share (“TBVPS”),grew TBVPS, ending the thirdsecond quarter of 20192020 at $60.48,$61.76, up 9%.4% versus the prior year.
ROTCE and TBVPS are non-GAAP financial measures. Refer to Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures on pages 19–20 for22-23 for a further discussion of each of these measures.


Business segment highlights
Selected business metrics for each of the Firm’s four lines of businessLOBs are presented below for the thirdsecond quarter of 2019.2020.
CCB
ROE 32%
(2)%
 
•
Average loans down 4%deposits up 20%; Home Lending loans down 12% impacted by loan sales; credit card loansclient investment assets up 8%9%
•
Client investment assets up 13%Average loans down 7%; average deposits up 3%credit card sales volume down 23%
•
Credit card sales volume up 10% and merchant processing volume up 11%Provision for credit losses of $5.8 billion, predominantly driven by an addition to the allowance for credit losses of $4.6 billion
CIB
ROE 13%
27%
 
•
Maintained #1 ranking for Global Investment Banking fees with 9.3%9.8% wallet share YTDyear-to-date
•
Total Markets revenue of $5.1$9.7 billion, up 14%79%, with Fixed Income Markets up 99% and Equity Markets up 38%
•
Provision for credit losses of $2.0 billion, predominantly driven by an addition to the allowance for credit losses of $1.8 billion
CB
ROE 16%
(14)%
 
•
Gross Investment Banking revenue of $700$851 million, up 20%44%
•
Average clientloans up 13%; average deposits up 41%
•
Provision for credit losses of $173$2.4 billion up 3%driven by an addition to the allowance for credit losses
AWM
ROE
 24%
 
•
Average loan balances up 7%
•
Assets under management (AUM) of $2.2$2.5 trillion, up 8%15%
•
Average loans up 12%; average deposits up 20%
•
Provision for credit losses of $223 million, driven by an addition to the allowance for credit losses
Refer to the Business Segment Results on pages 21–4324-47 for a detailed discussion of results by business segment.
 
Credit provided and capital raised
JPMorgan Chase continues to support consumers, businesses and communities around the globe. The Firm provided new and renewed credit and raised capital for wholesale and consumer clients during the first ninesix months of 2019,2020, consisting of:
$1.71.2 trillion 
Total credit provided and capital raised (including loans and commitments)(a)
   
$188107
billion
 Credit for consumers
   
$2511
billion
 Credit for U.S. small businesses
   
$630404 billion Credit for corporations
   
$785651 billion Capital raised for corporate clients and non-U.S. government entities
   
$53 billion 
Credit and capital raised for nonprofit and U.S. government entities(a)(b)
$28 billion
Loans under the Small Business Administration’s Paycheck Protection
Program

(a)Excludes loans under the SBA’s PPP.
(b)Includes states, municipalities, hospitals and universities.


Recent events
On June 29, 2020, JPMorgan Chase announced that it had completed the 2020 Comprehensive Capital Analysis and Review (“CCAR”) stress test process. The Firm’s indicative Stress Capital Buffer (“SCB”) requirement is 3.3% and the Federal Reserve Board will provide the Firm with its final SCB requirement by August 31, 2020. The Firm’s Board of Directors currently intends to maintain the quarterly common stock dividend of $0.90 per share for the third quarter of 2020. Additionally, in June 2020, the Federal Reserve directed all large bank holding companies, including the Firm, to discontinue net share repurchases, at least through the end of the third quarter of 2020.

20192020 outlook
These current expectations are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on the current beliefs and expectations of JPMorgan Chase’s management, speak only as of the date of this Form 10-Q, and are subject to significant risks and uncertainties. Refer to Forward-Looking Statements on page 7992 and Risk Factors on page 200 of this Form 10-Q and Risk Factors onand pages 7–6–28 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of certain of those risks and uncertainties and the other factors that could cause JPMorgan Chase’s actual results to differ materially because of those risks and uncertainties. There is no assurance that actual results in the full year of 20192020 will be in line with the outlook set forth below, and the Firm does not undertake to update any forward-looking statements.
JPMorgan Chase’s current outlook for the remainder of 20192020 should be viewed against the backdrop of the global and U.S. economies, the COVID-19 pandemic, financial markets activity, the geopolitical environment, the competitive environment, client and customer activity levels, and regulatory and legislative developments in the U.S. and other countries where the Firm does business. Each of these factors will affect the performance of the Firm and its lines of business.LOBs. The Firm expects that it will continue to make appropriate adjustments to its businesses and operations in response to ongoing developments in the business, economic, regulatory and legal environments in which it operates.The outlook information contained in this Form 10-Q supersedes all outlook information furnished by the Firm in its periodic reports filed with the SEC prior to the date of this Form 10-Q.
Firmwide
Management expects full-year 20192020 net interest income, on a managed basis, to be less than $57.5approximately $56 billion, market dependent. This estimate is based on stable long-end rates and assumes no more federal funds rate cuts in 2019.
Management expects Firmwide adjusted expense for the full-year 20192020 to be approximately $65.5$65 billion.
Management expects full-year 2019 net charge-offs to be approximately $5.5 billion.



Business Developments
Expected departureCOVID-19 Pandemic
In the first quarter of 2020, in response to the COVID-19 pandemic, the Firm invoked resiliency plans to allow its businesses to remain operational, utilizing disaster recovery sites and implementing alternative work arrangements globally, including work from home.
The Firm also implemented strategies and procedures designed to help it respond to increased market volatility, client demand for credit and liquidity, distress in certain industries/sectors and the ongoing impacts to consumers and businesses.
In the second quarter, the Firm continued its focus on responding to the COVID-19 pandemic, including developing plans to return employees to the office. The Firm continues to actively monitor the dynamic health and safety situations at local and regional levels, and plans remain flexible to adapt as these situations evolve.
Supporting clients and customers
The Firm has continued to support its clients and customers during the challenging conditions caused by the COVID-19 pandemic, including by providing liquidity. Since March, the Firm has extended more than $350 billion of new and renewed credit to its clients and customers, of which approximately $300 billion was in the wholesale businesses.
The Firm is participating in a number of U.S government facilities and programs including the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) and the Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”). At June 30, 2020, the Firm had approximately $28 billion of loans under the PPP. Refer to Regulatory Developments Relating to the COVID-19 Pandemic on pages 11-12 for more information on U.S. Government facilities and programs.
In addition, in March 2020 the Firm began providing payment deferrals on loans and auto leases, refunded fees, and modified covenants for clients and customers.
In the consumer portfolio segment, through June 30, 2020, the Firm has provided customer assistance to over 2 million accounts, including refunding over $83 million in fees and granting payment deferrals on over $79 billion of loans and leases, of which $42 billion was for third-party mortgage loans serviced. As of June 30, 2020 the Firm had approximately $28 billion of retained loans that were still under payment deferral.
In the wholesale portfolio segment, through June 30, 2020, the Firm has provided client assistance to approximately 12,000 clients, primarily risk-rated clients in CCB. The majority of the client assistance was payment deferrals on approximately $23 billion of loans. As of June 30, 2020, there were approximately $17 billion of retained loans that were still under payment deferral.
Refer to Credit Portfolio on pages 60-61 for additional information on assistance granted to customers and clients. Refer to Consumer Credit portfolio on pages 62-66 and Wholesale Credit Portfolio on pages 67-76 for additional information on retained loans that were still under payment deferral as of June 30, 2020.
Approximately three-quarters of the Firm’s branch network is operational, and ATMs remain accessible. The Firm also continues to provide a wide range of banking services accessible to clients and customers online.
Protecting and supporting employees
In addition to widespread work from home arrangements, the Firm has taken actions to protect and support its employees. These actions include providing increased safety measures for those employees whose job functions require them to continue to be onsite, a special payment for certain eligible employees and expanded healthcare resources.
Supporting communities
Since March, the Firm has committed $250 million to help address humanitarian needs and long-term economic challenges posed by the COVID-19 pandemic on the communities in which the Firm operates. This includes a $200 million commitment to be deployed over time to support underserved small businesses and nonprofits and $50 million in grants to help vulnerable communities impacted by the pandemic.


Departure of the U.K. from the EU
The U.K.’s expected departure from the EU, which is commonly referred to as “Brexit,” is scheduled to occur not later than January 31, 2020.
The Firm continues to execute the relevant elements ofon its Firmwide Brexit Implementation program with the objective of delivering the Firm’s capabilities to its EU clients on “day one” of any departure by the U.K. from the EU, whether or not an agreement has been reached to allow an orderly withdrawal.
The principal operational risks associated with Brexit continue to be the potential for disruption caused by insufficient preparations by individual market participants or in the overall market ecosystem, and risks related to potential disruptions of connectivity among market participants. Although legislative and regulatory actions taken by the EU and the U.K. have mitigated some of the significant market-wide risks, there continues to be regulatory and legal uncertainty with respect to various matters including contract continuity and access by market participants to liquidity in certain products, such as products subject to potentially conflicting U.K. and EU regulatory requirements in relation to eligible trading venues, including certain cross-border derivative contracts and equities that are listed on both U.K. and EU exchanges.
As discussed in Business Developments on page 46 of the 2018 Form 10-K, the Firm isremains focused on the following key areas to ensure continuation of service to its EU clients: regulatory and legal entity readiness; client readiness; and business and operational readiness. Following areThe Firm’s Brexit-related planning in the significant updatessecond half of 2020 will focus on the possibility that the U.K. will complete its departure from the matters discussed inEU without having agreed the 2018 Form 10-K.
Regulatoryterms of their future relationship, which is commonly referred to as “hard Brexit,” as the July 1, 2020 deadline for the U.K. to request an extension of the transition period has passed. This will require completion of the relocation of certain front office roles from the U.K. to EU locations, and legal entity readiness
finalization of the migration of EU clients and certain positions to EU entities by the end of 2020. The Firm’s legal entities in Germany, Luxembourg and Ireland are now prepared and licensed to provide servicesCOVID-19 pandemic has added incremental risk to the Firm’s EUBrexit Implementation program due to the potential impact on its ability to execute changes such as relocation of employees given travel restrictions, or the ability of clients including after any departure byto be operationally ready to the U.K. fromextent that they have diverted resources during 2020 to address the EU.
Client readiness
The agreements covering a significant proportioneffects of the Firm’s EU client activity have been re-documentedpandemic.
Interbank Offered Rate (“IBOR”) transition
On March 12, 2020, the Financial Accounting Standards Board (“FASB”) issued an accounting standards update providing optional expedients and exceptions for applying generally accepted accounting principles to other EU legal entitiescontracts and hedge relationships affected by reference rate reform. This update provides for various elective options, referred to help facilitate continuationas “practical expedients,” that are intended to simplify the operational impact of service.applying U.S. GAAP to certain transactions. The Firm expects to apply certain of these practical expedients relating to the IBOR transition in the second half of 2020. Refer to Accounting and Reporting Developments on page 91 for additional information. The Firm continues to actively engage with clients that have not completed re-documentation to ensure preparedness both in termsmonitor the transition relief being considered by the International Accounting Standards Board (“IASB”) and U.S. Treasury Department regarding accounting and tax implications of documentation and any operational changes that may be required. The Firm may be negatively impacted by any operational disruption stemming from delays of or lapses in the readiness of other market participants or market infrastructures.
Business and operational readinessreference rate reform.
The Firm relocated certain employees during the first quarter of 2019. During the second quarter of 2019, the Firm added specific employees to certain EU legal entities, where appropriate, to support the level of client activity that has been migrated. However, the Firm’s final staffing plan will depend upon the timing and terms of any withdrawal by the U.K. from the EU.
If Brexit is further delayed due to a transition deal or another mechanism, the Firm will continue to review the timing and extent of any further expansion of activities in its EU legal entities, as appropriate. The Firm continues to closely monitor legislative developments, and its implementation plan allows for flexibility given the continued uncertainties.
LIBOR transition
The Firmalso continues to develop and implement plans to appropriately mitigate the risks associated with the expected discontinuation of certain unsecured benchmark interest rates, including the London Interbank Offered Rate (“LIBOR”) and other Interbank Offered Rates (“IBORs”). In particular, the Firm:
has implemented or is in the process of implementing fallback language for LIBOR-linked syndicated loans, securitizations, floating rate notes and bi-lateral business loans based on the recommendations of the Alternative Reference Rates Committee, and has started to introduce the Secured Overnight Financing Rate as a replacement benchmark rate for certain of these products;
continues to monitor the transition relief being considered by the Financial Accounting Standards Board (“FASB”) and International Accounting Standards Board (“IASB”) concerning the accounting for contract modifications and hedge accounting; and
continues to engage with regulators and clients as the transition from IBORs progresses.
IBOR discontinuation. Refer to Business Developments on page 47 of the 20182019 Form 10-K for a discussion of the Firm’s initiatives to address the expected discontinuation of LIBORthe London Interbank Offered Rate (“LIBOR”) and other IBORs.


Regulatory Developments Relating to the COVID-19 Pandemic
Since March 2020, the U.S. government as well as central banks and banking authorities around the world have taken and continue to take actions to help individuals, households and businesses that have been adversely affected by the economic disruption caused by the COVID-19 pandemic. The CARES Act, which was signed into law on March 27, 2020, provides, among other things, funding to support loan facilities to assist consumers and businesses. Set forth below is a summary as of the date of this Form 10-Q of U.S. government actions currently impacting the Firm and U.S. government programs in which the Firm is participating to support individuals, businesses, and the broader economy. The Firm will continue to assess ongoing developments in government actions in response to the COVID-19 pandemic.
U.S. government actions
Eligible retained income definition. On March 17, 2020, the Office of the Comptroller of the Currency (“OCC”), the Board of Governors of the Federal Reserve System (“Federal Reserve”), and the Federal Deposit Insurance Corporation (“FDIC”), collectively the “federal banking agencies,” issued an interim final rule that revised the definition of “eligible retained income” in the regulatory capital rules that apply to all U.S. banking organizations. On March 23, 2020, the Federal Reserve issued an interim final rule that revised the definition of “eligible retained income” for purposes of the total loss-absorbing capacity (“TLAC”) buffer requirements that apply to global systemically important banking organizations. The revised definition of eligible retained income makes any automatic limitations on payout distributions that could apply under the agencies’ capital rules or TLAC rule take effect on a more graduated basis in the event that a banking organization’s capital, leverage and TLAC ratios were to decline below regulatory requirements (including buffers). The March 17, 2020 interim final rule was issued, in conjunction with an interagency statement encouraging banking organizations to use their capital and liquidity buffers, to further support banking organizations’ abilities to lend to households and businesses affected by the COVID-19 pandemic.
Reserve requirements. On March 26, 2020, the Federal Reserve reduced reserve requirement ratios to zero percent, effectively eliminating the reserve requirement for all depository institutions, an action that freed up liquidity in the banking system to support lending to households and businesses.
Refer to Liquidity Risk Management on pages 55-59 and Note 21 for additional information on the reduction to the reserve requirement.
Regulatory Capital - Current Expected Credit Losses (“CECL”) transition delay. On March 31, 2020, the federal banking agencies issued an interim final rule that provided banking organizations with the option to delay the effects of CECL on regulatory capital for two years, followed by a three-year
transition period (“CECL capital transition provisions”). The Firm elected to apply the CECL capital transition provisions.
Refer to Capital Risk Management on pages 49-54 and Note 22 on pages 176-177 for additional information on the CECL capital transition provisions and the impact to the Firm’s capital metrics.
Supplementary leverage ratio (“SLR”) temporary revision. On April 1, 2020, the Federal Reserve issued an interim final rule that requires, on a temporary basis, the calculation of total leverage exposure for purposes of calculating the SLR for bank holding companies, to exclude the on-balance sheet amounts of U.S. Treasury securities and deposits at Federal Reserve Banks. These exclusions became effective April 1, 2020, and will remain in effect through March 31, 2021.
Refer to Capital Risk Management on pages 49-54 and Note 22 for additional information on the Firm’s SLR.
Loan modifications. On April 7, 2020, the federal banking agencies along with the National Credit Union Administration, and the Consumer Financial Protection Bureau, in consultation with the state financial regulators, issued an interagency statement revising a March 22, 2020 interagency statement on loan modifications and the reporting for financial institutions working with customers affected by the COVID-19 pandemic (the “IA Statement”). The IA Statement reconfirmed that efforts to work with borrowers where the loans are prudently underwritten, and not considered past due or carried on nonaccrual status, should not result in the loans automatically being considered modified in a troubled debt restructuring (“TDR”) for accounting and financial reporting purposes, or for purposes of their respective risk-based capital rules, which would otherwise require financial institutions subject to the capital rules to hold more capital. The IA Statement also clarified the interaction between its previous guidance and Section 4013 of the CARES Act, which provides certain financial institutions with the option to suspend the application of accounting guidance for TDRs for a limited period of time for loan modifications made to address the effects of the COVID-19 pandemic.
The Firm has granted various forms of assistance to customers and clients impacted by the COVID-19 pandemic, including payment deferrals and covenant modifications. The majority of the Firm’s COVID-19 related loan modifications have not been considered TDRs as:
they represent short-term or other insignificant modifications, whether under the Firm’s regular loan modification assessments or the IA Statement guidance, or
the Firm has elected to apply the option to suspend the application of accounting guidance for TDRs as provided under section 4013 of the CARES Act.
To the extent that certain modifications do not meet any of the above criteria, the Firm accounts for them as TDRs. Refer to Credit Portfolio on pages 60-61 and Note 12 for

additional information on the Firm’s loan modification activities.
U.S. government facilities and programs. Beginning in March 2020, the Federal Reserve announced a suite of facilities using its emergency lending powers under section 13(3) of the Federal Reserve Act to support the flow of credit to individuals, households and businesses adversely affected by the COVID-19 pandemic and to support the broader economy. These facilities include the Money Market Mutual Fund Liquidity Facility (“MMLF”), Main Street Lending Facilities, Primary Dealer Credit Facility (“PDCF”), Commercial Paper Funding Facility (“CPFF”), Secondary Market Corporate Credit Facility (“SMCCF”) and Term Asset-Backed Securities Loan Facility (“TALF”). In addition, beginning April 3, 2020, the PPP, established by the CARES Act and administered by the SBA, authorized eligible lenders to provide nonrecourse loans to eligible borrowers until August 8, 2020 to provide an incentive for these businesses to keep their workers on their payroll. The Firm has participated and is participating in certain of these facilities and programs, as needed, to assist its clients and customers or to support the broader economy.
Refer to Capital Risk Management on pages 49-54, Liquidity Risk Management on pages 55-59, Note 22 and Note 24 for additional information on the Firm’s participation in the MMLF. Refer to Liquidity Risk Management on pages 55-59 for additional information on the Firm’s participation in the PDCF. Refer to Business Developments on pages 9-10, Capital Risk Management on pages 49-54, Credit Portfolio on pages 60-61 and Note 22 for additional information on the Firm’s participation in the PPP.


CONSOLIDATED RESULTS OF OPERATIONS
This section provides a comparative discussion of JPMorgan Chase’s Consolidated Results of Operations on a reported basis for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, unless otherwise specified. Factors that relate primarily to a single business segment are discussed in more detail within that business segment. Refer to pages 76–7788-90 of this Form 10-Q and pages 141-143136–138 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the Critical Accounting Estimates Used by the Firm that affect the Consolidated Results of Operations.
Revenue                      
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 Change
 2019
 2018
 Change
2020
 2019
 Change
 2020
 2019
 Change
Investment banking fees$1,967
 $1,832
 7 % $5,658
 $5,736
 (1)%$2,850
 $1,851
 54 % $4,716
 $3,691
 28 %
Principal transactions3,449
 2,964
 16
 11,239
 10,698
 5
7,621
 3,714
 105
 10,558
 7,790
 36
Lending- and deposit-related fees(a)1,626
 1,542
 5
 4,643
 4,514
 3
1,431
 1,624
 (12) 3,137
 3,183
 (1)
Asset management, administration and commissions(a)4,351
 4,310
 1
 12,818
 12,923
 (1)4,266
 4,264
 —
 8,806
 8,301
 6
Investment securities gains/(losses)78
 (46) NM
 135
 (371) NM
Investment securities gains26
 44
 (41) 259
 57
 354
Mortgage fees and related income887
 262
 239
 1,562
 1,051
 49
917
 279
 229
 1,237
 675
 83
Card income(b)1,283
 1,328
 (3) 3,923
 3,623
 8
974
 1,281
 (24) 1,969
 2,508
 (21)
Other income(a)(c)
1,472
 1,160
 27
 4,239
 4,041
 5
1,042
 1,292
 (19) 2,198
 2,767
 (21)
Noninterest revenue15,113
 13,352
 13
 44,217
 42,215
 5
19,127
 14,349
 33
 32,880
 28,972
 13
Net interest income14,228
 13,908
 2
 43,079
 40,705
 6
13,853
 14,398
 (4) 28,292
 28,851
 (2)
Total net revenue$29,341
 $27,260
 8 % $87,296
 $82,920
 5 %$32,980
 $28,747
 15 % $61,172
 $57,823
 6 %
(a)Included operating lease income of $1.4 billion and $1.2 billion for the three months ended September 30, 2019 and 2018, respectively and $4.0 billion and $3.3 billion for the nine months ended September 30, 2019 and 2018, respectively.
(a) In the first quarter of 2020, the Firm reclassified certain fees from asset management, administration and commissions to lending- and deposit-related fees. Prior-period amounts have been revised to conform with the current presentation.
(b) In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.
(c) Included operating lease income of $1.4 billion and $1.3 billion for the three months ended June 30, 2020 and 2019, respectively and $2.8 billion and$2.6 billion for the six months ended June 30, 2020 and 2019, respectively.
Quarterly results
Investment banking fees increased, driven by CIB, reflecting:
higher debt underwriting fees ondue to increased industry-wide fees and wallet share gains despite a decline in industry-wide fees, driven by participation in large acquisition financing dealsboth investment-grade and increased activity in investment-gradehigh-yield bonds
higher equity underwriting fees driven bydue to increased industry-wide fees and wallet share gains, primarily in the IPOfollow-on offerings and convertible securities markets
–the increased activity in debt and equity underwriting reflected clients seeking access to liquidity as a result of the COVID-19 pandemic
partially offset by
lowerhigher advisory fees driven by a decline in industry-wide fees compared with a strong prior year.few large completed transactions.
Refer to CIB segment results on pages 28–3331-37 and Note 56 for additional information.
Principal transactions revenue increased reflecting:and included two significant items, both of which represent reversals of a portion of the losses that were recognized in the first quarter of 2020:
higher revenue$678 million of markups on held-for-sale positions, including unfunded commitments, in the bridge financing portfolio in CIB primarilyand CB, compared with $896 million of markdowns in the first quarter of 2020, and
a $510 million gain in Credit Adjustments & Other in CIB driven by
–
strong performance across products in Fixed Income Markets, primarily in Rates, agency mortgage trading within Securitized Products, and Commodities, compared with the prior year, which was impacted by less favorable market conditions,
partially offset by
–lower revenue in Equity Markets, primarily in derivatives, driven by lower client activity and less favorable market conditions, compared with a strong prior year, and
funding spread tightening on derivatives, compared with a $951 million loss in Corporate,the first quarter of 2020.
Excluding these two items, principal transactions revenue increased in CIB driven by strong client activity in Fixed Income Markets primarily in Rates, Currencies & Emerging Markets, and Credit; and in Equity Markets related to derivatives and Cash Equities. The prior year included a gain from the initial public offering (“IPO”) of Tradeweb.
The increase in principal transactions revenue also reflected net gains on certain legacy private equity investments in Corporate, compared with net losses in the prior year.
Principal transactions revenue in CIB may in certain cases have offsets across other revenue lines, including net interest income. The Firm assesses its CIB Markets business performance on a total revenue basis.
Refer to CIB, AWMCB and Corporate segment results on pages 28–33, 31-37, pages 38–4138-41 and pages 42–43,page 46, and Note 56 for additional information.
Lending- and deposit-related fees increased primarilydecreased due to higherlower deposit-related fees in CCB, reflecting growthlower transaction activity and the impact of fee refunds related to the COVID-19 pandemic, partially offset by higher cash management fees in customer accountsCIB and transactions.
CB. Refer to CCB segment results on pages 22–27,26-30, CIB on pages 28–3331-37 and CB on pages 34–37,38-41, respectively, and Note 56 for additional information.
AssetFor information on asset management, administration and commissions revenue, increased driven by higher asset management fees in refer to CCB, from growth in client investment assets.
Refer to CCBCIB and AWM segment results on pages 22–2726-30, pages 31-37 and pages 38–41 ,42-45, respectively, and Note 5 for additional information.6.
Investment securities gains/(losses) primarily reflect the impact of repositioning the investment securities portfolio.
Refer to Corporate segment results on pages 42–43page 46 and Note 910 for additional information.information on investment securities gains.
Mortgage fees and related income increased driven by:due to:
higher net mortgage production revenue reflecting approximately $350 millionhigher production margins, partially offset by the absence of gains on loan sales in the sale of certain loans, as well as prior year in Home Lending, and
higher production volumes and margins
net mortgage servicing revenue which remained relatively flat, reflecting higher MSR risk management results due to the absence of losses resulting from updates to model inputs in the prior year partially offset by lower operating revenue driven by the impactreflecting a lower level of reclassifying certainthird-party loans to held-for-sale and faster prepayment speeds on lower rates, offset by favorable MSR risk management results.serviced.

Refer to CCB segment results on pages 22–27,26-30, Note 56 and 1415 for further information.
Card income decreased due to lower net interchange income reflecting higher rewards costs and partner payments, predominantlylower card sales volumes that began in March as a result of the COVID-19 pandemic, partially offset by higher interchange incomeannual fees and merchant processing fees on higher volumes.lower acquisition costs.
Refer to CCB, CIB and CB segment results on pages 22–2726-30, pages 31-37 and pages 38-41, as well as and Note 56 for further information.
Other income decreased, reflecting:
higher costs associated with using forward contracts to hedge certain non-U.S. dollar-denominated net investment exposures in Treasury and CIO,
increased reflecting:amortization on higher levels of alternative energy investments in CIB. The increased amortization was more than offset by lower income tax expense from the associated tax credits
lower market-driven results on certain investments in Corporate
partially offset by
higher operating lease income from growth in auto operating lease volume in CCB
losses in the prior year on certain investments in CIB and Corporate,
partially offset by
lower other income in CIB associated with increased amortization on a higher level of alternative energy investments. The increased amortization was more than offset by the lower income tax expense from the associated tax credits.
Refer to Note 517 for further information.
Net interest income increased drivendecreased due to the impact of lower rates, predominantly offset by continuedhigher net interest income in CIB Markets and balance sheet growth and changes in mix, largely offset by the net impact of rates. growth.
The Firm’s average interest-earning assets were $2.4$2.8 trillion, up $162$481 billion, and the yield was 2.31%, down 142 bps, primarily due to lower rates. The net interest yield on these assets, on a fully taxable-equivalent (“FTE”)an FTE basis, was 2.41%1.99%, a decrease of 12 basis points.50 bps. The net interest yield excluding CIB Markets was 3.23%2.27%, a decrease of 7 basis points. down 108 bps.
Net interest yield excluding CIB marketsMarkets is a non-GAAP financial measure. Refer to the Consolidated average balance sheets, interest and rates schedule on pages 166–167189–190 for further details; and the Explanation and Reconciliation of the Firm’s Use of Non-GAAP Financial Measures and Key Performance Measures on pages 19–2022-23 for a further discussion of Net interest yield excluding CIB markets.
Year-to-date results
Investment banking fees were relatively flat reflecting:
lower advisory and equity underwriting feesincreased, driven by a decline in industry-wide fees despite wallet share gains,
offset by
higher debt underwriting fees on wallet share gains despite a decline in industry-wide fees, driven by participation in large acquisition financing deals
Principal transactions revenueCIB, increased reflecting:
higher revenue in CIB, which included a gain on the IPO of Tradeweb. Excluding this gain, the increase in CIB’s revenue was driven by:
–•
higher revenuedebt underwriting fees due to increased industry-wide fees and wallet share gains in Fixed Income Markets, investment-grade bonds, and for high-yield bonds, after the markets stabilized in the second quarter of 2020
•
higher equity underwriting fees due to increased industry-wide fees and wallet share gains, primarily in agency mortgage trading within Securitized Products,follow-on offerings and Commodities, partially offset by Currencies & Emerging Marketsconvertible securities markets
–favorable changesthe increased activity in funding spreads on derivatives in Credit Adjustments & Other,debt and equity underwriting reflected clients seeking access to liquidity as a result of the COVID-19 pandemic
partially offset by
–•
lower revenue in Equity Markets advisory fees driven by a lower client activity in derivativesnumber of completed transactions.
the net increase in CIB was partially offset by
lower revenue in AWM, related to hedges on certain investments, which was more than offset by higher valuation gains on the related investments reflected in other income,
Corporate was relatively flat, reflecting
–losses on cash deployment transactions in Treasury and CIO, which were more than offset by the related net interest income earned on those transactions, and
–lower net valuation losses on certain legacy private equity investments.
Principal transactions revenue increased despite the year-to-date results of the two significant items noted below:
a $441 million net loss in CIB’s Credit Adjustments & Other predominantly driven by losses on certain components of fair value option elected liabilities, as well as the impact of funding spread widening on derivatives, and
$218 million of net markdowns on held-for-sale positions, including unfunded commitments, in the bridge financing portfolio in CIB may have offsets across otherand CB.
Excluding these two items, principal transactions revenue lines, including net interest income. The Firm assesses itsincreased in CIB, driven by strong client activity in Fixed Income Markets business performance on a total revenue basis.primarily in Rates, Currencies & Emerging Markets, and Credit; and in Equity Markets related to derivatives and Cash Equities.
Lending- and deposit-related fees increased primarily due to higherwas relatively flat as the lower deposit-related fees in CCB, reflecting growthlower transaction activity and the impact of fee refunds related to the COVID-19 pandemic, was offset by higher cash management fees in customer accountsCIB and transactions.CB.
Asset management, administration and commissions revenue was relatively flat reflecting:increased driven by:
lower asset management feeshigher brokerage commissions in CIB and AWM driven by a shift in the mix toward lower fee products,
largely offset byon higher client-driven volume, and
higher asset management fees in AWM as a result of inflows into liquidity products, and in CCB from growth in clientrelated to a higher level of investment assets.assets,
partially offset by
•
lower volume of annuity sales in CCB.
Investment securities gains/(losses) gainsprimarily reflect in both periods reflected the impact of repositioning the investment securities portfolio.
Mortgage fees and related income increased driven by:due to:
higher net mortgage production revenue reflecting gains on sales of certain loans, as well as higher mortgage production volumes and margins, and volumes,
partially offset by the absence of gains on loan sales in the prior year in Home Lending, and
lower

higher net mortgage servicing revenue drivenreflecting higher MSR risk management results due to the absence of losses resulting from updates to model inputs in the prior year, predominantly offset by lower operating revenue reflecting a lower level of third-party loans serviced and faster prepayment speeds on lower rates.
–lower operating revenue reflecting faster prepayment speeds on lower rates and the impact of reclassifying certain loans to held-for-sale, as well as
–lower MSR risk management results reflecting updates to model inputs.
Card income increaseddecreased due to lower net interchange income reflecting the absencelower card sales volumes that began in March as a result of the prior-year adjustment of approximately $330 million to the credit card rewards liability.COVID-19 pandemic, partially offset by higher annual fees.
Other income decreased reflecting:
net losses on certain equity investments in CIB, compared with net gains in the prior year
net valuation losses on certain investments in AWM, compared with gains in the prior year
increased reflecting:amortization on higher levels of alternative energy investments in CIB. The increased amortization is
more than offset by lower income tax expense from the associated tax credits, and
higher costs associated with using forward contracts to hedge certain non-U.S. dollar-denominated net investment exposures in Treasury and CIO,
partially offset by
higher operating lease income from growth in auto operating lease volume in CCB and
higher investment valuation gains in AWM, which were largely offset by the impact of the related hedges reflected in principal transactions revenue,
partially offset by

lower other income in CIB associated with increased amortization on a higher level of alternative energy investments. The increased amortization was more than offset by the lower income tax expense from the associated tax credits.
The prior year included:
$505 million of fair value gains related to the adoption of the recognition and measurement accounting guidance for certain equity investments previously held at cost in the first quarter of 2018, and
losses on certain investments in CIB and Corporate.
Net interest income increased drivendecreased due to the impact of lower rates, predominantly offset by continuedhigher net interest income in CIB Markets and balance sheet growth and changes in mix. growth.
The Firm’s average interest-earning assets were $2.3$2.6 trillion, up $136$324 billion, and the yield was 2.70%, down 106 bps, primarily due to lower rates. The net interest yield on these assets, on an FTE basis, was 2.49%2.17%, a decrease of 1 basis point.36 bps. The net interest yield excluding CIB Markets was 3.34%2.61%, an increase of 13 basis points. Net interest yield excluding CIB markets is a non-GAAP financial measure.down 78 bps.
Provision for credit lossesProvision for credit losses          Provision for credit losses        
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)

2019
 2018
 Change
 2019
 2018
 Change
2020
 2019
 Change 2020
 2019
 Change
Consumer, excluding credit card$(61) $(242) 75% $(265) $(152) (74)%$1,591
 $(366) NM $2,210
 $(246) NM
Credit card1,375
 1,223
 12
 4,017
 3,557
 13
4,028
 1,440
 180 9,091
 2,642
 244
Total consumer1,314
 981
 34
 3,752
 3,405
 10
5,619
 1,074
 423 11,301
 2,396
 372
Wholesale200
 (33) NM
 406
 (82) NM
4,850
 75
 NM 7,444
 248
 NM
Investment securities4
 NA
 NM 13
 NA
 NM
Total provision for credit losses$1,514
 $948
 60% $4,158
 $3,323
 25 %$10,473
 $1,149
 NM $18,758
 $2,644
 NM
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. In conjunction with the adoption of CECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Refer to Note 1 for further information.
Quarterly results
The provision for credit losses increased driven by consumerthe further deterioration and wholesale.increased uncertainty in the macroeconomic environment as a result of the impact of the COVID-19 pandemic in wholesale and consumer.
The increase in total wholesale reflects a net addition of $4.6 billion to the allowance for credit losses across the LOBs impacting multiple industry sectors.
The increase in consumer provision reflects:was driven by:
an increase inadditions of $4.4 billion to the allowance for credit card due tolosses, consisting of $2.9 billion for Card, $900 million for Home Lending, $285 million for Auto, and $272 million for CBB,
–higher net charge-offs on loan growth, in line with expectations, and
–a $200 million addition to the allowance for loan losses reflecting higher loss rates, as newer vintages season and become a larger part of the portfolio, compared to a $150 million addition in the prior year
an increase in consumer, excluding credit card in CCB due to
–a $100 million reduction in the allowance for loan losses in the non credit-impaired residential real estate portfolio, compared to a $250 million reduction in the PCI residential real estate portfolio in the prior year, and
–lower net recoveries in the residential real estate portfolio as the prior year benefited from a larger recovery on a loan sale
partially offset by
–a $50 million reduction in the allowance for loan losses in the business banking portfolio.
The wholesale provision was largely driven by select Commercial & Industrial (“C&I”) client downgrades. lower net charge-offs in Card reflecting higher recoveries.
The prior year wasincluded a $234 million net benefit which included net recoveries predominantly related to a loan salereduction in CIB.the allowance for credit losses.
Refer to CCB segment results on pages 22–27,26-30, CIB on pages 28–33,31-37, CB on pages 34–37,38-41, AWM on pages 38–41,42-45, the Allowance for Credit Losses on pages 67–68,77-78, and Note 1213 for additional information on the credit portfolio and the allowance for credit losses.
 
Year-to-date results
The provisionprovision for creditcredit losses increased driven by wholesalethe deterioration and consumer.uncertainty in the macroeconomic environment as a result of the impact of the COVID-19 pandemic in consumer and wholesale.
The increase in wholesale provision was largely driven by select C&I client downgrades. The prior year was a net benefit primarily driven by loan sales and other activity related to a single name in the Oil & Gas portfolio, partially offset by other net portfolio activity.
The total consumer provision reflects:was driven by:
an increase inadditions of $8.7 billion to the allowance for credit card due tolosses, consisting of $6.6 billion for Card, $1.2 billion for Home Lending, $520 million for Auto, and $352 million for CBB,
–a $400 million addition to the allowance for loan losses reflecting higher loss rates, as newer vintages season and become a larger part of the portfolio and loan growth, compared to a $150 million addition in the prior year, and
–higher net charge-offs on loan growth, in line with expectations
partially offset by
lower net charge-offs reflecting higher recoveries in Home Lending on a decreaseloan sale in consumer, excluding credit cardthe first quarter of 2020, and in CCB due to
–a $400 million reduction in the allowance for loan losses in the PCI residential real estate portfolio, reflecting continued improvement in home prices and delinquencies, and a $100 million reduction in the allowance for loan losses in the non credit-impaired residential real estate portfolio, compared to a $250 million reduction in the PCI residential real estate portfolio in the prior year, and
–a $50 million reduction in the allowance for loan losses in the business banking portfolio
Card, largely offset by higher charge-offs in Card on loan growth in the prior year.
–lower net recoveries in the residential real estate portfolio as the prior year benefited from larger recoveries on loan sales.
The prior year included a $221 million net reduction in the allowance for credit losses.
The increase in wholesale reflects a net addition of $7.0 billion to the allowance for credit losses across the LOBs impacting multiple industry sectors.


Noninterest expense                      
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)

2019
 2018
 Change
 2019
 2018
 Change2020
 2019
 Change
 2020
 2019
 Change
Compensation expense$8,583
 $8,108
 6 % $26,067
 $25,308
 3 %$9,509
 $8,547
 11 % $18,404
 $17,484
 5 %
Noncompensation expense:                      
Occupancy1,110
 1,014
 9
 3,238
 2,883
 12
1,080
 1,060
 2
 2,146
 2,128
 1
Technology, communications and equipment2,494
 2,219
 12
 7,236
 6,441
 12
2,590
 2,378
 9
 5,168
 4,742
 9
Professional and outside services2,056
 2,086
 (1) 6,307
 6,333
 —
1,999
 2,212
 (10) 4,027
 4,251
 (5)
Marketing(a)945
 798
 18
 2,686
 2,396
 12
481
 777
 (38) 1,281
 1,609
 (20)
Other expense(b)(c)
1,234
 1,398
 (12) 3,624
 4,313
 (16)1,283
 1,282
 —
 2,707
 2,390
 13
Total noncompensation expense7,839
 7,515
 4
 23,091
 22,366
 3
7,433
 7,709
 (4) 15,329
 15,120
 1
Total noninterest expense$16,422
 $15,623
 5 % $49,158
 $47,674
 3 %$16,942
 $16,256
 4 % $33,733
 $32,604
 3 %
(a)Included Firmwide legal expense/(benefit)In the second quarter of $10 million and $20 million for2020, the three months ended September 30, 2019 and 2018, respectively and $(2) million and $90 million forFirm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the nine months ended September 30, 2019 and 2018, respectively.current presentation.
(b)Included FDIC-related expenseFirmwide legal expense/(benefit) of $114$118 million and $349$69 million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $378$315 million and $1.1 billion$(12) million for the ninesix months ended SeptemberJune 30, 2020 and 2019, respectively.
(c)Included FDIC-related expense of $218 million and 2018,$121 million for the three months ended June 30, 2020 and 2019, respectively, and $317 million and $264 million for the six months ended June 30, 2020 and 2019, respectively.
Quarterly results
Compensation expense increased driven by higher revenue-related expense in CIBCIB.
Noncompensation expense decreased as a result of:
lower marketing expense in Card as a result of lower travel-related benefits and investments in marketing campaigns
lower structural expense, including lower travel and entertainment across the businesses, including front office hires, as well as technology staff.lower payment processing costs,
partially offset by
higher volume-related expense, including depreciation from growth in auto lease assets in CCB, and brokerage expense in CIB
higher investments in the businesses, including technology.

Year-to-date results
Compensation expense increased driven by higher revenue-related expense in CIB, partially offset by lower structural compensation expense in Corporate.
Noncompensation expense increased as a result of:
higher investments across the businesses, including technology, real estatelegal expense primarily in CIB and marketing, andCorporate
higher volume-related expense, including depreciation from growth in auto operating lease assets in CCB, and brokerage expense in certainCIB
higher investments in the businesses, in CIB,including technology,
partially offset by
lower FDIC chargesmarketing expense in Card as a result of the elimination of the surcharge at the end of the third quarter of 2018,lower travel-related benefits and investments in marketing campaigns
lower other regulatory-related charges in CIB.

Year-to-date results
Compensationstructural expense, increased driven by investments including lower travel and entertainment across the businesses, including front office hires, as well as technology staff, partially offset by lower revenue-related expense in CIB.
Noncompensation expense increased as a result of:
higher investments across the businesses, including, technology, real estate and marketing
higher volume-related expense, including depreciation from growth in auto operating lease assets in CCB, and brokerage expense in certain businesses in CIB
contributions to the Firm’s Foundation, whereas all prior-year contributions were made in the fourth quarter, and
higher pension costs due to changes to actuarial assumptions and estimates,
partially offset by
lower FDIC charges as a result of the elimination of the surcharge at the end of the third quarter of 2018
lower other regulatory-related charges in CIB
lower legal expense, and
lower distribution fees in AWM.
The prior year included a loss of $174 million on the liquidation of a legal entity in Corporate recorded in other expense.
Refer to Note 19 for additional information on the liquidation of a legal entity.payment processing costs.


Income tax expenseIncome tax expense       Income tax expense       
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)

2019
 2018
 Change
 2019
 2018
 Change2020
 2019
 Change
 2020
 2019
 Change
Income before income tax expense$11,405
 $10,689
 7% $33,980
 $31,923
 6 %$5,565
 $11,342
 (51)% $8,681
 $22,575
 (62)%
Income tax expense2,325
 2,309
 1
 6,069
 6,515
 (7)878
 1,690
 (48) 1,129
 3,744
 (70)
Effective tax rate20.4% 21.6%   17.9% 20.4%  15.8% 14.9%   13.0% 16.6%  
Quarterly results
The effective tax rate decreasedincreased as the reduction in income tax expense due to the recognitionimpact of tax benefits related to the resolution of certain tax audits and changes in the level and mix of income and expenseexpenses subject to U.S. federal, and state and local taxes. In addition,taxes was more than offset by the absence of the $768 million of tax benefits recorded in the prior year included a $132 million net tax benefit resulting from changes in the estimates under the Tax Cuts and Jobs Act (“TCJA”) related to the remeasurementresolution of certain deferred taxes and the deemed repatriation tax on non-U.S. earnings.audits.

 
Year-to-date results
The effective tax rate decreased due to the recognition of $1.0 billion of tax benefits related to the resolution of certain tax audits anddriven by changes in the level and mix of income and expenseexpenses subject to U.S. federal, and state and local taxes.taxes, as well as the more significant effect of certain tax benefits on a lower level of pre-tax income. The decrease was partially offset by lowerthe recognition of $874 million of tax benefits recorded in the prior year related to the vesting of employee stock-based awards. In addition, the prior year included a $305 million net tax benefit resulting from changes in the estimates under the TCJA related to the remeasurementresolution of certain deferred taxes and the deemed repatriation tax on non-U.S. earnings. Refer to Note 1 for additional information on the 2019 tax benefits.audits.



CONSOLIDATED BALANCE SHEETS AND CASH FLOWS ANALYSIS
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. Refer to Note 1 for further information.
Consolidated balance sheets analysis
The following is a discussion of the significant changes between SeptemberJune 30, 2019,2020, and December 31, 2018.2019.
Selected Consolidated balance sheets data
(in millions)September 30,
2019
 December 31,
2018
Change
June 30,
2020
 December 31,
2019
Change
Assets        
Cash and due from banks$21,215
 $22,324
(5)%$20,544
 $21,704
(5)%
Deposits with banks235,382
 256,469
(8)473,185
 241,927
96
Federal funds sold and securities purchased under resale agreements257,391
 321,588
(20)256,980
 249,157
3
Securities borrowed138,336
 111,995
24
142,704
 139,758
2
Trading assets495,875
 413,714
20
526,042
 411,103
28
Investment securities394,251
 261,828
51
Available-for-sale securities485,883
 350,699
39
Held-to-maturity securities, net of allowance for credit losses72,908
 47,540
53
Investment securities, net of allowance for credit losses558,791
 398,239
40
Loans945,218
 984,554
(4)978,518
 959,769
2
Allowance for loan losses(13,235) (13,445)(2)(32,092) (13,123)145
Loans, net of allowance for loan losses931,983
 971,109
(4)946,426
 946,646
—
Accrued interest and accounts receivable88,988
 73,200
22
72,260
 72,861
(1)
Premises and equipment25,117
 14,934
68
26,301
 25,813
2
Goodwill, MSRs and other intangible assets53,078
 54,349
(2)51,669
 53,341
(3)
Other assets123,045
 121,022
2
138,213
 126,830
9
Total assets$2,764,661
 $2,622,532
5 %$3,213,115
 $2,687,379
20 %
Cash and due from banks and deposits with banks decreasedincreased primarily as a result of a shiftsignificant deposit inflows, which also funded asset growth across the Firm, including in the deployment of cash in Treasury and CIO to investment securities. Deposits with banks reflect the Firm’s placements of its excess cash with various central banks, including the Federal Reserve Banks.
FederalRefer to Liquidity Risk Management on pages 55-59 and Note 11 for information on federal funds sold and securities purchased under resale agreements decreased largely as a result of a shift in the deployment of cash in Treasury and CIO. Refer to Liquidity Risk Management on pages 50–54 and Note 10 for additional information.
Securities borrowed increased in CIB driven by higher demand for securities related to client-driven market-making activities in Fixed Income Markets, and to cover customer short positions in prime brokerage. Refer to Liquidity Risk Management on pages 50–54 and Note 10 for additional information.agreements.
Trading assets increased compared with lower levels at year-end predominantly due to:
growth into client-driven market-making activities in CIB, primarily debt instruments in Fixed Income Markets, and equity instrumentsas well as higher derivative receivables in Equity Markets, including prime brokerage, and when compared with lower levels at year-end, and
in CCB, an increase in U.S. GSE MBS acquiredCIB as parta result of the proceeds of warehouse loan sales, and growth related to originations of mortgage warehouse loans, resulting from the favorable rate environment,
partially offset by
a reduction in short-term instruments associated with cash deployment activities in Treasury and CIO.market movements.
Refer to Notes 2 and 45 for additional information.
Investment securities increased, primarily reflecting net purchases of U.S. Treasuries and U.S. GSE and government agency MBS in Treasury and CIOthe available-for-sale (“AFS”) portfolio, driven by interest rate risk management activities and broader balance sheet management. cash deployment, partially offset by a non-cash transfer of $26 billion of U.S. GSE and government agency MBS from the AFS to the held-to-maturity (“HTM”) portfolio, resulting in a comparable increase in HTM.
Refer to Corporate segment results on pages 42–43,page 46, Investment Portfolio Risk Management on page 69,79, and Notes 2 and 910 for additional information on Investment securities.
Loans increased, reflecting:
Loans decreased reflecting loanthe outstanding loans from the March drawdown activity on committed revolving credit facilities in CIB and CB, as a result of the COVID-19 pandemic, and the impact of the PPP loans in CBB and CB,
partially offset by
lower loans in Card due to the decline in sales volume that began in Home Lending,March as a result of the COVID-19 pandemic, as well as the impact of seasonality; and lower loans in CIB,Home Lending primarily driven by a loan syndication anddue to net pay downs, partially offset by increases in CB and AWM.repayments.
The allowance for loan losses decreased driven by:increased primarily reflecting the deterioration and uncertainty in the macroeconomic environment as a result of the impact of the COVID-19 pandemic, consisting of:
•
a $550 million reduction$8.6 billion addition in consumer, predominantly in the CCB allowance for loan losses, which includes $400 million in the PCIcredit card and residential real estate portfolio, reflecting continued improvement in home prices and delinquencies; $100 million in the non credit-impaired residential real estate portfolio; and $50 million in the business banking portfolio; as well as
•
a $132 million reduction for write-offs of PCI loans,portfolios
largely offset bya net $6.2 billion addition in wholesale, across the LOBs impacting multiple industry sectors, and
a $400 millionnet $4.2 billion addition as a result of the adoption of CECL.
There were also additions to the allowance for loan losseslending-related commitments, which is included in other liabilities on the credit card portfolio reflecting higher loss rates, as newer vintages season and become a larger partconsolidated balance sheets, of $920 million related to the impact of the portfolioCOVID-19 pandemic, and loan growth.$98 million related to the adoption of CECL, resulting in total additions to the allowance for credit losses of $15.7 billion and $4.3 billion, respectively, as of June 30, 2020.

Refer to Credit and Investment Risk Management on pages 55–69,60-79, and Notes 1, 2, 3, 1112 and 1213 for a more detailed discussion of loans and the allowance for loan losses.
Accrued interest and accounts receivable increased reflecting higher client receivables related to client-driven activities in CIB.

Premises and equipment increased due to the adoption of the new lease accounting guidance effective January 1, 2019. Refer to Note 16 for additional information.
Goodwill, MSRs and other intangibles decreased reflecting lower MSRs as a result of faster prepayment speeds on lower rates and the realization of expected cash flows, partially offset by an increase in goodwill associated withnet additions to the acquisition of InstaMed. MSRs.Refer to Note 1415 for additional information.
Other assets increased reflecting higher cash collateral placed with central counterparties, and the Firm’s participation in the Federal Reserve Bank of Boston’s (“FRBB”) MMLF. The assets purchased from money market mutual fund clients related to the MMLF were funded by nonrecourse advances from the FRBB, which are recorded in short-term borrowings. Refer to Regulatory Developments Relating to the COVID-19 Pandemic on pages 11-12 and Liquidity Risk Management on pages 55-59 for additional information.
Selected Consolidated balance sheets data (continued)Selected Consolidated balance sheets data (continued) Selected Consolidated balance sheets data (continued) 
(in millions)September 30,
2019
 December 31,
2018
Change
June 30,
2020
 December 31,
2019
Change
Liabilities        
Deposits$1,525,261
 $1,470,666
4 %$1,931,029
 $1,562,431
24%
Federal funds purchased and securities loaned or sold under repurchase agreements247,766
 182,320
36
235,647
 183,675
28
Short-term borrowings48,893
 69,276
(29)48,014
 40,920
17
Trading liabilities138,343
 144,773
(4)165,212
 119,277
39
Accounts payable and other liabilities225,063
 196,710
14
230,916
 210,407
10
Beneficial interests issued by consolidated variable interest entities (“VIEs”)18,515
 20,241
(9)20,828
 17,841
17
Long-term debt296,472
 282,031
5
317,003
 291,498
9
Total liabilities2,500,313
 2,366,017
6
2,948,649
 2,426,049
22
Stockholders’ equity264,348
 256,515
3
264,466
 261,330
1
Total liabilities and stockholders’ equity$2,764,661
 $2,622,532
5 %$3,213,115
 $2,687,379
20%
Deposits increased reflecting:
growth in operating deposits in CIBreflecting significant inflows across the LOBs primarily driven by client activitythe COVID-19 pandemic, as customers and clients looked to remain liquid as a result of market conditions.
In the wholesale businesses, the inflows principally occurred in Treasury ServicesMarch, and Securities Services, and anin general were maintained through the second quarter.
In CCB, the increase in net issuances of structured notes in Markets, and
in CCB, predominantly due towas driven by the continued growth in both existing and new accounts, as well as COVID-19 related factors, such as the government stimulus for consumers and small businesses, lower consumer spending, and delays in CB, growth from existing clients.tax payments.
Refer to Liquidity Risk Management on pages 50–5455-59 and Notes 2 and 1516 for additional information.
Federal funds purchased and securities loaned or sold under repurchase agreements increased driven byreflecting:
•
in CIB, a net increase related to client-driven market-making activities, and higher secured financing of trading assets, partially offset by a decline in the Firm's participation in the Federal Reserve's open market operations, and
in Treasury and includes the Firm’s participation in the Federal Reserve’s open market operations, as well asCIO, higher secured financing of trading assets-debt instruments and client-driven activities.AFS investment securities. Refer to Liquidity Risk Management on pages 50–5455-59 and Note 1011 for additional information.
Short-term borrowings decreased reflecting lower commercial paper and short-termincreased driven by the Firm’s participation in the FRBB’s MMLF, as well as a change in mix of funding sources in CIB activities from securities sold under repurchase agreements in CIB. The nonrecourse advances from Federal Home Loan Banks (“FHLB”)the FRBB funded the assets purchased from money market mutual fund clients related to the MMLF, which are recorded in Treasury and CIO, primarily driven by liquidity management. other assets.
Refer to Regulatory Developments Relating to the COVID-19 Pandemic on pages 11-12 and Liquidity Risk Management on pages 50–5455-59 for additional information.
Trading liabilities decreasedincreased in CIB as a result of client-driven market-making activities, in CIB, which resulted in lowerhigher levels of short positions primarily in equitydebt instruments in Equity Markets.Fixed Income Markets, as well as higher derivative payables as a result of market movements. Refer to Notes 2 and 45 for additional information.
Accounts payable and other liabilities increased reflecting:
reflecting higher client payables related to client-driven activities in CIB, and
the impact of the adoption of the new lease accounting guidance effective January 1, 2019.
Refer to Note 16 for additional information on Leases.CIB.
Beneficial interests issued by consolidated VIEs decreased due to:
maturities of credit card securitizations,
predominantly offset by
increased reflecting higher levels of Firm-administered multi-seller conduit commercial paper issued toheld by third parties.
Refer to Off-Balance Sheet Arrangements on page 1821 and Notes 1314 and 2223 for further information on Firm-sponsored VIEs and loan securitization trusts.
Long-term debt increased as a result of client-drivenhigher FHLB net issuancesadvances, net issuance of structured notes in CIB’s Markets business.senior and subordinated debt, and higher fair value hedge accounting adjustments related to lower interest rates.
Refer to Liquidity Risk Management on pages 50–5455-59 for additional information on the Firm’s long-term debt activities.
Stockholders’ equity increased reflecting the net impact of capital actions, net income, the adoption of CECL and an increase in accumulated other comprehensive income (“AOCI”). The increase in AOCI was driven by net unrealized gains on AFS securities, and higher valuation of interest rate cash flow hedges.Refer to page 8396 for information on changes in stockholders’ equity and Capital actions on pages 47–48.page 53.



Consolidated cash flows analysis
The following is a discussion of cash flow activities during the ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
(in millions) Nine months ended September 30, Six months ended June 30,
2019
 2018
 2020
 2019
Net cash provided by/(used in)        
Operating activities $(77,039) $13,765
 $(37,032) $(94,734)
Investing activities (38,181) (39,782) (183,617) 27,424
Financing activities 96,006
 16,319
 451,436
 56,469
Effect of exchange rate changes on cash (2,982) (2,509) (689) 86
Net decrease in cash and due from banks and deposits with banks $(22,196) $(12,207)
Net increase/(decrease) in cash and due from banks and deposits with banks $230,098
 $(10,755)
Operating activities
In 2020, cash used resulted from higher trading assets and other assets, largely offset by higher trading liabilities and accounts payable and other liabilities.
In 2019, cash used primarily resulted from higher trading assets,assets-debt and equity instruments and securities borrowed, other assets and accrued interest and accounts receivable, partially offset by higherincreased trading liabilities and accounts payable and other liabilities, trading liabilities, and net proceeds from loans originated for sale.
In 2018, cash provided primarily resulted from net income, higher accounts payable and other liabilities, and trading liabilities, partially offset by higher trading assets and securities borrowed.held-for-sale.
 
Investing activities
In 2019,2020, cash used primarily resulted fromwas driven by net purchases of investment securities and net loan originations, predominantly offset by lower securities purchased under resale agreements, and proceeds from the sale of loans held-for-investment.
In 2018, cash used resulted from higher net loan originations and an increase in securities purchased under resale agreements, partially offset by net proceeds from investment securities and sales of loans held-for- investment.
Financing activitiesoriginations.
In 2019, cash provided resulted from a decrease in securities purchased under resale agreements, and net proceeds from sales of loans held-for-investment, partially offset by net purchases of investment securities.
Financing activities
In 2020, cash provided was due to higher deposits, an increase in federal funds purchased and securities loaned or sold under repurchase agreements, partially offset by lower short-term and net proceeds from long-term borrowings.
In 2018,2019, cash provided resulted from higher securities loaned or sold under repurchase agreements deposits and short-term borrowings, partially offset by a decrease in long-term borrowings.higher deposits.
For both periods, cash was used for repurchases of common stock and cash dividends on common and preferred stock. On March 15, 2020, in response to the COVID-19 pandemic, the Firm temporarily suspended repurchases of its common equity. Additionally, in June 2020, the Federal Reserve directed all large bank holding companies, including the Firm, to discontinue net share repurchases, at least through the end of the third quarter of 2020.
* * *
Refer to Consolidated Balance Sheets Analysis on pages 15-16,18-19, Capital Risk Management on pages 45–49,49-54, and Liquidity Risk Management on pages 50–5455-59 of this Form 10-Q, and pages 95–10093–98 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of the activities affecting the Firm’s cash flows.


OFF-BALANCE SHEET ARRANGEMENTS
In the normal course of business, the Firm enters into various off-balance sheet arrangements and contractual obligations that may require future cash payments. Certain obligations are recognized on-balance sheet, while others are disclosed as off-balance sheet under accounting principles generally accepted in the U.S. (“U.S. GAAP”).
Special-purpose entities
The Firm has several types of off–balance sheet arrangements, including through nonconsolidated special-purpose entities (“SPEs”), which are a type of VIE, and through lending-related financial instruments (e.g., commitments and guarantees).
The Firm holds capital, as appropriate, against all SPE-related transactions and related exposures, such as derivative contracts and lending-related commitments and guarantees.
The Firm has no commitments to issue its own stock to support any SPE transaction, and its policies require that transactions with SPEs be conducted at arm’s length and reflect market pricing. Consistent with this policy, no JPMorgan Chase employee is permitted to invest in SPEs with which the Firm is involved where such investment would violate the Firm’s Code of Conduct.
The table below provides an index of where in this Form 10-Q a discussion of the Firm’s various off-balance sheet arrangements can be found. In addition, referRefer to Note 1 for additional information about the Firm’s consolidation policies.
Type of off-balance sheet arrangementLocation of disclosurePage references
Special-purpose entities: variable interests and other obligations, including contingent obligations, arising from variable interests in nonconsolidated VIEsRefer to Note 1314139-144162-167
Off-balance sheet lending-related financial instruments, guarantees, and other commitmentsRefer to Note 2223156-159178-181



EXPLANATION AND RECONCILIATION OF THE FIRM’S USE OF NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE MEASURES
The Firm prepares its Consolidated Financial Statements in accordance with U.S. GAAP and this presentation is referred to as “reported” basis; these financial statements appear on pages 80–8493-97.
In addition to analyzing the Firm’s results on a reported basis, the Firm also reviews and uses certain non-GAAP financial measures at the Firmwide and segment level. These non-GAAP measures include:
Firmwide “managed” basis results, including the overhead ratio, which include certain reclassifications to present total net revenue from investments that receive tax credits and tax-exempt securities on a basis comparable to taxable investments and securities (“FTE” basis)
 
Pre-provision profit, which represents total net revenue less noninterest expense
Net interest income and net yield excluding CIB’s Markets businesses
Certain credit metrics and ratios, which exclude PCI loans
Tangible common equity (“TCE”), ROTCE, and TBVPS.TBVPS
In addition, coreAllowance for loan losses to period-end loans is a key performance measure utilized by the Firmretained, excluding trade finance and its investors and analysts in assessing actual growth in the loan portfolio.conduits.
Refer to Explanation and Reconciliation of the Firm’s Use Of Non-GAAP Financial Measures and Key Performance Measures on pages 57-5957–59 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of management’s use of non-GAAP financial measures and key performance measures.
The following summary table providestables provide a reconciliation from the Firm’s reported U.S. GAAP results to managed basis.
Three months ended September 30,Three months ended June 30,
2019 20182020 2019
(in millions, except ratios)Reported
results		 
Fully taxable-equivalent adjustments(a)
 Managed
basis		 Reported
results		 
Fully taxable-equivalent adjustments(a)
 Managed
basis		Reported 
Fully taxable-equivalent adjustments(b)
 Managed
basis		 Reported 
Fully taxable-equivalent adjustments(b)
 Managed
basis
Other income$1,472
 $596
 $2,068
 $1,160
 $408
 $1,568
$1,042
 $730
 $1,772
 $1,292
 $596
 $1,888
Total noninterest revenue15,113
 596
 15,709
 13,352
 408
 13,760
Total noninterest revenue(a)
19,127
 730
 19,857
 14,349
 596
 14,945
Net interest income14,228
 127
 14,355
 13,908
 154
 14,062
13,853
 107
 13,960
 14,398
 138
 14,536
Total net revenue29,341
 723
 30,064
 27,260
 562
 27,822
32,980
 837
 33,817
 28,747
 734
 29,481
Total noninterest expense(a)
16,942
 NA
 16,942
 16,256
 NA
 16,256
Pre-provision profit12,919
 723
 13,642
 11,637
 562
 12,199
16,038
 837
 16,875
 12,491
 734
 13,225
Provision for credit losses10,473
 NA
 10,473
 1,149
 NA
 1,149
Income before income tax expense11,405
 723
 12,128
 10,689
 562
 11,251
5,565
 837
 6,402
 11,342
 734
 12,076
Income tax expense$2,325
 $723
 $3,048
 $2,309
 $562
 $2,871
878
 837
 1,715
 1,690
 734
 2,424
Net income$4,687
 NA
 $4,687
 $9,652
 NA
 $9,652
           
Overhead ratio56% NM
 55% 57% NM
 56%51% NM
 50% 57% NM
 55%
                      
Nine months ended September 30,Six months ended June 30,
2019 20182020 2019
(in millions, except ratios)Reported
results		 
Fully taxable-equivalent adjustments(a)
 Managed
basis		 Reported
results		 
Fully taxable-equivalent adjustments(a)
 Managed
basis		Reported 
Fully taxable-equivalent adjustments(b)
 Managed
basis		 Reported 
Fully taxable-equivalent adjustments(b)
 Managed
basis
Other income$4,239
 $1,777
 $6,016
 $4,041
 $1,337
 $5,378
$2,198
 $1,438
 $3,636
 $2,767
 $1,181
 $3,948
Total noninterest revenue44,217
 1,777
 45,994
 42,215
 1,337
 43,552
Total noninterest revenue(a)
32,880
 1,438
 34,318
 28,972
 1,181
 30,153
Net interest income43,079
 408
 43,487
 40,705
 473
 41,178
28,292
 217
 28,509
 28,851
 281
 29,132
Total net revenue87,296
 2,185
 89,481
 82,920
 1,810
 84,730
61,172
 1,655
 62,827
 57,823
 1,462
 59,285
Total noninterest expense(a)
33,733
 NA
 33,733
 32,604
 NA
 32,604
Pre-provision profit38,138
 2,185
 40,323
 35,246
 1,810
 37,056
27,439
 1,655
 29,094
 25,219
 1,462
 26,681
Provision for credit losses18,758
 NA
 18,758
 2,644
 NA
 2,644
Income before income tax expense33,980
 2,185
 36,165
 31,923
 1,810
 33,733
8,681
 1,655
 10,336
 22,575
 1,462
 24,037
Income tax expense$6,069
 $2,185
 $8,254
 $6,515
 $1,810
 $8,325
1,129
 $1,655
 2,784
 3,744
 1,462
 5,206
Net Income$7,552
 NA
 $7,552
 $18,831
 NA
 $18,831
           
Overhead ratio56% NM
 55% 57% NM
 56%55% NM
 54% 56% NM
 55%
(a)In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.
(b)Predominantly recognized in CIB, CB and Corporate.













The following table provides information on net interest income and net yield excluding CIB’s Markets businesses.

(in millions, except rates)
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
2019
2018
 Change
 20192018 Change2020
2019
 Change
 20202019 Change
Net interest income – reported$14,228
$13,908
 2 % $43,079
$40,705
 6 %$13,853
$14,398
 (4)% $28,292
$28,851
 (2)%
Fully taxable-equivalent adjustments127
154
 (18) 408
473
 (14)107
138
 (22) 217
281
 (23)
Net interest income – managed basis(a)
$14,355
$14,062
 2
 $43,487
$41,178
 6
$13,960
$14,536
 (4) $28,509
$29,132
 (2)
Less: CIB Markets net interest income(b)
723
704
 3
 1,971
2,488
 (21)2,536
624
 306
 4,132
1,248
 231
Net interest income excluding CIB Markets(a)
$13,632
$13,358
 2
 $41,516
$38,690
 7
$11,424
$13,912
 (18) $24,377
$27,884
 (13)
              
Average interest-earning assets(c)
$2,365,154
$2,203,305
 7
 $2,334,623
$2,198,909
 6
$2,819,855
$2,339,094
 21
 $2,642,794
$2,319,105
 14
Less: Average CIB Markets interest-earning assets(c)(b)
690,593
596,784
 16
 671,236
589,185
 14
795,677
673,480
 18
 765,856
661,397
 16
Average interest-earning assets excluding CIB Markets$1,674,561
$1,606,521
 4 % $1,663,387
$1,609,724
 3 %$2,024,178
$1,665,614
 22% $1,876,938
$1,657,708
 13 %
Net interest yield on average interest-earning assets – managed basis(c)
2.41%2.53%   2.49%2.50%  
Net interest yield on average CIB Markets interest-earning assets(b)(c)
0.42
0.47
   0.39
0.56
  
Net interest yield on average interest-earning assets excluding CIB Markets3.23%3.30%   3.34%3.21%  
Net yield on average interest-earning assets – managed basis1.99%2.49%   2.17%2.53%  
Net yield on average CIB Markets interest-earning assets(b)
1.28
0.37
   1.08
0.38
  
Net yield on average interest-earning assets excluding CIB Markets2.27%3.35%   2.61%3.39%  
(a)Interest includes the effect of related hedges. Taxable-equivalent amounts are used where applicable.
(b)Refer to page 3236 for further information on CIB’s Markets businesses.
(c)In the second quarter of 2019, the Firm reclassified balances related to certain instruments from interest-earning to noninterest-earning assets, as the associated returns are recorded in principal transactions revenue and not in net interest income. These changes were applied retrospectively and, accordingly, prior period amounts were revised to conform with the current presentation.

The following summary table provides a reconciliation from the Firm’s common stockholders’ equity to TCE.
Period-end AveragePeriod-end Average
(in millions, except per share and ratio data)Sep 30,
2019
Dec 31,
2018
 Three months ended September 30,Nine months ended September 30,Jun 30,
2020
Dec 31,
2019
 Three months ended June 30, Six months ended June 30,
2019
2018
2019
2018
 2020
2019
 2020
2019
Common stockholders’ equity$235,985
$230,447
 $235,613
$230,439
$232,917
$228,995
$234,403
$234,337
 $234,408
$233,026
 $234,469
$231,547
Less: Goodwill47,818
47,471
 47,707
47,490
47,552
47,496
47,811
47,823
 47,805
47,472
 47,808
47,474
Less: Other intangible assets841
748
 842
795
776
820
778
819
 791
741
 802
741
Add: Certain Deferred tax liabilities(a)
2,371
2,280
 2,344
2,233
2,311
2,221
Add: Certain deferred tax liabilities(a)
2,397
2,381
 2,393
2,304
 2,388
2,296
Tangible common equity$189,697
$184,508
 $189,408
$184,387
$186,900
$182,900
$188,211
$188,076
 $188,205
$187,117
 $188,247
$185,628
        
Return on tangible common equityNA
NA
 18%17%19%18%NA
NA
 9%20% 7%20%
Tangible book value per share$60.48
$56.33
 NA
NA
NA
NA
$61.76
$60.98
 NA
NA
 N/A
N/A
(a)Represents deferred tax liabilities related to tax-deductible goodwill and to identifiable intangibles created in nontaxable transactions, which are netted against goodwill and other intangibles when calculating TCE.


BUSINESS SEGMENT RESULTS
The Firm is managed on a line of businessan LOB basis. There are four major reportable business segments – Consumer & Community Banking, Corporate & Investment Bank, Commercial Banking and Asset & Wealth Management. In addition, there is a Corporate segment.
The business segments are determined based on the products and services provided, or the type of customer served, and they reflect the manner in which financial information is currently evaluated by the Firm’s Operating Committee. Segment results are presented on a managed basis. Refer to Explanation and Reconciliation of the Firm’s use of Non-GAAP Financial Measures and Key Performance Measures on pages 19–2022-23 for a definition of managed basis.
Description of business segment reporting methodology
Results of the business segments are intended to present each segment as if it were essentially a stand-alone business. The management reporting process that derives business segment results includes the allocation of certain
income and expense items. Refer to Line of business equity on page 47 for further information about line of business capital. The Firm periodically assesses the assumptions, methodologies and reporting classifications used for segment reporting, and further refinements may be implemented in future periods. The Firm’s LOBs also provide various business metrics which are utilized by the Firm and its investors and analysts in assessing performance.
Revenue sharing
When business segments join efforts to sell products and services to the Firm’s clients, the participating business segments may agree to share revenue from those transactions. Revenue and expense are generally recognized in the segment responsible for the related product or service, with allocations to the other segment(s)
involved in the transaction. The segment results reflect these revenue-sharing agreements.
Business segment capital allocation
The amount of capital assigned to each business is referred to as equity. On at least an annual basis,Periodically, the assumptions and methodologies used into allocate capital allocation are assessed and as a result, the capital allocated to lines of businessthe LOBs may change. Refer to Line of business equity on page 9190 of JPMorgan Chase’s 20182019 Form 10-K for additional information on business segment capital allocation.
Refer to Business Segment Results – Description of business segment reporting methodology on pages 60–61 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of those methodologies.
Business segment changes
In the first quarter of 2020, the Firm began reporting a Wholesale Payments business unit within CIB following a realignment of the Firm’s wholesale payments businesses. The Wholesale Payments business comprises:
Merchant Services, which was realigned from CCB to CIB
Treasury Services and Trade Finance in CIB. Trade Finance was previously reported in Lending in CIB.
In connection with the alignment of Wholesale Payments, the assets, liabilities and headcount associated with the Merchant Services business were realigned to CIB from CCB, and the revenue and expenses of the Merchant Services business is reported across CCB, CIB and CB based primarily on client relationships. Prior periods have been revised to reflect this realignment and revised allocation methodology.

JPMorgan Chase
Consumer BusinessesWholesale Businesses
Consumer & Community BankingCorporate & Investment BankCommercial BankingAsset & Wealth Management
Consumer &
Business Banking		Home LendingCard & AutoBankingMarkets &
Securities Services		 • Middle Market Banking • Asset Management
 • Consumer Banking/Chase Wealth Management
 • Business Banking
 • Home Lending Production
 • Home Lending Servicing
 • Real Estate Portfolios
 • Credit Card
 • Auto

 • Investment Banking
 • Wholesale Payments
 • Lending
 • Fixed Income Markets • Corporate Client Banking
 • Wealth Management

 • Equity Markets
 • Securities Services
 • Credit Adjustments & Other
 • Commercial Real Estate Banking

Segment results – managed basis
The following tables summarize the Firm’s results by segment for the periods indicated.
Three months ended September 30,Consumer & Community Banking Corporate & Investment Bank Commercial Banking
Three months ended June 30,
Consumer & Community Banking(a)
 Corporate & Investment Bank Commercial Banking
(in millions, except ratios)2019
2018
Change 2019
2018
Change 2019
2018
Change
2020
2019
Change
 2020
2019
Change 2020
2019
Change
Total net revenue$14,259
$13,290
7 $9,338
$8,805
6 $2,207
$2,271
(3)%$12,217
$13,484
(9)% $16,352
$9,831
66 $2,392
$2,285
5 %
Total noninterest expense7,290
6,982
4 5,348
5,175
3 881
853
3
6,626
6,836
(3) 6,764
5,661
19 899
931
(3)
Pre-provision profit/(loss)6,969
6,308
10 3,990
3,630
10 1,326
1,418
(6)5,591
6,648
(16) 9,588
4,170
130 1,493
1,354
10
Provision for credit losses1,311
980
34 92
(42)NM 67
(15)NM
5,828
1,120
420
 1,987
—
NM 2,431
29
NM
Net income/(loss)4,273
4,086
5 2,809
2,626
7 937
1,089
(14)(176)4,157
NM
 5,464
2,946
85 (691)1,002
NM
Return on equity (“ROE”)32%31% 13%14% 16%21% (2)%31%  27%14% (14)%17% 
Three months ended September 30,Asset & Wealth Management Corporate Total
Three months ended June 30,Asset & Wealth Management Corporate 
Total(a)
(in millions, except ratios)2019
2018
Change
 2019
2018
Change 2019
2018
Change2020
2019
Change
 2020
2019
Change
 2020
2019
Change
Total net revenue$3,568
$3,559
—
 $692
$(103)NM $30,064
$27,822
8$3,610
$3,559
1 % $(754)$322
NM
 $33,817
$29,481
15 %
Total noninterest expense2,622
2,585
1
 281
28
NM 16,422
15,623
52,506
2,596
(3) 147
232
(37) 16,942
16,256
4
Pre-provision profit/(loss)946
974
(3) 411
(131)NM 13,642
12,199
121,104
963
15
 (901)90
NM
 16,875
13,225
28
Provision for credit losses44
23
91
 —
2
NM 1,514
948
60223
2
NM
 4
(2)NM
 10,473
1,149
NM
Net income/(loss)668
724
(8) 393
(145)NM 9,080
8,380
8658
719
(8) (568)828
NM
 4,687
9,652
(51)
ROE24%31%  NM
NM
 15%14% 24%27%  NM
NM
  7%16% 
Nine months ended September 30,Consumer & Community Banking Corporate & Investment Bank Commercial Banking
Six months ended June 30,
Consumer & Community Banking(a)
 Corporate & Investment Bank Commercial Banking
(in millions, except ratios)2019
2018
Change 2019
2018
Change
 2019
2018
Change
2020
2019
Change
 2020
2019
Change 2020
2019
Change
Total net revenue$41,843
$38,384
9 $28,827
$29,211
(1)% $6,756
$6,753
—
$25,329
$26,927
(6)% $26,300
$19,865
32 $4,570
$4,698
(3)%
Total noninterest expense21,663
20,770
4 16,288
16,237
—
 2,618
2,541
3
13,728
13,759
—
 12,660
11,290
12 1,887
1,869
1
Pre-provision profit/(loss)20,180
17,614
15 12,539
12,974
(3) 4,138
4,212
(2)11,601
13,168
(12) 13,640
8,575
59 2,683
2,829
(5)
Provision for credit losses3,745
3,405
10 179
(142)NM
 186
23
NM
11,600
2,434
377
 3,388
87
NM 3,441
119
NM
Net income/(loss)12,410
10,824
15 8,995
9,798
(8) 2,986
3,201
(7)15
8,104
(100) 7,452
6,206
20 (544)2,062
NM
ROE31%27% 14%18%  17%20% (1)%31%  18%15% (6)%18% 
Nine months ended September 30,Asset & Wealth Management Corporate Total
Six months ended June 30,Asset & Wealth Management Corporate 
Total(a)
(in millions, except ratios)2019
2018
Change
 2019
2018
Change 2019
2018
Change
2020
2019
Change
 2020
2019
Change
 2020
2019
Change
Total net revenue$10,616
$10,637
—
 $1,439
$(255)NM $89,481
$84,730
6%$7,216
$7,048
2 % $(588)$747
NM
 $62,827
$59,285
6 %
Total noninterest expense7,865
7,732
2
 724
394
84 49,158
47,674
3
5,165
5,243
(1) 293
443
(34) 33,733
32,604
3
Pre-provision profit/(loss)2,751
2,905
(5) 715
(649)NM 40,323
37,056
9
2,051
1,805
14
 (881)304
NM
 29,094
26,681
9
Provision for credit losses48
40
20
 —
(3)NM 4,158
3,323
25
317
4
NM
 12
—
NM
 18,758
2,644
NM
Net income/(loss)2,048
2,249
(9) 1,472
(664)NM 27,911
25,408
10
1,322
1,380
(4) (693)1,079
NM
 7,552
18,831
(60)
ROE25%32%  NM
NM
 15%14% 24%26%  NM
NM
  6%16% 
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation.
(a)
In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.
The following sections provide a comparative discussion of the Firm’s results by segment as of or for the three and ninesix months ended SeptemberJune 30, 20192020 versus the corresponding periods in the prior year, unless otherwise specified.


CONSUMER & COMMUNITY BANKING
Consumer & Community Banking offers services to consumers and businesses through bank branches, ATMs, digital (including mobile and online) and telephone banking. CCB is organized into Consumer & Business Banking (including Consumer Banking/Chase Wealth Management and Business Banking), Home Lending (including Home Lending Production, Home Lending Servicing and Real Estate Portfolios) and Card & Auto. Consumer & Business Banking offers deposit and investment products and services to consumers, and lending, deposit, and cash management and payment solutions to small businesses. Home Lending includes mortgage origination and servicing activities, as well as portfolios consisting of residential mortgages and home equity loans. Card & Auto issues credit cards to consumers and small businesses and originates and services auto loans and leases.

Refer to pages 62–65 of JPMorgan Chase’s 2018 Form 10-K and Line of Business Metrics on page 173197 for a further discussion of the business profile of CCB.
Selected income statement dataSelected income statement data          Selected income statement data          
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions, except ratios)2019
 2018
 Change
 2019
 2018
 Change
2020
 2019
 Change
 2020
 2019
 Change
Revenue                      
Lending- and deposit-related fees(a)$1,026
 $936
 10 % $2,827
 $2,668
 6 %$617
 $971
 (36)% $1,589
 $1,880
 (15)%
Asset management, administration and commissions(a)608
 626
 (3) 1,890
 1,792
 5
536
 620
 (14) 1,121
 1,201
 (7)
Mortgage fees and related income886
 260
 241
 1,561
 1,049
 49
917
 279
 229
 1,237
 675
 83
Card income(b)1,176
 1,219
 (4) 3,601
 3,299
 9
733
 913
 (20) 1,442
 1,775
 (19)
All other income1,399
 1,135
 23
 3,989
 3,255
 23
1,313
 1,321
 (1) 2,686
 2,611
 3
Noninterest revenue5,095
 4,176
 22
 13,868
 12,063
 15
4,116
 4,104
 —
 8,075
 8,142
 (1)
Net interest income9,164
 9,114
 1
 27,975
 26,321
 6
8,101
 9,380
 (14) 17,254
 18,785
 (8)
Total net revenue14,259
 13,290
 7
 41,843
 38,384
 9
12,217
 13,484
 (9) 25,329
 26,927
 (6)
                      
Provision for credit losses1,311
 980
 34
 3,745
 3,405
 10
5,828
 1,120
 420
 11,600
 2,434
 377
                      
Noninterest expense                      
Compensation expense2,683
 2,635
 2
 8,063
 7,916
 2
2,557
 2,531
 1
 5,154
 5,097
 1
Noncompensation expense(a)(c)
4,607
 4,347
 6
 13,600
 12,854
 6
4,069
 4,305
 (5) 8,574
 8,662
 (1)
Total noninterest expense7,290
 6,982
 4
 21,663
 20,770
 4
6,626
 6,836
 (3) 13,728
 13,759
 —
Income before income tax expense5,658
 5,328
 6
 16,435
 14,209
 16
Income tax expense1,385
 1,242
 12
 4,025
 3,385
 19
Net income$4,273
 $4,086
 5
 $12,410
 $10,824
 15
Income/(loss) before income tax expense/(benefit)(237) 5,528
 NM
 1
 10,734
 (100)
Income tax expense/(benefit)(61) 1,371
 NM
 (14) 2,630
 NM
Net income/(loss)$(176) $4,157
 NM
 $15
 $8,104
 (100)
                      
Revenue by line of business                      
Consumer & Business Banking$6,688
 $6,385
 5
 $20,053
 $18,238
 10
$5,107
 $6,897
 (26) $11,198
 $13,558
 (17)
Home Lending1,465
 1,306
 12
 3,929
 4,162
 (6)1,687
 1,118
 51
 2,848
 2,464
 16
Card, Merchant Services & Auto6,106
 5,599
 9
 17,861
 15,984
 12
Card & Auto(b)
5,423
 5,469
 (1) 11,283
 10,905
 3
                      
Mortgage fees and related income details:                      
Net production revenue738
 108
 NM
 1,291
 296
 336
742
 353
 110
 1,061
 553
 92
Net mortgage servicing revenue(b)(d)
148
 152
 (3) 270
 753
 (64)175
 (74) NM
 176
 122
 44
Mortgage fees and related income$886
 $260
 241 % $1,561
 $1,049
 49 %$917
 $279
 229 % $1,237
 $675
 83 %
                      
Financial ratios                      
Return on equity32% 31%   31% 27%  (2)% 31%   (1)% 31%  
Overhead ratio51
 53
   52
 54
  54
 51
   54
 51
  
Note: In the discussion andfirst quarter of 2020, the tables which follow,Merchant Services business was realigned from CCB presents certain financial measures which excludeto CIB as part of the impact of PCI loans; these are non-GAAP financial measures.Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation.
(a)Included operating lease depreciation expenseIn the first quarter of $1.0 billion2020, the Firm reclassified certain fees from asset management, administration and $862 million forcommissions to lending- and deposit-related fees. Prior-period amounts have been revised to conform with the three months ended September 30, 2019 and 2018, respectively, and $3.0 billion and $2.5 billion for nine months ended September 30, 2019 and 2018, respectively.current presentation.
(b)
In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.
(c)Included depreciation expense on leased assets of $1.1 billion and $957 million for the three months ended June 30, 2020 and 2019, respectively, and $2.2 billion and $1.9 billion for six months ended June 30, 2020 and 2019, respectively.
(d)Included MSR risk management results of $53$79 million and $(88)$(244) million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $(200)$(11) million and $(94)$(253) million for ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.



Quarterly results
Net loss was $176 million, compared with net income was $4.3of $4.2 billion in the prior year, predominantly driven by an increase of 5%.in the provision for credit losses.
Net revenue was $14.3$12.2 billion, an increasea decrease of 7%9%. Net production revenue included approximately $350 million of gains on the sale of certain mortgage loans that were predominantly offset by a charge in net interest income for the unwind of the related internal funding from Treasury and Chief Investment Office (“CIO”) associated with these loans. The charge reflects the net present value of that funding and is recognized as interest income in Treasury and CIO. Refer to Corporate on pages 42–43 of this Form 10-Q and Funds Transfer Pricing (“FTP”) on page 60 of the Firm’s 2018 Form 10-K for further information.
Net interest income was $9.2$8.1 billion, up 1% and includes the charge from the loan sales mentioned above. Excluding this charge, net interest income increased,down 14%, driven by:
higher loan balancesthe impact of deposit margin compression in CBB and margin expansionlower loans in Card, as well as growth in deposit balances and higher deposit margins in CBB,
partially offset by
lowergrowth in deposits in CBB and loan balances due to loan sales, as well as loan spread compressionmargin expansion in Home Lending.Card.
Noninterest revenue was $5.1$4.1 billion, up 22% and includesflat compared to the gain from the loan sales mentioned above. Excluding this gain, noninterest revenue increased, driven by:prior year, reflecting:
higher net mortgage production revenue reflecting higher production volumes and margins, partially offset by the absence of gains on loan sales in the prior year, and
higher auto lease volume
net mortgage servicing revenue which remained relatively flat, reflecting higher MSR risk management results due to the absence of losses resulting from updates to model inputs in the prior year partially offset by lower operating revenue drivenreflecting a lower level of third-party loans serviced,
offset by
lower deposit-related fees due to lower transaction activity and the impact of reclassifying certain loansfee refunds related to held-for-sale and faster prepayment speeds on the COVID-19 pandemic,
lower rates,card income due to lower net interchange income reflecting lower card sales volumes that began in March as a result of the COVID-19 pandemic, partially offset by favorable MSR risk management results.higher annual fees and lower acquisition costs, and
lower volume of annuity sales.
Refer to Note 1415 for further information regarding changes in the value of the MSR asset and related hedges, and mortgage fees and related income.
Noninterest expense was $7.3$6.6 billion, up 4%down 3%, predominantly driven by:
technology,by lower marketing expense on lower travel-related benefits and otherlower investments in the business,marketing campaigns, as well as higher auto lease depreciation,
partially offset by
lower structural expense, efficiencies andincluding lower FDIC charges.payment processing costs.
The provision for credit losses was $1.3$5.8 billion, an increase of 34%, reflecting:$4.7 billion from the prior year, driven by:
an increase inadditions to the allowance for credit card due tolosses as a result of the impact of the COVID-19 pandemic, consisting of: $2.9 billion for Card, $900 million for Home Lending, $490 million for CBB, and $310 million for Auto,
–higher net charge-offs on loan growth, in line with expectations, and
–a $200 million addition to the allowance for loan losses reflecting higher loss rates, as newer vintages season and become a larger part of the portfolio, compared to a $150 million addition in the prior year
an increase in consumer, excluding credit card due to
–a $100 million reduction in the allowance for loan losses in the non credit-impaired residential real estate portfolio, compared to a $250 million reduction in the PCI residential real estate portfolio in the prior year, and
–lower net recoveries in the residential real estate portfolio as the prior year benefited from a larger recovery on a loan sale
partially offset by
–a $50 million reduction in the allowance for loan losses in the business banking portfolio.

lower net charge-offs in Card reflecting higher recoveries.
The prior year included a $200 million net reduction in the allowance for credit losses.
Refer to Credit and Investment Risk Management on pages 60-79 and Allowance for Credit Losses on pages 77-78 for further discussions of the credit portfolios and the allowance for credit losses.


Year-to-date results
Net income was $12.4$15 million, compared to $8.1 billion in the prior year, predominantly driven by an increase of 15%.in the provision for credit losses.
Net revenue was $41.8$25.3 billion, an increasea decrease of 9%6%. Net production revenue included gains on sales of certain mortgage loans that were predominantly offset by charges in net interest income for the unwind of the related internal funding from Treasury and CIO associated with these loans.
Net interest income was $28.0$17.3 billion, up 6%down 8%, and includes charges from the loan sales mentioned above. Excluding these charges, net interest income increased, driven by:
higherthe impact of deposit margins and growth in deposit balancesmargin compression in CBB, as well as higherand lower loans in Home Lending predominantly due to prior year loan balances and margin expansion in Card,sales,
partially offset by
lowergrowth in deposits in CBB, and loan balances due to loan sales, as well as loan spread compressionmargin expansion in Home Lending.Card.
Noninterest revenue was $13.9$8.1 billion, up 15%, and includes gains from the loan sales mentioned above. Excluding these gains, noninterest revenue increased,relatively flat, driven by:
lower card income due to lower net interchange income reflecting lower card sales volumes that began in March as a result of the COVID-19 pandemic, partially offset by higher auto leaseannual fees,
lower deposit-related fees due to lower transaction activity and the impact of fee refunds related to the COVID-19 pandemic, and
lower volume of annuity sales,
offset by
higher net mortgage production revenue reflecting higher mortgage production margins and volumes and margins, partially offset by the absence of gains on loan sales in the prior year,
higher auto lease volume, and
higher net mortgage servicing revenue reflecting higher MSR risk management results due to the absence of losses resulting from updates to model inputs in the prior year, predominantly offset by lower operating revenue reflecting a lower level of third-party loans serviced and faster prepayment speeds on lower rates.
Noninterest expense was $13.7 billion, flat compared to the prior year, reflecting:
lower structural expenses, including lower payment processing costs, and
lower marketing expenses on lower travel-related benefits and investments in marketing campaigns,
offset by
higher volume- and revenue-related expense, including depreciation on auto lease assets, and investments in the business.
The provision for credit losses was $11.6 billion, an increase of $9.2 billion from the prior year, driven by:
additions to the allowance for credit losses as a result of the impact of the prior-year adjustment of approximately $330COVID-19 pandemic, consisting of: $6.6 billion for Card, $1.2 billion for Home Lending, $649 million to the credit card rewards liability,for CBB, and $560 million for Auto,
partially offset by
lower net mortgage servicing revenue driven by
–lower operating revenue reflecting faster prepayment speeds on lower rates and the impact of reclassifying certain loans to held-for-sale, as well as
–lower MSR risk management results reflecting updates to model inputs.
Noninterest expense was $21.7 billion, up 4%, driven by:
technology, marketing and other investmentscharge-offs reflecting higher recoveries in Home Lending on a loan sale in the business, as well asfirst quarter of 2020, and in Card, largely offset by higher auto lease depreciation,charge-offs in Card on loan growth in the prior year.
partially offset by
expense efficiencies and lower FDIC charges.
The provisionprior year included a $200 million net reduction in the allowance for credit losses was $3.7 billion, an increase of 10%, reflecting:
an increase in credit card due to
–a $400 million addition to the allowance for loan losses reflecting higher loss rates, as newer vintages season and become a larger part of the portfolio and loan growth, compared to a $150 million addition in the prior year, and
–higher net charge-offs on loan growth, in line with expectations
partially offset by
a decrease in consumer, excluding credit card due to
–a $400 million reduction in the allowance for loan losses in the PCI residential real estate portfolio, reflecting continued improvement in home prices and delinquencies, and a $100 million reduction in the allowance for loan losses in the non credit-impaired residential real estate portfolio, compared to a $250 million reduction in the PCI residential real estate portfolio in the prior year, and
–a $50 million reduction in the allowance for loan losses in the business banking portfolio
largely offset by
–lower net recoveries in the residential real estate portfolio as the prior year benefited from larger recoveries on loan sales.


losses.



Selected metrics                      
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except headcount)2019
 2018
 Change
 2019 2018 Change
2020
 2019
 Change
 2020 2019 Change
Selected balance sheet data (period-end)                      
Total assets$532,487
 $560,432
 (5)% $532,487
 $560,432
 (5)%$492,251
 $536,758
 (8)% $492,251
 $536,758
 (8)%
Loans:                      
Consumer & Business Banking26,699
 26,451
 1
 26,699
 26,451
 1
46,910
(b) 
26,616
 76
 46,910
(b) 
26,616
 76
Home equity31,552
 37,461
 (16) 31,552
 37,461
 (16)
Residential mortgage171,787
 205,389
 (16) 171,787
 205,389
 (16)
Home Lending203,339
 242,850
 (16) 203,339
 242,850
 (16)188,576
 219,533
 (14) 188,576
 219,533
 (14)
Card159,571
 147,881
 8
 159,571
 147,881
 8
141,656
 157,576
 (10) 141,656
 157,576
 (10)
Auto61,410
 63,619
 (3) 61,410
 63,619
 (3)59,287
 62,073
 (4) 59,287
 62,073
 (4)
Total loans451,019
 480,801
 (6) 451,019
 480,801
 (6)436,429
 465,798
 (6) 436,429
 465,798
 (6)
Core loans405,662
 425,917
 (5) 405,662
 425,917
 (5)
Deposits701,170
 677,260
 4
 701,170
 677,260
 4
876,991
 695,096
 26
 876,991
 695,096
 26
Equity52,000
 51,000
 2
 52,000
 51,000
 2
52,000
 52,000
 —
 52,000
 52,000
 —
Selected balance sheet data (average)                      
Total assets$538,500
 $551,080
 (2) $544,833
 $544,931
 —
$498,140
 $534,612
 (7) $507,676
 $540,296
 (6)
Loans:                      
Consumer & Business Banking26,550
 26,351
 1
 26,537
 26,104
 2
41,198
 26,570
 55
 34,230
 26,529
 29
Home equity32,215
 38,211
 (16) 33,694
 39,951
 (16)
Residential mortgage181,157
 204,689
 (11) 191,881
 201,665
 (5)
Home Lending213,372
 242,900
 (12) 225,575
 241,616
 (7)192,716
 224,685
 (14) 195,379
 231,778
 (16)
Card158,168
 146,272
 8
 154,375
 143,986
 7
142,377
 153,746
 (7) 152,518
 152,447
 —
Auto61,371
 64,060
 (4) 62,118
 65,096
 (5)60,306
 62,236
 (3) 60,599
 62,498
 (3)
Total loans459,461
 479,583
 (4) 468,605
 476,802
 (2)436,597
 467,237
 (7) 442,726
 473,252
 (6)
Core loans413,036
 422,582
 (2) 419,851
 415,662
 1
Deposits693,980
 674,211
 3
 688,676
 669,244
 3
831,996
 690,892
 20
 782,822
 685,980
 14
Equity52,000
 51,000
 2
 52,000
 51,000
 2
52,000
 52,000
 —
 52,000
 52,000
 —
                      
Headcount127,687
 129,891
 (2)% 127,687
 129,891
 (2)%
Headcount(a)
122,089
 123,580
 (1)% 122,089
 123,580
 (1)%



Selected metrics          
 As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,
(in millions, except ratio data)2019

2018
 Change
 2019 2018 Change
Credit data and quality statistics           
Nonaccrual loans(a)(b)
$3,099

$3,520

(12)%
$3,099

$3,520

(12)%
            
Net charge-offs/(recoveries)(c)
           
Consumer & Business Banking79
 68
 16
 204
 171
 19
Home equity(25) (12) (108) (41) (3) NM
Residential mortgage(17) (105) 84
 (34) (252) 87
Home Lending(42) (117) 64
 (75) (255) 71
Card1,175
 1,073
 10
 3,617
 3,407
 6
Auto49
 56
 (13) 149
 182
 (18)
Total net charge-offs/(recoveries)$1,261
 $1,080
 17
 $3,895
 $3,505
 11
            
Net charge-off/(recovery) rate(c)
           
Consumer & Business Banking1.18 % 1.02%   1.03 % 0.88%  
Home equity(d)
(0.41) (0.17)   (0.22) (0.01)  
Residential mortgage(d)
(0.04) (0.22)   (0.03) (0.18)  
Home Lending(d)
(0.09) (0.21)   (0.05) (0.16)  
Card2.95
 2.91
   3.13
 3.16
  
Auto0.32
 0.35
   0.32
 0.37
  
Total net charge-off/(recovery) rate(d)
1.16
 0.95
   1.17
 1.05
  
            
30+ day delinquency rate           
Home Lending(e)(f)
0.78 % 0.81%   0.78 % 0.81%  
Card1.84
 1.75
   1.84
 1.75
  
Auto0.88
 0.82
   0.88
 0.82
  
            
90+ day delinquency rate — Card0.90
 0.85
   0.90
 0.85
  
            
Allowance for loan losses           
Consumer & Business Banking$746
 $796
 (6) $746
 $796
 (6)
Home Lending, excluding PCI loans903
 1,003
 (10) 903
 1,003
 (10)
Home Lending — PCI loans(c)
1,256
 1,824
 (31) 1,256
 1,824
 (31)
Card5,583
 5,034
 11
 5,583
 5,034
 11
Auto465
 464
 —
 465
 464
 —
Total allowance for loan losses(c)
$8,953
 $9,121
 (2)% $8,953
 $9,121
 (2)%
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation, including a decrease to period-end assets and headcount of $13.9 billion and 4,152, respectively, as of June 30, 2019.
(a)Excludes
During the second quarter of 2020, certain technology and support functions, comprising approximately 850 staff, were transferred from AWM to CCB as part of the ongoing reorganization of the U.S. Wealth Management business.
(b)At June 30, 2020, included $19.9 billion of loans in Business Banking under the PPP. Refer to Credit Portfolio on pages 60-61 for a further discussion of the PPP.


Selected metrics          
 As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except ratio data)2020
 2019
 Change
 2020 2019 Change
Credit data and quality statistics           
Nonaccrual loans(a)(b)
$4,407
(e) 
$3,142
 40 %
$4,407
(e) 
$3,142

40 %
            
Net charge-offs/(recoveries)           
Consumer & Business Banking60
 66
 (9) 134
 125
 7
Home Lending(5) (28) 82
 (127) (33) (285)
Card1,178
 1,240
 (5) 2,491
 2,442
 2
Auto45
 42
 7
 93
 100
 (7)
Total net charge-offs/(recoveries)$1,278
 $1,320
 (3) $2,591
 $2,634
 (2)
            
Net charge-off/(recovery) rate           
Consumer & Business Banking0.59%
(f) 
1.00%   0.79 %
(f) 
0.95%  
Home Lending(0.01) (0.05)   (0.13) (0.03)  
Card3.33
 3.24
   3.28
 3.23
  
Auto0.30
 0.27
   0.31
 0.32
  
Total net charge-off/(recovery) rate1.18% 1.14%   1.18
 1.13
  
            
30+ day delinquency rate           
Home Lending(c)(d)
1.30%
(g) 
1.55%   1.30 %
(g) 
1.55%  
Card1.71
(g) 
1.71
   1.71
(g) 
1.71
  
Auto0.54
(g) 
0.82
   0.54
(g) 
0.82
  
            
90+ day delinquency rate — Card0.93%
(g) 
0.87%   0.93
(g) 
0.87
  
            
Allowance for loan losses           
Consumer & Business Banking$1,370
 $796
 72
 $1,370
 $796
 72
Home Lending2,957
 2,302
 28
 2,957
 2,302
 28
Card17,800
 5,383
 231
 17,800
 5,383
 231
Auto1,044
 465
 125
 1,044
 465
 125
Total allowance for loan losses$23,171
 $8,946
 159 % $23,171
 $8,946
 159 %
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. The adoption resulted in a change in the accounting for PCI loans, which are considered purchased credit deteriorated (“PCD”) loans under CECL. Refer to Note 1 for further information.
(a)At June 30, 2020, nonaccrual loans included $1.3 billion of PCD loans. Prior to the adoption of CECL, nonaccrual loans excluded PCI loans. Theloans as the Firm is recognizingrecognized interest income on each pool of PCI loans as each of the pools iswas performing.
(b)At SeptemberJune 30, 20192020 and 2018,2019, nonaccrual loans excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $1.6 billion$561 million and $2.9$1.8 billion, respectively. These amounts have been excluded based upon the government guarantee.
(c)Net charge-offs/(recoveries) andAt June 30, 2020, the net charge-off/(recovery)30+ day delinquency rates forincluded PCD loans. The rate prior to January 1, 2020 was revised to include the three months ended September 30, 2019 and 2018, excluded $43 million and $58 million, respectively, and for nine months ended September 30, 2019 and 2018, excluded $132 million and $151 million, respectively,impact of write-offs in the PCI portfolio. These write-offs decreased the allowance for loan losses for PCI loans. Refer to Summary of changes in the allowance for credit losses on page 68 for further information on PCI write-offs.
(d)Excludes the impact of PCI loans. For the three months ended SeptemberAt June 30, 20192020 and 2018, the net charge-off/(recovery) rates including the impact of PCI loans were as follows: (1) home equity of (0.31)% and (0.12)%, respectively; (2) residential mortgage of (0.04)% and (0.20)%, respectively; (3) Home Lending of (0.08)% and (0.19)%, respectively; and (4) total CCB of 1.10% and 0.89%, respectively. For nine months ended September 30, 2019, and 2018, the net charge-off/(recovery) rates included impact of PCI loans were as follows: (1) home equity of (0.16)% and (0.01)%, respectively; (2) residential mortgage of (0.02)% and (0.17)%, respectively; (3) Home Lending of (0.04)% and (0.14)%, respectively; and (4) total CCB of 1.12% and 0.98%, respectively.
(e)At September 30, 2019 and 2018, excluded mortgage loans insured by U.S. government agencies of $2.7 billion$826 million and $4.5$2.9 billion, respectively, that are 30 or more days past due. These amounts have been excluded based upon the government guarantee.
(e)Generally excludes loans that were under payment deferral programs offered in response to the COVID-19 pandemic. Refer to Consumer Credit Portfolio on pages 62-66 for further information on consumer payment assistance activity.
(f)Excludes PCIAt June 30, 2020, included $19.9 billion of loans in Business Banking under the PPP. Given that PPP loans are guaranteed by the SBA, the Firm does not expect to realize material credit losses on these loans. The 30+ day delinquency rateRefer to Credit Portfolio on pages 60-61 for PCIa further discussion of the PPP.
(g)At June 30, 2020, the principal balance of loans was 8.56%in Home Lending, Card and 9.39% at September 30, 2019Auto under payment deferral programs offered in response to the COVID-19 pandemic were $18.2 billion, $4.4 billion and 2018,$12.3 billion, respectively. Loans that are performing according to their modified terms are generally not considered delinquent. Refer to Consumer Credit Portfolio on pages 62-66 for further information on consumer payment assistance activity.



Selected metricsSelected metrics          Selected metrics          
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in billions, except ratios and where otherwise noted)2019
 2018
 Change
 2019
 2018
 Change
2020
 2019
 Change
 2020
 2019
 Change
Business Metrics                      
Number of branches4,949
 5,066
 (2)% 4,949
 5,066
 (2)%4,923
 4,970
 (1)% 4,923
 4,970
 (1)%
Active digital customers
(in thousands)(a)
51,843
 48,664
 7
 51,843
 48,664
 7
54,471
 51,032
 7
 54,471
 51,032
 7
Active mobile customers
(in thousands)(b)
36,510
 32,538
 12
 36,510
 32,538
 12
39,024
 35,392
 10
 39,024
 35,392
 10
Debit and credit card sales volume$282.2

$259.0

9
 $818.8

$746.4
 10
$237.6
 $281.5
 (16) $503.6

$536.6
 (6)
                      
Consumer & Business Banking                      
Average deposits$678.3
 $659.5
 3
 $674.5
 $655.3
 3
$813.2
 $676.7
 20
 $766.0
 $672.6
 14
Deposit margin2.47% 2.43%   2.56% 2.33%  1.52% 2.60%   1.77% 2.61%  
Business banking origination volume$1.6
 $1.6
 (5) $4.8
 $5.2
 (8)$23.0
(f) 
$1.7
 NM
 $24.5
(f) 
$3.2
 NM
Client investment assets337.9
 298.4
 13
 337.9
 298.4
 13
356.1
 328.1
 9
 356.1
 328.1
 9
                      
Home Lending                      
Mortgage origination volume by channel                      
Retail$14.2
 $10.6
 34
 $34.6
 $29.3
 18
$18.0
 $12.5
 44
 $32.1
 $20.4
 57
Correspondent18.2
 11.9
 53
 37.3
 32.9
 13
6.2
 12.0
 (48) 20.2
 19.1
 6
Total mortgage origination volume(c)
$32.4
 $22.5
 44
 $71.9
 $62.2
 16
$24.2
 $24.5
 (1) $52.3
 $39.5
 32
                      
Total loans serviced (period-end)$774.8
 $798.6
 (3) $774.8
 $798.6
 (3)$683.7
 $780.1
 (12) $683.7
 $780.1
 (12)
Third-party mortgage loans serviced (period-end)535.8
 526.5
 2
 535.8
 526.5
 2
482.4
 526.6
 (8) 482.4
 526.6
 (8)
MSR carrying value (period-end)4.4
 6.4
 (31) 4.4
 6.4
 (31)3.1
 5.1
 (39) 3.1
 5.1
 (39)
Ratio of MSR carrying value (period-end) to third-party mortgage loans serviced (period-end)0.82% 1.22%   0.82% 1.22%  0.64% 0.97%   0.64% 0.97%  
                      
MSR revenue multiple(d)
2.41x 3.49x   2.34x 3.49x  2.29x 2.69x   2.21x 2.77x  
                      
Card, excluding Commercial Card           
Credit card sales volume$193.6
 $176.0
 10
 $558.6
 $507.1
 10
           
Card Services           
Net revenue rate11.40% 11.50%   11.50% 11.17%  
           
Merchant Services           
Merchant processing volume$380.5
 $343.8
 11
 $1,108.6
 $990.9
 12
Credit Card           
Credit card sales volume, excluding Commercial Card$148.5
 $192.5
 (23) $327.6
 $365.0
 (10)
Net revenue rate(e)
11.02% 10.31%   10.76% 10.43%  
                      
Auto                      
Loan and lease origination volume$9.1
 $8.1
 12
 $25.5
 $24.8
 3
$7.7
 $8.5
 (9) $16.0
 $16.4
 (2)
Average auto operating lease assets21.8
 19.2
 14 % 21.3
 18.4
 16 %22.6
 21.3
 6 % 22.8
 21.1
 8 %
(a)Users of all web and/or mobile platforms who have logged in within the past 90 days.
(b)Users of all mobile platforms who have logged in within the past 90 days.
(c)Firmwide mortgage origination volume was $35.8$28.3 billion and $24.5$26.3 billion for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively and $78.5$60.2 billion and $68.2$42.7 billion for ninethe six months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.
(d)Represents the ratio of MSR carrying value (period-end) to third-party mortgage loans serviced (period-end) divided by the ratio of annualized loan servicing-related revenue to third-party mortgage loans serviced (average).

(e)In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.
(f)Included $21.5 billion of origination volume under the PPP for the three and six months ended June 30, 2020. Refer to Credit Portfolio on pages 60-61 for a further discussion of the PPP.

CORPORATE & INVESTMENT BANK
The Corporate & Investment Bank, which consists of Banking and Markets & Securities Services, offers a broad suite of investment banking, market-making, prime brokerage, and treasury and securities products and services to a global client base of corporations, investors, financial institutions, merchants, government and municipal entities. Banking offers a full range of investment banking products and services in all major capital markets, including advising on corporate strategy and structure, capital-raising in equity and debt markets, as well as loan origination and syndication. Banking also includes Wholesale Payments, which provides payments services enabling clients to manage payments and receipts globally, and cross-border financing. Markets & Securities Services includes Markets, a global market-maker in cash securities and derivative instruments, which also offers sophisticated risk management solutions, prime brokerage, and research. Markets & Securities Services also includes Securities Services, a leading global custodian which provides custody, fund accounting and administration, and securities lending products principally for asset managers, insurance companies and public and private investment funds.

Refer to pages 66–70 of JPMorgan Chase’s 2018 Form 10-K and Line of Business Metrics on page 173197 for a further discussion of the business profile of CIB.
Selected income statement dataSelected income statement data        Selected income statement data        
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions, except ratios)2019 2018 Change 2019 2018 Change2020 2019 Change 2020 2019 Change
Revenue                      
Investment banking fees$1,981
 $1,823
 9 % $5,671
 $5,658
 —
$2,847
 $1,846
 54 % $4,754
 $3,690
 29 %
Principal transactions3,418
 3,091
 11
 11,466
 10,786
 6
7,400
 3,885
 90
 10,588
 8,049
 32
Lending- and deposit-related fees(a)360
 373
 (3) 1,095
 1,136
 (4)500
 412
 21
 950
 808
 18
Asset management, administration and commissions1,197
 1,130
 6
 3,447
 3,416
 1
Asset management, administration and commissions(a)

1,146
 1,112
 3
 2,407
 2,179
 10
All other income226
 88
 157
 649
 958
 (32)380
 405
 (6) 415
 770
 (46)
Noninterest revenue7,182
 6,505
 10
 22,328
 21,954
 2
12,273
 7,660
 60
 19,114
 15,496
 23
Net interest income2,156
 2,300
 (6) 6,499
 7,257
 (10)4,079
 2,171
 88
 7,186
 4,369
 64
Total net revenue(a)(b)
9,338
 8,805
 6
 28,827
 29,211
 (1)16,352
 9,831
 66
 26,300
 19,865
 32
                      
Provision for credit losses92
 (42) NM
 179
 (142) NM
1,987
 —
 NM
 3,388
 87
 NM
                      
Noninterest expense                      
Compensation expense2,734
 2,402
 14
 8,381
 8,158
 3
3,997
 2,839
 41
 7,003
 5,930
 18
Noncompensation expense2,614
 2,773
 (6) 7,907
 8,079
 (2)2,767
 2,822
 (2) 5,657
 5,360
 6
Total noninterest expense5,348
 5,175
 3
 16,288
 16,237
 —
6,764
 5,661
 19
 12,660
 11,290
 12
Income before income tax expense3,898
 3,672
 6
 12,360
 13,116
 (6)7,601
 4,170
 82
 10,252
 8,488
 21
Income tax expense1,089
 1,046
 4
 3,365
 3,318
 1
2,137
 1,224
 75
 2,800
 2,282
 23
Net income$2,809
 $2,626
 7 % $8,995
 $9,798
 (8)%$5,464
 $2,946
 85 % $7,452
 $6,206
 20 %
Financial ratios                      
Return on equity13% 14%   14% 18%  27% 14%   18% 15%  
Overhead ratio57
 59
   57
 56
  41
 58
   48
 57
  
Compensation expense as percentage of total net revenue29
 27
   29
 28
  24
 29
   27
 30
  
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation.
(a)In the first quarter of 2020, the Firm reclassified certain fees from asset management, administration and commissions to lending- and deposit-related fees. Prior-period amounts have been revised to conform with the current presentation.
(b)Includes tax-equivalent adjustments, predominantly due to income tax credits related to alternative energy investments; income tax credits and amortization of the cost of investments in affordable housing projects; and tax-exempt income from municipal bonds of $527$686 million and $354$547 million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $1.6$1.4 billion and $1.2$1.1 billion for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.

Selected income statement dataSelected income statement data        Selected income statement data        
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019 2018 Change 2019 2018 Change2020 2019 Change 2020 2019 Change
Revenue by business                      
Investment Banking$1,871
 $1,731
 8 % $5,392
 $5,267
 2 %$3,401
 $1,776
 91 % $4,287
 $3,521
 22 %
Treasury Services1,101
 1,183
 (7) 3,383
 3,480
 (3)
Wholesale Payments
1,356
 1,402
 (3) 2,715
 2,817
 (4)
Lending329
 331
 (1) 1,006
 954
 5
270
 260
 4
 620
 518
 20
Total Banking3,301
 3,245
 2
 9,781
 9,701
 1
5,027
 3,438
 46
 7,622
 6,856
 11
Fixed Income Markets3,557
 2,844
 25
 10,972
 10,850
 1
7,338
 3,690
 99
 12,331
 7,415
 66
Equity Markets1,517
 1,595
 (5) 4,986
 5,571
 (11)2,380
 1,728
 38
 4,617
 3,469
 33
Securities Services1,034
 1,057
 (2) 3,093
 3,219
 (4)1,097
 1,045
 5
 2,171
 2,059
 5
Credit Adjustments & Other(a)
(71) 64
 NM
 (5) (130) 96
510
 (70) NM
 (441) 66
 NM
Total Markets & Securities Services6,037
 5,560
 9
 19,046
 19,510
 (2)11,325
 6,393
 77
 18,678
 13,009
 44
Total net revenue$9,338
 $8,805
 6 % $28,827
 $29,211
 (1)%$16,352
 $9,831
 66 % $26,300
 $19,865
 32 %
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation.
(a)Consists primarily ofIncludes credit valuation adjustments (“CVA”) managed centrally within CIB and funding valuation adjustments (“FVA”) on derivatives. Resultsderivatives and certain components of fair value option elected liabilities, which are primarily reported in principal transactions revenue. Results are presented net of associated hedging activities and net of CVA and FVA amounts allocated to Fixed Income Markets and Equity Markets.
allocated to Fixed Income Markets and Equity Markets.


Quarterly results
Net income was $2.8$5.5 billion, up 7%.85%, with record revenue more than offsetting higher noninterest expense and an increase in the provision for credit losses.
Net revenue was $9.3$16.4 billion, up 6%66%.
Banking revenue was $3.3$5.0 billion, up 2%46%.
Investment Banking revenue was $1.9$3.4 billion, up 8%91%, driven by higher debt and equity underwritingInvestment Banking fees, partially offset by lower advisory fees.up 54%, reflecting higher fees across products, as well as $659 million of markups on held-for-sale positions, including unfunded commitments, in the bridge financing portfolio as a result of improved market conditions. The Firm maintained its #1 ranking for Global Investment Banking fees, with overall share gains, according to Dealogic.
–Debt underwriting fees were $961 million,$1.3 billion, up 17%55%, reflectingdriven by increased industry-wide fees and wallet share gains despite a decline in industry-wide fees, driven by participation in large acquisition financing dealsboth investment-grade and increased activity in investment-gradehigh-yield bonds.
–Equity underwriting fees were $514$977 million, up 22%93%, driven by both increased industry-wide fees and wallet share gains primarily in the IPOfollow-on offerings and convertible securities markets.
–The increased activity in debt and equity underwriting reflected clients seeking access to liquidity as a result of the COVID-19 pandemic.
–Advisory fees were $506$602 million, down 13%up 15%, driven by a decline in industry-wide fees compared to a strong prior year.few large completed transactions.
Treasury ServicesWholesale Payments revenue was $1.1$1.4 billion, down 7%3%, driven by a reporting re-classification for certain expenses which are now reported as a reduction of revenue in Merchant Services. In addition, the impact of higher deposit balances was predominantly offset by deposit margin compression partially offset by fee growth and higher balances.compression.
Lending revenue was $329$270 million, down 1%.up 4%, with higher net interest income on higher loan balances, as well as
higher fees, offset by fair value losses on hedges of accrual loans.
Markets & Securities Services revenue was $6.0$11.3 billion, up 9%77%. Markets revenue was $5.1$9.7 billion, up 14%79%.
Fixed Income Markets revenue was $3.6$7.3 billion, up 25% compared to99%, or up 120% excluding a gain from the IPO of Tradeweb in the prior year, which reflected less favorable market conditions. The current quarter results weredriven by strong performance across products, primarily in Rates, Currencies & Emerging Markets, and Credit.
Equity Markets revenue was $2.4 billion, up 38%, predominantly driven by strong client activity across products primarily in Rates, agency mortgage trading within Securitized Products and Commodities.
Equity Markets revenue was $1.5 billion, down 5% compared to a strong prior year. The current quarter results were driven by lower revenue in derivatives reflecting lower client activity and less favorable market conditions which were partially offset by higher revenue in Cash Equities.
Securities Services revenue was $1.0$1.1 billion, down 2%up 5%, withpredominantly driven by deposit balance and fee growth partially offset by deposit margin compression largely offsetcompression.
Credit Adjustments & Other was a gain of $510 million, driven by organic growth.funding spread tightening on derivatives.
Noninterest expense was $6.8 billion, up 19%, driven by higher revenue-related compensation expense.
The provision for credit losses was $92 million, largely$2.0 billion, predominantly driven by a net additionadditions to the allowance for credit losses related to select emerging market client downgrades. The prior year wasas a benefitresult of $42 million reflecting a net recovery related to a loan sale.the impact of the COVID-19 pandemic across multiple industry sectors.
Noninterest expense was $5.3 billion, up 3%, driven by higher volume- and revenue-related expenses and investments, including compensation expense, largely offset
by lower legal expenses and FDIC charges.
Year-to-date results
Net income was $9.0$7.5 billion, down 8%.up 20%, with revenue more than offsetting higher noninterest expense and an increase in the provision for credit losses.
Net revenue was $28.8$26.3 billion, down 1%up 32%.
Banking revenue was $9.8$7.6 billion, up 1% compared to the prior year.11%.
Investment Banking revenue was $5.4$4.3 billion, up 2%22%, withdriven by higher Investment Banking fees, up 29%, reflecting higher debt and equity underwriting predominantlyfees, partially offset by lower advisory and equity underwriting fees.fees, as well as $161 million of net markdowns on held-for-sale positions,

including unfunded commitments, in the bridge financing portfolio. The Firm maintained its #1 ranking for Global Investment Banking fees, with overall share gains, according to Dealogic.
–Debt underwriting fees were $2.7$2.3 billion, up 7%34%, reflectingdriven by increased industry-wide fees and wallet share gains despite a decline in investment-grade bonds, and for high-yield bonds, after the markets stabilized in the second quarter of 2020.
–Equity underwriting fees were $1.3 billion, up 70%, driven by both increased industry-wide fees driven by participationand wallet share gains primarily in large acquisition financing deals.follow-on offerings and convertible securities markets.
–The increased activity in debt and equity underwriting reflected clients seeking access to liquidity as a result of the COVID-19 pandemic.
–Advisory fees of $1.1 billion were $1.7 billion, down 6%, and Equity underwriting fees were $1.3 billion, down 4%5%, driven by a decline in industry-wide fees despite wallet share gains.lower number of completed transactions.
Treasury ServicesWholesale payments revenue was $3.4$2.7 billion, down 3%4%, with deposit margin compressiondriven by a reporting re-classification for certain expenses which are now reported as a reduction of revenue in Merchant Services. In addition, the impact of higher balances and fee growth was predominantly offset by fee growth and higher balances.deposit margin compression.
Lending revenue was $1.0$620 million, up 20%, driven by higher net interest income on higher loan balances, as well as higher fees.
Markets & Securities Services revenue was $18.7 billion, up 44%. Markets revenue was $16.9 billion, up 56%.
Fixed Income Markets revenue was $12.3 billion, up 66%, driven by strong client activity across products primarily in Rates, Currencies & Emerging Markets, and Credit.
Equity Markets revenue was $4.6 billion, up 33%, driven by strong client activity in derivatives and Cash Equities.
Securities Services revenue was $2.2 billion, up 5%, predominantly driven by higher net interest income reflectingdeposit balance and fee growth in loan balances.
Markets & Securities Services revenue was $19.0 billion, down 2%. Markets revenue was $16.0 billion, down 3% which included a gain from the IPO of Tradeweb. In addition, prior year results included approximately $500 million of fair value gains related to the adoption of the recognition and measurement accounting guidance for certain equity investments previously held at cost.
Fixed Income Markets revenue was $11.0 billion, up 1% reflecting higher revenue in agency mortgage trading within Securitized Products and Commodities partially offset by lower revenue in Currencies & Emerging Markets.
Equity Markets revenue was $5.0 billion, down 11% compared to a strong prior year, predominantly driven by lower client activity in derivatives.
Securities Services revenue was $3.1 billion, down 4%, driven by deposit margin compression and the impact of a business exit partially offset by organic growth.compression.
Credit Adjustments & Other was a net loss of $5$441 million, compared with a losspredominantly driven by losses on certain components of $130 million infair value option elected liabilities, as well as the prior year.impact of funding spread widening on derivatives
Noninterest expense was $12.7 billion, up 12%, predominantly driven by higher revenue-related compensation expense.
The provision for credit losses was $179$3.4 billion, compared with $87 million reflecting select C&I client downgrades including those in an emerging market.the prior year. The prior yearincrease was a benefit of $142 million, primarilypredominantly driven by loan sales and other activity related to a single name in the Oil & Gas portfolio, partially offset by other net portfolio activity.
Noninterest expense was $16.3 billion, flat comparedadditions to the prior year reflecting higher volume-related expensesallowance for credit losses as a result of the impact of the COVID-19 pandemic across multiple industry sectors.
Refer to Credit and investments, including front office hires, as well as technology staff, predominantly offset by lower FDIC chargesInvestment Risk Management on pages 60-79 and revenue-related compensation expense.Allowance for Credit Losses on pages 77-78 for further discussions of the credit portfolios and the allowance for credit losses.

Selected metricsSelected metrics          Selected metrics          
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except headcount)2019 2018 Change 2019 2018 Change2020 2019 Change 2020 2019 Change
Selected balance sheet data (period-end)                      
Assets$1,023,132
 $928,148
 10 % $1,023,132
 $928,148
 10 %$1,080,761
 $976,430
 11% $1,080,761
 $976,430
 11%
Loans:                      
Loans retained(a)
118,290
 117,084
 1
 118,290
 117,084
 1
140,770
 123,074
 14
 140,770
 123,074
 14
Loans held-for-sale and loans at fair value8,324
 6,133
 36
 8,324
 6,133
 36
10,241
 6,838
 50
 10,241
 6,838
 50
Total loans126,614
 123,217
 3
 126,614
 123,217
 3
151,011
 129,912
 16
 151,011
 129,912
 16
Core loans126,445
 122,953
 3
 126,445
 122,953
 3
Equity80,000
 70,000
 14
 80,000
 70,000
 14
80,000
 80,000
 —
 80,000
 80,000
 —
Selected balance sheet data (average)                      
Assets$1,003,395
 $924,909
 8
 $985,503
 $924,145
 7
$1,167,807
 $1,000,517
 17
 $1,125,314
 $984,165
 14
Trading assets-debt and equity instruments415,450
 349,390
 19
 406,304
 354,270
 15
450,507
 421,775
 7
 438,911
 401,656
 9
Trading assets-derivative receivables48,266
 62,025
 (22) 49,221
 60,943
 (19)76,710
 48,815
 57
 65,922
 49,707
 33
Loans:                      
Loans retained(a)
$119,007
 $115,390
 3
 $123,368
 $112,921
 9
$154,038
 $124,194
 24
 $141,438
 $125,585
 13
Loans held-for-sale and loans at fair value8,344
 7,328
 14
 8,239
 6,263
 32
8,399
 7,763
 8
 9,108
 8,186
 11
Total loans$127,351
 $122,718
 4
 $131,607
 $119,184
 10
$162,437
 $131,957
 23
 $150,546
 $133,771
 13
Core loans127,187
 122,442
 4
 131,436
 118,877
 11
Equity80,000
 70,000
 14
 80,000
 70,000
 14
80,000
 80,000
 —
 80,000
 80,000
 —
Headcount55,873
 54,052
 3 % 55,873
 54,052
 3 %60,950
 59,111
 3% 60,950
 59,111
 3%
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation, including an increase to period-end assets and headcount of $13.9 billion and 4,152, respectively, as of June 30, 2019.
(a)Loans retained includes credit portfolio loans, loans held by consolidated Firm-administered multi-seller conduits, trade finance loans, other held-for-investment loans and overdrafts.


Selected metrics                      
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except ratios)2019 2018 Change 2019 2018 Change2020 2019 Change 2020 2019 Change
Credit data and quality statistics                      
Net charge-offs/(recoveries)$38
 $(40) NM
 $140
 $94
 49 %$204
 $72
 183 % $259
 $102
 154 %
Nonperforming assets:                      
Nonaccrual loans:                      
Nonaccrual loans retained(a)
$712
 $318
 124 % $712
 $318
 124
$1,195
 $569
 110 % $1,195
 $569
 110
Nonaccrual loans held-for-sale and loans at fair value
262
 9
 NM
 262
 9
 NM
250
 370
 (32) 250
 370
 (32)
Total nonaccrual loans974
 327
 198
 974
 327
 198
1,445
 939
 54
 1,445
 939
 54
Derivative receivables26
 90
 (71) 26
 90
 (71)108
 39
 177
 108
 39
 177
Assets acquired in loan satisfactions75
 61
 23
 75
 61
 23
35
 58
 (40) 35
 58
 (40)
Total nonperforming assets$1,075
 $478
 125
 $1,075
 $478
 125
$1,588
 $1,036
 53
 $1,588
 $1,036
 53
Allowance for credit losses:                      
Allowance for loan losses$1,171
 $1,068
 10
 $1,171
 $1,068
 10
$3,440
 $1,131
 204
 $3,440
 $1,131
 204
Allowance for lending-related commitments824
 802
 3
 824
 802
 3
1,233
 807
 53
 1,233
 807
 53
Total allowance for credit losses$1,995
 $1,870
 7 % $1,995
 $1,870
 7 %$4,673
 $1,938
 141 % $4,673
 $1,938
 141 %
Net charge-off/(recovery) rate(b)
0.13% (0.14)%   0.15% 0.11%  0.53% 0.23%   0.37% 0.16%  
Allowance for loan losses to period-end loans retained0.99
 0.91
   0.99
 0.91
  2.44
 0.92
   2.44
 0.92
  
Allowance for loan losses to period-end loans retained, excluding trade finance and conduits(c)
1.33
 1.27
   1.33
 1.27
  3.27
 1.27
   3.27
 1.27
  
Allowance for loan losses to nonaccrual loans retained(a)
164
 336
   164
 336
  288
 199
   288
 199
  
Nonaccrual loans to total period-end loans0.77% 0.27 %   0.77% 0.27%  0.96% 0.72%   0.96% 0.72%  
(a)Allowance for loan losses of $207$340 million and $145$147 million were held against these nonaccrual loans at SeptemberJune 30, 20192020 and 2018,2019, respectively.
(b)Loans held-for-sale and loans at fair value were excluded when calculating the net charge-off/(recovery) rate.
(c)Management uses allowance for loan losses to period-end loans retained, excluding trade finance and conduits, a non-GAAP financial measure, to provide a more meaningful assessment of CIB’s allowance coverage ratio.

Investment banking feesInvestment banking fees          Investment banking fees        
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019 2018 Change 2019 2018 Change2020 2019 Change 2020 2019 Change
Advisory$506
 $581
 (13)% $1,675
 $1,782
 (6)%$602
 $525
 15 $1,105
 $1,169
 (5)%
Equity underwriting514
 420
 22
 1,284
 1,336
 (4)977
 505
 93 1,308
 770
 70
Debt underwriting(a)
961
 822
 17
 2,712
 2,540
 7
1,268
 816
 55 2,341
 1,751
 34
Total investment banking fees$1,981
 $1,823
 9 % $5,671
 $5,658
 —
$2,847
 $1,846
 54 $4,754
 $3,690
 29 %
(a)Represents long-term debt and loan syndications.

League table results – wallet shareLeague table results – wallet share          League table results – wallet share        
Three months ended September 30, Nine months ended September 30, Full-year 2018
Three months ended June 30, Six months ended June 30, Full-year 2019
2019 2018 2019 2018 2020 2019 2020 2019 
Rank Share Rank Share Rank Share Rank Share Rank ShareRank Share Rank Share Rank Share Rank Share Rank Share
Based on fees(a)
           
Based on fees(a)
          
M&A(b)
                      
Global#2
 8.6 #2
 8.4 #2
 9.3 #2
 8.8 #2
 8.7%#1
 10.6 #2
 8.8 #2
 9.2 #2
 9.3 #2
 9.0%
U.S.4
 8.7 3
 7.0 2
 9.4 2
 9.3 2
 8.9
4
 8.8 2
 8.8 2
 8.8 2
 9.5 2
 9.3
Equity and equity-related(c)
                      
Global1
 11.9 1
 9.7 1
 10.3 3
 9.1 1
 9.0
2
 11.8 2
 9.6 2
 10.9 2
 9.3 1
 9.3
U.S.1
 17.3 1
 13.2 1
 13.8 1
 12.5 1
 12.3
2
 13.2 2
 11.4 2
 12.9 2
 11.7 2
 13.2
Long-term debt(d)
                      
Global1
 8.8 1
 7.8 1
 8.0 1
 7.4 1
 7.2
1
 10.0 1
 7.4 1
 9.5 1
 7.6 1
 7.8
U.S.1
 13.7 1
 12.9 1
 12.2 1
 11.4 1
 11.2
1
 13.4 1
 11.4 1
 12.9 1
 11.6 1
 12.0
Loan syndications                      
Global1
 10.1 1
 10.8 1
 10.6 1
 9.9 1
 9.7
1
 8.7 1
 9.0 1
 9.9 1
 11.1 1
 10.1
U.S.1
 13.0 1
 14.4 1
 13.2 1
 12.6 1
 12.3
3
 9.2 2
 10.2 1
 9.8 1
 13.4 1
 12.5
Global investment banking fees(e)
#1
 9.6 #1
 9.0 #1
 9.3 #1
 8.7 #1
 8.6%#1
 10.6 #1
 8.6 #1
 9.8 #1
 9.1 #1
 8.9%
(a)Source: Dealogic as of OctoberJuly 1, 2019.2020. Reflects the ranking of revenue wallet and market share.
(b)Global M&A excludes any withdrawn transactions. U.S. M&A revenue wallet represents wallet from client parents based in the U.S.
(c)Global equity and equity-related ranking includes rights offerings and Chinese A-Shares.
(d)Long-term debt rankings include investment-grade, high-yield, supranationals, sovereigns, agencies, covered bonds, asset-backed securities (“ABS”)ABS and mortgage-backed securities (“MBS”); and exclude money market, short-term debt, and U.S. municipal securities.
(e)Global investment banking fees exclude money market, short-term debt and shelf deals.


Markets revenue
The following table summarizes select income statement data for the Markets businesses. Markets includes both Fixed Income Markets and Equity Markets. Markets revenue comprises principal transactions, fees, commissions and other income, as well as net interest income. The Firm assesses its Markets business performance on a total revenue basis, as offsets may occur across revenue line items. For example, securities that generate net interest income may be risk-managed by derivatives that are
 
recorded in principal transactions revenue. Refer to Notes 56 and 67 for a description of the composition of these income statement line items. Refer to Markets revenue on page 69 of JPMorgan Chase’s 20182019 Form 10-K for further information.
For the periods presented below, the predominant source of principal transactions revenue was the amount recognized
upon executing new transactions.
Three months ended September 30, Three months ended September 30,Three months ended June 30, Three months ended June 30,
2019 20182020 2019

(in millions)		Fixed Income MarketsEquity MarketsTotal Markets Fixed Income MarketsEquity MarketsTotal MarketsFixed Income MarketsEquity
Markets		Total
Markets		 Fixed Income MarketsEquity
Markets		Total
Markets
Principal transactions$2,292
$1,263
$3,555
 $1,849
$1,252
$3,101
$4,651
$1,737
$6,388
 $2,431
$1,608
$4,039
Lending- and deposit-related fees51
1
52
 51
1
52
48
2
50
 49
2
51
Asset management, administration and commissions110
472
582
 96
446
542
93
497
590
 97
453
550
All other income108
54
162
 33
7
40
176
(22)154
 173
(19)154
Noninterest revenue2,561
1,790
4,351
 2,029
1,706
3,735
4,968
2,214
7,182
 2,750
2,044
4,794
Net interest income996
(273)723
 815
(111)704
2,370
166
2,536
 940
(316)624
Total net revenue$3,557
$1,517
$5,074
 $2,844
$1,595
$4,439
$7,338
$2,380
$9,718
 $3,690
$1,728
$5,418
   
Six months ended June 30, Six months ended June 30,
2020 2019

(in millions)
Fixed Income Markets
Equity
Markets
Total
Markets
 Fixed Income Markets
Equity
Markets
Total
Markets
Principal transactions$7,794
$3,460
$11,254
 $4,913
$3,165
$8,078
Lending- and deposit-related fees95
4
99
 98
4
102
Asset management, administration and commissions204
1,105
1,309
 200
887
1,087
All other income177
(23)154
 392
(23)369
Noninterest revenue8,270
4,546
12,816
 5,603
4,033
9,636
Net interest income4,061
71
4,132
 1,812
(564)1,248
Total net revenue$12,331
$4,617
$16,948
 $7,415
$3,469
$10,884
CIB Markets had one loss day in the second quarter of 2020 and three loss days for the six months ended June 30, 2020. Loss days represent the number of days for which CIB Markets, which consists of Fixed Income Markets and Equity Markets, posted losses to total net revenue. The loss days determined under this measure differ from the measure used to determine backtesting gains and losses. Daily backtesting gains and losses include positions in the Firm’s Risk Management value-at-risk (“VaR”) measure and exclude select components of total net revenue, which may more than offset backtesting gains or losses on a particular day. For more information on daily backtesting gains and losses, refer to the VaR discussion on pages 80-82
 Nine months ended September 30, Nine months ended September 30,
 2019 2018

(in millions)		Fixed Income MarketsEquity MarketsTotal Markets Fixed Income MarketsEquity MarketsTotal Markets
Principal transactions$7,205
$4,428
$11,633
 $6,795
$4,528
$11,323
Lending- and deposit-related fees149
5
154
 147
4
151
Asset management, administration and commissions310
1,359
1,669
 313
1,364
1,677
All other income500
31
531
 764
18
782
Noninterest revenue8,164
5,823
13,987
 8,019
5,914
13,933
Net interest income(a)
2,808
(837)1,971
 2,831
(343)2,488
Total net revenue$10,972
$4,986
$15,958
 $10,850
$5,571
$16,421
(a)Declines in Markets net interest income were driven by higher funding costs.

Selected metrics           
 As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except where otherwise noted)2020 2019 Change 2020 2019 Change
Assets under custody (“AUC”) by asset class (period-end)
(in billions):
           
Fixed Income$15,023
 $13,056
 15 % $15,023
 $13,056
 15 %
Equity9,288
 9,352
 (1) 9,288
 9,352
 (1)
Other(a)
3,136
 3,042
 3
 3,136
 3,042
 3
Total AUC$27,447

$25,450
 8
 $27,447
 $25,450
 8
Merchant processing volume (in billions)(b)
$371.9
 $371.6
 —
 $746.7
 $728.1
 3
Client deposits and other third-party liabilities (average)(c)
$607,902

$458,237
 33 % $561,183
 $451,185
 24 %

Selected metrics           
 As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,
(in millions, except where otherwise noted)2019 2018 Change 2019 2018 Change
Assets under custody (“AUC”) by asset class (period-end)
(in billions):
           
Fixed Income$13,349
 $12,339
 8% $13,349
 $12,339
 8%
Equity9,301
 9,174
 1
 9,301
 9,174
 1
Other(a)
3,045
 2,890
 5
 3,045
 2,890
 5
Total AUC$25,695

$24,403
 5
 $25,695
 $24,403
 5
Client deposits and other third-party liabilities (average)(b)
$471,291

$434,847
 8% $457,961
 $430,640
 6%
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation.
(a)Consists of mutual funds, unit investment trusts, currencies, annuities, insurance contracts, options and other contracts.
(b)Represents total merchant processing volume across CIB, CCB and CB.
(c)Client deposits and other third-party liabilities pertain to the Treasury ServicesWholesale Payments and Securities Services businesses.

International metrics                      
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except where
otherwise noted)
2019 
2018(c)
 Change 2019 
2018(c)
 Change2020 
2019(c)
 Change 2020 
2019(c)
 Change
Total net revenue(a)
                      
Europe/Middle East/Africa$2,892
 $2,773
 4 % $8,955
 $9,936
 (10)%$4,976
 $2,898
 72 % $7,566
 $6,078
 24 %
Asia/Pacific1,428
 1,234
 16
 4,143
 3,997
 4
Asia-Pacific2,196
 1,276
 72
 3,972
 2,683
 48
Latin America/Caribbean404
 318
 27
 1,205
 1,123
 7
587
 379
 55
 1,094
 785
 39
Total international net revenue4,724
 4,325
 9
 14,303
 15,056
 (5)7,759
 4,553
 70
 12,632
 9,546
 32
North America4,614
 4,480
 3
 14,524
 14,155
 3
8,593
 5,278
 63
 13,668
 10,319
 32
Total net revenue$9,338
 $8,805
 6
 $28,827
 $29,211
 (1)$16,352
 $9,831
 66
 $26,300
 $19,865
 32
                      
Loans retained (period-end)(a)
Loans retained (period-end)(a)
          
Loans retained (period-end)(a)
          
Europe/Middle East/Africa$23,807
 $25,341
 (6) $23,807
 $25,341
 (6)$28,973
 $27,843
 4
 $28,973
 $27,843
 4
Asia/Pacific14,402
 16,907
 (15) 14,402
 16,907
 (15)
Asia-Pacific13,644
 15,302
 (11) 13,644
 15,302
 (11)
Latin America/Caribbean5,782
 6,097
 (5) 5,782
 6,097
 (5)8,190
 7,090
 16
 8,190
 7,090
 16
Total international loans43,991
 48,345
 (9) 43,991
 48,345
 (9)50,807
 50,235
 1
 50,807
 50,235
 1
North America74,299
 68,739
 8
 74,299
 68,739
 8
89,963
 72,839
 24
 89,963
 72,839
 24
Total loans retained$118,290
 $117,084
 1
 $118,290
 $117,084
 1
$140,770
 $123,074
 14
 $140,770
 $123,074
 14
                      
Client deposits and other third-party liabilities (average)(b)
                      
Europe/Middle East/Africa$175,354
 $162,060
 8
 $171,601
 $162,102
 6
$216,211
 $175,189
 23
 $203,594
 $169,694
 20
Asia/Pacific91,556
 81,771
 12
 87,866
 82,272
 7
Asia-Pacific125,839
 86,889
 45
 114,816
 85,990
 34
Latin America/Caribbean30,165
 26,196
 15
 28,849
 26,477
 9
36,339
 28,860
 26
 33,598
 28,175
 19
Total international$297,075
 $270,027
 10
 $288,316
 $270,851
 6
$378,389
 $290,938
 30
 $352,008
 $283,859
 24
North America174,216
 164,820
 6
 169,645
 159,789
 6
229,513
 167,299
 37
 209,175
 167,326
 25
Total client deposits and other third-party liabilities$471,291
 $434,847
 8
 $457,961
 $430,640
 6
$607,902
 $458,237
 33
 $561,183
 $451,185
 24
                      
AUC (period-end)(b)
(in billions)
                      
North America$16,146
 $15,148
 7
 $16,146
 $15,148
 7
$17,734
 $15,875
 12
 $17,734
 $15,875
 12
All other regions9,549
 9,255
 3
 9,549
 9,255
 3
9,713
 9,575
 1
 9,713
 9,575
 1
Total AUC$25,695
 $24,403
 5 % $25,695
 $24,403
 5 %$27,447
 $25,450
 8 % $27,447
 $25,450
 8 %
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. Prior-period amounts have been revised to conform with the current presentation.
(a)Total net revenue and loans retained (excluding loans held-for-sale and loans at fair value) are based on the location of the trading desk, booking location, or domicile of the client, as applicable.
(b)Client deposits and other third-party liabilities pertaining to the Treasury ServicesWholesale Payments and Securities Services businesses, and AUC, are based on the domicile of the client.
(c)The prior periodPrior-period amounts have been revised to conform with the current period presentation.

COMMERCIAL BANKING
Commercial Banking provides comprehensive financial solutions, including lending, wholesale payments, investment banking and asset management products across three primary client segments: Middle Market Banking, Corporate Client Banking and Commercial Real Estate Banking. Other includes amounts not aligned with a primary client segment.
Middle Market Banking covers small and midsized companies, local governments and nonprofit clients.
Corporate Client Banking covers large corporations.
Commercial Real Estate Banking covers investors, developers, and owners of multifamily, office, retail, industrial and affordable housing properties.

Refer to pages 71-73 of JPMorgan Chase’s 2018 Form 10-K and Line of Business Metrics on page 174198 for a discussion of the business profile of CB.
Selected income statement dataSelected income statement data      Selected income statement data      
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 Change
 2019
 2018
 Change2020
 2019
 Change
 2020
 2019
 Change
Revenue                      
Lending- and deposit-related fees(a)$221
 $216
 2 % $664
 $666
 — %$297
 $224
 33 % $558
 $457
 22 %
All other income(a)
378
 360
 5
 1,142
 1,092
 5
518
 399
 30
 878
 899
 (2)
Noninterest revenue599
 576
 4
 1,806
 1,758
 3
815
 623
 31
 1,436
 1,356
 6
Net interest income1,608
 1,695
 (5) 4,950
 4,995
 (1)1,577
 1,662
 (5) 3,134
 3,342
 (6)
Total net revenue(b)
2,207
 2,271
 (3) 6,756
 6,753
 —
2,392
 2,285
 5
 4,570
 4,698
 (3)
                      
Provision for credit losses67
 (15) NM
 186
 23
 NM
2,431
 29
 NM
 3,441
 119
 NM
                      
Noninterest expense                      
Compensation expense454
 432
 5
 1,341
 1,268
 6
430
 438
 (2) 902
 887
 2
Noncompensation expense427
 421
 1
 1,277
 1,273
 —
469
 493
 (5) 985
 982
 —
Total noninterest expense881
 853
 3
 2,618
 2,541
 3
899
 931
 (3) 1,887
 1,869
 1
                      
Income before income tax expense1,259
 1,433
 (12) 3,952
 4,189
 (6)
Income tax expense322
 344
 (6) 966
 988
 (2)
Net income$937
 $1,089
 (14)% $2,986
 $3,201
 (7)%
Income/(loss) before income tax expense/(benefit)(938) 1,325
 NM
 (758) 2,710
 NM
Income tax expense/(benefit)(247) 323
 NM
 (214) 648
 NM
Net income/(loss)$(691) $1,002
 NM
 $(544) $2,062
 NM
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB and the revenue and expense of the business is reported across CCB, CIB and CB based primarily on client relationship. In conjunction with this realignment, treasury services product revenue has been renamed wholesale payments. Prior-period revenue and expense amounts have been revised to conform with the current presentation.
(a)Effective inIn the first quarter of 2019, includes revenue2020, the Firm reclassified certain fees from investment banking products, commercial card transactions and asset management, administration and commissions (which are included in all other income) to lending- and deposit-related fees. The prior periodPrior-period amounts have been revised to conform with the current period presentation.
(b)Total net revenue included tax-equivalent adjustments from income tax credits related to equity investments in designated community development entities and in entities established for rehabilitation of historic properties, as well as tax-exempt income related to municipal financing activities of $80 million and $100 million for the three months ended June 30, 2020 and 2019, respectively, and $161 million and $194 million for the six months ended June 30, 2020 and 2019, respectively.
development entities that provide loans to qualified businesses in low-income communities, as well as tax-exempt income related to municipal financing activities of $114 million and $107 million for the three months ended September 30, 2019 and 2018, respectively and $308 million and $316 million for the nine months ended September 30, 2019 and 2018, respectively.
Quarterly results
Net incomeloss was $937$691 million, a decrease of 14%.driven by an increase in the provision for credit losses.
Net revenue was $2.2$2.4 billion, down 3%up 5%. Net interest income was $1.6 billion, down 5%, driven by lower deposit margins, partiallymargin, largely offset by higher deposit and loan balances. Noninterest revenue was $599$815 million, an increase of 4%up 31%, predominantly driven by stronga gain on a strategic investment, higher deposit related fees, and investment banking performancerevenue, partially offset by lower card income predominantly due to increased equity underwriting and M&A activity.lower volumes as a result of the COVID-19 pandemic.
Noninterest expense was $881$899 million, updown 3%, predominantlydriven by lower structural expense.
The provision for credit losses was $2.4 billion, compared with $29 million in the prior year. The increase was driven by net additions to the allowance for credit losses as a result of the impact of the COVID-19 pandemic across multiple industry sectors.
Year-to-date results
Net loss was $544 million, driven by an increase in the provision for credit losses.
Net revenue was $4.6 billion, down 3%. Net interest income was $3.1 billion, down 6%, driven by lower deposit margin largely offset by higher deposit and loan balances. Noninterest revenue was $1.4 billion, up 6%, driven by higher deposit related fees and a gain on a strategic investment, largely offset by lower card income primarily

due to lower volumes as a result of the COVID-19 pandemic and a $57 million mark down of a held-for-sale position.
Noninterest expense was $1.9 billion, relatively flat, driven by investments in the business largely offset by lower FDIC charges.structural expense.
The provision for credit losses was $67 million,$3.4 billion, compared with a benefit of $15$119 million in the prior year.
Year-to-date results
Net income The increase was $3.0 billion, a decrease of 7%.
Net revenue of $6.8 billion was flat. Net interest income was $5.0 billion, a decrease of 1%, driven by lower loan spreads and lower deposit balances, largely offset by higher deposit margins. Noninterest revenue was $1.8 billion, up 3% driven by higher investment banking revenue, predominantly due to increased equity underwriting and M&A activity.
Noninterest expense was $2.6 billion, an increase of 3%, predominantly driven by continued investments in the business, largely offset by lower FDIC charges.
The provision for credit losses was $186 million, largely driven by a net additionadditions to the allowance for credit losses relatedas a result of the impact of the COVID-19 pandemic across multiple industry sectors.
Refer to select C&I client downgrades.Credit and Investment Risk Management on pages 60-79 and Allowance for Credit Losses on pages 77-78 for further discussions of the credit portfolios and the allowance for credit losses.


Selected income statement data (continued)      
 Three months ended September 30, Nine months ended September 30,
(in millions, except ratios)2019
 2018
 Change
 2019
 2018
 Change
Revenue by product           
Lending$1,006
 $1,027
 (2)% $3,030
 $3,052
 (1)%
Treasury services950
 1,021
 (7) 2,968
 3,019
 (2)
Investment banking(a)
226
 206
 10
 708
 644
 10
Other25
 17
 47
 50
 38
 32
Total Commercial Banking net revenue$2,207
 $2,271
 (3) $6,756
 $6,753
 —
            
Investment banking revenue, gross(b)
$700
 $581
 20
 $2,110
 $1,889
 12
            
Revenue by client segments           
Middle Market Banking$903
 $935
 (3) $2,793
 $2,749
 2
Corporate Client Banking739
 749
 (1) 2,264
 2,243
 1
Commercial Real Estate Banking(c)
547
 562
 (3) 1,632
 1,681
 (3)
Other(c)
18
 25
 (28) 67
 80
 (16)
Total Commercial Banking net revenue$2,207
 $2,271
 (3)% $6,756
 $6,753
 — %
            
Financial ratios           
Return on equity16% 21%   17% 20%  
Overhead ratio40
 38
   39
 38
  
CB product revenue consists of the following:
Lending includes a variety of financing alternatives, which are primarily provided on a secured basis; collateral includes receivables, inventory, equipment, real estate or other assets. Products include term loans, revolving lines of credit, bridge financing, asset-based structures, leases, and standby letters of credit.
Wholesale payments includes revenue from a broad range of products and services that enable CB clients to manage payments and receipts, as well as invest and manage funds.
Investment banking includes revenue from a range of products providing CB clients with sophisticated capital-raising alternatives, as well as balance sheet and risk management tools through advisory, equity underwriting, and loan syndications. Revenue from Fixed Income and Equity Markets products used by CB clients is also included.
Other product revenue primarily includes tax-equivalent adjustments generated from Community Development Banking activities and certain income derived from principal transactions.
Selected income statement data (continued)      
 Three months ended June 30, Six months ended June 30,
(in millions, except ratios)2020
 2019
 Change
 2020
 2019
 Change
Revenue by product           
Lending$1,127
 $1,012
 11 % $2,081
 $2,024
 3 %
Wholesale payments917
 1,063
 (14) 1,908
 2,167
 (12)
Investment banking(a)
256
 193
 33
 491
 482
 2
Other92
 17
 441
 90
 25
 260
Total Commercial Banking net revenue$2,392
 $2,285
 5
 $4,570
 $4,698
 (3)
            
Investment banking revenue, gross(b)
$851
 $592
 44
 $1,537
 $1,410
 9
            
Revenue by client segments           
Middle Market Banking$866
 $961
 (10) $1,812
 $1,935
 (6)
Corporate Client Banking859
 744
 15
 1,540
 1,595
 (3)
Commercial Real Estate Banking566
 538
 5
 1,107
 1,085
 2
Other101
 42
 140
 111
 83
 34
Total Commercial Banking net revenue$2,392
 $2,285
 5 % $4,570
 $4,698
 (3)%
            
Financial ratios           
Return on equity(14)% 17%   (6)% 18%  
Overhead ratio38
 41
   41
 40
  
In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB and the revenue and expense of the business is reported across CCB, CIB and CB based primarily on client relationship. In conjunction with this realignment, treasury services product revenue has been renamed wholesale payments. Prior-period revenue and expense amounts have been revised to conform with the current presentation.
(a)Includes CB’s share of revenue from investment banking products sold to CB clients through the CIB.
(b)Refer to Business Segment Results on page 60 of the 2018 Form 10-K24 for discussion of revenue sharing.
(c)Effective in the first quarter of 2019, client segment data includes Commercial Real Estate Banking which comprises the former Commercial Term Lending and Real Estate Banking client segments, and Community Development Banking (previously part of Other). The prior period amounts have been revised to conform with the current period presentation.



Selected metricsSelected metrics     Selected metrics        
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except headcount)2019
2018
Change
 20192018Change2020
 2019
Change
 2020
 2019
Change
Selected balance sheet data (period-end)               
Total assets$222,483
$217,194
2 % $222,483
$217,194
2 %$234,934
 $220,712
6 % $234,934
 $220,712
6 %
Loans:              
Loans retained209,448
205,177
2
 209,448
205,177
2
223,192
 208,323
7
 223,192
 208,323
7
Loans held-for-sale and loans at fair value3,187
405
NM
 3,187
405
NM
917
 1,284
(29) 917
 1,284
(29)
Total loans$212,635
$205,582
3
 $212,635
$205,582
3
$224,109
 $209,607
7
 $224,109
 $209,607
7
Core loans212,514
205,418
3
 212,514
205,418
3
Equity22,000
20,000
10
 22,000
20,000
10
22,000
 22,000
—
 22,000
 22,000
—
              
Period-end loans by client segment              
Middle Market Banking$54,298
$57,324
(5) $54,298
$57,324
(5)$64,211
(a) 
$56,346
14
 $64,211
(a) 
$56,346
14
Corporate Client Banking55,976
46,890
19
 55,976
46,890
19
56,182
 51,500
9
 56,182
 51,500
9
Commercial Real Estate Banking(a)
101,326
100,072
1
 101,326
100,072
1
Other(a)
1,035
1,296
(20) 1,035
1,296
(20)
Commercial Real Estate Banking103,117
 100,751
2
 103,117
 100,751
2
Other599
 1,010
(41) 599
 1,010
(41)
Total Commercial Banking loans$212,635
$205,582
3
 $212,635
$205,582
3
$224,109
(a) 
$209,607
7
 $224,109
(a) 
$209,607
7
              
Selected balance sheet data (average)              
Total assets$218,620
$219,232
—
 $218,560
$218,270
—
$247,512
 $218,760
13
 $236,792
 $218,530
8
Loans:              
Loans retained207,286
205,603
1
 206,183
203,950
1
233,044
 206,771
13
 221,516
 205,623
8
Loans held-for-sale and loans at fair value963
1,617
(40) 1,097
1,139
(4)502
 701
(28) 1,167
 1,165
—
Total loans$208,249
$207,220
—
 $207,280
$205,089
1
$233,546
 $207,472
13
 $222,683
 $206,788
8
Core loans208,125
207,052
1
 207,145
204,902
1
              
Average loans by client segment              
Middle Market Banking$54,806
$57,258
(4) $56,221
$57,121
(2)$66,279
 $57,155
16
 $61,162
 $56,940
7
Corporate Client Banking51,389
49,004
5
 49,407
47,650
4
63,308
 48,656
30
 58,170
 48,400
20
Commercial Real Estate Banking(a)
101,044
99,627
1
 100,663
98,880
2
Other(a)
1,010
1,331
(24) 989
1,438
(31)
Commercial Real Estate Banking103,516
 100,671
3
 102,521
 100,469
2
Other443
 990
(55) 830
 979
(15)
Total Commercial Banking loans$208,249
$207,220
—
 $207,280
$205,089
1
$233,546
 $207,472
13
 $222,683
 $206,788
8
              
Client deposits and other third-party liabilities$172,714
$168,169
3
 $169,427
$171,483
(1)$236,968
 $168,247
41
 $212,888
 $167,756
27
Equity22,000
20,000
10
 22,000
20,000
10
22,000
 22,000
—
 22,000
 22,000
—
              
Headcount11,501
10,937
5 % 11,501
10,937
5 %11,802
 11,248
5 % 11,802
 11,248
5 %
(a)EffectiveAt June 30, 2020, total loans included $6.5 billion of loans under the PPP, of which $6.3 billion were in Middle Market Banking. Refer to Credit Portfolio on pages 60-61 for a further discussion of the first quarter of 2019, client segment data includes Commercial Real Estate Banking which comprises the former Commercial Term Lending and Real Estate Banking client segments, and Community Development Banking (previously part of Other). The prior period amounts have been revised to conform with the current period presentation.PPP.


Selected metrics (continued)Selected metrics (continued)        Selected metrics (continued)        
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except ratios)2019
2018
Change
 2019
 2018
 Change2020
2019
Change
 2020
 2019
 Change
Credit data and quality statistics                
Net charge-offs/(recoveries)$45
$(18)NM
 $71
 $16
 344%$79
$15
427% $179
 $26
 NM
Nonperforming assets                
Nonaccrual loans:                
Nonaccrual loans retained(a)
$659
$452
46% $659
 $452
 46%$1,377
$614
124% $1,377
 $614
 124%
Nonaccrual loans held-for-sale and loans at fair value—
5
NM
 —
 5
 NM
—
—
—
 —
 —
 —
Total nonaccrual loans$659
$457
44
 $659
 $457
 44
$1,377
$614
124
 $1,377
 $614
 124
Assets acquired in loan satisfactions19
2
NM
 19
 2
 NM
24
20
20
 24
 20
 20
Total nonperforming assets$678
$459
48
 $678
 $459
 48
$1,401
$634
121
 $1,401
 $634
 121
Allowance for credit losses:                
Allowance for loan losses$2,759
$2,619
5
 $2,759
 $2,619
 5
$4,830
$2,756
75
 $4,830
 $2,756
 75
Allowance for lending-related commitments293
249
18
 293
 249
 18
707
274
158
 707
 274
 158
Total allowance for credit losses$3,052
$2,868
6% $3,052
 $2,868
 6%$5,537
$3,030
83% $5,537
 $3,030
 83%
Net charge-off/(recovery) rate(b)
0.09%(0.03)%  0.05% 0.01%  0.14%0.03%  0.16% 0.03%  
Allowance for loan losses to period-end loans retained
1.32
1.28
  1.32
 1.28
  2.16
1.32
  2.16
 1.32
  
Allowance for loan losses to nonaccrual loans retained(a)
419
579
  419
 579
  351
449
  351
 449
  
Nonaccrual loans to period-end total loans0.31
0.22
  0.31
 0.22
  0.61
0.29
  0.61
 0.29
  
(a)Allowance for loan losses of $119$287 million and $105$125 million was held against nonaccrual loans retained at SeptemberJune 30, 20192020 and 2018,2019, respectively.
(b)Loans held-for-sale and loans at fair value were excluded when calculating the net charge-off/(recovery) rate.


ASSET & WEALTH MANAGEMENT
Refer to pages 74–76 of JPMorgan Chase’s 20182019 Form 10-K and Line of Business Metrics on pages 174–175198-199 for a discussion of the business profile of AWM.
Selected income statement dataSelected income statement data   Selected income statement data   
(in millions, except ratios)Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
2019
2018
Change
 2019
2018
Change
2020
2019
Change
 2020
2019
Change
Revenue          
Asset management, administration and commissions$2,574
$2,563
— % $7,558
$7,623
(1)%$2,589
$2,568
1 % $5,295
$4,984
6 %
All other income139
117
19
 431
374
15
131
115
14
 134
292
(54)
Noninterest revenue2,713
2,680
1
 7,989
7,997
—
2,720
2,683
1
 5,429
5,276
3
Net interest income855
879
(3) 2,627
2,640
—
890
876
2
 1,787
1,772
1
Total net revenue3,568
3,559
—
 10,616
10,637
—
3,610
3,559
1
 7,216
7,048
2
          
Provision for credit losses44
23
91
 48
40
20
223
2
NM
 317
4
NM
          
Noninterest expense          
Compensation expense1,391
1,391
—
 4,259
4,112
4
1,315
1,406
(6) 2,726
2,868
(5)
Noncompensation expense1,231
1,194
3
 3,606
3,620
—
1,191
1,190
—
 2,439
2,375
3
Total noninterest expense2,622
2,585
1
 7,865
7,732
2
2,506
2,596
(3) 5,165
5,243
(1)
          
Income before income tax expense902
951
(5) 2,703
2,865
(6)881
961
(8) 1,734
1,801
(4)
Income tax expense234
227
3
 655
616
6
223
242
(8) 412
421
(2)
Net income$668
$724
(8) $2,048
$2,249
(9)$658
$719
(8) $1,322
$1,380
(4)
          
Revenue by line of business          
Asset Management$1,816
$1,827
(1) $5,362
$5,440
(1)$1,780
$1,785
—
 $3,520
$3,546
(1)
Wealth Management1,752
1,732
1
 5,254
5,197
1
1,830
1,774
3
 3,696
3,502
6
Total net revenue$3,568
$3,559
— % $10,616
$10,637
— %$3,610
$3,559
1 % $7,216
$7,048
2 %
          
Financial ratios          
Return on equity24%31%  25%32% 24%27%  24%26% 
Overhead ratio73
73
  74
73
 69
73
  72
74
 
Pre-tax margin ratio:          
Asset Management25
27
  25
27
 30
25
  26
24
 
Wealth Management25
26
  26
27
 19
29
  22
27
 
Asset & Wealth Management25
27
  25
27
 24
27
  24
26
 
Quarterly results
Net income was $668$658 million, a decrease ofdown 8%.
Net revenue ofwas $3.6 billion, was flat.up 1%. Net interest income was $855$890 million, down 3%up 2%, drivenreflecting higher deposit and loan balances, offset by deposit margin compression, largely offset by deposit and loan growth.compression. Noninterest revenue was $2.7 billion, up 1%, as a result of increased brokerage commissions on higher client-driven volume partially offset by lower asset management fees as a shift in the mix toward lower yield products was predominantly offset by strong net inflows into liquidity products over the past year.
Revenue from Asset Management of $1.8 billion, was flat versus the prior year.
Revenue from Wealth Management was $1.8 billion, up 3%, driven by higher average market levels.deposit and loan balances, as well as increased brokerage commissions on higher client-driven volume, largely offset by deposit margin compression.
Noninterest expense of $2.5 billion was down 3%, as lower structural as well as volume-and revenue-related expense, were partially offset by higher investments.
The provision for credit losses was $44$223 million, driven by net charge-offs, as well as net additions to the allowance for loancredit losses predominantly dueas a result of the impact of the COVID-19 pandemic.
Refer to loan growth.
Noninterest expense was $2.6 billion, an increaseCredit and Investment Risk Management on pages 60-79 and Allowance for Credit Losses on pages 77-78 for further discussions of 1%, predominantly driven by continued investments in technologythe credit portfolios and advisors, partially offset by lower distribution and legal fees.the allowance for credit losses.
Year-to-date results
Net income was $2.0$1.3 billion, a decrease of 9%4%.
Net revenue was $7.2 billion, an increase of $10.6 billion was flat.2%. Net interest income of $2.6was $1.8 billion, was flat,up 1%, reflecting higher deposit and loan growth,balances, offset by deposit margin compression. Noninterest revenue was $5.4 billion, up 3%, driven by increased brokerage commissions on higher client-driven volume, and higher asset management fees as a result of $8.0 billion was flat, reflecting a shiftnet inflows into liquidity products partially offset by net valuation losses on certain investments, compared with gains in the mix toward lower fee products and lower brokerage activity,prior year.

Revenue from Asset Management was $3.5 billion, down 1%, driven by net valuation losses on certain investments, compared with gains in the prior year, predominantly offset by higher asset management fees as a result of net investment valuation gains.inflows into liquidity products.
Revenue from Wealth Management was $3.7 billion, up 6%, largely driven by higher deposit and loan balances as well as increased brokerage commissions on higher client-driven volume, largely offset by deposit margin compression.
Noninterest expense was $5.2 billion, a decrease of 1%, as lower structural as well as volume-and revenue-related expense, were largely offset by higher investments.
The provision for credit losses was $48$317 million, driven by net charge-offs, as well as net additions to the allowance for loancredit losses predominantly due to loan growth.
Noninterest expense was $7.9 billion, an increaseas a result of 2%, predominantly driven by continued investments in technology and advisors, partially offset by lower distribution fees.

the impact of the COVID-19 pandemic.

Selected metrics          
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except ranking data, headcount and ratios)2019
2018
Change
 2019
2018
Change
2020
2019
Change
 2020
2019
Change
% of JPM mutual fund assets rated as 4- or 5-star(a)
65%64%  65%64% 54%63%  54%63% 
% of JPM mutual fund assets ranked in 1st or 2nd quartile:(b)
          
1 year74
65
  74
65
 54
78
  54
78
 
3 years80
64
  80
64
 69
75
  69
75
 
5 years86
83
  86
83
 72
82
  72
82
 
          
Selected balance sheet data (period-end)(c)          
Total assets$174,226
$166,716
5 % $174,226
$166,716
5 %$183,189
$172,149
6 % $183,189
$172,149
6 %
Loans153,245
143,162
7
 153,245
143,162
7
165,299
149,877
10
 165,299
149,877
10
Core loans153,245
143,162
7
 153,245
143,162
7
Deposits138,439
130,497
6
 138,439
130,497
6
169,537
136,225
24
 169,537
136,225
24
Equity10,500
9,000
17
 10,500
9,000
17
10,500
10,500
—
 10,500
10,500
—
          
Selected balance sheet data (average)     
Selected balance sheet data (average)(c)
     
Total assets$171,121
$161,982
6
 $168,688
$158,218
7
$182,318
$167,544
9
 $182,817
$167,452
9
Loans150,486
140,558
7
 147,481
136,663
8
163,440
146,494
12
 162,631
145,953
11
Core loans150,486
140,558
7
 147,481
136,663
8
Deposits138,822
133,021
4
 139,127
138,885
—
168,573
140,317
20
 159,602
139,282
15
Equity10,500
9,000
17
 10,500
9,000
17
10,500
10,500
—
 10,500
10,500
—
          
Headcount24,228
23,747
2
 24,228
23,747
2
Headcount(d)
22,949
23,683
(3) 22,949
23,683
(3)
          
Number of Wealth Management client advisors2,872
2,808
2
 2,872
2,808
2
2,869
2,735
5
 2,869
2,735
5
          
Credit data and quality statistics     
Net charge-offs$26
$11
136
 $27
$7
286
Credit data and quality statistics(c)
     
Net charge-offs/(recoveries)$(2)$(3)33
 $—
$1
NM
Nonaccrual loans176
285
(38) 176
285
(38)775
127
NM
 775
127
NM
Allowance for credit losses:          
Allowance for loan losses$350
$317
10
 $350
$317
10
$648
$331
96
 $648
$331
96
Allowance for lending-related commitments16
15
7
 16
15
7
28
17
65
 28
17
65
Total allowance for credit losses$366
$332
10 % $366
$332
10 %$676
$348
94 % $676
$348
94 %
Net charge-off rate0.07%0.03%  0.02%0.01% —
(0.01)%  —
—
 
Allowance for loan losses to period-end loans0.23
0.22
  0.23
0.22
 0.39
0.22
  0.39
0.22
 
Allowance for loan losses to nonaccrual loans199
111
  199
111
 84
261
  84
261
 
Nonaccrual loans to period-end loans0.11
0.20
  0.11
0.20
 0.47
0.08
  0.47
0.08
 
(a)Represents the “overall star rating” derived from Morningstar for the U.S., the U.K., Luxembourg, Hong Kong and Taiwan domiciled funds; and Nomura “star rating” for Japan domiciled funds and Morningstar for all other domiciled funds. Includes only Asset Management retail open-ended mutual funds that have a rating. Excludes money market funds, Undiscovered Managers Fund, and Brazil and India domiciled funds.
(b)Quartile ranking sourced from:from Lipper, for the U.S. and Taiwan domiciled funds; Morningstar, for the U.K., Luxembourg and Hong Kong domiciled funds; Nomura for Japan domiciled funds and Fund Doctor for South Korea domiciled funds.based on country of domicile. Includes only Asset Management retail open-ended mutual funds that are ranked by the aforementioned sources. Excludes money market funds, Undiscovered Managers Fund, and Brazil and India domiciled funds.
(c)Loans, deposits and related credit data and quality statistics relate to the Wealth Management business.
(d)During the second quarter of 2020, certain technology and support functions, comprising approximately 850 staff, were transferred from AWM to CCB as part of the ongoing reorganization of the U.S. Wealth Management business.


Client assets
Client assets of $3.1$3.4 trillion and assets under management of $2.2$2.5 trillion were up 7%12% and 8%15%, respectively, predominantly driven by cumulative net inflows into long-termliquidity and liquiditylong term products as well as higher market levels globally.levels.
Client assets    
September 30,As of June 30,
(in billions)2019
2018
Change
2020
2019
Change
Assets by asset class    
Liquidity$505
$463
9 %$707
$481
47%
Fixed income590
457
29
629
543
16
Equity437
452
(3)457
441
4
Multi-asset and alternatives714
705
1
718
713
1
Total assets under management2,246
2,077
8
2,511
2,178
15
Custody/brokerage/administration/deposits815
790
3
859
820
5
Total client assets$3,061
$2,867
7
$3,370
$2,998
12
    
Memo:    
Alternatives client assets (a)
$183
$172
6
$188
$177
6
    
Assets by client segment    
Private Banking$636
$576
10
$677
$617
10
Institutional1,029
945
9
1,218
991
23
Retail581
556
4
616
570
8
Total assets under management$2,246
$2,077
8
$2,511
$2,178
15
    
Private Banking$1,424
$1,339
6
$1,500
$1,410
6
Institutional1,051
967
9
1,249
1,013
23
Retail586
561
4
621
575
8
Total client assets$3,061
$2,867
7 %$3,370
$2,998
12%
(a)Represents assets under management, as well as client balances in brokerage accounts
Client assets (continued)      


Three months ended
September 30,		Nine months ended
September 30,		Three months ended
June 30,		Six months ended
June 30,
(in billions)2019
2018
 2019
2018
2020
2019
 2020
2019
Assets under management rollforward      
Beginning balance$2,178
$2,028
 $1,987
$2,034
$2,239
$2,096
 $2,364
$1,987
Net asset flows:      
Liquidity24
14
 23
10
95
4
 170
(1)
Fixed income41
3
 97
(9)17
37
 18
56
Equity(2)1
 (9)8
11
(1) 10
(7)
Multi-asset and alternatives1
4
 (2)29
1
—
 (1)(3)
Market/performance/other impacts4
27
 150
5
148
42
 (50)146
Ending balance, September 30$2,246
$2,077
 $2,246
$2,077
Ending balance, June 30$2,511
$2,178
 $2,511
$2,178
      
Client assets rollforward      
Beginning balance$2,998
$2,799
 $2,733
$2,789
$3,002
$2,897
 $3,226
$2,733
Net asset flows59
33
 120
58
138
52
 223
61
Market/performance/other impacts4
35
 208
20
230
49
 (79)204
Ending balance, September 30$3,061
$2,867
 $3,061
$2,867
Ending balance, June 30$3,370
$2,998
 $3,370
$2,998







International metrics         
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		Three months ended June 30, Six months ended June 30,
(in millions)2019
2018
Change
 2019
2018
Change
2020
2019
Change 2020
2019
Change
Total net revenue (a)
         
Europe/Middle East/Africa$672
$677
(1)% $2,014
$2,095
(4)%$719
$714
1 $1,342
$1,409
(5)%
Asia/Pacific376
377
—
 1,104
1,161
(5)
Asia-Pacific378
376
1 778
740
5
Latin America/Caribbean218
228
(4) 658
689
(4)198
179
11 386
361
7
Total international net revenue1,266
1,282
(1) 3,776
3,945
(4)1,295
1,269
2 2,506
2,510
—
North America2,302
2,277
1
 6,840
6,692
2
2,315
2,290
1 4,710
4,538
4
Total net revenue(a)
$3,568
$3,559
—
 $10,616
$10,637
— %$3,610
$3,559
1 $7,216
$7,048
2 %
(a)Regional revenue is based on the domicile of the client.
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of June 30, As of June 30,
(in billions)2019
2018
Change
 2019
2018
Change
2020
2019
Change
 2020
2019
Change
Assets under management          
Europe/Middle East/Africa$387
$375
3% $387
$375
3%$446
$392
14% $446
$392
14%
Asia/Pacific183
164
12
 183
164
12
Asia-Pacific205
183
12
 205
183
12
Latin America/Caribbean70
65
8
 70
65
8
64
56
14
 64
56
14
Total international assets under management640
604
6
 640
604
6
715
631
13
 715
631
13
North America1,606
1,473
9
 1,606
1,473
9
1,796
1,547
16
 1,796
1,547
16
Total assets under management$2,246
$2,077
8
 $2,246
$2,077
8
$2,511
$2,178
15
 $2,511
$2,178
15
          
Client assets          
Europe/Middle East/Africa$455
$435
5
 $455
$435
5
$537
$478
12
 $537
$478
12
Asia/Pacific253
228
11
 253
228
11
Asia-Pacific286
257
11
 286
257
11
Latin America/Caribbean172
162
6
 172
162
6
148
136
9
 148
136
9
Total international client assets880
825
7
 880
825
7
971
871
11
 971
871
11
North America2,181
2,042
7
 2,181
2,042
7
2,399
2,127
13
 2,399
2,127
13
Total client assets$3,061
$2,867
7% $3,061
$2,867
7%$3,370
$2,998
12% $3,370
$2,998
12%


















CORPORATE
Refer to pages 77–78 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of Corporate.
Selected income statement and balance sheet dataSelected income statement and balance sheet data      Selected income statement and balance sheet data      
As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except headcount)2019
2018
 Change
 2019
 2018
 Change
2020
2019
 Change
 2020
 2019
 Change
Revenue                  
Principal transactions$10
$(161) NM
 $(227) $(222) (2)%$(2)$(175) 99 % $(115) $(237) 51 %
Investment securities gains/(losses)78
(46) NM
 135
 (371) NM
Investment securities gains26
44
 (41)% 259
 57
 354 %
All other income32
30
 7% 95
 373
 (75)(91)6
 NM
 120
 63
 90
Noninterest revenue120
(177) NM
 3
 (220) NM(67)(125) 46 % 264
 (117) NM
Net interest income572
74
 NM
 1,436
 (35) NM(687)447
 NM
 (852) 864
 NM
Total net revenue(a)
692
(103) NM
 1,439
 (255) NM(754)322
 NM
 (588) 747
 NM
                  
Provision for credit losses—
2
 NM
 —
 (3) NM4
(2) NM
 12
 —
 NM
                  
Noninterest expense(b)
281
28
 NM
 724
 394
 84147
232
 (37)% 293
 443
 (34)
Income/(loss) before income tax expense/(benefit)411
(133) NM
 715
 (646) NM(905)92
 NM
 (893) 304
 NM
Income tax expense/(benefit)18
12
 50
 (757) 18
 NM(337)(736) 54
 (200) (775) 74 %
Net income/(loss)$393
$(145) NM
 $1,472
 $(664) NM$(568)$828
 NM
 $(693) $1,079
 NM
Total net revenue                  
Treasury and CIO$801
$186
 331
 $1,930
 $235
 NM$(671)$618
 NM
 $(502) $1,129
 NM
Other Corporate(109)(289) 62
 (491) (490) —(83)(296) 72
 (86) (382) 77
Total net revenue$692
$(103) NM
 $1,439
 $(255) NM$(754)$322
 NM
 $(588) $747
 NM
Net income/(loss)                  
Treasury and CIO$576
$96
 500
 $1,372
 $(244) NM$(550)$462
 NM
 $(467) $796
 NM
Other Corporate(183)(241) 24
 100
 (420) NM(18)366
 NM
 (226) 283
 NM
Total net income/(loss)$393
$(145) NM
 $1,472
 $(664) NM$(568)$828
 NM
 $(693) $1,079
 NM
Total assets (period-end)$812,333
$742,693
 9
 $812,333
 $742,693
 9$1,221,980
$821,330
 49
 $1,221,980
 $821,330
 49
Loans (period-end)1,705
1,556
 10
 1,705
 1,556
 101,670
1,695
 (1) 1,670
 1,695
 (1)
Core loans(c)
1,706
1,556
 10
 1,706
 1,556
 10
Headcount38,155
36,686
 4% 38,155
 36,686
 4 %38,920
37,361
 4 % 38,920
 37,361
 4 %
(a)Included tax-equivalent adjustments, driven by tax-exempt income from municipal bonds, of $74$63 million and $94$81 million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $241$124 million and $287$167 million for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.
(b)Included a net legal benefit of $(32)$(12) million and $(175)$(67) million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $(189)$(32) million and $(225)$(157) million for the ninesix months ended SeptemberJune 30, 2020 and 2019, and 2018, respectively.
(c)Average core loans were $1.7 billion and $1.6 billion for the three months ended September 30, 2019 and 2018, respectively, and $1.7 billion for both the nine months ended September 30, 2019 and 2018.
Quarterly results
Net incomeloss was $393$568 million compared with a net lossincome of $145$828 million in the prior year.
Net revenue was $692 million, compared with a net loss of $103$754 million, in the prior year,down $1.1 billion, driven by higherlower net interest income and noninterest revenue. Net interest income was driven by balance sheet growth and changes in mix, partially offset byon lower rates. Net interest incomeThe current quarter also includes income related to the unwind of the internal funding provided to CCB upon the sale of certain mortgage loans. The income reflects the net present value of that funding and is recognized as a charge to net interest income in CCB. Refer to CCB on pages 23–24 of this Form 10-Q and Funds Transfer Pricing (“FTP”) on page 60 of the Firm’s 2018 Form 10-K for further information.
Noninterest revenue increased reflectingincluded small net gains on certain legacy private equity investments compared to net losses in the prior year.
Noninterest expense of $281$147 million was up $253down $85 million due to higher investments in technology andlower structural expense, partially offset by a lower net legal benefit compared withto the prior year.
The current period includedincome tax benefits related tobenefit was predominantly driven by the resolution of certain tax audits as well as other tax adjustments, which were partially offset by changes to certain tax reserves. The prior year reflected a net benefit of $132 million resulting from changes in estimates under the TCJA related to the remeasurement of certain deferred taxes and the deemed repatriation tax on non-U.S. earnings, which was more than offset by changes to certain tax reserves and other tax adjustments.
Year-to-date results
Net income was $1.5 billion, compared with a net loss of $664 millionchange in the prior year.
Net revenue was $1.4 billion, compared with a net losslevel and mix of $255 million in the prior year driven by higher net interest income and noninterest revenue. Net interest income was

driven by balance sheet growthexpenses subject to U.S. federal, and changes in mixstate and includes the income related to the unwind of the internal funding, as mentioned above.
Noninterest revenue increased reflecting:
investment securities gains compared with losses in the prior year due to the repositioning of the investment securities portfolio
lower net valuation losses on certain legacy private equity investments,
partially offset by
losses on cash deployment transactions which were more than offset by the related net interest income earned on those transactions.
Noninterest expense of $724 million, was up $330 million reflecting:
higher investments in technology and real estate,
contributions to the Firm’s Foundation, whereas all prior-year contributions were made in the fourth quarter, and
higher pension costs due to changes to actuarial assumptions and estimates.
local taxes. The prior year included a $174 million loss on the liquidation of a legal entity.
The current period included tax benefits of $957$742 million related to the resolution of certain tax audits,audits.
Year-to-date results
Net loss was $693 million compared with net income of $1.1 billion in the prior year.
Net revenue was a loss of $588 million, compared with $747 million in the prior year. The decrease was driven by lower net interest income on lower rates, partially offset by higher noninterest revenue primarily due to higher net investment securities gains reflecting the impact of repositioning the investment securities portfolio.
Noninterest expense of $293 million was down $150 million due to lower structural expense, partially offset by a lower net legal benefit compared to the prior year.
The current period income tax benefit was driven by the change in the level and mix of income and expenses subject to U.S. federal, and state and local taxes as well as other tax adjustments, partially offset by changes in certainthe impact of the Firm’s estimated full-year expected tax reserves.rate relative to the level of year-to-date pretax income. The prior year expense reflected changes to certainperiod included tax reserves, largely offset by a net benefitbenefits of $305$825 million resulting from changes in estimates under the TCJA related to the remeasurementresolution of certain deferred taxes and the deemed repatriation tax on non-U.S. earnings as well as other tax adjustments.audits.

Treasury and CIO overview
At SeptemberJune 30, 2019,2020, the average credit rating of the Treasury and CIO investment securities comprising the portfolio in the table below was AA+ (based upon external ratings where available and, where not available, based primarily upon internal ratings that correspond to ratings as defined by S&P and Moody’s)risk ratings). Refer to Note 910 for further information on the Firm’s investment securities portfolio.portfolio and internal risk ratings.
Refer to Liquidity Risk Management on pages 50–5455-59 for further information on liquidity and funding risk. Refer to Market Risk Management on pages 70–7480-84 for information on interest rate, foreign exchange and other risks.
Selected income statement and balance sheet data      
 As of or for the three months
ended September 30,		 As of or for the nine months
ended September 30,
(in millions)2019
 2018
 Change 2019
 2018
 Change
Investment securities gains/(losses)$78
 $(46) NM $135
 $(371) NM
Available-for-sale (“AFS”) investment securities (average)$305,894
 $197,230
 55 $260,661
 $200,569
 30
Held-to-maturity (“HTM”) investment securities (average)35,494
 31,232
 14 32,518
 31,842
 2
Investment securities portfolio (average)$341,388
 $228,462
 49 $293,179
 $232,411
 26
AFS investment securities (period-end)$351,599
 $198,523
 77 $351,599
 $198,523
 77
HTM investment securities (period-end)40,830
 31,368
 30 40,830
 31,368
 30
Investment securities portfolio (period-end)$392,429
 $229,891
 71 $392,429
 $229,891
 71
Selected income statement and balance sheet data      
 As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions)2020
 2019
 Change
 2020
 2019
 Change
Investment securities gains$26
 $44
 (41)% $259
 $57
 354
Available-for-sale securities (average)$426,470
 $248,612
 72 % $399,712
 $237,669
 68
Held-to-maturity securities (average)71,713
 30,929
 132
 59,193
 31,005
 91
Investment securities portfolio (average)$498,183
 $279,541
 78
 $458,905
 $268,674
 71
Available-for-sale securities (period-end)$483,752
 $274,533
 76
 $483,752
 $274,533
 76
Held-to-maturity securities, net of allowance for credit losses (period-end)(a)(b)
72,908
 30,907
 136
 72,908
 30,907
 136
Investment securities portfolio, net of allowance for credit losses (period-end)(a)
$556,660
 $305,440
 82 % $556,660
 $305,440
 82
(a)At June 30, 2020, the allowance for credit losses on HTM securities was $23 million.
(b)During the first quarter of 2020, the Firm transferred $26.1 billion of U.S. GSE and government agency MBS from AFS to HTM for capital management purposes.
Refer to Note 10 for further information.


ENTERPRISE-WIDEFIRMWIDE RISK MANAGEMENT
Risk is an inherent part of JPMorgan Chase’s business activities. When the Firm extends a consumer or wholesale loan, advises customers and clients on their investment decisions, makes markets in securities, or offers other products or services, the Firm takes on some degree of risk. The Firm’s overall objective is to manage its businesses, and the associated risks, in a manner that balances serving the interests of its clients, customers and investors and protects the safety and soundness of the Firm.
The Firm believes that effective risk management requires:requires, among other things:
Acceptance of responsibility, including identification and escalation of risk issues, by all individuals within the Firm;
Ownership of risk identification, assessment, data and management within each of the lines of businessLOBs and Corporate; and
Firmwide structures for risk governance.
The Firm strives for continual improvement throughin its efforts to enhance controls, ongoing employee training and development, talent retention, and other measures. The Firm follows a disciplined and balanced compensation framework with strong internal governance and independent oversight by the Board oversight.of Directors (the “Board”). The impact of risk and control issues areis carefully considered in the Firm’s performance evaluation and incentive compensation processes.
Firmwide Risk Management is overseengovernance and managed on an enterprise-wide basis. oversight framework
The Firm’s risk management governance and oversight framework involves understanding drivers of risks, types of risks, and impacts of risks.
jpmcgovernancea07.jpg
Refer to pages 79-83 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of Enterprise-wideFirmwide risk management governance and oversight.
 
Effective July 2019, the Board of Directors’ Risk Policy Committee (“DRPC”) was renamed the Risk Committee. The committee’s responsibilities were not changed. Refer to page 81 of JPMorgan Chase’s 2018 Form 10-K for a further discussion of the committee.

Governancegovernance and Oversight Functionsoversight functions
The following sections of this Form 10-Q and the 20182019 Form 10-K discuss the risk governance and oversight functions in place to manage the risks inherent in the Firm’s business activities.
Risk governance and oversight functionsForm 10-Q page referenceForm 10-K page referenceForm 10-Q page referenceForm 10-K page reference
Strategic risk 84 84
Capital risk45–4985–9449–5485–92
Liquidity risk50–5495–10055–5993–98
Reputation risk 101 99
Consumer credit risk56–59106-11162-66103–107
Wholesale credit risk60–66112-11967-76108–115
Investment portfolio risk6912379118
Market risk70–74124-13180-84119–126
Country risk75132–13385127–128
Operational risk 134-13686129–135
Compliance risk 137 132
Conduct risk 138 133
Legal risk 139 134
Estimations and Model risk 14087135

CAPITAL RISK MANAGEMENT
Capital risk is the risk the Firm has an insufficient level andor composition of capital to support the Firm’s business activities and associated risks during normal economic environments and under stressed conditions.
Refer to pages 85-9485–92 of JPMorgan Chase’s 20182019 Form
10-K, Note 2122 of this Form 10-Q and the Firm’s Pillar 3 Regulatory Capital Disclosures reports, which are available on the Firm’s website, for a further discussion of the Firm’s Capital Risk Management, including capital planning and stress testing.
COVID-19 Pandemic
The Firm has been impacted by recent market events as a result of the COVID-19 pandemic, but remains well-capitalized. However, the continuation or further deterioration of the current macroeconomic environment could result in impacts to the Firm’s capital and leverage position.
Basel III Overview
The capital rules under Basel III establish minimum capital ratios and overall capital adequacy standards for large and internationally active U.S. bank holding companies (“BHC”) and banks, including the Firm and its insured depository institution (“IDI”) subsidiaries, including JPMorgan Chase Bank, N.A. The minimum amount of regulatory capital that must be held by BHCs and banks is determined by calculating risk-weighted assets (“RWA”), which are on-balance sheet assets and off-balance sheet exposures, weighted according to risk. Two comprehensive approaches are prescribed for calculating RWA: a standardized approach (“Basel III
Standardized”), and an advanced approach (“Basel III Advanced”). Effective January 1, 2019,For each of the risk-based capital ratios, the capital adequacy of the Firm is evaluated against the fully phased-in measures under Basel III and represents the lower of the Standardized or Advanced approaches. During 2018, the required capital measures were subject to the transitional rules and as of December 31, 2018 the calculations were the same on a fully phased-in and on a transitional basis.
The Firm’s Basel III Standardized risk-basedStandardized-risk-based ratios are currently more binding than the Basel III Advanced risk-based ratios, and the Firm expects that this will remain the case for the foreseeable future.Advanced-risk-based ratios.
Basel III also includes a requirement for Advanced Approach banking organizations, including the Firm, to calculate the SLR. Refer to SLR on page 9190 of JPMorgan Chase’s 20182019 Form 10-K for additional information.
Key Regulatory Developments
Current Expected Credit Losses. As disclosed in the Firm’s 2019 Form 10-K, the Firm initially elected to phase-in the January 1, 2020 (“day 1”) CECL adoption impact to retained earnings of $2.7 billion to CET1 capital, at 25% per year in each of 2020 to 2023. As part of their response to the impact of the COVID-19 pandemic, on March 31, 2020, the federal banking agencies issued an interim final rule that provided the option to delay the effects of CECL on regulatory capital for two years, followed by a three-year transition period (“CECL capital transition provisions”).
The interim final rule provides a uniform approach for estimating the effects of CECL compared to the legacy incurred loss model during the first two years of the transition period (the “day 2” transition amount), whereby the Firm may exclude from CET1 capital 25% of the change in the allowance for credit losses (excluding allowances on PCD loans). The cumulative day 2 transition amount as at December 31, 2021 that is not recognized in CET1 capital as well as the $2.7 billion day 1 impact, will be phased into CET1 capital at 25% per year beginning January 1, 2022. The Firm has elected to apply the CECL capital transition provisions, and accordingly, for the period ended June 30, 2020, the capital metrics of the Firm exclude $6.5 billion, which is the $2.7 billion day 1 impact to retained earnings and 25% of the $15.7 billion increase in the allowance for credit losses (excluding allowances on PCD loans).
The impacts of the CECL capital transition provisions on Tier 2 capital, adjusted average assets, and total leverage exposure have also been incorporated into the Firm’s capital metrics. Refer to Note 1 for further information on SLR.the CECL accounting guidance.

Money Market Mutual Fund Liquidity Facility. On March 18, 2020, the Federal Reserve established the MMLF facility, authorized through September 30, 2020, to enhance the liquidity and functioning of money markets. On July 28, 2020, the Federal Reserve announced that it was extending the MMLF through December 31, 2020. Under the MMLF, the FRBB makes nonrecourse advances to participating financial institutions to purchase certain types of assets from eligible money market mutual fund clients. These assets, which are reflected in other assets on the Firm’s Consolidated balance sheets, are pledged to the FRBB as collateral. On March 23, 2020, the federal banking agencies issued an interim final rule to neutralize the effects of purchasing assets through the program on risk-based and leverage-based capital ratios. As of June 30, 2020, the Firm excluded assets purchased from money market mutual fund clients pursuant to nonrecourse advances provided under the MMLF in the amount of $3.8 billion from its RWA and $7.8 billion from adjusted average assets and total leverage exposure.
Supplementary leverage ratio temporary revision.On April 1, 2020, the Federal Reserve issued an interim final rule that requires, on a temporary basis, the calculation of total leverage exposure for purposes of calculating the SLR for bank holding companies, to exclude the on-balance sheet amounts of U.S. Treasury securities and deposits at Federal Reserve Banks. These exclusions became effective April 1, 2020, and will remain in effect through March 31, 2021.
On June 1, 2020, the Federal Reserve, OCC and FDIC issued an interim final rule that provides IDI subsidiaries with an option to apply this temporary exclusion subject to certain

restrictions. As of June 30, 2020, JPMorgan Chase Bank, N.A. has not elected to apply this exclusion.
Paycheck Protection Program. On April 13, 2020, the federal banking agencies issued an interim final rule to neutralize the regulatory capital effects of participating in the PPP on risk-based capital ratios by applying a zero percent risk weight to loans originated under the program. As of June 30, 2020, the Firm had approximately $28 billion of loans under the program.
The interim rule also provides that if the PPP loan is pledged as collateral for a non-recourse loan under theFederal Reserve’s Paycheck Protection Program Lending (“PPPL”) Facility, the PPP loans can be excluded from leverage-based capital ratios. As of June 30, 2020, the Firm had not participated in the PPPL Facility.
Refer to Regulatory Developments Relating to the COVID-19 Pandemic on pages 11-12 for additional information on
regulatory actions and significant financing programs that the U.S. government and regulators have introduced to address the effects of the COVID-19 pandemic.
Stress Capital Buffer. On March 4, 2020, the Federal Reserve issued the final rule introducing the SCB framework for the Basel III Standardized approach that is designed to more closely integrate the results of the quantitative assessment in the annual CCAR with the ongoing minimum capital requirements for BHCs under the U.S. Basel III rules. The final rule replaces the static 2.5% CET1 capital conservation buffer in the Standardized approach with a dynamic institution-specific SCB. The final rule does not apply to the Advanced approach capital requirements. The SCB requirement for BHCs will be effective on October 1 of each year and is expected to remain in effect until September 30 of the following year.
The following tables present the Firm’s risk-based and leverage-based capital measuresmetrics under both the Basel III Standardized and Advanced Approaches. The Firm’s Basel III ratios exceeded regulatory minimums as of September 30, 2019 and December 31, 2018. Refer to Capital Risk Management on pages 85-9485–92 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of these capital metrics.
September 30, 2019 December 31, 2018
June 30, 2020(c)(d)
 December 31, 2019  
(in millions)Standardized Advanced Minimum capital ratios 
Standardized(b)
 
Advanced(b)
 Minimum capital ratios
(in millions, except ratios)StandardizedAdvanced StandardizedAdvanced 
Minimum capital ratios(e)
Risk-based capital metrics:                
CET1 capital$188,151
 $188,151
   $183,474
 $183,474
  $190,867
$190,867
 $187,753
$187,753
  
Tier 1 capital214,831
 214,831
   209,093
 209,093
  220,674
220,674
 214,432
214,432
  
Total capital243,500
 233,203
   237,511
 227,435
  256,667
244,112
 242,589
232,112
  
Risk-weighted assets1,527,762
 1,435,693
   1,528,916
 1,421,205
  1,541,365
1,450,587
 1,515,869
1,397,878
  
CET1 capital ratio12.3% 13.1% 10.5% 12.0% 12.9% 9.0%12.4%13.2% 12.4%13.4% 10.5%
Tier 1 capital ratio14.1
 15.0
 12.0
 13.7
 14.7
 10.5
14.3
15.2
 14.1
15.3
 12.0
Total capital ratio15.9
 16.2
 14.0
 15.5
 16.0
 12.5
16.7
16.8
 16.0
16.6
 14.0
Leverage-based capital metrics:                
Adjusted average assets(a)
$2,717,852
 $2,717,852
   $2,589,887
 $2,589,887
  $3,176,729
$3,176,729
 $2,730,239
$2,730,239
  
Tier 1 leverage ratio7.9% 7.9% 4.0% 8.1% 8.1% 4.0%6.9%6.9% 7.9%7.9% 4.0%
Total leverage exposure(b)NA
 $3,404,535
   NA
 $3,269,988
  NA
$3,228,424
 NA
$3,423,431
  
SLR(b)NA
 6.3% 5.0% NA
 6.4% 5.0%NA
6.8% NA
6.3% 5.0%
(a)
Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio,ratios, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets.
(b)The Firm’sAs of June 30, 2020, total leverage exposure for purposes of calculating the SLR excludes U.S. Treasury securities and deposits at Federal Reserve Banks, as provided by the interim final rule issued by the Federal Reserve on April 1, 2020.
(c)As of June 30, 2020, the capital ratios asmetrics reflect the CECL capital transition provisions.
(d)As of December 31, 2018 were equivalent whether calculated onJune 30, 2020, the capital metrics reflect the exclusion of assets purchased from money market mutual fund clients pursuant to nonrecourse advances provided under the MMLF. Additionally, loans originated under the PPP receive a transitional or fully phased-in basis.zero percent risk weight.
(e)Represents minimum requirements and regulatory buffers applicable to the Firm. Refer to Note 22 for additional information.


Capital components
The following table presents reconciliations of total stockholders’ equity to Basel III CET1 capital, Tier 1 capital and Total capital as of SeptemberJune 30, 20192020 and December 31, 2018.2019.
(in millions)September 30, 2019
December 31, 2018
June 30, 2020
December 31, 2019
Total stockholders’ equity$264,348
$256,515
$264,466
$261,330
Less: Preferred stock(a)
28,363
26,068
30,063
26,993
Common stockholders’ equity235,985
230,447
234,403
234,337
Add: 
Certain deferred tax liabilities(a)
2,397
2,381
Less:  
Goodwill47,818
47,471
47,811
47,823
Other intangible assets841
748
778
819
Other CET1 capital adjustments1,546
1,034
Add: 
Deferred tax liabilities(b)
2,371
2,280
Other CET1 capital adjustments(b)
(2,656)323
Standardized/Advanced CET1 capital188,151
183,474
190,867
187,753
Preferred stock(a)
28,363
26,068
30,063
26,993
Less: Other Tier 1 adjustments(a)
1,683
449
256
314
Standardized/Advanced Tier 1 capital$214,831
$209,093
$220,674
$214,432
Long-term debt and other instruments qualifying as Tier 2 capital$14,145
$13,772
$17,894
$13,733
Qualifying allowance for credit losses(c)14,400
14,500
18,006
14,314
Other124
146
93
110
Standardized Tier 2 capital$28,669
$28,418
$35,993
$28,157
Standardized Total capital$243,500
$237,511
$256,667
$242,589
Adjustment in qualifying allowance for credit losses for Advanced Tier 2 capital(d)(10,297)(10,076)(12,555)(10,477)
Advanced Tier 2 capital$18,372
$18,342
$23,438
$17,680
Advanced Total capital$233,203
$227,435
$244,112
$232,112
(a)
As of September 30, 2019, preferred stock reflects the issuance of $2.25 billion of Series FF preferred stock and redemption of $880 million of Series W preferred stock. Other Tier 1 adjustments includes $1.37 billion of Series I preferred stock called for partial redemption on September 26, 2019 and subsequently redeemed on October 30, 2019. Tier 1 capital as of September 30, 2019 reflects the issuance and redemptions.
(b)Represents certain deferred tax liabilities related to tax-deductible goodwill and to identifiable intangibles created in nontaxable transactions, which are netted against goodwill and other intangibles when calculating CET1 capital.
(b)
As of June 30, 2020, the impact of the CECL capital transition provision was an increase in CET1 capital of $6.5 billion.
(c)Represents the allowance for credit losses eligible for inclusion in Tier 2 capital up to 1.25% of credit risk RWA, including the impact of the CECL capital transition provision with any excess deducted from RWA.
(d)Represents an adjustment to qualifying allowance for credit losses for the excess of eligible credit reserves over expected credit losses up to 0.6% of credit risk RWA, including the impact of the CECL capital transition provision with any excess deducted from RWA.
 
Capital rollforward
The following table presents the changes in Basel III CET1 capital, Tier 1 capital and Tier 2 capital for the ninesix months ended SeptemberJune 30, 2019.2020.
Nine months ended September 30,
(in millions)		2019
Standardized/Advanced CET1 capital at December 31, 2018$183,474
Six months ended June 30,
(in millions)		2020
Standardized/Advanced CET1 capital at December 31, 2019$187,753
Net income applicable to common equity26,710
6,730
Dividends declared on common stock(8,086)(5,559)
Net purchase of treasury stock(15,805)(5,288)
Changes in additional paid-in capital(650)(397)
Changes related to AOCI2,877
7,220
Adjustment related to DVA(a)
287
Adjustment related to AOCI(a)
(3,415)
Changes related to other CET1 capital adjustments(b)(656)3,823
Change in Standardized/Advanced CET1 capital4,677
3,114
Standardized/Advanced CET1 capital at September 30, 2019$188,151
Standardized/Advanced CET1 capital at June 30, 2020$190,867
  
Standardized/Advanced Tier 1 capital at December 31, 2018$209,093
Standardized/Advanced Tier 1 capital at December 31, 2019$214,432
Change in CET1 capital(b)4,677
3,114
Net issuance of noncumulative perpetual preferred stock(b)
925
3,070
Other136
58
Change in Standardized/Advanced Tier 1 capital5,738
6,242
Standardized/Advanced Tier 1 capital at September 30, 2019$214,831
Standardized/Advanced Tier 1 capital at June 30, 2020$220,674
  
Standardized Tier 2 capital at December 31, 2018$28,418
Standardized Tier 2 capital at December 31, 2019$28,157
Change in long-term debt and other instruments qualifying as Tier 2373
4,162
Change in qualifying allowance for credit losses(101)
Change in qualifying allowance for credit losses(b)
3,692
Other(21)(18)
Change in Standardized Tier 2 capital251
7,836
Standardized Tier 2 capital at September 30, 2019$28,669
Standardized Total capital at September 30, 2019$243,500
Standardized Tier 2 capital at June 30, 2020$35,993
Standardized Total capital at June 30, 2020$256,667
  
Advanced Tier 2 capital at December 31, 2018$18,342
Advanced Tier 2 capital at December 31, 2019$17,680
Change in long-term debt and other instruments qualifying as Tier 2373
4,162
Change in qualifying allowance for credit losses(322)
Change in qualifying allowance for credit losses(b)
1,614
Other(21)(18)
Change in Advanced Tier 2 capital30
5,758
Advanced Tier 2 capital at September 30, 2019$18,372
Advanced Total capital at September 30, 2019$233,203
Advanced Tier 2 capital at June 30, 2020$23,438
Advanced Total capital at June 30, 2020$244,112
(a)Includes cash flow hedges and DVA related to structured notes recorded in AOCI.
(b)Includes the net effectimpact of $2.25 billion and $1.85 billion of non-cumulative preferred stock issued on July 31, 2019 and January 24, 2019, respectively, and redemptions of non-cumulative preferred stock of $925 million and $880 million on March 1, 2019 and September 1, 2019, respectively, as well as $1.37 billion of non-cumulative preferred stock that was called for partial redemption on September 26, 2019 and subsequently redeemed on October 30, 2019.the CECL capital transition provisions.



RWA rollforward
The following table presents changes in the components of RWA under Basel III Standardized and Advanced approaches for the ninesix months ended SeptemberJune 30, 2019.2020. The amounts in the rollforward categories are estimates, based on the predominant driver of the change.
Standardized Advanced Standardized Advanced 
Nine months ended September 30, 2019
(in millions)		Credit risk RWAMarket risk RWATotal RWA Credit risk RWAMarket risk RWA
Operational risk
RWA
Total RWA
December 31, 2018$1,423,053
$105,863
$1,528,916
 $926,647
$105,976
$388,582
$1,421,205
Six months ended June 30, 2020
(in millions)		Credit risk RWAMarket risk RWATotal RWA Credit risk RWAMarket risk RWA
Operational risk
RWA
Total RWA
December 31, 2019$1,440,220
$75,649
$1,515,869
 $932,948
$75,652
$389,278
$1,397,878
Model & data changes(a)
(3,406)(17,076)(20,482) (4,542)(17,076)—
(21,618)300
(15,200)(14,900) (6,300)(15,200)—
(21,500)
Portfolio runoff(b)
(4,400)—
(4,400) (4,300)—
—
(4,300)(2,500)—
(2,500) (2,200)—
—
(2,200)
Movement in portfolio levels(c)
24,711
(983)23,728
 44,408
(1,136)(2,866)40,406
(5,799)48,695
42,896
 31,270
48,872
(3,733)76,409
Changes in RWA16,905
(18,059)(1,154) 35,566
(18,212)(2,866)14,488
(7,999)33,495
25,496
 22,770
33,672
(3,733)52,709
September 30, 2019$1,439,958
$87,804
$1,527,762
 $962,213
$87,764
$385,716
$1,435,693
June 30, 2020$1,432,221
$109,144
$1,541,365
 $955,718
$109,324
$385,545
$1,450,587
(a)
Model & data changes refer to material movements in levels of RWA as a result of revised methodologies and/or treatment per regulatory guidance (exclusive of rule changes).
(b)Portfolio runoff for credit risk RWA primarily reflects reduced risk from position rolloffs in legacy portfolios in Home Lending.
(c)Movement in portfolio levels (inclusive of rule changes) refers to: changes in book size, composition, credit quality, and market movements for credit risk RWA; changes in position and market movements for market risk RWA; and updates to cumulative losses for operational risk RWA.RWA; and deductions to credit risk RWA for excess eligible credit reserves not eligible for inclusion in Tier 2 capital.

Supplementary leverage ratio
Refer to Capital Risk ManagementSupplementary Leverage Ratio on page 88pages 87-88 of JPMorgan Chase’s 20182019 Form 10-K for additional information.
The following table presents the components of the Firm’s SLR as of September 30, 2019 and December 31, 2018.SLR.
(in millions, except ratio)September 30,
2019
December 31,
2018
June 30,
2020
December 31,
2019
Tier 1 capital$214,831
$209,093
$220,674
$214,432
Total average assets2,765,052
2,636,505
3,229,268
2,777,270
Less: Adjustments for deductions from Tier 1 capital47,200
46,618
Less: Regulatory capital adjustments(a)
52,539
47,031
Total adjusted average assets(a)(b)
2,717,852
2,589,887
3,176,729
2,730,239
Off-balance sheet exposures(b)
686,683
680,101
Add: Off-balance sheet exposures(c)
670,606
693,192
Less: Exclusion for U.S Treasuries and Federal Reserve Bank deposits618,911
—
Total leverage exposure$3,404,535
$3,269,988
$3,228,424
$3,423,431
SLR6.3%6.4%6.8%6.3%
(a)
Adjusted average assets, forFor purposes of calculating the SLR, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets. As of June 30, 2020, includes adjustments for the CECL capital transition provisions and the exclusion of assets purchased from money market mutual fund clients pursuant to nonrecourse advances provided under the MMLF.
(b)Adjusted average assets used for the calculation of Tier 1 leverage ratio.
(c)Off-balance sheet exposures are calculated as the average of the three month-end spot balances during the reporting quarter.
Refer to Note 2122 for JPMorgan Chase Bank, N.A.’s SLR ratios.
Line of business equity
Each business segment is allocated capital by taking into consideration a variety of factors including capital levels of similarly rated peers and applicable regulatory capital requirements. Effective January 1, 2019,Refer to line of business capital allocations have increased due to a combination of changes in the relative weights, with greater emphasisequity on Standardized RWA and stress, a higher capitalization rate, updated stress simulations, and general business growth. Refer to page 9190 of JPMorgan Chase’s 20182019 Form 10-K for additional information.information on capital allocation.
 

The following table representspresents the capital allocated to each business segment:

(in billions)
September 30,
2019
 December 31,
2018
June 30,
2020
 December 31,
2019
Consumer & Community Banking$52.0
 $51.0
$52.0
 $52.0
Corporate & Investment Bank80.0
 70.0
80.0
 80.0
Commercial Banking22.0
 20.0
22.0
 22.0
Asset & Wealth Management10.5
 9.0
10.5
 10.5
Corporate71.5
 80.4
69.9
 69.8
Total common stockholders’ equity$236.0
 $230.4
$234.4
 $234.3
Planning and stress testing
Comprehensive Capital Analysis and Review (“CCAR”)
On June 27, 2019,29, 2020, the Firm announced that it had completed the 2020 CCAR stress test process. The Firm’s indicative SCB requirement is 3.3% and the Federal Reserve informedwill provide the Firm with its final SCB requirement by August 31, 2020. The SCB requirement will become effective on October 1, 2020 and will remain in effect until September 30, 2021. The SCB will be integrated into the Firm’s ongoing Standardized risk-based capital requirements, increasing the minimum CET1 capital ratio to 11.3% (up from 10.5%).
The Federal Reserve has determined that it did not objectchanges in financial markets or the macroeconomic outlook due to the Firm’sCOVID-19 pandemic could have a material effect on a firm’s risk profile and financial condition and therefore is requiring all large bank holding companies, including the Firm, to update and resubmit their capital plans later this year.
Refer to Key Regulatory Developments on pages 49-50 of this Form 10-Q and capital planning and stress testing on pages 85-86 of JPMorgan Chase’s 2019 capital plan.Form 10-K for additional information.

Capital actions
Preferred stock
Preferred stock dividends declared were $423$401 million and $1.2 billion$822 million for the three and ninesix months ended SeptemberJune 30, 2019.2020.
On October 31, 2019,During the three months ended June 30, 2020, the Firm announced and priced an offering of depositary shares representing $900 million of 4.75% non-cumulativedid not issue or redeem any preferred stock, Series GG. This issuance is expected to close on November 7, 2019. On November 1, 2019, the Firm announced that it will redeem all $900 million of its 5.45% non-cumulative preferred stock, SeriesP on December 1, 2019.
On October 30, 2019, the Firm redeemed $1.37 billion of its Series I fixed-to-floating rate non-cumulative perpetual preferred stock.
On September 1, 2019, the Firm redeemed all $880 million of its 6.30% non-cumulative preferred stock, Series W.
On July 31, 2019, the Firm issued $2.25 billion of fixed-to-floating rate non-cumulative preferred stock, Series FF.

Refer to Note 1718 of this Form 10-Q and Note 2021 of JPMorgan Chase’s 20182019 Form 10-K for additional information on the Firm’s preferred stock.stock, including the issuance and redemption of preferred stock during the three months ended March 31, 2020.
Common stock dividends
On September 17, 2019, the Firm announced that its Board of Directors had declared aThe Firm’s quarterly common stock dividend which increased tois currently $0.90 per share, from $0.80 per share effective withshare. The Firm intends to maintain the quarterly common stock dividend paid on October 31, 2019. The Firm’s dividends arefor the third quarter of 2020 subject to the approval of the Board of Directors’ approval on a quarterly basis.Directors.
Common equity
The Firm’s BoardOn March 15, 2020, in response to the COVID-19 pandemic, the Firm temporarily suspended repurchases of Directors has authorizedits common equity. In June 2020, the repurchase of upFederal Reserve directed all large bank holding companies, including the Firm, to $29.4 billion of gross common equity between July 1, 2019 and June 30, 2020 as partdiscontinue net share repurchases, at least through the end of the Firm’s annual capital plan.third quarter of 2020.
The following table sets forth the Firm’s repurchases of common equity on a settlement-date basis, for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.

Three months ended
September 30,
Nine months ended
September 30,
(in millions)2019
2018

2019
2018
Total shares of common stock repurchased62.0
39.3

159.0
126.0
Aggregate common stock repurchases$6,949
$4,416

$17,250
$14,055

Three months ended
June 30,
Six months ended
June 30,
(in millions)2020
2019

2020
2019
Total number of shares of common stock repurchased—
47.5

50.0
97.0
Aggregate purchase price of common stock repurchases$—
$5,210

$6,397
$10,301
Refer to Part II, Item 2: Unregistered Sales of Equity Securities and Use of Proceeds and Part II, Item 5: Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities on pages 176-177page 201 of this Form 10-Q and page 30 of JPMorgan Chase’s 20182019 Form 10-K, respectively, for additional information regarding repurchases of the Firm’s equity securities.

 
Other capital requirements
TLACTotal Loss-Absorbing Capacity (“TLAC”)
The Federal Reserve’s TLAC rule requires the top-tier U.S. GSIBglobal systemically important bank (“GSIB”) top-tier holding companies, including the Firm, to maintain minimum levels of external TLAC and eligible LTD effective January 1, 2019.long-term debt (“eligible LTD”).
Refer to other capital requirements on page 9391 of JPMorgan Chase’s 20182019 Form 10-K for additional information.information on TLAC.
The following table presents the TLAC and external long-term debt minimum requirements including applicable regulatory buffers, as of June 30, 2020 and December 31, 2019.
Minimum Requirements
TLAC to RWA23.0%
TLAC to leverage exposure9.5
External long-term debt to RWA9.5
External long-term debt to leverage4.5
The following table presents the eligible external TLAC and eligible LTD amounts, as well as a representation of the amounts as a percentage of the Firm’s total RWA and total leverage exposure.exposure applying the impact of the CECL capital transition provisions as of June 30, 2020.
September 30, 2019 
June 30, 2020December 31, 2019
(in billions, except ratio)
Eligible external TLAC(a)
Eligible LTDEligible external TLACEligible LTDEligible external TLACEligible LTD
Total eligible TLAC & LTD$387.8
$159.9
$407.1
$179.6
$386.4
$161.8
% of RWA25.4%10.5%26.4%11.7%25.5%10.7%
Minimum requirement23.0
9.5
Surplus/(shortfall)$36.4
$14.8
$52.5
$33.2
$37.7
$17.8
  
% of total leverage exposure11.4%4.7%12.6%5.6%11.3%4.7%
Minimum requirement9.5
4.5
Surplus/(shortfall)$64.3
$6.7
$100.4
$34.3
$61.2
$7.8
(a)As of September 30, 2019, total eligible external TLAC reflects the issuance of $2.25 billion of Series FF non-cumulative preferred stock, redemption of $880 million of Series W non-cumulative preferred stock, and redemption of $1.37 billion of Series I non-cumulative preferred stock called for partial redemption on September 26, 2019 and subsequently redeemed on October 30, 2019. 
Refer to Part I, Item 1A: Risk Factors on pages 7-286–28 of JPMorgan Chase’s 20182019 Form 10-K for information on the financial consequences to holders of the Firm’s debt and equity securities in a resolution scenario.

Broker-dealer regulatory capital
J.P. Morgan Securities
JPMorgan Chase’s principal U.S. broker-dealer subsidiary is J.P. Morgan Securities. J.P. Morgan Securities is subject to Rule 15c3-1 under the Securities Exchange Act of 1934 (the “Net Capital Rule”). J.P. Morgan Securities is also registered as a futures commission merchant and subject to Rule 1.17the Rules of the Commodity Futures Trading Commission (“CFTC”).
Refer to Capital risk management on pages 85-9485–92 of JPMorgan Chase’s 20182019 Form 10-K for a discussion on J.P. Morgan Securities’ capital requirements.
The following table presents J.P. Morgan Securities’ net capital:
September 30, 2019 
June 30, 2020 
(in millions)Actual
Minimum
Actual(a)

Minimum
Net Capital$22,068
$3,746
$27,714
$5,462
(a)Net capital reflects the exclusion of assets purchased from money market mutual fund clients pursuant to nonrecourse advances provided under the MMLF.

 

J.P. Morgan Securities plc
J.P. Morgan Securities plc is a wholly-owned subsidiary of JPMorgan Chase Bank, N.A. and has authority to engage in banking, investment banking and broker-dealer activities. J.P. Morgan Securities plc is jointly regulated by the U.K. Prudential Regulation Authority (“PRA”) and the Financial Conduct Authority (“FCA”).
Refer to Capital risk management on pages 85-9485–92 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion on J.P. Morgan Securities plc.
Effective January 1, 2019, theThe Bank of England requires, on a transitional basis, that U.K. banks, including U.K. regulated subsidiaries of overseas groups, maintain a minimum requirement for own funds and eligible liabilities (“MREL”). As of SeptemberJune 30, 2019,2020, J.P. Morgan Securities plc was compliant with the requirements of the MREL rule. Refer to Supervision and Regulation on pages 1-61–6 of JPMorgan Chase’s 20182019 Form 10-K for additional information on MREL.
The following table presents J.P. Morgan Securities plc’s capital metrics:
September 30, 2019  
June 30, 2020  
(in millions, except ratios)Estimated
Minimum ratios
Estimated
Minimum ratios
Total capital$55,614
 $55,188
 
CET1 ratio16.9%4.5%17.6%4.5%
Total capital ratio21.5%8.0%22.5%8.0%




LIQUIDITY RISK MANAGEMENT
Liquidity risk is the risk that the Firm will be unable to meet its contractual and contingent financial obligations as they arise or that it does not have the appropriate amount, composition and tenor of funding and liquidity to support its assets and liabilities. Refer to pages 95–10093–98 of JPMorgan Chase’s 20182019 Form 10-K and the Firm’s USU.S. LCR Disclosure reports, which are available on the Firm’s website for a further discussion of the Firm’s Liquidity Risk Management.
LCR and HQLA
The LCR rule requires that the Firm to maintain an amount of unencumbered HQLAHigh Quality Liquid Assets (“HQLA”) that is sufficient to meet its estimated total net cash outflows over a prospective 30 calendar-day period of significant stress. HQLA is the amount of liquid assets that qualify for inclusion in the LCR. HQLA primarily consist of unencumbered cash and certain high-quality liquid securities as defined in the LCR rule. The LCR is required to be a minimum of 100%.
Under the LCR rule, the amount of HQLA held by JPMorgan Chase Bank, N.A. that is in excess of its standalonestand-alone 100% minimum LCR requirement, and that is not transferable to non-bank affiliates, must be excluded from the Firm’s reported HQLA. The LCR is required to be a minimum of 100%. Refer to page 94 of JPMorgan Chase’s 2019 Form 10-K and the Firm’s U.S. LCR Disclosure reports for additional information on HQLA and net cash outflows.
The following table summarizes the Firm’s average LCR for the three months ended SeptemberJune 30, 2019,2020, March 31, 2020 and June 30, 2019 and September 30, 2018 based on the Firm’s interpretation of the finalized LCR framework.
Three months endedThree months ended
Average amount
(in millions)
September 30,
2019		June 30, 2019September 30,
2018		June 30,
2020		March 31, 2020June 30,
2019
HQLA  
Eligible cash(a)
$199,757
$219,838
$344,660
$426,053
$205,027
$219,838
Eligible securities(b)(c)
337,704
317,439
190,349
225,135
343,124
317,439
Total HQLA(d)
$537,461
$537,277
$535,009
$651,188
$548,151
$537,277
Net cash outflows$468,452
$477,442
$466,803
$556,395
$482,372
$477,442
LCR115%113%115%117%114%113%
Net excess HQLA(d)
$69,009
$59,835
$68,206
$94,793
$65,779
$59,835
(a)
Represents cash on deposit at central banks, primarily the Federal Reserve Banks.
(b)Predominantly U.S. Treasuries, U.S. GSE and U.S. government agency MBS, and sovereign bonds net of applicable haircuts under the LCR rules.rule.
(c)HQLA eligible securities may be reported in securities borrowed or purchased under resale agreements, trading assets, or investment securities on the Firm’s Consolidated balance sheets.
(d)Excludes average excess HQLA at JPMorgan Chase Bank, N.A. that are not transferable to non-bank affiliates.
The Firm’s average LCR increased during the three months ended SeptemberJune 30, 2019,2020, compared with the three-month period ended June 30, 2019,March 31, 2020, largely due to long-term debt issuances and a benefit from the return of funding to the Parent Company from JPMorgan Chase Bank, N.A. as a result of the bank’s strong liquidity position. Liquidity in JPMorgan Chase Bank, N.A. increased during the quarter primarily due to a declinedeposits net of loan growth. Deposits increased in the netsecond quarter as a result of market conditions driven by the COVID-19 pandemic. Additionally, effective March 26, 2020, the Federal Reserve, in response
to the COVID-19 pandemic, reduced reserve requirements to zero percent, which increased JPMorgan Chase Bank, N.A.’s average HQLA by approximately $25 billion in the second quarter. However, these increases in excess liquidity in JPMorgan Chase Bank, N.A. are excluded from the Firm’s reported LCR under the LCR rule. Refer to Note 21 for additional information.
The Firm's average LCR increased during the three months ended June 30, 2020, compared with the prior year period, primarily due to an increase in the average amount of reportable HQLA as a result of increased cash outflows from CIB activities.unsecured long-term debt issuances.
The Firm’s average LCR fluctuates from period to period, due to changes in its HQLA and estimated net cash outflows as a result of ongoing business activity.
Other liquidity sources
As of September 30, 2019, inIn addition to the assets reported in the Firm’s HQLA above, the Firm had approximately $312 billion of unencumbered marketable securities, such as equity securities and fixed income debt securities, that the Firm believes would be available to raise liquidity. This includes HQLA-eligible securities included as part of the excess liquidityHQLA at JPMorgan Chase Bank, N.A. that are not transferable to non-bank affiliates.affiliates, as described above. The fair value of these securities was approximately $606 billion and $315 billion as of June 30, 2020 and December 31, 2019, respectively, although the amount of liquidity that could be raised would be dependent on prevailing market conditions. The fair value increased compared to December 31, 2019, due to an increase in excess HQLA at JPMorgan Chase Bank, N.A. which was primarily a result of increased deposits as noted above.
As of September 30, 2019, theThe Firm also had approximately $313 billion of available borrowing capacity at FHLBs and the discount window at the Federal Reserve Bank and other central banks as a result of collateral pledged by the Firm to such banks.banks of approximately $281 billion and $322 billion as of June 30, 2020 and December 31, 2019, respectively. This borrowing capacity excludes the benefit of cash and securities reported in the Firm’s HQLA or other unencumbered securities that are currently pledged at the Federal Reserve Bank discount window.window and other central banks. Available borrowing capacity decreased from December 31, 2019 primarily due to lower credit card receivable balances and lower collateral values due to a decline in their fair value, both driven by the COVID-19 pandemic. Although available, the Firm does not view this borrowing capacity at the Federal Reserve Bank discount window and the other central banks as a primary source of liquidity.

Funding
Sources of funds
Management believes that the Firm’s unsecured and secured funding capacity is sufficient to meet its on- and off-balance sheet obligations.
The Firm funds its global balance sheet through diverse sources of funding including stable deposits, as well as secured and unsecured funding in the capital markets. The Firm’s loan portfolio is funded with a portionmarkets and stockholders’ equity. Deposits are the primary funding source for JPMorgan Chase Bank, N.A. Additionally, JPMorgan Chase Bank, N.A. may also access funding through short- or long-term secured borrowings, through the issuance of the Firm’s deposits, through securitizations and, with respect to a portion of the Firm’s real estate-related loans, with secured
unsecured long-term debt, or from borrowings from the FHLBs. Deposits in excess ofParent Company or the amount utilized to fund loansIntermediate Holding Company (“IHC”). The Firm’s non-bank subsidiaries are primarily funded from long-term unsecured borrowings and short-term secured borrowings, primarily securities loaned or sold under repurchase agreements. Excess funding is invested by Treasury and CIO in the Firm’s investment securities portfolio or deployed in cash or other short-term liquid investments based on their interest rate and liquidity risk
characteristics. Securities borrowed or purchased under resale agreements and trading assets-debt and equity instruments are primarily funded by the Firm’s securities loaned or sold under agreements to repurchase, trading liabilities-debt and equity instruments, and a portion of the Firm’s long-term debt and stockholders’ equity. In addition to funding securities borrowed or purchased under resale agreements and trading assets-debt and equity instruments, proceeds from the Firm’s debt and equity issuances are used to fund certain loans and other financial and non-financial assets, or may be invested in the Firm’s investment securities portfolio. Refer to the discussion below for additional information relating to Deposits, Short-term funding, and Long-term funding and issuance.
Deposits
The table below summarizes, by line of business,the LOBs and Corporate, the deposit balances as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, and the average deposit balances for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.
September 30, 2019
December 31, 2018
 Three months ended September 30, Nine months ended September 30,June 30, 2020
December 31, 2019
 Three months ended June 30, Six months ended June 30,
Deposits Average Average Average Average
(in millions) 2019
2018
 2019
2018
 2020
2019
 2020
2019
Consumer & Community Banking$701,170
$678,854
 $693,980
$674,211
 $688,676
$669,244
$876,991
$718,354
(a) 
 $831,996
$690,892
 $782,822
$685,980
Corporate & Investment Bank510,403
482,084
 524,521
476,995
 509,775
472,879
643,133
511,905
(a) 
 652,464
512,098
 607,345
502,280
Commercial Banking174,903
170,859
 172,653
168,102
 169,361
171,403
240,440
184,115
 236,753
168,194
 212,718
167,688
Asset & Wealth Management138,439
138,546
 138,822
133,021
 139,127
138,885
169,537
147,804
 168,573
140,317
 159,602
139,282
Corporate346
323
 904
533
 887
736
928
253
 731
793
 864
878
Total Firm$1,525,261
$1,470,666
 $1,530,880
$1,452,862
 $1,507,826
$1,453,147
$1,931,029
$1,562,431
 $1,890,517
$1,512,294
 $1,763,351
$1,496,108
(a)In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB as part of the Firm’s Wholesale Payments business. The prior- period amounts were revised to conform with the current presentation.
Deposits provide a stable source of funding and reduce the Firm’s reliance on the wholesale funding markets. A significant portion of the Firm’s deposits are consumer deposits and wholesale operating deposits, which are both considered to be stable sources of liquidity. Wholesale operating deposits are considered to be stable sources of liquidity because they are generated from customers that maintain operating service relationships with the Firm.
The table below shows the loan and deposit balances, the loans-to-deposits ratios, and deposits as a percentage of total liabilities, as of SeptemberJune 30, 20192020 and December 31, 2018.2019.
(in billions except ratios)September 30, 2019
 December 31, 2018
June 30, 2020
 December 31, 2019
Deposits$1,525.3
 $1,470.7
$1,931.0
 $1,562.4
Deposits as a % of total liabilities61% 62%65% 64%
Loans$945.2
 $984.6
$978.5
 $959.8
Loans-to-deposits ratio62% 67%51% 61%
The Firm believes that average deposit balances are generally more representative of deposit trends than period-end deposit balances.balances, over time. However, during periods of market disruption those trends could be affected.
Average deposits increased for the three and six months ended SeptemberJune 30, 2019.
The increase in CIB reflects an increase in operating deposits predominantly in Treasury Services2020, reflecting significant inflows across the LOBs primarily driven by
growth the COVID-19 pandemic, as customers and clients looked to remain liquid as a resultof marketconditions. In the wholesale businesses, the inflows principally occurred in client activity,March, and anin general were maintained through the second quarter. In CCB, the increase in the net issuances of structured notes in Markets. The increase in CCB was driven by the continued growth in both existing and new accounts. The increaseaccounts, as well as COVID-19 related factors, such as the government stimulus for consumers and small businesses, lower consumer spending and delays in AWM was driven by growth in interest-bearing deposits on new client activity. The increase in CB was primarily driven by growth from existing clients.tax payments.
Average deposits increased for the nine months ended September 30, 2019 in CIB and CCB, partially offset by a decline in CB. Balances in AWM were relatively flat.
The increase in CIB reflects an increase in operating deposits predominantly in Treasury Services driven by growth in client activity, and an increase in the net issuances of structured notes in Markets. The increase in CCB was driven by growth in new accounts.
The decrease in CB was primarily driven by lower non operating deposits.
AWM balances were relatively flat with growth in interest-bearing deposits offset by migration predominantly into the Firm’s investment-related products.
Refer to the discussion of the Firm’s Business Segment Results and the Consolidated Balance Sheets Analysis on pages 21–4324-47 and pages 15-16,18-19, respectively, for further information on deposit and liability balance trends.


The following table summarizes short-term and long-term funding, excluding deposits, as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, and average balances for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively. Refer to the Consolidated Balance Sheets Analysis on pages 15–1718-19 and Note 1011 for additional information.
September 30, 2019December 31, 2018 Three months ended September 30, Nine months ended September 30,June 30, 2020December 31, 2019 Three months ended June 30, Six months ended June 30,
Sources of funds (excluding deposits)Average AverageAverage Average
(in millions)2019
2018
 2019
2018
2020
2019
 2020
2019
Commercial paper$19,620
$30,059
 $19,607
$28,702
 $24,756
$27,289
$13,988
$14,754
 $14,032
$26,030
 $14,003
$27,373
Other borrowed funds8,826
8,789
 10,537
11,172
 10,869
11,716
8,447
7,544
 8,613
11,818
 8,853
11,037
Total short-term unsecured funding$28,446
$38,848
 $30,144
$39,874
 $35,625
$39,005
$22,435
$22,298
 $22,645
$37,848
 $22,856
$38,410
Securities sold under agreements to repurchase(a)
$235,968
$171,975
 $229,581
$174,436
 $215,148
$178,929
$229,320
$175,709
 $268,281
$218,057
 $251,338
$207,812
Securities loaned(a)
9,739
9,481
 8,505
9,131
 9,117
10,900
4,246
5,983
 5,950
8,090
 6,649
9,428
Other borrowed funds(b)
20,447
30,428
 21,758
21,169
 28,343
21,336
25,579
18,622
 28,206
27,840
 23,983
31,690
Obligations of Firm-administered multi-seller conduits(c)
$10,514
$4,843
 $12,167
$3,102
 $10,987
$3,070
$12,666
$9,223
 $12,428
$13,356
 $11,163
$10,387
Total short-term secured funding$276,668
$216,727
 $272,011
$207,838
 $263,595
$214,235
$271,811
$209,537
 $314,865
$267,343
 $293,133
$259,317
          
Senior notes$173,550
$162,733
 $172,059
$154,820
 $167,495
$152,046
$180,532
$166,185
 $177,972
$167,376
 $171,857
$165,176
Trust preferred securities—
—
 —
517
 —
629
Subordinated debt18,043
16,743
 17,797
16,079
 17,196
16,106
22,320
17,591
 20,934
17,056
 19,545
16,890
Structured notes(d)
70,687
53,090
 69,144
50,905
 62,984
48,874
73,833
74,724
 71,561
62,284
 72,205
59,853
Total long-term unsecured funding$262,280
$232,566
 $259,000
$222,321
 $247,675
$217,655
$276,685
$258,500
 $270,467
$246,716
 $263,607
$241,919
          
Credit card securitization(c)
$6,457
$13,404
 $7,394
$15,052
 $10,802
$16,620
$5,789
$6,461
 $5,907
$11,671
 $6,039
$12,535
FHLB advances29,642
44,455
 29,646
48,645
 35,998
54,378
36,129
28,635
 36,130
34,541
 31,629
39,227
Other long-term secured funding(e)
4,550
5,010
 4,558
5,013
 4,708
4,832
4,189
4,363
 4,233
4,680
 4,320
4,785
Total long-term secured funding$40,649
$62,869
 $41,598
$68,710
 $51,508
$75,830
$46,107
$39,459
 $46,270
$50,892
 $41,988
$56,547
          
Preferred stock(f)
$28,363
$26,068
 $28,241
$26,252
 $27,457
$26,130
$30,063
$26,993
 $30,063
$26,993
 $29,734
$27,059
Common stockholders’ equity(f)
$235,985
$230,447
 $235,613
$230,439
 $232,917
$228,995
$234,403
$234,337
 $234,408
$233,026
 $234,469
$231,547
(a)Primarily consists of short-term securities loaned or sold under agreements to repurchase.
(b)Includes FHLBEffective March 2020, includes nonrecourse advances with original maturities of less than one year of $2.6 billion and $11.4 billion as of September 30, 2019 and December 31, 2018, respectively.provided under the MMLF.
(c)Included in beneficial interests issued by consolidated variable interest entities on the Firm’s Consolidated balance sheets.
(d)Includes certain TLAC-eligible long-term unsecured debt issued by the Parent Company.
(e)Includes long-term structured notes which are secured.
(f)Refer to Capital Risk Management on pages 45–49,49-54 and Consolidated statements of changes in stockholders’ equity on page 8396 of this Form 10-Q, and Note 2021 and Note 2122 of JPMorgan Chase’s 20182019 Form 10-K for additional information on preferred stock and common stockholders’ equity.
Short-term funding
The Firm’s sources of short-term secured funding primarily consist of securities loaned or sold under agreements to repurchase. These instruments are secured predominantly by high-quality securities collateral, including government-issued debt and U.S. GSE and government agency MBS, and constitute a significant portion of the federal funds purchased and securities loaned orMBS. Securities sold under agreements to repurchase agreements on the Consolidated balance sheets. The increaseincreased at SeptemberJune 30, 2019, from2020, compared with December 31, 2018, was driven by2019, reflecting in CIB, a net increase related to client-driven market-making activities, and includes the Firm’s participation in the Federal Reserve’s open market operations, as well as higher secured financing of trading assets-debt instruments
assets, partially offset by a decline in the Firm's participation in the Federal Reserve's open market operations, and client-driven activities.in Treasury and CIO, higher secured financing of AFS investment securities.
The balances associated with securities loaned or sold under agreements to repurchase fluctuate over time due to customers’ investment and financing activities, the Firm’s demand for financing, the ongoing management of the mix of the Firm’s liabilities, including its secured and unsecured financing (for both the investment securities and market-making portfolios), and other market and portfolio factors.
As of June 30, 2020, the Firm participated in the MMLF government facility. The secured nonrecourse advances under the MMLF are included in other borrowed funds. Refer to Capital Risk Management on pages 49-54 for additional information on the MMLF.
The PDCF was established by the Federal Reserve on March 20, 2020, to allow primary dealers to support smooth market functioning by facilitating the availability of credit to businesses and households. Under the PDCF, the Federal Reserve Bank of New York (“FRBNY”) provides collateralized financing on a term basis to primary dealers. These financing transactions were reported as securities sold under agreements to repurchase. On July 28, 2020, the Federal Reserve announced that it was extending through December 31, 2020 the PDCF, which was previously scheduled to expire on or around September 30, 2020. The Firm participated in the PDCF in the first quarter of 2020, and ceased its participation in May 2020 as the secured financing market normalized.
The Firm also continues to participate in the Federal Reserve’s open market operations.
The Firm’s sources of short-term unsecured funding primarily consist of issuance of wholesale commercial paper. The decrease in commercial paper at SeptemberJune 30, 2019,2020, from December 31, 2018,2019 and for the average three and six months ended June 30, 2020 compared to the prior year period, was due to lower net issuance primarily for short-term liquidity management.


Long-term funding and issuance
Long-term funding provides additional sources of stable funding and liquidity for the Firm. The Firm’s long-term funding plan is driven primarily by expected client activity, liquidity considerations, and regulatory requirements, including TLAC. Long-term funding objectives include maintaining diversification, maximizing market access and optimizing funding costs. The Firm evaluates various funding markets, tenors and currencies in creating its optimal long-term funding plan.
The significant majority of the Firm’s long-term unsecured funding is issued by the Parent Company to provide maximum flexibility in support of both bank and nonbanknon-bank subsidiary funding needs. The Parent Company advances substantially all net funding proceeds to its subsidiary, the Intermediate Holding Company (“IHC”).IHC. The IHC does not issue debt to external counterparties. The following table summarizes long-term unsecured issuance and maturities or redemptions for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019. Refer to Liquidity Risk Management on pages 95-10093–98 and Note 1920 of JPMorgan Chase’s 20182019 Form 10-K for additional information on the IHC and long-term debt.
Long-term unsecured fundingLong-term unsecured funding       Long-term unsecured funding       
Three months ended September 30, Nine months ended September 30, Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30, Three months ended June 30, Six months ended June 30,
2019
2018
 2019
2018
 2019
2018
 2019
2018
2020
2019
 2020
2019
 2020
2019
 2020
2019
(Notional in millions)Parent Company SubsidiariesParent Company Subsidiaries
Issuance              
Senior notes issued in the U.S. market$5,000
$6,000
 $13,250
$17,000
 $—
$1,250
 $1,750
$8,761
$13,500
$4,000
 $18,750
$8,250
 $—
$—
 $—
$1,750
Senior notes issued in non-U.S. markets1,672
—
 3,920
1,175
 —
—
 —
—
—
—
 1,355
2,248
 —
—
 —
—
Total senior notes6,672
6,000
 17,170
18,175
 —
1,250
 1,750
8,761
13,500
4,000
 20,105
10,498
 —
—
 —
1,750
Subordinated debt3,000
—
 3,000
—
 —
—
 —
—
Structured notes(a)
780
387
 2,596
2,047
 8,511
5,934
 23,643
20,159
2,526
631
 5,308
1,816
 3,862
9,016
 13,114
15,132
Total long-term unsecured funding – issuance$7,452
$6,387
 $19,766
$20,222
 $8,511
$7,184
 $25,393
$28,920
$19,026
$4,631
 $28,413
$12,314
 $3,862
$9,016
 $13,114
$16,882
              
Maturities/redemptions              
Senior notes$2,700
$646
 $10,607
$18,633
 $2,751
$1,503
 $4,567
$4,466
$2,618
$4,157
 $8,084
$7,907
 $3,572
$1
 $7,637
$1,816
Subordinated debt37
15
 183
15
 —
—
 —
—
—
—
 —
146
 —
—
 —
—
Structured notes477
582
 1,436
2,465
 4,540
3,474
 12,700
12,104
1,309
331
 2,834
959
 5,355
4,327
 14,737
8,160
Total long-term unsecured funding – maturities/redemptions$3,214
$1,243
 $12,226
$21,113
 $7,291
$4,977
 $17,267
$16,570
$3,927
$4,488
 $10,918
$9,012
 $8,927
$4,328
 $22,374
$9,976
(a)Includes certain TLAC-eligible long-term unsecured debt issued by the Parent Company.

The Firm raisescan also raise secured long-term funding through securitization of consumer credit card loans and advances from the FHLBs.FHLB advances. The following table summarizes the securitization issuance and FHLB advances and their respective maturities or redemptions for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.
Long-term secured fundingLong-term secured funding      Long-term secured funding      
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
Issuance Maturities/Redemptions Issuance Maturities/RedemptionsIssuance Maturities/Redemptions Issuance Maturities/Redemptions
(in millions)20192018 20192018 2019
2018
 2019
2018
20202019 20202019 2020
2019
 2020
2019
Credit card securitization$—
$—
 $2,850
$2,375
 $—
$1,396
 $6,975
$8,500
$—
$—
 $774
$4,125
 $1,000
$—
 $1,674
$4,125
FHLB advances—
—
 5
10,704
 —
4,000
 14,810
23,157
—
—
 2
12,804
 15,000
—
 7,505
14,805
Other long-term secured funding(a)
62
117
 180
139
 115
312
 633
161
89
18
 229
207
 323
53
 434
453
Total long-term secured funding$62
$117
 $3,035
$13,218
 $115
$5,708
 $22,418
$31,818
$89
$18
 $1,005
$17,136
 $16,323
$53
 $9,613
$19,383
(a)Includes long-term structured notes which are secured.
The Firm’s wholesale businesses also securitize loans for client-driven transactions; those client-driven loan securitizations are not considered to be a source of funding for the Firm and are not included in the table above. Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for further description of the client-driven loan securitizations.

Credit ratings
The cost and availability of financing are influenced by credit ratings. Reductions in these ratings could have an adverse effect on the Firm’s access to liquidity sources, increase the cost of funds, trigger additional collateral or funding requirements and decrease the number of investors and counterparties willing to lend to the Firm. The nature and magnitude of the impact of ratings downgrades depends on numerous contractual and behavioral factors, which the Firm believes are incorporated in its liquidity risk and stress testing metrics. The Firm believes that it maintains sufficient liquidity to withstand a potential decrease in funding capacity due to ratings downgrades.
 
Additionally, the Firm’s funding requirements for VIEs and other third-party commitments may be adversely affected by a decline in credit ratings. Refer to SPEs on page 18,21, and liquidity risk and credit-related contingent features in Note 45 for additional information on the impact of a credit ratings downgrade on the funding requirements for VIEs, and on derivatives and collateral agreements.


The credit ratings of the Parent Company and the Firm’s principal bank and non-bank subsidiaries as of SeptemberJune 30, 2019,2020 were as follows.follows:
 JPMorgan Chase & Co. 
JPMorgan Chase Bank, N.A.(a)
 
J.P. Morgan Securities LLC
J.P. Morgan Securities plc
SeptemberJune 30, 20192020Long-term issuerShort-term issuerOutlook Long-term issuerShort-term issuerOutlook Long-term issuerShort-term issuerOutlook
Moody’s Investors ServiceA2P-1Stable Aa2P-1Stable Aa3P-1Stable
Standard & Poor’sA-A-2Stable A+A-1Stable A+A-1Stable
Fitch Ratings(a)
AA-F1+StableNegative AAF1+StableNegative AAF1+StableNegative
(a)On May 18, 2019, the Firm merged Chase Bank USA, N.A. with and into JPMorgan Chase Bank, N.A., with JPMorgan Chase Bank, N.A. as the surviving bank. The credit rating for JPMorgan Chase Bank, N.A. reflects the credit rating of the merged entity.
(a) On April 18, 2020, Fitch affirmed the credit ratings of the Parent Company and the Firm’s principal bank and non-bank subsidiaries but revised the outlook on the credit ratings from stable to negative given expectations that credit fundamentals will deteriorate as a result of the COVID-19 pandemic.
Refer to page 10098 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the factors that could affect credit ratings of the Parent Company and the Firm’s principal bank and non-bank subsidiaries.


CREDIT AND INVESTMENT RISK MANAGEMENT
Credit and investment risk is the risk associated with the default or change in credit profile of a client, counterparty or customer; or loss of principal or a reduction in expected returns on investments, including consumer credit risk,
wholesale credit risk, and investment portfolio risk. Refer to pages 55-6860-78 for a further discussion of Credit Risk.
Refer to page 6979 for a further discussion of Investment Portfolio Risk. Refer to Credit and Investment Risk Management on pages 102-123100–118 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of the Firm’s Credit and Investment Risk Management framework and organization, and the identification, monitoring and management.framework.

CREDIT PORTFOLIO
Credit risk is the risk associated with the default or change in credit profile of a client, counterparty or customer.
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. The adoption resulted in a change in the accounting for PCI loans, which are considered PCD loans under CECL. In conjunction with the adoption of CECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Refer to Note 1 for further information.
The Firm has granted various forms of assistance to customers and clients impacted by the COVID-19 pandemic, including payment deferrals and covenant modifications. The majority of the Firm’s COVID-19 related loan modifications have not been considered TDRs as:
they represent short-term or other insignificant modifications, whether under the Firm’s regular loan modification assessments or the IA Statement guidance, or
the Firm has elected to apply the option to suspend the application of accounting guidance for TDRs as provided under section 4013 of the CARES Act.
To the extent that certain modifications do not meet any of the above criteria, the Firm accounts for them as TDRs. The Firm considers expected losses of principal and accrued interest associated with all COVID-19 related loan modifications in its allowance for credit losses. Refer to Business Developments on pages 9-10 for more information on customer and client assistance granted. Refer to Notes 12 and 13 for further information on the Firm’s accounting
policies on loan modifications and the allowance for credit losses.
The effectiveness of the Firm’s actions in helping borrowers recover and in mitigating the Firm’s credit losses remains uncertain in light of the unpredictable nature and duration of the COVID-19 pandemic. Assistance provided in response to the COVID-19 pandemic could delay the recognition of delinquencies, nonaccrual status, and net charge-offs for those customers and clients who would have otherwise moved into past due or nonaccrual status. Refer to Consumer Credit Portfolio on pages 62-66 and Wholesale Credit Portfolio on pages 67-76 for information on loan modifications as of June 30, 2020.
In the following tables, reported loans include loans retained (i.e., held-for-investment); loans held-for-sale; and certain loans accounted for at fair value. The following tables do not include loans which the Firm accounts for at fair value and classifies as trading assets; refer to Notes 2 and 3 for further information regarding these loans. Refer to Notes 11, 22,12, 23, and 45 for additional information on the Firm’s loans, lending-related commitments and derivative receivables, including the Firm’s accounting policies.
Refer to Wholesale credit exposure – industry exposures on pages 62–64 for further information regarding the credit risk inherent in the Firm’s cash placed with banks; refer to Note 9 of this Form 10-Q and Note 10 of JPMorgan Chase’s 2018 Form 10-K for information regarding the credit risk inherent in the Firm’s investment securities portfolio; and refer to Note 10 of this Form 10-Q and Note 11 of JPMorgan Chase’s 2018 Form 10-K for information regarding the credit risk inherent in the securities financing portfolio.
Refer to Consumer Credit Portfolio on pages 106–111 of JPMorgan Chase’s 2018 Form 10-K62-66 and Note 11 of this Form 10-Q12 for a further discussiondiscussions of the consumer credit environment and consumer loans. Refer to Wholesale Credit Portfolio on pages 112–119 of JPMorgan Chase’s 2018 Form 10-K67-76 and Note 11 of this Form 10-Q12 for a further discussiondiscussions of the wholesale credit environment and wholesale loans.
Total credit portfolio    
 Credit exposure 
Nonperforming(d)(e)
(in millions)Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
Loans retained$928,887
$969,415
 $4,687
$4,611
Loans held-for-sale10,571
11,988
 88
—
Loans at fair value5,760
3,151
 176
220
Total loans–reported945,218
984,554
 4,951
4,831
Derivative receivables55,577
54,213
 26
60
Receivables from customers and other(a)
32,236
30,217
 —
—
Total credit-related assets1,033,031
1,068,984
 4,977
4,891
Assets acquired in loan satisfactions     
Real estate ownedNA
NA
 340
269
OtherNA
NA
 26
30
Total assets acquired in loan satisfactions
NA
NA
 366
299
Lending-related commitments1,095,090
1,039,258
 446
469
Total credit portfolio$2,128,121
$2,108,242
 $5,789
$5,659
Credit derivatives used
in credit portfolio management activities(b)
$(15,031)$(12,682) $—
$—
Liquid securities and other cash collateral held against derivatives(c)
(15,482)(15,322) NA
NA



(in millions,
except ratios)
Three months ended
September 30,		 Nine months ended
September 30,
2019
2018
 2019
2018
Net charge-offs$1,371
$1,033
 $4,135
$3,620
Average retained loans     
Loans932,493
942,583
 944,666
931,766
Loans – reported, excluding
residential real estate PCI loans		910,753
916,205
 921,978
903,377
Net charge-off rates     
Loans0.58%0.43% 0.59%0.52%
Loans – excluding PCI0.60
0.45
 0.60
0.54
Total credit portfolio    
 Credit exposure 
Nonperforming(d)(e)
(in millions)Jun 30,
2020
Dec 31,
2019
 Jun 30,
2020
Dec 31,
2019
Loans retained$965,448
$945,601
 $7,669
$3,983
Loans held-for-sale7,147
7,064
 245
7
Loans at fair value5,923
7,104
 130
90
Total loans–reported978,518
959,769
 8,044
4,080
Derivative receivables74,846
49,766
 108
30
Receivables from customers and other(a)
22,403
33,706
 —
—
Total credit-related assets1,075,767
1,043,241
 8,152
4,110
Assets acquired in loan satisfactions     
Real estate ownedNA
NA
 284
344
OtherNA
NA
 4
43
Total assets acquired in loan satisfactions
NA
NA
 288
387
Lending-related commitments1,124,677
1,104,199
 762
474
Total credit portfolio$2,200,444
$2,147,440
 $9,202
$4,971
Credit derivatives used
in credit portfolio management activities(b)
$(16,542)$(18,030) $—
$—
Liquid securities and other cash collateral held against derivatives(c)
(21,501)(16,009) NA
NA
(in millions,
except ratios)
Three months ended June 30, Six months ended
June 30,
2020
2019
 2020
2019
Net charge-offs$1,560
$1,403
 $3,029
$2,764
Average retained loans986,804
945,209
 967,719
950,852
Net charge-off rates0.64%0.60% 0.63%0.59%
(a)Receivables from customers and other primarily represents prime brokerage-related held-for-investment customer receivables.
(b)Represents the net notional amount of protection purchased and sold through credit derivatives used to manage both performing and nonperforming wholesale credit exposures; these derivatives do not qualify for hedge accounting under U.S. GAAP. Refer to Credit derivatives on page 6676 and Note 45 for additional information.
(c)Includes collateral related to derivative instruments where an appropriate legal opinion hasopinions have not been either sought or obtained.obtained with respect to master netting agreements.
(d)Excludes PCI loans. The Firm is recognizing interest income on each pool of PCI loans as each of the pools is performing.
(e)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, nonperforming assets excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $1.6 billion$561 million and $2.6 billion,$961 million, respectively, and real estate owned (“REO”) insured by U.S. government agencies of $50$13 million and $75$41 million, respectively. These amounts have been excluded based upon the government guarantee. In addition, the Firm’s policy is generally to exempt credit card loans from being placed on nonaccrual status as permitted by regulatory guidance issued by the Federal Financial Institutions Examination Council (“FFIEC”).
(e)At June 30, 2020, nonperforming loans included $1.3 billion of PCD loans on nonaccrual status. Prior to the adoption of CECL, nonaccrual loans excluded PCI loans as the Firm recognized interest income on each pool of PCI loans as each of the pools was performing.
Paycheck Protection Program
The PPP, established by the CARES Act and implemented by the SBA, provides the Firm with delegated authority to process and originate PPP loans until August 8, 2020. When certain criteria are met, PPP loans are subject to forgiveness and the Firm will receive payment of the forgiveness amount from the SBA. The term for PPP loans issued before June 5, 2020 is two years (with an option to extend to five years) and five years for those originated on or after June 5, 2020. PPP loan terms provide borrowers with an automatic payment deferral of principal and interest. Given that PPP loans are guaranteed by the SBA, the Firm does not expect to realize material credit losses on these loans. PPP processing fees are deferred and accreted into interest income over the contractual life of the loans.
At June 30, 2020, the Firm had approximately $28 billion of loans under the PPP, of which $20 billion and $8 billion are in Consumer and Wholesale, respectively. The impact on interest income related to PPP loans was not material for the three months ended June 30, 2020.

CONSUMER CREDIT PORTFOLIO
The Firm’s retained consumer portfolio consists primarily of residential real estate loans, credit card loans, scored auto loans, and business banking loans, as well as associated lending-related commitments. The Firm’s focus is on serving primarily the prime segment of the consumer credit market. Refer to Note 11 of this Form 10-Q and Consumer Credit Portfolio on pages 106–111 and Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information on consumer loans.loans, as well as the Firm’s nonaccrual and charge-off accounting policies. Refer to Note 22 of this Form 10-Q and Note 27 of JPMorgan Chase’s 2018 Form 10-K23 for further information on lending-related commitments.
Continued weakness in the macroeconomic environment driven by the impacts of the COVID-19 pandemic, resulted in an additional increase in the allowance for credit losses. The continuation or worsening of the effects of the COVID-19 pandemic on the macroeconomic environment and the extent to which customer assistance and government stimulus efforts are effective could result in further impacts to credit quality metrics, including delinquencies, nonaccrual loans and charge-offs.
The following table presents consumer credit-related information with respect to the scored credit portfolioportfolios held byin CCB, scored prime mortgage and scored home equity loans held by AWM and prime mortgage loans held by Corporate. Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information about the Firm’s nonaccrual and charge-off accounting policies.
Consumer credit portfolio                
      Three months ended September 30, Nine months ended September 30,

(in millions, except ratios)		Credit exposure 
Nonaccrual loans(f)(g)
 
Net charge-offs/(recoveries)(h)
 
Net charge-off/(recovery) rate(h)(i)
 
Net charge-offs/(recoveries)(h)
 
Net charge-off/(recovery) rate(h)(i)
Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
 2019
2018
 2019
2018
 2019
2018
 2019
2018
Consumer, excluding credit card                 
Loans, excluding PCI loans and loans held-for-sale                 
Residential mortgage$197,456
$231,078
 $1,629
$1,765
 $(15)$(105) (0.03)%(0.18)% $(31)$(256) (0.02)%(0.15)%
Home equity24,954
28,340
 1,208
1,323
 (25)(12) (0.39)(0.16) (40)(2) (0.20)(0.01)
Auto(a)(b)
61,410
63,573
 112
128
 49
56
 0.32
0.35
 149
182
 0.32
0.37
Consumer & Business Banking(b)(c)
26,699
26,612
 268
245
 79
68
 1.18
1.02
 204
171
 1.03
0.88
Total loans, excluding PCI loans and loans held-for-sale310,519
349,603
 3,217
3,461
 88
7
 0.11
0.01
 282
95
 0.11
0.04
Loans – PCI                 
Home equity7,753
8,963
 NA
NA
 NA
NA
 NA
NA
 NA
NA
 NA
NA
Prime mortgage4,164
4,690
 NA
NA
 NA
NA
 NA
NA
 NA
NA
 NA
NA
Subprime mortgage1,797
1,945
 NA
NA
 NA
NA
 NA
NA
 NA
NA
 NA
NA
Option ARMs7,576
8,436
 NA
NA
 NA
NA
 NA
NA
 NA
NA
 NA
NA
Total loans – PCI21,290
24,034
 NA
NA
 NA
NA
 NA
NA
 NA
NA
 NA
NA
Total loans – retained331,809
373,637
 3,217
3,461
 88
7
 0.10
0.01
 282
95
 0.11
0.03
Loans held-for-sale4,821
95
 2
—
 NA
NA
 NA
NA
 NA
NA
 NA
NA
Total consumer, excluding credit card loans336,630
373,732
 3,219
3,461
 88
7
 0.10
0.01
 282
95
 0.11
0.03
Lending-related commitments(d)
53,591
46,066
               
Receivables from customers18
154
               
Total consumer exposure, excluding credit card390,239
419,952
               
Credit card                 
Loans retained(e)
159,571
156,616
 —
—
 1,175
1,073
 2.95
2.91
 3,617
3,407
 3.13
3.16
Loans held-for-sale—
16
 —
—
 NA
NA
 NA
NA
 NA
NA
 NA
NA
Total credit card loans159,571
156,632
 —
—
 1,175
1,073
 2.95
2.91
 3,617
3,407
 3.13
3.16
Lending-related commitments(d)
645,880
605,379
               
Total credit card exposure805,451
762,011
               
Total consumer credit portfolio$1,195,690
$1,181,963
 $3,219
$3,461
 $1,263
$1,080
 1.00 %0.82 % $3,899
$3,502
 1.02 %0.90 %
Memo: Total consumer credit portfolio, excluding PCI$1,174,400
$1,157,929
 $3,219
$3,461
 $1,263
$1,080
 1.05 %0.86 % $3,899
$3,502
 1.07 %0.96 %
Consumer credit portfolio                  
      Three months ended June 30, Six months ended June 30,

(in millions, except ratios)		Credit exposure 
Nonaccrual loans(h)(i)(j)
 Net charge-offs/(recoveries) 
Net charge-off/(recovery) rate(k)
 Net charge-offs/(recoveries) 
Net charge-off/(recovery) rate(k)
Jun 30,
2020
Dec 31,
2019
 Jun 30,
2020
Dec 31,
2019
 2020
2019
 2020
 2019
 2020
2019
 2020
 2019
Consumer, excluding credit card                   
Residential real estate(a)
$235,381
$243,317
 $4,106
$2,780
 $(5)$(29) (0.01)% (0.04)% $(125)$(31) (0.10)% (0.02)%
Auto and other(b)(c)(d)
71,624
51,682
 140
146
 88
97
 0.54
(d) 
0.75
 202
206
 0.70
(d) 
0.80
Total loans – retained307,005
294,999
 4,246
2,926
 83
68
 0.11
 0.09
 77
175
 0.05
 0.11
Loans held-for-sale1,912
3,002
 —
2
 NA
NA
 NA NA
 NA
NA
 NA NA
Total consumer, excluding credit card loans308,917
298,001
 4,246
2,928
 83
68
 0.11
 0.09
 77
175
 0.05
 0.11
Lending-related commitments(e)
45,348
40,169
                 
Total consumer exposure, excluding credit card354,265
338,170
                 
Credit card                   
Loans retained(f)
141,656
168,924
 —
—
 1,178
1,240
 3.33
 3.24
 2,491
2,442
 3.28
 3.23
Loans held-for-sale—
—
 —
—
 NA
NA
 NA NA
 NA
NA
 NA NA
Total credit card loans141,656
168,924
 —
—
 1,178
1,240
 3.33
 3.24
 2,491
2,442
 3.28
 3.23
Lending-related commitments(e)(g)
673,836
650,720
                 
Total credit card exposure(g)
815,492
819,644
                 
Total consumer credit portfolio(g)
$1,169,757
$1,157,814
 $4,246
$2,928
 $1,261
$1,308
 1.14 % 1.11 % $2,568
$2,617
 1.14 % 1.10 %
(a)Includes scored mortgage and home equity loans held in CCB and AWM, and scored mortgage loans held in Corporate.
(b)At SeptemberJune 30, 2019,2020 and December 31, 2018,2019, excluded operating lease assets of $22.1$22.2 billion and $20.5$22.8 billion, respectively. These operating lease assets are included in other assets on the Firm’s Consolidated balance sheets. Refer to Note 1617 for further information.
(b)(c)Includes certainscored auto and business banking loans and auto dealer risk-rated loans that apply the wholesale methodology for determining the allowance for loan losses; these loans are managed by CCB, and therefore, for consistency in presentation, are included within the consumer portfolio.
(c)Predominantly includes Business Banking loans.overdrafts.
(d)At June 30, 2020, included $19.9 billion of loans in Business Banking under the PPP. Given that PPP loans are guaranteed by the SBA, the Firm does not expect to realize material credit losses on these loans. Refer to Credit Portfolio on pages 60-61 for a further discussion of the PPP.
(e)Credit card, and home equity and certain business banking lending-related commitments represent the total available lines of credit for these products. The Firm has not experienced, and does not anticipate, that all available lines of credit would be used at the same time. For credit card commitments, and if certain conditions are met, home equity commitments and certain business banking commitments, the Firm can reduce or cancel these lines of credit by providing the borrower notice or, in some cases as permitted by law, without notice. Refer to Note 2223 for further information.
(e)(f)Includes billed interest and fees net of an allowance for uncollectible interest and fees.
(f)(g)Also includes commercial card lending-related commitments primarily in CB and CIB.
(h)At SeptemberJune 30, 20192020 and December 31, 2018,2019, nonaccrual loans excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $1.6 billion$561 million and $2.6 billion,$961 million, respectively. These amounts have been excluded from nonaccrual loans based upon the government guarantee. In addition, the Firm’s policy is generally to exempt credit card loans from being placed on nonaccrual status, as permitted by regulatory guidance issued by the FFIEC.
(g)(i)ExcludesAt June 30, 2020, nonaccrual loans included $1.3 billion of PCD loans. Prior to the adoption of CECL, nonaccrual loans excluded PCI loans. Theloans as the Firm is recognizingrecognized interest income on each pool of PCI loans as each of the pools iswas performing.
(h)(j)Net charge-offs/(recoveries) andGenerally excludes loans that were under payment deferral programs offered in response to the net charge-off/(recovery) rates excluded write-offs in the PCI portfolio of $43 million and $58 million for the three months ended September 30, 2019 and 2018, respectively, and $132 million and $151 million for the nine months ended September 30, 2019 and 2018, respectively. These write-offs decreased the allowance for loan losses for PCI loans. Refer to Allowance for Credit Losses on pages 67–68 for further information.COVID-19 pandemic.
(i)(k)Average consumer loans held-for-sale were $5.5$1.9 billion and $196 million$1.2 billion for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $2.6were $2.2 billion and $240 million$1.2 billion for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively. These amounts were excluded when calculating net charge-off/(recovery) rates.


Consumer assistance
In March 2020, the Firm began providing assistance to customers in response to the COVID-19 pandemic, predominantly in the form of payment deferrals.
Predominantly all accounts that requested payment assistance were less than 30 days past due at the time of enrollment. Although borrowers are not required to make payments while still under payment deferral, on approximately 50% of accounts with payment assistance offered, borrowers have made at least one payment between March 2020 and June 30, 2020. The Firm continues to monitor the credit risk associated with loans subject to deferrals throughout the deferral period and on an ongoing basis after the borrowers are required to resume making regularly scheduled payments.
The following table presents information related to the $28 billion unpaid principal balance of retained loans still under payment deferral as of June 30, 2020.
As of June 30, 2020
(in millions, except ratios)
Loan balance(a)
Percent of loan class balance(b)
Type of modifications
Residential real estate$20,548
8.7%Rolling three month deferral up to one year; final work-out is determined at the end of the deferral period; Generally deferred payments are required to be paid at the end of the loan term
Auto and other3,357
4.6
•
Auto: Three month deferral with automatic maturity extension
•
Business Banking: Three month deferral with automatic deferment to either maturity (loan) or one year forward (line)
Credit card4,384
3.1
Three month minimum payment waiver with potential one month extensions totaling six months;
Interest continues to accrue during the deferral period and is added to the principal balance
Total consumer$28,289
6.3% 
(a)Excludes $7.5 billion of loans which were previously under payment deferral, with predominantly all returning to their original loan terms prior to June 30, 2020. Also excludes risk-rated business banking and auto dealer loans held in CCB and auto operating lease assets that were still under payment deferral as of June 30, 2020. Auto operating lease asset payment assistance consists of a three month payment deferral. Deferrals do not extend the term of the lease and all deferred payments are due at the end of the lease term.
(b)Represents the unpaid principal balance of retained loans which were still under payment deferral as of June 30, 2020, divided by the total unpaid principal balance of the respective loan classes retained loans as of June 30, 2020.

Consumer, excluding credit card
Portfolio analysis
Loan balances decreasedincreased from December 31, 20182019 due to PPP loan originations in Business Banking, partially offset by lower residential real estate loans, predominantly driven byreflecting paydowns and loan sales. The credit performance of the portfolio continues to benefit from a strong labor market and improvement in home prices.
The following discussions provide information concerning individual loan products, excluding PCI loans which are addressed separately. Refer to Note 11 of this Form 10-Q for further information about this portfolio, including information about delinquencies, loan modifications and other credit quality indicators.
Residential mortgage:real estate: The residential mortgagereal estate portfolio, including loans held-for-sale, predominantly consists of prime mortgage loans.loans and home equity lines of credit. The portfolio decreased from December 31, 20182019 driven by paydowns and loan sales in Home Lending, as well as paydowns, largely offset by originations of prime mortgage loans that have been retained on the balance sheet. Net recoveries for the three and nine months ended SeptemberJune 30, 20192020 were lower when compared with the same periodsperiod in the prior year as the current quarter included losses associated with the purchased credit deteriorated portfolio as a result of the adoption of CECL. Net recoveries for the six months ended June 30, 2020 were higher when compared with the same period in the prior year as the current year benefited from larger recoveriesa recovery on a loan sales.sale.
The carrying value of home equity lines of credit outstanding was $26.5 billion at June 30, 2020. This amount included $9.9 billion of HELOCs that have recast from interest-only to fully amortizing payments or have been modified and $8.7 billion of interest-only balloon HELOCs, which primarily mature after 2030. The Firm manages the risk of HELOCs during their revolving period by closing or reducing the undrawn line to the extent permitted by law when borrowers are exhibiting a material deterioration in their credit risk profile.
At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, the Firm’scarrying value of interest-only residential mortgage portfolio included $21.8loans was $23.2 billion and $21.6$22.5 billion, respectively, of interest-only loans.respectively. These loans have an interest-only payment period generally followed by an adjustable-rate or fixed-rate fully amortizing payment period to maturity and are typically originated as higher-balance loans to higher-income borrowers, predominantly in AWM. Performance of this portfolio for the three and ninesix months ended SeptemberJune 30, 20192020 was in line with the performance of the broader residential mortgage portfolio for the same period.
The following table provides a summary of the Firm’s residential mortgage portfolio insured and/or guaranteed by U.S. government agencies, including loans held-for-sale. The Firm monitors its exposure to certain potential unrecoverable claim payments related to government-insured loans and considers this exposure in estimating the allowance for loan losses.
(in millions)September 30,
2019
December 31,
2018
June 30,
2020
December 31,
2019
Current$2,100
$2,884
$692
$1,280
30-89 days past due1,054
1,528
265
695
90 or more days past due1,602
2,600
561
961
Total government guaranteed loans$4,756
$7,012
$1,518
$2,936
 
Home equity:The home equity portfolio declined from December 31, 2018 primarily reflecting loan paydowns.
At September 30, 2019, approximately 90% of the Firm’s home equity portfolio consisted of home equity lines of credit (“HELOCs”)Geographic composition and the remainder consisted of home equity loans (“HELOANs”). The carrying value of HELOCs outstanding was $23 billion at September 30, 2019. This amount included $10 billion of HELOCs that have recast from interest-only to fully amortizing payments or have been modified and $4 billion of interest-only balloon HELOCs, which primarily mature after 2030. The Firm manages the risk of HELOCs during their revolving period by closing or reducing the undrawn line to the extent permitted by law when borrowers are exhibiting a material deterioration in their credit risk profile.
Refer to Note 11 of this Form 10-Q and Consumer Credit Portfolio on pages 106–111 of JPMorgan Chase’s 2018 Form 10-K for further information on the Firm’s home equity portfolio.
Auto: The auto loan portfolio predominantly consists of prime-quality loans. The portfolio declined when compared with December 31, 2018, as paydowns and charge-offs or liquidation of delinquent loans were predominantly offset by new originations.
Consumer & Business Banking: Consumer & Business Banking loans were flat when compared with December 31, 2018 as loan originations were offset by paydowns and charge-offs of delinquent loans. Net charge-offs for the three and nine months ended September 30, 2019 increased when compared with the same period in the prior year due primarily to higher deposit overdraft losses.
Purchased credit-impaired loans:PCI loans represent certain loans that were acquired and deemed to be credit-impaired on the acquisition date. PCI loans decreased from December 31, 2018 due to portfolio run off. As of September 30, 2019, approximately 9% of the option ARM PCI loans were delinquent and approximately 71% of the portfolio had been modified into fixed-rate, fully amortizing loans. The borrowers for substantially all of the remaining option ARM loans are making amortizing payments, although such payments are not necessarily fully amortizing. This latter group of loans is subject to the risk of payment shock due to future payment recast. Default rates generally increase on option ARM loans when payment recast results in a payment increase. The expected increase in default rates is considered in the Firm’s quarterly impairment assessment.

The following table provides a summary of lifetime principal loss estimates included in either the nonaccretable difference or the allowance for loan losses.
Summary of PCI loans lifetime principal loss estimates
 
Lifetime loss
 estimates(a)
 
Life-to-date
liquidation losses(b)
(in billions)Sep 30,
2019
 Dec 31,
2018
 Sep 30,
2019
 Dec 31,
2018
Home equity$13.9
 $14.1
 $13.0
 $13.0
Prime mortgage4.1
 4.1
 3.9
 3.9
Subprime mortgage3.3
 3.3
 3.2
 3.2
Option ARMs10.3
 10.3
 10.0
 9.9
Total$31.6
 $31.8
 $30.1
 $30.0
(a)Includes the original nonaccretable difference established in purchase accounting of $30.5 billion for principal losses plus additional principal losses recognized subsequent to acquisition through the provision and allowance for loan losses. The remaining nonaccretable difference for principal losses was $476 million and $512 million at September 30, 2019, and December 31, 2018, respectively.
(b)Represents both realization of loss upon loan resolution and any principal forgiven upon modification.
Geographic compositioncurrent estimated loan-to-value ratio of residential real estate loans
Refer to Note 1112 for information on the geographic composition of the Firm’s residential real estate loans.
Current estimated loan-to-value ratio of residential real estate loans
Average current estimated loan-to-value (“LTV”) ratios have declined consistent with recent improvements in home prices, customer paydowns, and charge-offs or liquidations of higher LTV loans. Refer to Note 11 for information on current estimated LTVs of the Firm’s residential real estate loans.
Loan modification activities forModified residential real estate loans
The performance of modified loans generally differs by product type due to differences in both the credit quality and the types of modifications provided. Performance metrics for modifications to the residential real estate portfolios as measured through redefault rates, were not materially different from December 31, 2018. Refer to Consumer Credit Portfolio on pages 106–111 of JPMorgan Chase’s 2018 Form 10-K for further information on the Firm’s redefault rates.
Certain modified loans have interest rate reset provisions (“step-rate modifications”) where the interest rates on these loans generally began to increase commencing in 2014 by 1% per year, and will continue to do so, until the rate reaches a specified cap. The cap on these loans is typically at a prevailing market interest rate for a fixed-rate mortgage loan as of the modification date. At September 30, 2019, the carrying value of non-PCI loans and the unpaid principal balance of PCI loans modified in step-rate modifications, which have not yet met their specified caps, were $1.3 billion and $2.4 billion, respectively. The Firm continues to monitor this risk exposure and the impact of these potential interest rate increases is considered in the Firm’s allowance for loan losses.
The following table presents information as of September 30, 2019, and December 31, 2018, relating to modified retained residential real estate loans for which concessions have been granted to borrowers experiencing financial difficulty.difficulty, which include both TDRs and modified loans accounted for as PCI loans prior to the adoption of CECL. The following table does not include loans with short-term or other insignificant modifications that are not considered concessions and, therefore, are not TDRs. Refer to Note 1112 for further information on modifications for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
Modified residential real estate loans
 September 30, 2019 December 31, 2018
(in millions)Retained loans
Non-accrual
retained loans(d)
 Retained loans
Non-accrual
retained loans(d)
Modified residential real estate loans, excluding
PCI loans(a)(b)
     
Residential mortgage$4,118
$1,376
 $4,565
$1,459
Home equity1,961
981
 2,012
955
Total modified residential real estate loans, excluding PCI loans$6,079
$2,357
 $6,577
$2,414
Modified PCI loans(c)
     
Home equity$2,003
NA
 $2,086
NA
Prime mortgage2,929
NA
 3,179
NA
Subprime mortgage1,919
NA
 2,041
NA
Option ARMs5,879
NA
 6,410
NA
Total modified PCI loans$12,730
NA
 $13,716
NA
(in millions)June 30, 2020
 December 31, 2019
 
Retained loans(a)
$16,350
 $5,926
 
PCI loansNA
 12,372
(d) 
Nonaccrual retained loans(b)(c)
$3,412
 $2,332
 
(a)Amounts represent the carrying value of modified residential real estate loans.
(b)At SeptemberJune 30, 2019,2020, and December 31, 2018, $162019, $5 million and $4.1 billion,$14 million, respectively, of loans modified subsequent to repurchase from Ginnie Mae in accordance with the standards of the appropriate government agency (i.e., Federal Housing Administration (“FHA”), U.S. Department of Veterans Affairs (“VA”), Rural Housing Service of the U.S. Department of Agriculture (“RHS”)) are not included in the table above. When such loans perform subsequent to modification in accordance with Ginnie Mae guidelines, they are generally sold back into Ginnie Mae loan pools. Modified loans that do not re-perform become subject to foreclosure. Refer to Note 1314 for additional information about sales of loans in securitization transactions with Ginnie Mae.
(c)Amounts represent the unpaid principal balance of modified PCI loans.
(d)(b)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, nonaccrual loans included $1.9$2.4 billion and $2.0$1.9 billion, respectively, of troubled debt restructurings (“TDRs”)TDRs for which the borrowers were less than 90 days past due. Refer to Note 1112 for additional information about loans modified in a TDR that are on nonaccrual status.
(c)At June 30, 2020, nonaccrual loans included $1.0 billion of PCD loans. Prior to the adoption of CECL, nonaccrual loans excluded PCI loans as the Firm recognized interest income on each pool of PCI loans as each of the pools was performing.
(d)Amount represents the unpaid principal balance of modified PCI loans at December 31, 2019, which were moved to retained loans upon the adoption of CECL.
Auto and other: The auto and other loan portfolio predominantly consists of prime-quality scored auto and business banking loans, as well as overdrafts. The portfolio increased when compared with December 31, 2019, predominantly due to PPP loan originations of $21.5 billion in Business Banking of which $19.9 billion remained outstanding on June 30, 2020, partially offset by paydowns and charge-offs or liquidation of delinquent loans. The scored auto portfolio net charge-off rates were 0.39% and 0.36% for the three months ended June 30, 2020 and 2019, respectively, and 0.40% and 0.43% for the six months ended June 30, 2020 and 2019, respectively.


Nonperforming assets
The following table presents information as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, about consumer, excluding credit card, nonperforming assets.
Nonperforming assets(a)
       
(in millions)September 30,
2019
 December 31,
2018
June 30,
2020
 December 31,
2019
 
Nonaccrual loans(b)
       
Residential real estate(b)$2,839
 $3,088
$4,106
 $2,782
 
Other consumer380
 373
Auto and other140
 146
 
Total nonaccrual loans3,219
 3,461
4,246
 2,928
 
Assets acquired in loan satisfactions       
Real estate owned(c)
209
 196
185
 208
 
Other26
 30
4
 24
 
Total assets acquired in loan satisfactions235
 226
189
 232
 
Total nonperforming assets$3,454
 $3,687
$4,435
 $3,160
 
(a)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, nonperforming assets excluded mortgage loans 90 or more days past due and insured by U.S. government agencies of $1.6 billion$561 million and $2.6 billion,$961 million, respectively, and REO insured by U.S. government agencies of $50$13 million and $75$41 million, respectively. These amounts have been excluded based upon the government guarantee.
(b)Excludes
At June 30, 2020, nonaccrual loans included $1.3 billion of PCD loans. Prior to the adoption of CECL, nonaccrual loans excluded PCI loans which are accounted for on a pool basis. Since each pool is accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows, the past-due status of the pools, or that of individual loans within the pools, is not meaningful. The Firm is recognizingrecognized interest income on each pool of PCI loans as each of the pools iswas performing.
(c)The prior period amount has been revised to conform with the current period presentation.
Nonaccrual loans in the residential real estate portfolio at September 30, 2019 decreased to $2.8 billion from $3.1 billion at December 31, 2018, of which 20% and 24% were greater than 150 days past due, respectively. In the aggregate, the unpaid principal balance of residential real estate loans greater than 150 days past due was charged down by approximately 31% and 32% to the estimated net realizable value of the collateral at September 30, 2019, and December 31, 2018, respectively.
Nonaccrual loans: The following table presents changes in consumer, excluding credit card, nonaccrual loans for the ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
Nonaccrual loan activity   
Nine months ended September 30,
(in millions)		 2019
2018
Six months ended June 30,
(in millions)		2020
2019
Beginning balance $3,461
$4,209
$2,928
$3,244
Additions 1,674
2,174
 
Additions: 
PCD loans, upon adoption of CECL708
NA
Other additions1,655
975
Total additions2,363
975
 
Reductions:   
Principal payments and other(a)
 766
1,119
369
431
Charge-offs 301
354
220
189
Returned to performing status 657
1,057
356
393
Foreclosures and other liquidations 192
217
100
129
Total reductions 1,916
2,747
1,045
1,142
 
Net changes (242)(573)1,318
(167)
Ending balance $3,219
$3,636
$4,246
$3,077
(a)Other reductions includes loan sales.
Active and suspended foreclosure: Refer to Note 1112 for information on loans that were in the process of active or suspended foreclosure.
Refer to Note 12 for further information about the consumer credit portfolio, including information about delinquencies, loan modifications and other credit quality indicators.
Purchased credit deteriorated (“PCD”) loans
The following tables provide credit-related information for PCD loans, which were accounted for as PCI loans prior to the adoption of CECL. PCI loans are considered PCD loans under CECL and are subject to the Firm’s nonaccrual and charge-off policies. PCD loans are now reported in the consumer, excluding credit card portfolio’s residential real estate class. Refer to Note 1 for further information.
(in millions, except ratios)June 30,
2020
December 31,
2019
Loan delinquency(a)
  
Current$17,522
$18,571
30-149 days past due693
970
150 or more days past due568
822
Total PCD loans$18,783
$20,363
   
% of 30+ days past due to total retained PCD loans6.71%8.80%
Nonaccrual loans$1,283
NA
(in millions, except ratios)Three months ended June 30, 2020
 Six months ended June 30, 2020
Net charge-offs$27
$33
Net charge-off rate0.57%0.34%
(a)At June 30, 2020, loans under payment deferral programs offered in response to the COVID-19 pandemic which are still within their deferral period and performing according to their modified terms are generally not considered delinquent.


Credit card
Total credit card loans increaseddecreased from December 31, 20182019 reflecting increaseda decline in sales volumes from existing customersvolume beginning in March as a result of the COVID-19 pandemic and new account growth, partially offset by the impact of seasonality. The SeptemberJune 30, 2020 30+ and 90+ day delinquency rates of 1.71% and 0.93%, respectively, decreased compared to the December 31, 2019 30+ and 90+ day delinquency rates of 1.84%1.87% and 0.90%, respectively, were relatively flat compared to the December 31, 2018 30+ and 90+ day delinquency rates of 1.83% and 0.92%0.95%, respectively. The delinquency rate was positively impacted by loans in payment deferral programs, as these loans are generally not considered delinquent if they are performing according to their modified terms. Net charge-offs decreased for the three months ended June 30, 2020 compared with the same period in the prior year due to higher recoveries. However, net charge-offs increased for the three and ninesix months ended SeptemberJune 30, 20192020 when compared with the same period in the prior year due to loan growth in line with expectations.the prior year largely offset by higher recoveries.
Consistent with the Firm’s policy, all credit card loans typically remain on accrual status until charged off. However, the Firm establishes anFirm’s allowance which is offset against loans and reduces interest income, for loan losses includes the estimated uncollectible portion of accrued and billed interest and fee income. Refer to Note 12 for further information about this portfolio, including information about delinquencies.
Geographic and FICO composition of credit card loans
Refer to Note 1112 for information on the geographic and FICO composition of the Firm’s credit card loans.
Modifications of credit card loans
At SeptemberJune 30, 2019 and December 31, 2018,2020 the Firm had $1.4 billion and $1.3 billion, respectively, of credit card loans outstanding that have been modified in TDRs.TDRs, which does not include loans with short-term or other insignificant modifications that are not considered TDRs, compared to $1.5 billion at December 31, 2019. Refer to Note 1112 for additional information about loan modification programs to borrowers.

WHOLESALE CREDIT PORTFOLIO
In its wholesale businesses, the Firm is exposed to credit risk primarily through its underwriting, lending, market-making, and hedging activities with and for clients and counterparties, as well as through various operating services (such as cash management and clearing activities), securities financing activities and cash placed with banks. A portion of the loans originated or acquired by the Firm’s wholesale businesses is generally retained on the balance sheet. The Firm distributes a significant percentage of the loans that it originates into the market as part of its syndicated loan business and to manage portfolio concentrations and credit risk.
The credit performance of the wholesale portfolio remained favorable for the nine months ended September 30, 2019, characterized by continued low levels of criticized exposure, nonaccrual loans and charge-offs. Refer to the industry discussion on pages 62–64 for further information. Loans held-for-sale decreased, driven by a loan syndication in CIB. The wholesale portfolio is actively managed, in part by conducting ongoing, in-depth reviews of client credit quality and transaction structure inclusive of collateral where applicable, and of industry, product and client concentrations.
Refer to the industry discussion on pages 70-74 for further information.
In the following tables, theThe Firm’s wholesale credit portfolio includes exposure held in CIB, CB, AWM and Corporate. It excludes all exposure managed by CCB, scored prime mortgageCorporate, as well as risk-rated business banking and scored home equity loansauto dealer exposures held in AWMCCB for which the wholesale methodology is applied when determining the allowance for credit losses.
The macroeconomic environment, driven by the impacts of the COVID-19 pandemic, has resulted in broad-based deterioration and prime mortgagean increase in the allowance for credit losses. In the six months ended June 30, 2020, the investment-grade percentage of the portfolio decreased from 74% to 72%, and criticized exposure increased $24.3 billion from $15.1 billion to $39.4 billion.  The increase in criticized exposure was largely driven by downgrades in Consumer & Retail and Oil & Gas. The continuation or worsening of the effects of the COVID-19 pandemic on the macroeconomic environment could result in further impacts to credit quality metrics, including investment-grade percentages, as well as to criticized and nonperforming exposures and charge-offs.
Retained loans heldincreased by $35.1 billion in Corporate.the six months ended June 30, 2020, driven by the CIB and CB, predominantly to commercial and industrial clients. The $35.1 billion increase reflects the outstanding loans from the March drawdown activity on committed revolving credit facilities, as a result of the COVID-19 pandemic, and the impact of loans under the PPP.
Wholesale credit portfolio
 Credit exposure 
Nonperforming(c)
(in millions)Jun 30,
2020
Dec 31,
2019
 Jun 30,
2020
Dec 31,
2019
Loans retained$516,787
$481,678
 $3,423
$1,057
Loans held-for-sale5,235
4,062
 245
5
Loans at fair value5,923
7,104
 130
90
Loans – reported527,945
492,844
 3,798
1,152
Derivative receivables74,846
49,766
 108
30
Receivables from customers and other(a)
22,403
33,706
 —
—
Total wholesale credit-related assets625,194
576,316
 3,906
1,182
Assets acquired in loan satisfactions     
Real estate ownedNA
NA
 99
136
OtherNA
NA
 —
19
Total assets acquired in loan satisfactionsNA
NA
 99
155
Lending-related commitments405,493
413,310
 762
474
Total wholesale credit portfolio$1,030,687
$989,626
 $4,767
$1,811
Credit derivatives used
in credit portfolio management activities(b)
$(16,542)$(18,030) $—
$—
Liquid securities and other cash collateral held against derivatives(21,501)(16,009) NA
NA
Wholesale credit portfolio
 Credit exposure 
Nonperforming(c)
(in millions)Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
Loans retained$437,507
$439,162
 $1,470
$1,150
Loans held-for-sale5,750
11,877
 86
—
Loans at fair value5,760
3,151
 176
220
Loans – reported449,017
454,190
 1,732
1,370
Derivative receivables55,577
54,213
 26
60
Receivables from customers and other(a)
32,218
30,063
 —
—
Total wholesale credit-related assets536,812
538,466
 1,758
1,430
Lending-related commitments395,619
387,813
 446
469
Total wholesale credit exposure$932,431
$926,279
 $2,204
$1,899
Credit derivatives used in credit portfolio management activities(b)
$(15,031)$(12,682) $—
$—
Liquid securities and other cash collateral held against derivatives(15,482)(15,322) NA
NA
(a)Receivables from customers and other include $32.2$22.4 billion and $30.1$33.7 billion of prime brokerage-related held-for-investment customer receivables at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively, to customersclients in CIB and AWM; these are classified in accrued interest and accounts receivable on the Consolidated balance sheets.
(b)Represents the net notional amount of protection purchased and sold through credit derivatives used to manage both performing and nonperforming wholesale credit exposures; these derivatives do not qualify for hedge accounting under U.S. GAAP. Refer to Credit derivatives on page 6676 and Note 45 for additional information.
(c)Excludes assets acquiredLoans that were modified in loan satisfactions.response to the COVID-19 pandemic continue to be risk-rated in accordance with the Firm’s overall credit risk management framework. As of June 30, 2020, predominantly all of these loans were considered performing.



Wholesale assistance
In March 2020, the Firm began providing assistance to clients in response to the COVID-19 pandemic, predominantly in the form of payment deferrals and covenant modifications.
As of June 30, 2020, the Firm had approximately $17 billion of retained loans still under payment deferral, almost all short-term, and included $8.8 billion in Automotive in the table below that the Firm proactively offered to performing auto dealer clients where the deferral period ended on June 30, 2020, and the majority of the clients returned to their original loan terms. The Firm continues to monitor the credit risk associated with loans subject to deferrals throughout the deferral period and on an ongoing basis after the borrowers are required to resume making regularly scheduled payments.
As of June 30, 2020
(in millions, except ratios)
   
Industry
Loan balance(a)
Percent of total industry loan balance(b)
IG percentage of loan balance in payment deferral
Automotive$8,827
46%72%
Real Estate5,211
4
64
Individuals and Individual Entities809
1
9
Consumer & Retail

690
1
4
Industrials335
1
10
Healthcare300
1
16
All other industries603
—
55
Total$16,775
3%61%
(a)Excludes $6.5 billion of loans which were previously under payment deferral, with the majority returning to their original loan terms prior to June 30, 2020.
(b)Represents the balance of the retained loans which were still under payment deferral as of June 30, 2020, divided by the respective industry total retained loans balance as of June 30, 2020.
In addition, the Firm granted assistance in the form of covenant modifications. These types of assistance, both payment deferrals and covenant modifications, have not resulted in an increase in TDRs, either because the modifications were insignificant or they qualified for the option to suspend the application of accounting guidance for TDRs as provided under section 4013 of the CARES Act. These loans continue to be risk-rated in accordance with the Firm’s overall credit risk management framework. As of June 30, 2020, predominantly all of these loans were considered performing.
Wholesale credit exposure – maturity and ratings profile
The following tables present the maturity and internal risk ratings profiles of the wholesale credit portfolio as of SeptemberJune 30, 2019,2020, and December 31, 2018.2019. The Firm considers internal ratings scale is based on the Firm’s internal risk ratings, which generally correspondequivalent to the ratings assigned by S&P and Moody’s.BBB-/Baa3 or higher as investment grade. Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for additionalfurther information on wholesale loan portfoliointernal risk ratings.
Wholesale credit exposure – maturity and ratings profile     
Maturity profile(d)
 Ratings profile
Maturity profile(d)
 Ratings profile
Due in 1 year or lessDue after 1 year through 5 yearsDue after 5 yearsTotal Investment-grade Noninvestment-gradeTotalTotal % of IGDue in 1 year or lessDue after 1 year through 5 yearsDue after 5 yearsTotal Investment-grade Noninvestment-gradeTotalTotal % of IG
September 30, 2019
(in millions, except ratios)		 AAA/Aaa to BBB-/Baa3 BB+/Ba1 & below
June 30, 2020
(in millions, except ratios)		Due in 1 year or lessDue after 1 year through 5 yearsDue after 5 yearsTotal Investment-grade Noninvestment-gradeTotalTotal % of IG
Loans retained$132,888
$199,877
$104,742
$437,507
 $337,298
 $100,209
$437,507
77%
Derivative receivables 55,577
    55,577
  74,846
    74,846
 
Less: Liquid securities and other cash collateral held against derivatives (15,482)    (15,482)  (21,501)    (21,501) 
Total derivative receivables, net of all collateral8,332
8,263
23,500
40,095
 32,535
 7,560
40,095
81
10,718
14,756
27,871
53,345
 37,148
 16,197
53,345
70
Lending-related commitments75,484
307,093
13,042
395,619
 291,144
 104,475
395,619
74
106,972
285,017
13,504
405,493
 293,070
 112,423
405,493
72
Subtotal216,704
515,233
141,284
873,221
 660,977
 212,244
873,221
76
273,939
535,006
166,680
975,625
 702,037
 273,588
975,625
72
Loans held-for-sale and loans at fair value(a)
 11,510
    11,510
  11,158
    11,158
 
Receivables from customers and other 32,218
    32,218
  22,403
    22,403
 
Total exposure – net of liquid securities and other cash collateral held against derivatives $916,949
    $916,949
  $1,009,186
    $1,009,186
 
Credit derivatives used in credit portfolio management activities(b)(c)
$(864)$(8,013)$(6,154)$(15,031) $(13,606) $(1,425)$(15,031)91%$(134)$(13,714)$(2,694)$(16,542) $(14,035) $(2,507)$(16,542)85%

Maturity profile(d)
 Ratings profile
Maturity profile(d)
 Ratings profile
Due in 1 year or lessDue after 1 year through 5 yearsDue after 5 yearsTotal Investment-grade Noninvestment-gradeTotalTotal % of IGDue in 1 year or lessDue after 1 year through 5 yearsDue after 5 yearsTotal Investment-grade Noninvestment-gradeTotalTotal % of IG
December 31, 2018
(in millions, except ratios)		 AAA/Aaa to BBB-/Baa3 BB+/Ba1 & below
December 31, 2019
(in millions, except ratios)		Due in 1 year or lessDue after 1 year through 5 yearsDue after 5 yearsTotal Investment-grade Noninvestment-gradeTotalTotal % of IG
Loans retained$138,458
$196,974
$103,730
$439,162
 $339,729
 $99,433
$439,162
77%
Derivative receivables 54,213
    54,213
  49,766
    49,766
 
Less: Liquid securities and other cash collateral held against derivatives (15,322)    (15,322)  (16,009)    (16,009) 
Total derivative receivables, net of all collateral11,038
9,169
18,684
38,891
 31,794
 7,097
38,891
82
6,561
6,960
20,236
33,757
 26,966
 6,791
33,757
80
Lending-related commitments79,400
294,855
13,558
387,813
 288,724
 99,089
387,813
74
83,821
316,328
13,161
413,310
 294,317
 118,993
413,310
71
Subtotal228,896
500,998
135,972
865,866
 660,247
 205,619
865,866
76
232,002
541,611
155,132
928,745
 684,727
 244,018
928,745
74
Loans held-for-sale and loans at fair value(a)
 15,028
    15,028
  11,166
    11,166
 
Receivables from customers and other 30,063
    30,063
  33,706
    33,706
 
Total exposure – net of liquid securities and other cash collateral held against derivatives $910,957
    $910,957
  $973,617
    $973,617
 
Credit derivatives used in credit portfolio management activities(b)(c)
$(447)$(9,318)$(2,917)$(12,682) $(11,213) $(1,469)$(12,682)88%$(4,912)$(10,031)$(3,087)$(18,030) $(16,276) $(1,754)$(18,030)90%
(a)Represents loans held-for-sale, primarily related to syndicated loans and loans transferred from the retained portfolio, and loans at fair value.
(b)These derivatives do not qualify for hedge accounting under U.S. GAAP.
(c)The notional amounts are presented on a net basis by underlying reference entity and the ratings profile shown is based on the ratings of the reference entity on which protection has been purchased. Predominantly all of the credit derivatives entered into by the Firm where it has purchased protection used in credit portfolio management activities are executed with investment-grade counterparties.
(d)The maturity profile of retained loans, lending-related commitments and derivative receivables is based on the remaining contractual maturity. Derivative contracts that are in a receivable position at SeptemberJune 30, 2019,2020, may become payable prior to maturity based on their cash flow profile or changes in market conditions.

Wholesale credit exposure – industry exposures
The Firm focuses on the management and diversification of its industry exposures, and pays particular attention to industries with actual or potential credit concerns. Exposures deemed criticized align with the U.S. banking regulators’ definition of criticized exposures, which consist of the special mention, substandard and doubtful
categories.
categories. The total criticized component of the portfolio, excluding loans held-for-sale and loans at fair value, was $12.8$39.4 billion at SeptemberJune 30, 2019,2020, compared with $12.1$15.1 billion at December 31, 2018. The increase was2019, with increases largely driven by select client downgrades across a number of sectors.in Consumer & Retail and Oil & Gas due to impacts from the COVID-19 pandemic.

Below are summaries of the Firm’s exposures as of SeptemberJune 30, 2019,2020, and December 31, 2018.2019. The industry of risk category is generally based on the client or counterparty’s primary business activity. Refer to Note 4 of JPMorgan Chase’s 2018 Form 10-K for additional information on industry concentrations.

Wholesale credit exposure – industries(a)
Wholesale credit exposure – industries(a)
    
Wholesale credit exposure – industries(a)
    
    Selected metrics     Selected metrics
     30 days or more past due and accruing
loans
Net
charge-offs/
(recoveries)
Credit derivative hedges(g)
Liquid securities
and other cash collateral held against derivative
receivables		     
30 days or more past due and accruing
loans (g)
Net
charge-offs/
(recoveries)
Credit derivative hedges(h)
Liquid securities
and other cash collateral held against derivative
receivables
  Noninvestment-grade  Noninvestment-grade
As of or for the nine months ended
Credit exposure(f)
Investment- grade Noncriticized Criticized performingCriticized nonperforming
September 30, 2019
As of or for the six months ended
Credit exposure(f)
Investment- grade Noncriticized Criticized performingCriticized nonperforming
June 30, 2020
30 days or more past due and accruing
loans (g)
Net
charge-offs/
(recoveries)
Credit derivative hedges(h)
Liquid securities
and other cash collateral held against derivative
receivables
(in millions)
Credit exposure(f)
Investment- grade Noncriticized Criticized performingCriticized nonperforming30 days or more past due and accruing
loans
Net
charge-offs/
(recoveries)
Credit derivative hedges(g)
Liquid securities
and other cash collateral held against derivative
receivables
Real Estate$148,656
$118,177
 $28,031
 $2,220
$228
Consumer & Retail110,160
53,944
 43,793
 11,793
630
Individuals and Individual Entities(b)
99,653
88,477
 10,815
 269
92
109,563
96,134
 12,474
 269
686
Consumer & Retail98,445
56,815
 39,387
 2,086
157
Industrials66,179
39,328
 24,135
 2,453
263
196
31
(817)(62)
Healthcare60,471
45,882
 12,816
 1,537
236
19
96
(394)(209)
Technology, Media &
Telecommunications		57,127
33,754
 20,723
 2,509
141
9
23
(612)(17)60,461
33,658
 22,994
 3,606
203
11
46
(870)(38)
Industrials57,085
38,511
 17,203
 1,222
149
158
30
(551)(17)
Asset Managers60,270
52,285
 7,806
 165
14
10
—
—
(5,637)
Banks & Finance Cos53,185
36,764
 15,979
 378
64
27
—
(832)(2,683)49,970
34,862
 14,365
 675
68
44
13
(1,855)(2,868)
Asset Managers50,119
44,006
 6,096
 4
13
26
—
—
(5,201)
Healthcare48,041
36,641
 10,422
 891
87
40
6
(230)(177)
Oil & Gas44,007
23,882
 18,615
 635
875
9
43
(445)(12)43,035
21,204
 15,136
 5,583
1,112
1
197
(374)—
Automotive38,294
23,882
 11,232
 3,176
4
10
—
(475)—
State & Municipal Govt(c)
36,824
36,316
 506
 —
2
7
—
—
(107)
Utilities29,709
23,543
 5,806
 184
176
10
37
(387)(75)32,078
24,144
 7,555
 319
60
—
4
(441)(13)
State & Municipal Govt(c)
26,806
26,287
 519
 —
—
13
—
—
(51)
Transportation18,089
8,246
 8,599
 961
283
18
10
(240)(34)
Chemicals & Plastics16,870
11,311
 5,490
 69
—
1
—
(10)—
17,172
11,388
 5,196
 561
27
7
—
(44)—
Central Govt16,685
16,264
 421
 —
—
1
—
(8,527)(2,836)16,385
16,056
 329
 —
—
—
—
(8,509)(3,323)
Automotive16,430
10,053
 5,978
 399
—
6
—
(172)—
Metals & Mining15,049
8,396
 6,280
 359
14
—
(1)(204)(8)15,790
6,652
 8,146
 913
79
6
10
(145)(7)
Transportation14,969
9,196
 5,356
 317
100
37
4
(36)(38)
Insurance13,365
10,517
 2,824
 19
5
—
—
(36)(2,062)14,804
10,995
 3,762
 44
3
12
—
(36)(2,717)
Securities Firms8,233
6,175
 2,045
 1
12
—
12
(49)(3,437)
Financial Markets Infrastructure5,775
5,640
 135
 —
—
—
—
—
(7)7,724
7,438
 286
 —
—
—
—
—
(33)
Securities Firms4,418
2,789
 1,605
 24
—
—
—
(49)(387)
All other(d)
73,510
70,286
 2,892
 330
2
20
7
(2,634)(1,087)82,968
74,328
 7,428
 829
383
105
(6)(997)(1,613)
Subtotal$888,703
$674,831
 $201,025
 $10,905
$1,942
$978
$236
$(15,031)$(15,482)$997,126
$721,094
 $236,634
 $35,105
$4,293
$1,642
$461
$(16,542)$(21,501)
Loans held-for-sale and loans at fair value11,510
      11,158
      
Receivables from customers and other32,218
     22,403
     
Total(e)
$932,431
     $1,030,687
     




















(continued from previous page)(continued from previous page)     (continued from previous page)     







Selected metrics





Selected metrics







30 days or more past due and accruing
loans		Net
charge-offs/
(recoveries)
Credit derivative hedges(g)
Liquid securities
and other cash collateral held against derivative
receivables





30 days or more past due and accruing
loans		Net
charge-offs/
(recoveries)
Credit derivative hedges(h)
Liquid securities
and other cash collateral held against derivative
receivables



Noninvestment-grade

Noninvestment-grade
As of or for the year ended
Credit exposure(f)
Investment- grade
Noncriticized
Criticized performingCriticized nonperforming
Credit exposure(f)
Investment- grade
Noncriticized
Criticized performingCriticized nonperforming
December 31, 2018
December 31, 2019
(in millions)
Credit exposure(f)
Investment- grade
Noncriticized
Criticized performingCriticized nonperforming30 days or more past due and accruing
loans		Net
charge-offs/
(recoveries)
Credit derivative hedges(g)
Liquid securities
and other cash collateral held against derivative
receivables
Credit exposure(f)
Investment- grade
Noncriticized
Criticized performingCriticized nonperforming30 days or more past due and accruing
loans		Net
charge-offs/
(recoveries)
Credit derivative hedges(h)
Liquid securities
and other cash collateral held against derivative
receivables
Real Estate
Consumer & Retail
Individuals and Individual Entities(b)
97,077
86,581
 10,164
 174
158
105,018
93,172

11,617

192
37
Consumer & Retail94,815
60,678

31,901

2,033
203
Industrials62,483
39,434
 21,673
 1,157
219
172
48
(746)(9)
Healthcare50,824
36,988

12,544

1,141
151
108
14
(405)(145)
Technology, Media & Telecommunications72,646
46,334
 24,081
 2,170
61
8
12
(1,011)(12)60,033
35,878
 21,066
 2,953
136
27
27
(658)(17)
Industrials58,528
38,487

18,594

1,311
136
171
20
(207)(29)
Asset Managers51,856
45,249

6,588

6
13
18
—
—
(4,785)
Banks & Finance Cos49,920
34,120
 15,496
 299
5
11
—
(575)(2,290)50,786
34,941

15,031

808
6
—
—
(834)(2,112)
Asset Managers42,807
36,722

6,067

4
14
10
—
—
(5,829)
Healthcare48,142
36,687

10,625

761
69
23
(5)(150)(133)
Oil & Gas42,600
23,356

17,451

1,158
635
6
36
(248)—
41,641
22,244

17,823

995
579
—
98
(429)(10)
Automotive35,118
24,255

10,246

615
2
8
1
(194)—
State & Municipal Govt(c)
30,095
29,586

509

—
—
33
7
—
(46)
Utilities28,172
23,558

4,326

138
150
—
38
(142)(60)34,843
22,213

12,316

301
13
2
39
(414)(50)
State & Municipal Govt(c)
27,351
26,746

603

2
—
18
(1)—
(42)
Transportation14,497
8,734
 5,336
 353
74
30
8
(37)(37)
Chemicals & Plastics16,035
11,490

4,427

118
—
4
—
—
—
17,499
12,033

5,243

221
2
5
—
(10)(13)
Central Govt18,456
18,251
 124
 81
—
4
—
(7,994)(2,130)14,865
14,524

341

—
—
—
—
(9,018)(1,963)
Automotive17,339
9,637

7,310

392
—
1
—
(125)—
Metals & Mining15,359
8,188

6,767

385
19
1
—
(174)(22)15,586
7,095

7,789

661
41
2
(1)(33)(6)
Transportation15,660
10,508

4,699

393
60
21
6
(31)(112)
Insurance12,639
9,777

2,830

—
32
—
—
(36)(2,080)12,348
9,458

2,867

19
4
3
—
(36)(1,998)
Securities Firms7,344
5,973

1,344

27
—
—
—
(48)(3,201)
Financial Markets Infrastructure7,484
6,746

738

—
—
—
—
—
(26)4,121
3,969

152

—
—
—
—
—
(6)
Securities Firms4,558
3,099

1,459

—
—
—
—
(158)(823)
All other(d)
68,284
64,664

3,606

12
2
2
2
(1,581)(804)78,006
73,453

4,130

412
11
4
4
(4,833)(959)
Subtotal$881,188
$673,617

$195,442

$10,450
$1,679
$1,096
$155
$(12,682)$(15,322)$944,754
$699,510

$230,104

$13,579
$1,561
$1,022
$415
$(18,030)$(16,009)
Loans held-for-sale and loans at fair value15,028

















11,166

















Receivables from customers and other30,063


















33,706


















Total(e)
$926,279
     $989,626
     
(a)The industry rankings presented in the table as of December 31, 2018,2019, are based on the industry rankings of the corresponding exposures at SeptemberJune 30, 2019,2020, not actual rankings of such exposures at December 31, 2018.2019.
(b)
Individuals and Individual Entities predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts.
(c)In addition to the credit risk exposure to states and municipal governments (both U.S. and non-U.S.) at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, noted above, the Firm held: $6.9$7.5 billion and $7.8$6.5 billion, respectively, of trading securities; $31.1assets; $30.4 billion and $37.7$29.8 billion, respectively, of AFS securities; and $4.8 billion at both periods of held-to-maturity (“HTM”)HTM securities, issued by U.S. state and municipal governments. Refer to Note 2 and Note 910 for further information.
(d)All other includes: SPEs and Private education and civic organizations, representing approximately 91%90% and 9%10%, respectively, at Septemberboth June 30, 2019,2020, and 92% and 8%, respectively, at December 31, 2018.2019.
(e)
Excludes cash placed with banks of $248.8$484.2 billion and $268.1$254.0 billion, at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively, which is predominantly placed with various central banks, primarily Federal Reserve Banks.
(f)Credit exposure is net of risk participations and excludes the benefit of credit derivatives used in credit portfolio management activities held against derivative receivables or loans and liquid securities and other cash collateral held against derivative receivables.
(g)Generally excludes loans that were under payment deferral programs offered in response to the COVID-19 pandemic.
(h)Represents the net notional amounts of protection purchased and sold through credit derivatives used to manage the credit exposures; these derivatives do not qualify for hedge accounting under U.S. GAAP. The All other category includes purchased credit protection on certain credit indices.

Real Estate
Presented below is additional informationdetail on certain of the Firm’s largest industry exposures and/or certain industries which present potential heightened credit concerns.
Real Estate industry, to which the Firm has significant exposure.
Real Estate exposure increased $4.1was $148.7 billion to $147.5as of June 30, 2020, of which $87.1 billion foris multifamily lending as shown in the ninetable below. During the six months ended SeptemberJune 30, 2019, and2020 the investment grade percentageinvestment-grade portion of the portfolio remained relatively flat at 83%. Referdecreased from 81% to Note 11 for further information on Real Estate loans.79%, while the drawn percentage increased from 78% to 82%, both driven by the impacts of the COVID-19 pandemic.
September 30, 2019 June 30, 2020 
(in millions, except ratios)Loans and Lending-related Commitments Derivative Receivables Credit exposure % Investment-grade
% Drawn(c)
Loans and Lending-related Commitments Derivative Receivables Credit exposure % Investment-grade
% Drawn(d)
Multifamily(a)
$85,666
 $86
 $85,752
 91% 92% $86,854
 $229
 $87,083
 88% 92% 
Other60,968
 735
 61,703
 71
 59
 
Total Real Estate Exposure(b)
146,634
 821
 147,455
 83
 79
 
Office16,731
 616
 17,347
 80
 72
 
Retail11,316
 218
 11,534
 63
 70
 
Other Income Producing Properties(b)
10,454
 423
 10,877
 74
 67
 
Industrial8,991
 68
 9,059
 72
 75
 
Lodging3,525
 9
 3,534
 17
 67
 
Services and Non Income Producing9,204
 18
 9,222
 51
 53
 
Total Real Estate Exposure(c)
147,075
 1,581
 148,656
 79
 82
 
                    
December 31, 2018 December 31, 2019 
(in millions, except ratios)Loans and Lending-related Commitments 
Derivative
Receivables
 Credit exposure 
% Investment-
grade
% Drawn(c)
Loans and Lending-related Commitments 
Derivative
Receivables
 Credit exposure 
% Investment-
grade
% Drawn(d)
Multifamily(a)
$85,683
 $33
 $85,716
 89% 92% $86,380
 $58
 $86,438
 91% 92% 
Other57,469
 131
 57,600
 72
 63
 
Total Real Estate Exposure(b)
143,152
 164
 143,316
 82
 81
 
Office15,647
 231
 15,878
 80
 70
 
Retail11,321
 87
 11,408
 83
 69
 
Other Income Producing Properties(b)
14,372
 181
 14,553
 48
 45
 
Industrial8,842
 24
 8,866
 74
 75
 
Lodging3,702
 19
 3,721
 51
 38
 
Services and Non Income Producing9,922
 19
 9,941
 57
 47
 
Total Real Estate Exposure150,186
 619
 150,805
 81
 78
 
(a)Multifamily exposure is largely in California.
(b)Other Income Producing Properties consists of clients with diversified property types or other property types outside of multifamily, office, retail, industrial and lodging with less material exposures.
(c)Real Estate exposure is predominantlyapproximately 80% secured; unsecured exposure is approximately 75% investment-grade.
(d)Represents drawn exposure as a percentage of credit exposure.
Consumer & Retail
Consumer & Retail exposure was $110.2 billion as of June 30, 2020, and predominantly includes Retail, Food and Beverage, and Business and Consumer Services as shown in the table below. During the six months ended June 30, 2020, the following changes were primarily driven by impacts from the COVID-19 pandemic:
the investment-grade portion of the Consumer & Retail portfolio decreased from 55% to 49%
the drawn percentage of this portfolio increased from 35% to 43%
•
criticized exposure increased by $9.9 billion from $2.5 billion to $12.4 billion

 June 30, 2020 
(in millions, except ratios)Loans and Lending-related Commitments Derivative Receivables Credit exposure % Investment-grade
% Drawn(d)
Retail(a)
$30,847
 $631
 $31,478
 48% 46% 
Food and Beverage26,987
 794
 27,781
 60
 39
 
Business and Consumer Services24,934
 631
 25,565
 51
 48
 
Consumer Hard Goods13,160
 173
 13,333
 56
 42
 
Leisure(b)
11,700
 303
 12,003
 13
 39
 
Total Consumer & Retail(c)
107,628
 2,532
 110,160
 49
 43
 
           
 December 31, 2019 
(in millions, except ratios)Loans and Lending-related Commitments 
Derivative
Receivables
 Credit exposure 
% Investment-
grade
% Drawn(d)
Retail(a)
$29,290
 $294
 $29,584
 54% 37% 
Food and Beverage27,956
 625
 28,581
 67
 36
 
Business and Consumer Services24,242
 249
 24,491
 51
 37
 
Consumer Hard Goods13,144
 109
 13,253
 65
 35
 
Leisure(b)
10,930
 147
 11,077
 21
 19
 
Total Consumer & Retail105,562
 1,424
 106,986
 55
 35
 
(a)Retail consists of Home Improvement & Specialty Retailers, Restaurants, Supermarkets, Discount & Drug Stores, Specialty Apparel and Department Stores.
(b)Leisure consists of Gaming, Arts & Culture, Travel Services and Sports & Recreation. As of June 30, 2020 approximately 90% of the noninvestment-grade Leisure portfolio is secured.
(c)Approximately 80% of the noninvestment-grade portfolio is secured.
(d)Represents drawn exposure as a percent of credit exposure.
Oil & Gas
Oil & Gas exposure was $43.0 billion as of June 30, 2020, including $21.0 billion of Exploration & Production and Oil field Services as shown in the table below. During the six months ended June 30, 2020, the following changes were driven by lower oil prices and impacts from the COVID-19 pandemic:
•
the investment-grade portion of the Oil & Gas portfolio decreased from 53% to 49%
the drawn percentage of this portfolio increased from 31% to 33%
criticized exposure increased by $5.1 billion from $1.6 billion to $6.7 billion
 June 30, 2020 
(in millions, except ratios)Loans and Lending-related Commitments Derivative Receivables Credit exposure % Investment-grade
% Drawn(c)
Exploration & Production ("E&P") and Oil field Services$20,683
 $290
 $20,973
 33% 42% 
Other Oil & Gas(a)
21,356
 706
 22,062
 65
 24
 
Total Oil & Gas(b)
42,039
 996
 43,035
 49
 33
 
           
 December 31, 2019 
(in millions, except ratios)Loans and Lending-related Commitments 
Derivative
Receivables
 Credit exposure 
% Investment-
grade
% Drawn(c)
Exploration & Production ("E&P") and Oil field Services$22,543
 $646
 $23,189
 38% 38% 
Other Oil & Gas(a)
18,246
 206
 18,452
 73
 23
 
Total Oil & Gas(b)
40,789
 852
 41,641
 53
 31
 
(a)Other Oil & Gas includes Integrated Oil & Gas companies, Midstream/Oil Pipeline companies and refineries.
(b)Secured lending was $13.9 billion and $15.7 billion at June 30, 2020 and December 31, 2019, respectively, approximately half of which is reserve-based lending to the Exploration & Production sub-sector; unsecured exposure is largely investment-grade.
(c)Represents drawn exposure as a percentagepercent of credit exposure.

Loans
In the normal course of its wholesale business,businesses, the Firm provides loans to a variety of clients, ranging from large corporate and institutional clients to high-net-worth individuals. Refer to Note 1112 for a further discussion on loans, including information onabout delinquencies, loan modifications and other credit quality indicators and sales of loans.indicators.
The following table presents the change in the nonaccrual loan portfolio for the ninesix months ended SeptemberJune 30, 20192020 and 2018.2019. The increase in nonaccrual loans during the six months ended June 30, 2020 was driven by downgrades across multiple industries on client credit deterioration.
Wholesale nonaccrual loan activity
Nine months ended September 30,
(in millions)		 2019
2018
Six months ended June 30,
(in millions)		 20202019
Beginning balance $1,370
$1,734
 $1,152
$1,587
Additions 1,907
570
 3,754
1,307
Reductions:    
Paydowns and other 1,097
541
 402
814
Gross charge-offs 235
251
 484
163
Returned to performing status 25
217
 184
67
Sales 188
287
 38
57
Total reductions 1,545
1,296
 1,108
1,101
Net changes 362
(726) 2,646
206
Ending balance $1,732
$1,008
 $3,798
$1,793
 
The following table presents net charge-offs/recoveries, which are defined as gross charge-offs less recoveries, for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019. The amounts in the table below do not include gains or losses from sales of nonaccrual loans.
Wholesale net charge-offs/(recoveries)Wholesale net charge-offs/(recoveries)  Wholesale net charge-offs/(recoveries) 
(in millions, except ratios)Three months ended
September 30,		 Nine months ended
September 30,		Three months ended
June 30,		 Six months ended
June 30,
2019
2018
 2019
2018
2020
2019
 2020
2019
Loans – reported      
Average loans retained$433,744
$420,597
 $434,434
$413,537
$540,248
$472,049
 $516,032
$471,999
Gross charge-offs120
23
 270
264
310
112
 491
176
Gross recoveries(12)(70) (34)(146)
Gross recoveries collected(11)(17) (30)(29)
Net charge-offs/(recoveries)108
(47) 236
118
299
95
 461
147
Net charge-off/(recovery) rate0.10%(0.04)% 0.07%0.04%0.22%0.08% 0.18%0.06%


Lending-related commitments
The Firm uses lending-related financial instruments, such as commitments (including revolving credit facilities) and guarantees, to address the financing needs of its clients. The contractual amounts of these financial instruments represent the maximum possible credit risk should the clients draw down on these commitments or when the Firm fulfillfulfills its obligations under these guarantees, and the clients subsequently fail to perform according to the terms of these contracts. Most of these commitments and guarantees arehave historically been refinanced, extended, cancelled, or expireexpired without being drawn upon or a default occurring. InAs a result, the Firm’s view,Firm does not believe that the total contractual amount of these wholesale lending-related commitments is not representative of the Firm’s expected future credit exposure or funding requirements. Refer to Note 2223 for further information on wholesale lending-related commitments.
Receivables from Customers
Receivables from customers primarily represent held-for-investment margin loans to brokerage clients in CIB and AWM that are collateralized by assets maintained in the clients’ brokerage accounts (e.g., cash on deposit, liquid and readily marketable debt or equity securities), as such generally no allowance for credit losses is held against these receivables. To manage its credit risk the Firm establishes margin requirements and monitors the required margin levels on an ongoing basis, and requires clients to deposit additional cash or other collateral, or to reduce positions, when appropriate. These receivables are reported within accrued interest and accounts receivable on the Firm’s Consolidated balance sheets.
Derivative contracts
Derivatives enable clients and counterparties to manage risks including credit risk and risks arising from fluctuations in interest rates, foreign exchange, equities, and commodities. The Firm makes markets in derivatives in order to meet these needs and uses derivatives to manage certain risks associated with net open risk positions from its market-making activities, including the counterparty credit risk arising from derivative receivables. The Firm also uses derivative instruments to manage its own credit risk and other market risk exposure. Refer to Note 45 for a further discussion of derivative contracts.
The following table summarizes the net derivative receivables for the periods presented.
Derivative receivables  
(in millions)September 30,
2019
December 31,
2018
June 30,
2020
December 31,
2019
Total, net of cash collateral55,577
54,213
74,846
49,766
Liquid securities and other cash collateral held against derivative receivables(a)
(15,482)(15,322)(21,501)(16,009)
Total, net of collateral$40,095
$38,891
$53,345
$33,757
(a)Includes collateral related to derivative instruments where appropriate legal opinions have not been either sought or obtained with respect to master netting agreements.
 
The fair value of derivative receivables reported on the Consolidated balance sheets were $55.6$74.8 billion and $54.2$49.8 billion at SeptemberJune 30, 2019,2020, and December 31, 2018, respectively.2019, respectively, with increases in CIB resulting from market movements. Derivative receivables represent the fair value of the derivative contracts after giving effect to legally enforceable master netting agreements and cash collateral held by the Firm. However, in management’s view, the appropriate measure of current credit risk should also take into consideration additional liquid securities (primarily U.S. government and agency securities and other groupGroup of sevenSeven nations (“G7”) government securities) and other cash collateral held by the Firm aggregating $15.5$21.5 billion and $15.3$16.0 billion at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively, that may be used as security when the fair value of the client’s exposure is in the Firm’s favor.
In addition to the collateral described in the preceding paragraph, theThe Firm also holds additional collateral (primarily cash, G7 government securities, other liquid government agency and guaranteed securities, and corporate debt and equity securities) delivered by clients at the initiation of transactions, as well as collateral related to contracts that have a non-daily call frequency and collateral that the Firm has agreed to return but has not yet settled as of the reporting date. Although this collateral does not reduce the balances and is not included in the table above, it is available as security against potential exposure that could arise should the fair value of the client’s derivative contracts move in the Firm’s favor. The derivative receivables fair value, net of all collateral, also does not include other credit enhancements, such as letters of credit. Refer to Note 45 for additional information on the Firm’s use of collateral agreements.



















The following table summarizes the ratings profile of the Firm’s derivative receivables, including credit derivatives, net of all collateral, at the dates indicated. The ratings scale is based on the Firm’sFirm considers internal ratings which generally correspondequivalent to the ratingsBBB-/Baa3 or higher as assigned by S&P and Moody’s.investment grade. Refer to Note 12 for further information on internal risk ratings.
Ratings profile of derivative receivables     
Rating equivalent
September 30, 2019 December 31, 2018

(in millions, except ratios)
Exposure net of all collateral% of exposure net of all collateral Exposure net of all collateral% of exposure net of all collateral
AAA/Aaa to AA-/Aa3$10,663
27% $11,831
31%
A+/A1 to A-/A36,106
15
 7,428
19
BBB+/Baa1 to BBB-/Baa315,766
39
 12,536
32
BB+/Ba1 to B-/B37,116
18
 6,373
16
CCC+/Caa1 and below444
1
 723
2
Total$40,095
100% $38,891
100%

Ratings profile of derivative receivables     
Internal rating equivalent
June 30, 2020 December 31, 2019

(in millions, except ratios)
Exposure net of all collateral% of exposure net of all collateral Exposure net of all collateral% of exposure net of all collateral
AAA/Aaa to AA-/Aa3$12,158
23% $8,347
25%
A+/A1 to A-/A36,503
12
 5,471
16
BBB+/Baa1 to BBB-/Baa318,487
35
 13,148
39
BB+/Ba1 to B-/B312,850
24
 6,225
18
CCC+/Caa1 and below3,347
6
 566
2
Total$53,345
100% $33,757
100%
As previously noted, the Firm uses collateral agreements to mitigate counterparty credit risk. The percentage of the Firm’s over-the-counter derivative contracts subject to collateral agreements — excluding foreign exchange spot trades, which are not typically covered by collateral agreements due to their short maturity and centrally cleared trades that are settled daily — was approximately 87% and 90% at both SeptemberJune 30, 2019,2020, and December 31, 2018.2019, respectively.
Credit derivatives
The Firm uses credit derivatives for two primary purposes: first, in its capacity as a market-maker, and second, as an end-user, to manage the Firm’s own credit risk associated with various exposures.
 
Credit portfolio management activities
Included in the Firm’s end-user activities are credit derivatives used to mitigate the credit risk associated with traditional lending activities (loans and unfundedlending-related commitments) and derivatives counterparty exposure in the Firm’s wholesale businesses (collectively, “credit portfolio management” activities). Information on credit portfolio management activities is provided in the table below.
Credit derivatives used in credit portfolio management activities
Notional amount of protection
purchased and sold(a)
Notional amount of protection
purchased and sold(a)
(in millions)September 30,
2019
 December 31,
2018
June 30,
2020
 December 31,
2019
Credit derivatives used to manage:      
Loans and lending-related commitments$1,726
 $1,272
$5,064
 $2,047
Derivative receivables13,305
 11,410
11,478
 15,983
Credit derivatives used in credit portfolio management activities$15,031
 $12,682
$16,542
 $18,030
(a)Amounts are presented net, considering the Firm’s net protection purchased or sold with respect to each underlying reference entity or index.
Refer to Credit derivatives in Note 45 of this Form 10-Q and Note 5 of JPMorgan Chase’s 20182019 Form 10-K for further information on credit derivatives and derivatives used in credit portfolio management activities.

ALLOWANCE FOR CREDIT LOSSES
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. The adoption of this guidance established a single allowance framework for all financial assets measured at amortized cost and certain off-balance sheet credit exposures. This framework requires that management’s estimate reflects credit losses over the instrument’s remaining expected life and considers expected future changes in macroeconomic conditions. Refer to Note 1 for further information.
The Firm’s allowance for credit losses comprises:
the allowance for loan losses, which covers the Firm’s retained consumer and wholesale loan portfolios as well as(scored and risk-rated) and is presented separately on the balance sheet,
the allowance for lending-related commitments, which is presented on the balance sheet in accounts payable and other liabilities, and
the allowance for credit losses on investment securities, which covers the Firm’s HTM and AFS securities and is recognized within Investment Securities on the balance sheet.
Refer to Note 13 and Note 10 for a description of the policies, methodologies and judgments used to determine the Firm’s allowances for credit losses on loans, lending-related commitments, and investment securities.
The allowance for credit losses increased compared with December 31, 2019, primarily reflecting the deterioration and uncertainty in the macroeconomic environment as a result of the impact of the COVID-19 pandemic, consisting of:
a $8.7 billion addition in consumer, predominantly in the credit card and residential real estate portfolios
a net $7.0 billion addition in wholesale, across the LOBs impacting multiple industry sectors, and
a net $4.3 billion addition as a result of the adoption of CECL.
The increase in the allowance for loan losses and certain consumer lending-related commitments.commitments was primarily driven by an increase in the provision for credit losses, reflecting the deterioration in and uncertainty around the future macroeconomic environment as a result of the impact of the COVID-19 pandemic. In the first quarter of 2020, management’s macroeconomic forecast included a decline in the U.S. real GDP of approximately 25% and an increase in the U.S. unemployment rate to above 10%, both in the second quarter, followed by a solid recovery in the second half of 2020. In the second quarter of 2020, based on the increased uncertainty around the duration and depth of the downturn and speed of economic recovery, the Firm’s central case reflected a more protracted downturn with a slower recovery of U.S. real GDP.
In the first and second quarters of 2020, the Firm’s central case assumptions reflected forecasted U.S. unemployment rates and cumulative changes in U.S. real GDP as follows:
 2020 2021
 4Q 2Q4Q
Central case assumptions    
     
U.S. unemployment rate(a)
    
1Q 20206.6 % 5.5 %4.6 %
2Q 202010.9
 9.0
7.7
     
U.S. real GDP - cumulative change from December 31, 2019    
1Q 2020(5.4) (2.3)0.3
2Q 2020(6.2) (4.0)(3.0)
(a)Reflects quarterly average of forecasted reported U.S. unemployment rate.
In the second quarter of 2020, the Firm placed significant weighting on its adverse scenarios, which incorporate more punitive macroeconomic factors than the central case assumptions above, resulting in weighted average U.S. unemployment rates remaining in double digits through the first half of 2021.
Subsequent changes to this forecast and related estimates will be reflected in the provision for credit losses in future periods.
Refer to Critical Accounting Estimates Used by the Firm on pages 76–77 and Note 12 of this Form 10-Q, and Critical Accounting Estimates Used by the Firm on pages 141-143 and Note 13 of JPMorgan Chase’s 2018 Form 10-K88-90 for further information on the components of the allowance for credit losses and related management judgments.
At least quarterly, the allowance for credit losses is reviewed by the CRO, the CFO and the Controller of the Firm. As of September 30, 2019, JPMorgan Chase deemed the allowance for credit losses to be appropriate and sufficient to absorb probable credit losses inherent in the portfolio.





The allowance for credit losses decreased compared with December 31, 2018, driven by:
a $550 million reduction in the CCB allowance for loan losses, which includes $400 million in the PCI residential real estate portfolio, reflecting continued improvement in home prices and delinquencies; $100 million in the non credit-impaired residential real estate portfolio; and $50 million in the business banking portfolio; as well as
a $132 million reduction for write-offs of PCI loans,
predominantly offset by
a $400 million addition to the allowance for loan losses in the credit card portfolio reflecting higher loss rates, as newer vintages season and become a larger part of the portfolio and loan growth; as well as
a $170 million addition in the wholesale allowance for credit losses largely driven by select C&I client downgrades.
Refer to Consumer Credit Portfolio on pages 56–59,62-66, Wholesale Credit Portfolio on pages 60–6667-76 and Note 1112 for additional information on the consumer and wholesale credit portfolios.



The adoption of the CECL accounting guidance resulted in a change in the accounting for PCI loans, which are considered PCD loans under CECL. In conjunction with the adoption of CECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Refer to Note 1 for further information.
Summary of changes in the allowance for credit losses     
 2019 2018
Nine months ended September 30,
Consumer, excluding
credit card
Credit cardWholesaleTotal 
Consumer, excluding
credit card
Credit cardWholesaleTotal
(in millions, except ratios) 
Allowance for loan losses         
Beginning balance at January 1,$4,146
$5,184
$4,115
$13,445
 $4,579
$4,884
$4,141
$13,604
Gross charge-offs702
4,050
270
5,022
 776
3,777
264
4,817
Gross recoveries(420)(433)(34)(887) (681)(370)(146)(1,197)
Net charge-offs282
3,617
236
4,135
 95
3,407
118
3,620
Write-offs of PCI loans(a)
132
—
—
132
 151
—
—
151
Provision for loan losses(265)4,017
296
4,048
 (152)3,557
(111)3,294
Other—
(1)10
9
 1
—
—
1
Ending balance at September 30,$3,467
$5,583
$4,185
$13,235
 $4,182
$5,034
$3,912
$13,128
Impairment methodology         
Asset-specific(b)
$145
$488
$342
$975
 $204
$421
$280
$905
Formula-based2,066
5,095
3,843
11,004
 2,154
4,613
3,632
10,399
PCI1,256
—
—
1,256
 1,824
—
—
1,824
Total allowance for loan losses$3,467
$5,583
$4,185
$13,235
 $4,182
$5,034
$3,912
$13,128
Allowance for lending-related commitments         
Beginning balance at January 1,$33
$—
$1,022
$1,055
 $33
$—
$1,035
$1,068
Provision for lending-related commitments—
—
110
110
 —
—
29
29
Other—
—
—
—
 —
—
—
—
Ending balance at September 30,$33
$—
$1,132
$1,165
 $33
$—
$1,064
$1,097
Impairment methodology         
Asset-specific$—
$—
$135
$135
 $—
$—
$71
$71
Formula-based33
—
997
1,030
 33
—
993
1,026
Total allowance for lending-related commitments(c)
$33
$—
$1,132
$1,165
 $33
$—
$1,064
$1,097
Total allowance for credit losses$3,500
$5,583
$5,317
$14,400
 $4,215
$5,034
$4,976
$14,225
Memo:         
Retained loans, end of period$331,809
$159,571
$437,507
$928,887
 $375,958
$147,856
$423,837
$947,651
Retained loans, average355,865
154,367
434,434
944,666
 374,298
143,931
413,537
931,766
PCI loans, end of period21,290
—
—
21,290
 25,209
—
3
25,212
Credit ratios         
Allowance for loan losses to retained loans1.04%3.50%0.96%1.42% 1.11%3.40%0.92%1.39%
Allowance for loan losses to retained nonaccrual loans(d)
108
NM
285
282
 115
NM
394
284
Allowance for loan losses to retained nonaccrual loans excluding credit card108
NM
285
163
 115
NM
394
175
Net charge-off rates0.11
3.13
0.07
0.59
 0.03
3.16
0.04
0.52
Credit ratios, excluding residential real estate PCI loans         
Allowance for loan losses to retained loans0.71
3.50
0.96
1.32
 0.67
3.40
0.92
1.23
Allowance for loan losses to retained nonaccrual loans(d)
69
NM
285
256
 65
NM
394
244
Allowance for loan losses to retained nonaccrual loans excluding credit card69
NM
285
136
 65
NM
394
135
Net charge-off rates0.11%3.13%0.07%0.60% 0.04%3.16%0.04%0.54%
Note: In the table above, the financial measures which exclude the impact of PCI loans are non-GAAP financial measures.
Allowance for credit losses and related information     
 
2020(d)
 2019
Six months ended June 30,
Consumer, excluding
credit card
Credit cardWholesaleTotal 
Consumer, excluding
credit card
Credit cardWholesaleTotal
(in millions, except ratios) 
Allowance for loan losses         
Beginning balance at January 1,$2,538
$5,683
$4,902
$13,123
 $3,434
$5,184
$4,827
$13,445
Cumulative effect of a change in accounting principle297
5,517
(1,642)4,172
 NA
NA
NA
NA
Gross charge-offs425
2,863
491
3,779
 445
2,725
176
3,346
Gross recoveries collected(348)(372)(30)(750) (270)(283)(29)(582)
Net charge-offs77
2,491
461
3,029
 175
2,442
147
2,764
Write-offs of PCI loans(a)
NA
NA
NA
NA
 89
—
—
89
Provision for loan losses2,115
9,091
6,619
17,825
 (246)2,642
173
2,569
Other(1)—
2
1
 —
(1)6
5
Ending balance at June 30,$4,872
$17,800
$9,420
$32,092
 $2,924
$5,383
$4,859
$13,166
          
Allowance for lending-related commitments         
Beginning balance at January 1,$12
$—
$1,179
$1,191
 $12
$—
$1,043
$1,055
Cumulative effect of a change in accounting principle133
—
(35)98
 NA
NA
NA
NA
Provision for lending-related commitments95
—
825
920
 —
—
75
75
Other1
—
(1)—
 —
—
(1)(1)
Ending balance at June 30,$241
$—
$1,968
$2,209
 $12
$—
$1,117
$1,129
          
Impairment methodology         
Asset-specific(b)
$263
$642
$757
$1,662
 $87
$472
$346
$905
Portfolio-based4,609
17,158
8,663
30,430
 1,538
4,911
4,513
10,962
PCINA
NA
NA
NA
 1,299
—
—
1,299
Total allowance for loan losses$4,872
$17,800
$9,420
$32,092
 $2,924
$5,383
$4,859
$13,166
          
Impairment methodology         
Asset-specific$—
$—
$115
$115
 $—
$—
$136
$136
Portfolio-based241
—
1,853
2,094
 12
—
981
993
Total allowance for lending-related commitments$241
$—
$1,968
$2,209
 $12
$—
$1,117
$1,129
          
Total allowance for credit losses$5,113
$17,800
$11,388
$34,301
 $2,936
$5,383
$5,976
$14,295
          
Memo:         
Retained loans, end of period$307,005
$141,656
$516,787
$965,448
 $314,675
$157,568
$475,485
$947,728
Retained loans, average299,169
152,518
516,032
967,719
 326,418
152,435
471,999
950,852
Credit ratios         
Allowance for loan losses to retained loans1.59%12.57%1.82%3.32% 0.93%3.42%1.02%1.39%
Allowance for loan losses to retained nonaccrual loans(c)
115
NM
275
418
 96
NM
341
295
Allowance for loan losses to retained nonaccrual loans excluding credit card115
NM
275
186
 96
NM
341
174
Net charge-off rates0.05
3.28
0.18
0.63
 0.11
3.23
0.06
0.59
(a)Write-offsPrior to the adoption of CECL, write-offs of PCI loans arewere recorded against the allowance for loan losses when actual losses for a pool exceedexceeded estimated losses that were recorded as purchase accounting adjustments at the time of acquisition. A write-off of a PCI loan iswas recognized when the underlying loan iswas removed from a pool.
(b)Includes modified PCD loans and loans that have been modified or are reasonably expected to be modified in a TDR. Also includes risk-rated loans that have been placed on nonaccrual status and loans that have been modified in a TDR.for the wholesale portfolio segment. The asset-specific credit card allowance for loan losses modified or reasonably expected to be modified in a TDR is calculated based on the loans’ original contractual interest rates and does not consider any incremental penalty rates.
(c)The allowance for lending-related commitments is reported in accounts payable and other liabilities on the Consolidated balance sheets.
(d)
(d)The Firm’s policy is generally to exempt credit card loans from being placed on nonaccrual status as permitted by regulatory guidance.
(d)Excludes HTM securities, which had an allowance for credit losses of $23 million and a provision for credit losses of $13 million as of and for the six months ended June 30, 2020.





INVESTMENT PORTFOLIO RISK MANAGEMENT
Investment portfolio risk is the risk associated with the loss of principal or a reduction in expected returns on investments arising from the investment securities portfolio or from principal investments. The investment securities portfolio is predominantly held predominantly by Treasury and CIO in connection with the Firm’s balance sheet or asset-liability management objectives or from principalobjectives. Principal investments are predominantly privately-held financial instruments and are managed in the LOBs and Corporate in predominantly privately-held financial instruments.Corporate. Investments are typically intended to be held over extended periods and, accordingly, the Firm has no expectation for short-term realized gains with respect to these investments.
Investment securities risk
Investment securities risk includes the exposure associated with a default in the payment of principal and interest. This risk is mitigated given that the investment securities portfolio held by Treasury and CIO substantially investis predominantly invested in high-quality securities. At SeptemberJune 30, 2019,2020, the Treasury and CIO investment securities portfolio, net of allowance for credit losses, was $392.4$556.7 billion, and the average credit rating of the securities comprising the portfolio was AA+ (based upon external ratings where available and where not available, based primarily upon internal ratings that correspond to ratings as defined by S&P and Moody’s)risk ratings). Refer to Corporate segment results on pages 42–43page 46 and Note 910 for further information on the investment securities portfolio.portfolio and internal risk ratings. Refer to Market Risk Management on pages 70–7480-84 for further information on the market risk inherent in the portfolio. Refer to Liquidity Risk Management on pages 50–5455-59 for further information on related liquidity risk.

 
Principal investment risk
Principal investments are typically private non-traded financial instruments representing ownership or other forms of junior capital. Principal investmentscapital and span multiple asset classes andclasses. These investments are made either in stand-aloneby dedicated investing businesses or as part of a broader business platform.strategy. In general, new principal investments include tax-oriented investments, as well as investments made to enhance or accelerate LOB and Corporate strategic business initiatives. The Firm’s principal investments are managed by the LOBs and Corporate and are reflected within their respective financial results. The carrying values of the principal investment portfolios have not been significantly affected by recent market events as a result of the COVID-19 pandemic. However, the duration and severity of adverse macroeconomic conditions could subject certain principal investments to impairments, write-downs, or other negative impacts.
As of SeptemberJune 30, 20192020 and December 31, 2018,2019, the aggregate carrying values of the principal investment portfolios were $23.3$24.5 billion and $22.2$24.2 billion, respectively, which included tax-oriented investments (e.g., affordable housing and alternative energy investments) of $16.7$18.5 billion and $16.6$18.2 billion respectively, and private equity, various debt and equity instruments, and real assets of $6.6$6.0 billion and $5.6 billion, respectively.at the end of both periods.
Refer to page 123118 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the Firm’s Investment Portfolio Risk Management governance and oversight.


MARKET RISK MANAGEMENT
Market risk is the risk associated with the effect of changes in market factors such as interest and foreign exchange rates, equity and commodity prices, credit spreads or implied volatilities, on the value of assets and liabilities held for both the short and long term. Refer to Market Risk Management on pages 124–131119–126 of JPMorgan Chase’s 2018 2019 Form 10-K for a discussion of the Firm’s Market Risk Management organization, market risk measurement, risk monitoring and control, and predominant business activities that give rise to market risk.
COVID-19 Pandemic
Market Risk Management is actively monitoring the impact of the COVID-19 pandemic on market risk exposures by leveraging existing risk measures and controls.
Models used to measure market risk are inherently imprecise and may be limited in their ability to measure certain risks or to predict losses. This imprecision may be heightened when sudden or severe shifts in market conditions occur, such as those observed during the COVID-19 pandemic. For additional discussion on model uncertainty refer to Estimations and Model Risk Management on page 87.
Market Risk Management periodically reviews the Firm’s existing market risk measures to identify opportunities for enhancement, and to the extent appropriate, will calibrate those measures accordingly over time. This is increasingly important in periods of sustained, heightened market volatility.



Value-at-risk
JPMorgan Chase utilizes value-at-risk (“VaR”), a statistical risk measure, to estimate the potential loss from adverse market moves in the current market environment. The Firm has a single VaR framework used as a basis for calculating Risk Management VaR and Regulatory VaR.
The Firm’s Risk Management VaR is calculated assuming a one-day holding period and an expected tail-loss methodology which approximates a 95% confidence level. For risk management purposes, the Firm believes this methodology provides a daily measure of risk that is closely aligned to risk management decisions made by the lines of businessLOBs and Corporate and, along with other market risk measures, provides the appropriate information needed to respond to risk events. The Firm calculates separately a daily aggregated VaR in accordance with regulatory rules (“Regulatory VaR”), which is used to derive the Firm’s regulatory VaR-based capital requirements under Basel III.
The Firm’s VaR model calculations are periodically evaluated and enhanced in response to changes in the composition of the Firm’s portfolios, changes in market conditions, improvements in the Firm’s modeling techniques and measurements, and other factors. Such changes may affect historical comparisons of VaR results. Refer to Estimations and Model Risk Management on page 140135 of JPMorgan Chase’s 20182019 Form 10-K for information regarding model reviews and approvals.
Refer to page 126121 of JPMorgan Chase’s 20182019 Form 10-K for further information regarding VaR, including the inherent limitations, and the key differences between Risk Management VaR and Regulatory VaR. Refer to JPMorgan Chase’s Basel III Pillar 3 Regulatory Capital Disclosures reports, which are available on the Firm’s website at:
(http://investor.shareholder.com/jpmorganchase/basel.cfm) for additional information on Regulatory VaR and the other components of market risk regulatory capital for the Firm (e.g., VaR-based measure, stressed VaR-based measure and the respective backtesting). Refer to Other risk measures on pages 129-131124-126 of JPMorgan Chase’s 20182019 Form 10-K for further information regarding nonstatistical market risk measures used by the Firm.



The table below shows the results of the Firm’s Risk Management VaR measure using a 95% confidence level. VaR can vary significantly as positions change, market volatility fluctuates, and diversification benefits change.
Total VaR

















                  

Three months ended
Three months ended 

September 30, 2019
June 30, 2019
September 30, 2018
June 30, 2020
March 31, 2020 June 30, 2019 
(in millions) Avg.MinMax
 Avg.MinMax
 Avg.MinMax

 Avg.MinMax  Avg.MinMax  Avg.MinMax
 
CIB trading VaR by risk type

















                  
Fixed income$37

$31

$46


$39

$33

$45


$30

$25

$37

$129
 $109

$155

 $60
 $30
 $156
 $39
 $33
 $45
 
Foreign exchange6

4

8


7

5

12


5

3

11

9
 7

13

 7
 4
 11
 7
 5
 12
 
Equities22

19

27


25

14

31


16

13

19

27
 22

35

 20
 13
 41
 25
 14
 31
 
Commodities and other8

7

9


9

7

10


9

7

11

32
 21

44

 10
 7
 24
 9
 7
 10
 
Diversification benefit to CIB trading VaR(34)
(a) 
 NM
(b) 
 NM
(b) 

(36)
(a) 
 NM
(b) 
 NM
(b) 

(27)
(a) 
NM
(b) 
NM
(b) 
(69)
(a) 
 NM
(b) 
 NM
(b) 
 (40)
(a) 
NM
(b) 
NM
(b) 
 (36)
(a) 
NM
(b) 
NM
(b) 
CIB trading VaR39

33
(b) 
47
(b) 

44

34
(b) 
55
(b) 

33

27
(b) 
41
(b) 
128
 104

158

 57
 27
 160
  44
 34
 55
 
Credit portfolio VaR5

4

7


5

4

7


3

3

4

22
 18

28

 9
 3
 25
 5
 4
 7
 
Diversification benefit to CIB VaR(6)
(a) 
 NM
(b) 
 NM
(b) 

(5)
(a) 
NM
(b) 
NM
(b) 

(3)
(a) 
NM
(b) 
NM
(b) 
(23)
(a) 
 NM
(b) 
 NM
(b) 
 (8)
(a) 
NM
(b) 
NM
(b) 
 (5)
(a) 
NM
(b) 
NM
(b) 
CIB VaR38

33
(b) 
46
(b) 

44

35
(b) 
55
(b) 

33

28
(b) 
42
(b) 
127
 101

157

 58
 27
 162
 44
 35
 55
 






























  

 

   

 

   

 

 
CCB VaR6

2

11


4

2

7


1

1

2

5
 2

12

 7
 3
 11
 4
 2
 7
 
Corporate VaR10

9

11


10

9

10


13

12

14

Corporate and other LOB VaR15
 11

18

 11
 9
 14
 10
 9
 10
 
Diversification benefit to other VaR(5)
(a) 
 NM
(b) 
 NM
(b) 

(5)
(a) 
NM
(b) 
NM
(b) 

(1)
(a) 
NM
(b) 
NM
(b) 
(4)
(a) 
 NM
(b) 
 NM
(b) 
 (5)
(a) 
NM
(b) 
NM
(b) 
 (5)
(a) 
NM
(b) 
NM
(b) 
Other VaR11

9
(b) 
15
(b) 

9

8
(b) 
11
(b) 

13

12
(b) 
14
(b) 
16
 13

18

 13
 10
 16
 9
 8
 11
 
Diversification benefit to CIB and other VaR(10)
(a) 
 NM
(b) 
 NM
(b) 

(7)
(a) 
NM
(b) 
NM
(b) 

(11)
(a) 
NM
(b) 
NM
(b) 
(13)
(a) 
 NM
(b) 
 NM
(b) 
 (12)
(a) 
NM
(b) 
NM
(b) 
 (7)
(a) 
NM
(b) 
NM
(b) 
Total VaR$39

$35
(b) 
$46
(b) 

$46

$36
(b) 
$57
(b) 

$35

$30
(b) 
$43
(b) 
$130
 $106

$163

 $59
 $27
 $164
 $46
 $36
 $57
 
(a)Average portfolio VaR is less than the sum of the VaR of the components described above, which is due to portfolio diversification. The diversification effect reflects that the risks are not perfectly correlated.
(b)Diversification benefit represents the difference between the totalportfolio VaR and each reported level and the sum of its individual components. Diversification benefitThis reflects the non-additive nature of VaR due to imperfect correlation across lines of business,LOBs, Corporate, and risk types.
(b)The maximum and minimum VaR for each portfolio may have occurred on different trading days than the components and consequently diversification benefit is not meaningful.
Generally, average VaR across the risk types and LOBs was higher due to increased volatility, which occurred at the end of the first quarter as a result of the COVID-19 pandemic and has been incorporated into average VaR results for the entirety of the second quarter of 2020.
Quarter over quarter results
Results
Average total VaR decreasedincreased by $7$71 million and $84 million for the three months ended SeptemberJune 30, 2019 as2020 when compared with the prior quarter.quarter ended March 31, 2020 and June 30, 2019, respectively. This reflects a reductionincrease was driven by the substantial increase in risk acrossvolatility in the Fixed Income and Foreign Exchange risk types, as wellone-year historical look-back period as a decreaseresult of the COVID-19 pandemic. The most significant impacts were reflected in the Equitiesfixed income and commodities risk type driven by certain CIB investments, including Tradeweb.types.


 
Year over year results
Average totalEffective January 1, 2020, the Firm refined the scope of VaR increased by $4 million forto exclude positions related to the three months ended September 30, 2019, compared with the same periodrisk management of interest rate exposure from changes in the prior year. The increaseFirm’s own credit spread on fair value option elected liabilities, and included these positions in other sensitivity-based measures. In the absence of this refinement, the average totalTotal VaR is primarily due to increased exposureand each of the components would have been different by the amounts reported in the Fixed Income risk type, as well as an increase in the Equities risk type in CIB driven by the inclusion of Tradeweb following the IPO in the second quarter of 2019.table:
In addition, average CCB VaR has increased by $5 million, driven by mortgage servicing rights risk management activities.
(in millions)Amount by which reported VaR would have been different for the three months ended June 30, 2020
CIB fixed income VaR $(11) 
CIB trading VaR (11) 
CIB VaR (8) 
Total VaR (8) 



VaR back-testingbacktesting
The Firm performs daily VaR model back-testing,backtesting, which compares the daily Risk Management VaR results with the daily gains and losses actually recognized on market-risk related revenue.
that are utilized for VaR backtesting purposes. The Firm’s definition of market risk-related gains and losses is consistentin the chart below do not reflect the Firm’s revenue results as they exclude select components of total net revenue, such as those associated with the definition used by the banking regulators under Basel III. Under this definition market risk-related gainsexecution of new transactions (i.e., intraday client-driven trading and losses are defined as: gains and losses on the positions included in the Firm’s Risk Management VaR excludingintraday risk management activities), fees, commissions, certain valuation adjustments and net interest income, andincome. These excluded components of total net revenue may more than offset backtesting gains and losses arising from intraday trading.on a particular day. The definition of backtesting gains and losses above is consistent with the requirements for backtesting under Basel III capital rules.
The following chart compares actualFirmwide daily market risk-relatedbacktesting gains and losses with the Firm’s Risk Management VaR for the nine12 months ended SeptemberJune 30, 2019. As the chart presents market risk-related gains and losses related to those positions included in the Firm’s Risk Management VaR, the2020. The results in the tablechart below differ from the results of back-testingbacktesting disclosed in the Market Risk section of the Firm’s Basel III Pillar 3 Regulatory Capital Disclosures reports, which are based on Regulatory VaR applied to CIB’sthe Firm’s covered positions.
For the nine12 months ended SeptemberJune 30, 2019,2020, the Firm observed five VaR back-testing exceptions and posted market risk-relatedbacktesting gains on 116142 of the 194 days.260 days, and observed 16 VaR backtesting exceptions, which was higher than the statistically expected number of backtesting exceptions due to recent market volatility being materially higher than the levels realized in the historical data used for the VaR calculation. For the three months ended SeptemberJune 30, 2019,2020, the Firm observed three VaR back-testing exceptions and posted market risk-relatedbacktesting gains on 3538 of the 66 days.65 days, and observed two VaR backtesting exceptions as higher volatility became fully embedded in the look-back period used for the VaR calculation. Firmwide backtesting loss days can differ from the loss days for which Fixed Income Markets and Equity Markets posted losses, as disclosed in the CIB Markets revenue results, as the population of positions which compose each metric are different and due to the exclusion of select components of total net revenue in backtesting gains and losses as described above. For more information on CIB Markets revenue results, refer to page 36 .
Daily Market Risk-Related Gains and Losses
vs. Risk Management VaR (1-day, 95% Confidence level)Backtesting Results
Nine12 months ended SeptemberJune 30, 20192020
 
Market Risk-RelatedBacktesting Gains and Losses
 
Risk Management VaR(1-day, 95% Confidence level)
chart-62dd8fa2647b59ecb55.jpgchart-09987098e56854f39b9.jpg
Third Quarter
2019
Fourth Quarter
2019
First Quarter 2019
2020
Second Quarter 2019
Third Quarter 2019
2020


Earnings-at-risk
The effect of interest rate exposure on the Firm’s reported net income is important as interest rate risk represents one of the Firm’s significant market risks. Interest rate risk arises not only from trading activities but also from the Firm’s traditional banking activities, which include extension of loans and credit facilities, taking deposits and issuing debt as well as from the investment securities portfolio. Refer to the table on page 125120 of JPMorgan Chase’s 20182019 Form 10-K for a summary by line of businessLOB and Corporate, identifying positions included in earnings-at-risk.
One way the Firm evaluates its structural interest rate risk is through earnings-at-risk. Earnings-at-risk estimates the Firm’s interest rate exposure for a given interest rate scenario. It is presented as a sensitivity to a baseline, which includes net interest income and certain interest rate sensitive fees. The baseline uses market interest rates and in the case of deposits, pricing assumptions. The Firm conducts simulations of changes to this baseline for interest rate-sensitive assets and liabilities denominated in U.S. dollars and other currencies (“non-U.S. dollar” currencies). These simulations primarily include retained loans, deposits, deposits with banks, investment securities, long term debt and any related interest rate hedges, and exclude other positions in risk management VaR and other sensitivity-based measures as described on page 125120 of JPMorgan Chase’s 20182019 Form 10-K.
Earnings-at-risk scenarios estimate the potential change to a net interest income baseline, over the following 12 months utilizing multiple assumptions. These scenarios include a parallel shift involving changes to both short-term and long-term rates by an equal amount; a steeper yield curve involving holding short-term rates constant and increasing long-term rates or decreasing short-term rates and holding long-term rates constant;rates; and a flatter yield curve involving increasing short-term rates and holding long-term rates constant or holding short-term rates constant and decreasing long-term rates.constant. These scenarios consider many different factors, including:
The impact on exposures as a result of instantaneous changes in interest rates from baseline rates.
Forecasted balance sheet, as well as modeled prepayment and reinvestment behavior, but do not include assumptions about actions that could be taken by the Firm in response to any such instantaneous rate changes. Mortgage prepayment assumptions are based on the interest rates used in the scenarios compared with underlying contractual rates, the time since origination, and other factors which are updated periodically based on historical experience.
•
The pricing sensitivity of deposits, using normalized deposit betas which represent the amount by which deposit rates paid could change upon a given change in market interest rates over the cycle. These normalized deposit betas represent the amount by which deposit rates paid could change upon a given change in market interest
rates. The deposit rates paid in these scenarios may differ from actual deposit rates paid, particularly for retail deposits, due to repricing lags and other factors.
The Firm’s earnings-at-risk scenarios are periodically evaluated and enhanced in response to changes in the composition of the Firm’s balance sheet, changes in market conditions, improvements in the Firm’s simulation and other factors. While a relevant measure of the Firm’s interest rate exposure, the earnings at risk analysis does not represent a forecast of the Firm’s net interest income (Refer to 20192020 Outlook on page 8 for additional information).
The Firm’s U.S. dollar sensitivities are presented in the table below.
(in billions)September 30, 2019
 December 31, 2018
June 30, 2020
 December 31, 2019
Parallel shift:      
+100 bps shift in rates$0.7
 $0.9
$3.7
 $0.3
-100 bps shift in rates(2.6) (2.1)
Steeper yield curve:      
+100 bps shift in long-term rates0.9
 0.5
1.7
 1.2
-100 bps shift in short-term rates(0.9) (1.2)
Flatter yield curve:      
+100 bps shift in short-term rates(0.2) 0.4
2.0
 (0.9)
-100 bps shift in long-term rates(1.6) (0.9)
The change in the Firm’s U.S. dollar sensitivities as of SeptemberJune 30, 20192020 compared to December 31, 20182019 reflected updatingupdates to the Firm’s baseline for lower short-term and long-term rates as well as the impact of changes in the Firm’s balance sheet.
The Firm’s sensitivity to short-term rates decreased asis primarily a result of changesassets repricing at a faster pace than deposits.
Based upon current and implied market rates as of June 30, 2020, scenarios reflecting lower rates could result in the Firm’s balance sheet primarily offset by updating the Firm’s baseline to reflect lowernegative interest rates. The Firm’s sensitivity to long-term rates increased primarily asU.S. has never experienced an interest rate environment where the Federal Reserve has a result of updatingnegative interest rate policy. In a negative rate environment, the Firm’s baseline to reflect lower ratesmodeling assumptions used for certain assets and is more impactful to the downward scenario due to the Firm’s sensitivity to mortgage prepayments.liabilities require additional management judgment.
The Firm’s non-U.S. dollar sensitivities are presented in the table below.
(in billions)September 30, 2019
 December 31, 2018
June 30, 2020
 December 31, 2019
Parallel shift:      
+100 bps shift in rates$0.5
 $0.5
$0.7
 $0.5
Flatter yield curve:      
+100 bps shift in short-term rates0.5
 0.5
0.7
 0.5
The results of the non-U.S. dollar interest rate scenario involving a steeper yield curve with long-term rates rising by 100 basis points and short-term rates staying at current levels were not material to the Firm’s earnings-at-risk at SeptemberJune 30, 20192020 and December 31, 2018.2019.



Other sensitivity-based measures
The Firm quantifies the market risk of certain investmentnon-traded debt and equity and funding activities by assessing the potential impact on net revenue, other comprehensive income (“OCI”) and OCInoninterest expense due to changes in relevant market variables. Refer to the table Predominant business activities
that give rise to market risk on page 125120 of JPMorgan Chase’s 20182019 Form 10-K for additional information on the positions captured in other sensitivity-based measures.
The table below represents the potential impact to net revenue, OCI or OCInoninterest expense for market risk-sensitive instruments that are not included in VaR or earnings-at-risk. Where appropriate, instruments used for hedging purposes are reported along withnet of the positions being hedged. The sensitivities disclosed in the table below may not be representative of the actual gain or loss that would have been realized at SeptemberJune 30, 20192020 and December 31, 2018,2019, as the movement in market parameters across maturities may vary and are not intended to imply management’s expectation of future deteriorationchanges in these sensitivities.
Gain/(loss) (in millions)
 September 30, 2019
 December 31, 2018
 June 30, 2020
 December 31, 2019
Activity Description Sensitivity measure   Description Sensitivity measure  
        
Investment activities(a)
    
Investment management activities Consists of seed capital and related hedges; and fund co-investments 10% decline in market value $(79) $(102)
Non-traded debt and equity(a)
    
Asset Management activities 
Consists of seed capital and related hedges; fund co-investments(b); and certain deferred compensation and related hedges(c)
 10% decline in market value $(60) $(68)
Other investments Consists of privately held equity and other investments held at fair value 10% decline in market value (202) (218) 
Consists of privately held equity and other investments held at fair value(b)
 10% decline in market value (181) (192)
        
Funding activities        
Non-USD LTD cross-currency basis 
Represents the basis risk on derivatives used to hedge the foreign exchange risk on the non-USD LTD(b)
 1 basis point parallel tightening of cross currency basis (15) (13) 
Represents the basis risk on derivatives used to hedge the foreign exchange risk on the non-USD LTD(d)
 1 basis point parallel tightening of cross currency basis (16) (17)
Non-USD LTD hedges foreign currency (“FX”) exposure 
Primarily represents the foreign exchange revaluation on the fair value of the derivative hedges(b)
 10% depreciation of currency 7
 17
 
Primarily represents the foreign exchange revaluation on the fair value of the derivative hedges(d)
 10% depreciation of currency 1
 15
Derivatives – funding spread risk Impact of changes in the spread related to derivatives FVA 1 basis point parallel increase in spread (5) (4) 
Impact of changes in the spread related to derivatives FVA(b)
 1 basis point parallel increase in spread (6) (5)
Fair value option elected liabilities – funding spread risk 
Impact of changes in the spread related to fair value option elected liabilities DVA(b)
 1 basis point parallel increase in spread 28
 30
 
Impact of changes in the spread related to fair value option elected liabilities DVA(d)
 1 basis point parallel increase in spread 32
 29
Fair value option elected liabilities – interest rate sensitivity 
Interest rate sensitivity on fair value option liabilities resulting from a change in the Firm’s own credit spread(b)
 1 basis point parallel increase in spread 1
 1
 
Interest rate sensitivity on fair value option liabilities resulting from a change in the Firm’s own credit spread(d)
 1 basis point parallel increase in spread 2
 (2)
Fair value option elected liabilities – interest rate sensitivity
Interest rate sensitivity related to risk management of changes in the Firm’s own credit spread on fair value option liabilities(b)

 1 basis point parallel increase in spread (2) 2
(a)Excludes equity securities without readily determinable fair values that are measured under the measurement alternative. Refer to Note 2 for additional information.
(b)Impact recognized through net revenue.
(c)In the second quarter of 2020, the Firm refined the approach for risk management of certain deferred compensation, which is recognized through noninterest expense. As a result, certain deferred compensation and related hedges are now included in other sensitivity-based measures.
(d)Impact recognized through OCI.


COUNTRY RISK MANAGEMENT
The Firm, through its lines of businessLOBs and Corporate, may be exposed to country risk resulting from financial, economic, political or other significant developments which adversely affect the value of the Firm’s exposures related to a particular country or set of countries. The Country Risk Management group actively monitors the various portfolios which may be impacted by these developments and measures the extent to which the Firm’s exposures are diversified given the Firm’s strategy and risk tolerance relative to a country.
Refer to pages 132–133127–128 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of the Firm’s country risk management.
COVID-19 Pandemic
Country Risk Management continues to monitor the impact of the COVID-19 pandemic on countries to which the Firm has exposure, leveraging tailored analysis and existing stress testing, exposure reporting and controls.
Risk Reporting
The following table presents the Firm’s top 20 exposures by country (excluding the U.S.) as of SeptemberJune 30, 20192020 and their comparative exposures as of December 31, 2018.2019. The selection of countries represents the Firm’s largest total exposures by country, based on the Firm’s internal country risk management approach, and does not represent the Firm’s view of any actual or potentially adverse credit conditions. Country exposures may fluctuate from period to period due to client activity and market flows.
The overall increase in top 20 exposures was predominantly driven by client activity and demand for liquidity, relative to the period ending December 31, 2019. This resulted in an increase in cash placements primarily with the central banks of Germany, the United Kingdom and Australia.
 
Top 20 country exposures (excluding the U.S.)(a)
Top 20 country exposures (excluding the U.S.)(a)
Top 20 country exposures (excluding the U.S.)(a)

(in billions)		September 30, 2019 
December 31, 2018(e)
June 30, 2020 
December 31, 2019(e)
Lending and deposits(b)
Trading and investing(c)
Other(d)
Total exposure Total exposure
Lending and deposits(b)
Trading and investing(c)
Other(d)
Total exposure Total exposure
Germany$58.1
$6.2
$0.4
$64.7
 $62.1
$72.4
$7.5
$0.9
$80.8
 $51.6
United Kingdom28.8
10.0
3.7
42.5
 40.7
46.8
10.3
1.6
58.7
 42.4
Japan23.3
4.2
0.3
27.8
 29.1
34.1
6.6
0.3
41.0
 43.8
Switzerland10.7
1.0
7.6
19.3
 12.8
France11.3
4.8
1.5
17.6
 17.9
12.0
11.0
3.8
26.8
 18.1
China9.3
6.7
1.4
17.4
 19.3
9.6
10.6
1.0
21.2
 19.2
Australia13.1
6.0
0.6
19.7
 11.7
Switzerland10.0
0.7
3.8
14.5
 18.3
Canada12.0
1.5
—
13.5
 14.3
11.7
1.2
0.2
13.1
 13.2
Luxembourg10.3
0.7
—
11.0
 12.9
Netherlands5.2
0.1
4.9
10.2
 9.0
Italy4.8
5.1
0.1
10.0
 6.8
India5.0
4.8
2.8
12.6
 11.8
4.0
5.1
0.9
10.0
 11.3
Luxembourg11.6
0.7
—
12.3
 11.0
Australia7.1
5.0
—
12.1
 13.0
Netherlands6.0
1.2
3.0
10.2
 5.8
Brazil4.0
4.9
—
8.9
 7.3
4.3
4.7
—
9.0
 7.2
Singapore4.3
1.6
2.6
8.5
 6.8
4.7
2.2
1.8
8.7
 6.8
South Korea3.7
3.5
0.4
7.6
 6.4
Saudi Arabia7.2
0.9
—
8.1
 5.3
5.3
0.9
—
6.2
 5.2
South Korea4.0
3.6
0.1
7.7
 7.6
Italy2.2
4.7
0.1
7.0
 6.4
Hong Kong3.4
1.5
1.7
6.6
 5.4
Spain3.3
3.3
—
6.6
 5.1
3.2
1.5
0.1
4.8
 5.8
Mexico4.2
0.9
—
5.1
 5.5
3.7
0.8
—
4.5
 4.7
Belgium3.6
0.5
—
4.1
 2.3
Hong Kong SAR1.9
1.6
1.0
4.5
 5.1
Malaysia1.7
1.1
1.5
4.3
 3.4
(a)Top 20 countryCountry exposures presented in the table reflect approximately 87%89% and 86%88% of total firmwide non-U.S. exposure, where exposure is attributed to a specific country, at SeptemberJune 30, 2019,2020, and December 31, 20182019, respectively.
(b)Lending and deposits includes loans and accrued interest receivable (net of eligible collateral and the allowance for loan losses), deposits with banks (including central banks), acceptances, other monetary assets, issued letters of credit net of participations, and unused commitments to extend credit. Excludes intra-day and operating exposures, such as those from settlement and clearing activities.
(c)Includes market-making inventory, AFS securities, and counterparty exposure on derivative and securities financings net of eligible collateral and hedging. Includes exposure from single reference entity (“single-name”), index and other multiple reference entity transactions for which one or more of the underlying reference entities is in a country listed in the above table.
(d)Predominantly includes physical commodity inventory.
(e)The country rankings presented in the table as of December 31, 2018,2019, are based on the country rankings of the corresponding exposures at SeptemberJune 30, 2019,2020, not actual rankings of such exposures at December 31, 2018.2019.

OPERATIONAL RISK MANAGEMENT
Operational risk is the risk associated with an adverse outcome resulting from inadequate or failed internal processes or systems; human factors; or external events impacting the Firm’s processes or systems; it includes compliance, conduct, legal, and estimations and model risk. Operational risk is inherent in the Firm’s activities and can manifest itself in various ways, including fraudulent acts, business interruptions, cybersecurity attacks, inappropriate employee behavior, failure to comply with applicable laws and regulations or failure of vendors to perform in accordance with their agreements. Operational Risk Management attempts to manage operational risk at appropriate levels in light of the Firm’s financial position, the characteristics of its businesses, and the markets and regulatory environments in which it operates. Refer to Operational Risk Management on pages 129-131 of JPMorgan Chase’s 2019 Form 10-K for a discussion of the Firm’s Operational Risk Management.
Subcategories and examples of operational risks
Operational risk can manifest itself in various ways. Operational risk subcategories such as Compliance risk, Conduct risk, Legal risk, and Estimations and Model risk as well as other operational risks, can lead to losses which are captured through the Firm’s operational risk measurement processes. Refer to Compliance Risk Management on page 132, Conduct Risk Management on page 133, Legal Risk Management on page 134 and Estimations and Model Risk Management on page 135 of JPMorgan Chase’s 2019 Form 10-K for more information. Details on other select examples of operational risks are provided below.
Business and Technology Resiliency Risk
Business disruptions can occur due to forces beyond the Firm’s control such as severe weather, power or telecommunications loss, accidents, failure of a third party to provide expected services, cyberattack, flooding, transit strikes, terrorism, health emergencies, the spread of infectious diseases or pandemics. The Firmwide resiliency program is intended to enable the Firm to recover its critical business functions and supporting assets (i.e., staff, technology and facilities) in the event of a business interruption, while prioritizing the health and safety
of employees and customers. The program includes governance, awareness training, and testing of recovery strategies, as well as strategic and tactical initiatives to identify, assess, and manage business interruption and public safety risks. The strength and proficiency of the Firmwide resiliency program has played an integral role in maintaining the Firm’s business operations during and after various events.
COVID-19 Pandemic
The Firm’s Technology and Cybersecurity operations continue to monitor the Firm’s systems 24 hours a day, seven days a week including responding to threat activity using COVID-19 themes in phishing and other social engineering campaigns.
The Technology function is actively supporting the Firm’s response to the impacts of the COVID-19 pandemic, including the Firm’s expanded use of remote collaboration tools and platforms. Technology diligently monitors the operational performance of the Firm’s infrastructure to support increased market volumes as a result of the COVID-19 pandemic.

ESTIMATIONS AND MODEL RISK MANAGEMENT

Estimations and Model risk, a subcategory of operational risk, is the potential for adverse consequences from decisions based on incorrect or misused estimation outputs.
The Firm uses models and other analytical and judgment based estimations across various businesses and functions. The estimation methods are of varying levels of sophistication and are used for many purposes, such as the valuation of positions, measurement of risk, sizing the allowance for credit losses, assessing regulatory capital requirements, conducting stress testing, and making business decisions.
While models are inherently imprecise, the degree of imprecision or uncertainty can be heightened by the market or economic environment. This is particularly true when the current and forecasted environment is significantly different from the historical macroeconomic environments upon which the models were calibrated, as the Firm has experienced during the COVID-19 pandemic. This uncertainty may necessitate a greater degree of judgment and analytics to inform adjustments to model outputs than in typical periods.
Refer to Critical Accounting Estimates Used by the Firm on pages 88-90 and Note 2 of this Form 10-Q, and Estimations and Model Risk Management section on page 135 of JPMorgan Chase’s 2019 Form 10-K for a summary of model-based valuations and other valuation techniques.


CRITICAL ACCOUNTING ESTIMATES USED BY THE FIRM
JPMorgan Chase’s accounting policies and use of estimates are integral to understanding its reported results. The Firm’s most complex accounting estimates require management’s judgment to ascertain the appropriate carrying value of assets and liabilities. The Firm has established policies and control procedures intended to ensure that estimation methods, including any judgments made as part of such methods, are well-controlled, independently reviewed and applied consistently from period to period. The methods used and judgments made reflect, among other factors, the nature of the assets or liabilities and the related business and risk management strategies, which may vary across the Firm’s businesses and portfolios. In addition, the policies and procedures are intended to ensure that the process for changing methodologies occurs in an appropriate manner. The Firm believes its estimates for determining the carrying value of its assets and liabilities are appropriate. The following is a brief description of the Firm’s critical accounting estimates involving significant judgments.
Allowance for credit losses
The Firm’s allowance for credit losses coversrepresents management’s estimate of expected credit losses over the retained consumer and wholesale loan portfolios, as well asremaining expected life of the Firm’s wholesalefinancial assets measured at amortized cost, certain off-balance sheet lending-related commitments and certain consumer lending-related commitments. investment securities. The allowance for credit losses comprises:
The allowance for loan losses, is intended to adjust the carrying value ofwhich covers the Firm’s retained loan assets to reflect probable credit losses inherent in the loan portfolio as of the balance sheet date. Similarly, theportfolios (scored and risk-rated),
The allowance for lending-related commitments, is established to cover probable credit losses inherent in the lending-related commitments portfolio as of the balance sheet date.and
The allowance for credit losses includes a formula-based component, an asset-specific component,on investment securities, which covers the Firm’s HTM and a component related to PCI loans. AFS securities.
The determination of each of these componentsallowance for credit losses involves significant judgment on a number of matters.matters including development and weighting of macroeconomic forecasts, incorporation of historical loss experience, assessment of risk characteristics, assignment of risk ratings, valuation of collateral, and the determination of remaining expected life. Refer to pages 120–122, page 141Note 10 and Note 13 of JPMorgan Chase’s 2018 Form 10-K for further information on these components, areas of judgmentjudgments as well as the Firm’s policies and methodologies used in establishingto determine the Firm’s allowance for credit losses; and refer to Allowance for credit losses on pages 67–68 and Note 12losses.
One of this Form 10-Q.
As notedthe most significant judgments involved in the discussion on page 141 of JPMorgan Chase’s 2018 Form 10-K,estimating the Firm’s allowance for credit losses is sensitiverelates to numerous factors, which may differ dependingthe macroeconomic forecasts used to estimate credit losses over the eight-quarter forecast period within the Firm’s methodology. The eight-quarter forecast incorporates hundreds of macroeconomic variables (“MEVs”) that are relevant for exposures across the Firm, with modeled credit losses being driven primarily by a subset of less than twenty variables. The specific variables that have the greatest effect on the portfolio. modeled losses of each portfolio vary by portfolio and geography.
Key MEVs for the consumer portfolio include U.S. unemployment, house price index (“HPI”) and U.S. real gross domestic product (“GDP”).
Key MEVs for the wholesale portfolio include U.S. real GDP, U.S. unemployment, U.S. equity prices, corporate credit spreads, oil prices, commercial real estate prices and HPI.
Changes in economic conditions or in the Firm’s assumptions and estimatesforecasts of economic conditions could significantly affect its estimate of probableexpected credit losses inherent in the portfolio at the balance sheet date. The Firm uses its best judgmentdate or lead to assess these economic conditions and loss data in estimating the allowance for credit losses and these estimates are subject to periodic refinement based on changes to underlying external or Firm-specific historical data. Refer to Note 12 for further information.
To illustrate the potential magnitude of certain alternate judgments, the Firm estimates thatsignificant changes in the following inputs would haveestimate from one reporting period to the following effects onnext.
The COVID-19 pandemic has resulted in a weak labor market and weak overall economic conditions that will continue to affect borrowers across the Firm’s modeled credit loss estimates as of September 30, 2019,
without consideration of any offsetting or correlated effects of other inputs inconsumer and wholesale lending portfolios. Significant judgment is required to estimate the Firm’s allowance for loan losses:
A combined 5% decline in housing pricesseverity and a 100 basis point increase in unemployment rates from expectations could imply:
◦an increase to modeled credit loss estimates of approximately $250 million for PCI loans.
◦an increase to modeled annual credit loss estimates of approximately $50 million for residential real estate loans, excluding PCI loans.
For credit card loans, a 100 basis point increase in unemployment rates from expectations could imply an increase to modeled annual credit loss estimates of approximately $800 million.
An increase in probability of default (“PD”) factors consistent with a one-notch downgrade in the Firm’s internal risk ratings for its entire wholesale loan portfolio could imply an increase in the Firm’s modeled credit loss estimates of approximately $1.7 billion.
A 100 basis point increase in estimated loss given default (“LGD”) for the Firm’s entire wholesale loan portfolio could imply an increase in the Firm’s modeled credit loss estimates of approximately $175 million.
The purpose of these sensitivity analyses is to provide an indicationduration of the isolated impactscurrent economic downturn, as well as its potential impact on borrower defaults and loss severities. In particular, macroeconomic conditions and forecasts regarding the duration and severity of hypothetical alternative assumptions on modeled loss estimates. Thethe economic downturn caused by the COVID-19 pandemic have been rapidly changing and remain highly uncertain. It is difficult to predict exactly how borrower behavior will be impacted by these changes in economic conditions. The effectiveness of government support, customer assistance and enhanced unemployment benefits should act as mitigants to credit losses, but the inputs presented above are not intended to imply management’s expectationextent of future deterioration of those risk factors. In addition, these analyses are not intended to estimate changes in the overall allowance for loan losses, which would also be influenced by the judgment management applies to the modeled loss estimates to reflect the uncertainty and imprecision of these modeled loss estimates based on then-current circumstances and conditions.mitigation impact remains uncertain.
It is difficult to estimate how potential changes in specific factorsany one factor or input might affect the overall allowance for credit losses because management considers a wide variety of factors and inputs in estimating the allowance for credit losses. Changes in thesethe factors and inputs considered may not occur at the same rate and may not be consistent across all geographies or product types, and changes in factors and inputs may be directionally inconsistent, such that improvement in one factor or input may offset deterioration in other factors. In addition, it is difficult to predict how changes in specific economic conditions or assumptions could affect borrower behavior or other factorsothers.
To consider the impact of a hypothetical alternate macroeconomic forecast, the Firm compared the modeled credit losses determined using its central and relative adverse macroeconomic scenarios, which are two of the five scenarios considered by management in estimating the allowanceallowances for credit losses. Givenloan losses and lending-related commitments. The central and relative adverse scenarios each included a full suite of MEVs, but differed in the processlevels, paths and peaks/troughs of those variables over the Firm followseight-quarter forecast period.
For example, compared to the Firm’s central scenario described on page 77 and in Note 13, the judgments madeFirm’s relative adverse scenario assumes a significantly elevated U.S. unemployment rate through the first half of 2021, averaging 3.6% higher over the eight-quarter forecast, with a peak difference of nearly 7% in evaluating the risk factors relatedfourth quarter of 2020; lower U.S. real GDP with a slower recovery, remaining nearly 4% lower at the end of the eight-quarter

forecast, with a peak difference of nearly 5.5% in the first quarter of 2021; and an 11% further deterioration in the national HPI with a trough in the first quarter of 2022.
This analysis is not intended to its loss estimates, management believes that its current estimate ofexpected future changes in the allowance for credit losses, for a number of reasons, including:
the Firm has placed significant weight on its adverse scenarios in estimating its allowance for credit losses as of June 30, 2020, and accordingly, the existing allowance already reflects credit losses beyond those estimated under the central scenario
the changes in the MEVs are not intended to imply management’s expectation of the extent or nature of future deterioration in MEVs
the impacts of changes in many MEVs are both interrelated and nonlinear, so the results of this analysis cannot be simply extrapolated for more severe changes in macroeconomic variables
the COVID-19 pandemic has stressed many MEVs at a speed and to degrees not seen in recent history, adding significantly higher degrees of uncertainty around modeled credit loss estimations which use scenarios outside of historical experience
significant changes in the expected severity and duration of the economic downturn caused by the COVID-19 pandemic, the effects of government support and customer assistance, and the speed of the subsequent recovery could significantly affect the Firm’s estimate of expected credit losses irrespective of the estimated sensitivities described below.
To demonstrate the sensitivity of credit loss estimates to macroeconomic forecasts as of June 30, 2020, the Firm compared the modeled estimates under its relative adverse scenario to its central scenario. Without considering the additional weight the Firm has placed on its adverse scenarios or any other offsetting or correlated effects in other qualitative components of the Firm’s allowance for credit losses for these lending exposures, the difference between these two scenarios would result in the following:
An increase of approximately $2 billion for residential real estate loans and lending-related commitments
An increase of approximately $4 billion for credit card loans
An increase of approximately $7 billion for wholesale loans and lending-related commitments
This analysis relates only to the modeled credit loss estimates and is appropriate.not intended to estimate changes in the overall allowance for credit losses as it does not reflect any potential changes in other adjustments to the quantitative calculation, which would also be influenced by the judgment management applies to the modeled lifetime loss estimates to reflect the uncertainty and imprecision of these modeled lifetime loss estimates based on then-current circumstances
and conditions.
Recognizing that forecasts of macroeconomic conditions are inherently uncertain, particularly in light of the recent economic conditions, the Firm believes that its process to consider the available information and associated risks and uncertainties is appropriately governed and that its estimates of expected credit losses were reasonable and appropriate for the period ended June 30, 2020.

Fair value
JPMorgan Chase carries a portion of its assets and liabilities at fair value. The majority of such assets and liabilities are measured at fair value on a recurring basis, including, derivatives, structured note products and certain securities financing agreements. Certain assets and liabilities are measured at fair value on a nonrecurring basis, including certain mortgage, home equity and other loans, where the carrying value is based on the fair value of the underlying collateral.
Assets measured at fair value
The following table includes the Firm’s assets measured at fair value and the portion of such assets that are classified within level 3 of the valuation hierarchy. Refer to Note 2 for further information.
September 30, 2019
(in billions, except ratios)
Total assets at fair value Total level 3 assets
June 30, 2020
(in billions, except ratios)
Total assets at fair value Total level 3 assets
Federal funds sold and securities purchased under resale agreements

$244.0
 $—
Securities borrowed42.5
 —
Trading assets:   
Trading–debt and equity instruments$440.2
  $4.4
$451.2
 $4.9
Derivative receivables(a)
55.6
 5.6
74.8
 8.6
Trading assets495.8
 10.0
Total trading assets526.0
 13.5
AFS securities353.4
 —
485.9
 —
Loans5.8
 —
5.9
 0.3
MSRs4.4
 4.4
3.1
 3.1
Other27.8
 0.7
298.3
 0.5
Total assets measured at fair value on a recurring basis
$887.2
 $15.1
1,319.2
 17.4
Total assets measured at fair value on a nonrecurring basis6.4
 1.0
3.0
 1.2
Total assets measured at fair value
$893.6
 $16.1
$1,322.2
 $18.6
Total Firm assets$2,764.7
  $3,213.1
  
Level 3 assets as a percentage of total Firm assets(a)
  0.6%  0.6%
Level 3 assets as a percentage of total Firm assets at fair value(a)
  1.8%  1.4%
(a)For purposes of the table above, the derivative receivables total reflects the impact of netting adjustments; however, the $5.6$8.6 billion of derivative receivables classified as level 3 does not reflect the netting adjustment as such netting is not relevant to a presentation based on the transparency of inputs to the valuation of an asset. The level 3 balances would be reduced if netting were applied, including the netting benefit associated with cash collateral.
Valuation
Estimating fair value requires the application of judgment. The type and level of judgment required is largely dependent on the amount of observable market information available to the Firm. For instruments valued using internally developed valuation models and other valuation techniques that use significant unobservable inputs and are

therefore classified within level 3 of the valuation hierarchy, judgments used to estimate fair value are more significant than those required when estimating the fair value of instruments classified within levels 1 and 2.
In arriving at an estimate of fair value for an instrument within level 3, management must first determine the appropriate valuation technique to use. Second, the lack of observability of certain significant inputs requires management to assess all relevant empirical data in deriving valuation inputs including, for example, transaction details, yield curves, interest rates, prepayment rates, default rates, volatilities, correlations, equity or debt prices, valuations of comparable instruments, foreign exchange rates and credit curves. Refer to Note 2 for a further discussion of the valuation of level 3 instruments, including unobservable inputs used.
For instruments classified in levels 2 and 3, management judgment must be applied to assess the appropriate level of valuation adjustments to reflect counterparty credit quality, the Firm’s creditworthiness, market funding rates, liquidity considerations, unobservable parameters, and for portfolios that meet specified criteria, the size of the net open risk position. The judgments made are typically affected by the type of product and its specific contractual terms, and the level of liquidity for the product or within the market as a whole. In periods of heightened market volatility and uncertainty judgments are further affected by the wider variation of reasonable valuation estimates, particularly for positions that are less liquid. Refer to Note 2 for a further discussion of valuation adjustments applied by the Firm.
Imprecision in estimating unobservable market inputs or other factors can affect the amount of gain or loss recorded for a particular position. Furthermore, while the Firm believes its valuation methods are appropriate and consistent with those of other market participants, the methods and assumptions used reflect management judgment and may vary across the Firm’s businesses and portfolios.
The Firm uses various methodologies and assumptions in the determination of fair value. The use of methodologies or assumptions different than those used by the Firm could result in a different estimate of fair value at the reporting date. Refer to Note 2 for a detailed discussion of the Firm’s valuation process and hierarchy, and its determination of fair value for individual financial instruments.
Goodwill impairment
Management applies significant judgment when testing goodwill for impairment. The goodwill associated with each business combination is allocated to the related reporting units for goodwill impairment testing. Refer to Goodwill impairment on page 142137 of JPMorgan Chase’s 20182019 Form 10-K for a description of the significant valuation judgments associated with goodwill impairment.
Refer to Note 1415 for additional information on goodwill, including the goodwill impairment assessment as of SeptemberJune 30, 2019.2020.

Credit card rewards liability
The credit card rewards liability was $6.3$7.1 billion and $5.8$6.4 billion at SeptemberJune 30, 20192020 and December 31, 2018,2019, respectively, and is recorded in accounts payable and other liabilities on the Consolidated balance sheets. Refer to page 143pages 137-138 of JPMorgan Chase’s 20182019 Form 10-K for a description of the significant assumptions and judgments associated with the Firm’s credit card rewards liability.
Income taxes
Refer to Income taxes on page 143138 of JPMorgan Chase’s 20182019 Form 10-K for a description of the significant assumptions, judgments and interpretations associated with the accounting for income taxes.
Litigation reserves
Refer to Note 2425 of this Form 10-Q, and Note 2930 of JPMorgan Chase’s 20182019 Form 10-K for a description of the significant estimates and judgments associated with establishing litigation reserves.

ACCOUNTING AND REPORTING DEVELOPMENTS
Financial Accounting Standards Board (“FASB”) Standards Adopted since January 1, 2019
StandardSummary of guidanceEffects on financial statements
Leases
Issued February 2016
 • Requires lessees to recognize all leases longer than twelve months on the Consolidated balance sheets as a lease liability with a corresponding right-of-use asset.
 • Requires lessees and lessors to classify most leases using principles similar to existing lease accounting, but eliminates the “bright line” classification tests.
 • Expands qualitative and quantitative leasing disclosures.

• Adopted January 1, 2019.
•
The Firm elected the available practical expedient to not reassess whether existing contracts contain a lease or whether classification or unamortized initial lease costs would be different under the new lease guidance. The Firm elected the modified retrospective transition method, through a cumulative-effect adjustment to retained earnings without revising prior periods.
 • Refer to Note 16 for further information.




FASB Standards Issued but not yet Adopted2020
     
Standard Summary of guidance Effects on financial statements
     
Financial instrumentsInstruments – credit lossesCredit Losses (“CECL”)

Issued June 2016
 
 • Replaces existing incurred loss impairment guidance and establishesEstablishes a single allowance framework for all financial assets carriedmeasured at amortized cost which will reflectand certain off-balance sheet credit exposures. This framework requires that management’s estimate ofreflects credit losses over the fullinstrument’s remaining expected life of the financial assets and will considerconsiders expected future changes in macroeconomic conditions.
 • Eliminates existing guidance for PCI loans, and requires recognition of the nonaccretable difference as an increase to the allowance for expected credit losses on financial assets purchased with more than insignificant credit deterioration since origination, with a corresponding increase in the recorded investmentamortized cost of the related loans.
 • Requires inclusion of expected recoveries, limited to the cumulative amount of prior write-offs, when estimating the allowance for credit losses for in scope financial assets (including collateral dependentcollateral-dependent assets).
 • Amends existing impairment guidance for AFS securities to incorporate an allowance, which will allow for reversals of credit impairments in the event that the credit of an issuer improves.
 • Requires a cumulative-effect adjustment to retained earnings as of the beginning of the reporting period of adoption.

 
•
 • Required effective date:Adopted January 1, 2020.(a)
 • The Firm has established a Firmwide, cross-discipline governance structure, which provides implementation oversight. The Firm continues to test and refine its current expected credit loss models that satisfy the requirements of the new standard. Oversight and testing, as well as efforts to meet expanded disclosure requirements, will extend through the remainder of 2019.  
•
The Firm expects that the allowance related to the Firm’s loans and commitments will increase as it will cover credit losses over the full remaining expected life of the portfolios. The Firm currently intends to estimate losses over a two-year forecast period using the weighted-average of a range of macroeconomic scenarios (established on a Firmwide basis), and then revert to longer term historical loss experience to estimate losses over more extended periods.
•
The Firm currently expects the increase in the allowanceRefer to be in the range of $4-6 billion, primarily driven by Card. This estimate is subject toNote 1 for further refinement based on continuing reviews and approvals of models, methodologies and judgments. The ultimate impact will depend upon the nature and characteristics of the Firm’s portfolio at the adoption date, the macroeconomic conditions and forecasts at that date, and other management judgments.
•
The Firm plans to adopt the new guidance on January 1, 2020.information.
Goodwill
Issued January 2017
 
 • Requires recognition of an impairment loss to be recognized when the estimated fair value of a reporting unit falls below its carrying value.
 • Eliminates the second condition in the current guidancerequirement that requires an impairment loss to be recognized only if the estimated implied fair value of the goodwill is below its carrying value.
 
•
 • Required effective date:Adopted January 1, 2020.
•
(a)No impact upon adoption as the guidance is to be applied prospectively.
•
Refer to Note 15 for further information.
Reference Rate Reform
Issued March 2020

 • Provides optional expedients and exceptions to current accounting guidance when financial instruments, hedging relationships, and other transactions are amended due to reference rate reform.
 • Based on current impairment test results,Provides an election to account for certain contract amendments related to reference rate reform as modifications rather than extinguishments without the requirement to assess the significance of the amendments.
 • Allows for changes in critical terms of a hedging relationship without automatic termination of that relationship. Provides various practical expedients and elections designed to allow hedge accounting to continue uninterrupted during the transition period.
 • Provides a one-time election to transfer securities out of the held-to-maturity classification if certain criteria are met.
•
Issued and effective March 12, 2020.
•
The Firm expects to apply certain of the practical expedients related to contract modifications and hedge accounting relationships in the second half of 2020 and does not expect a material effect onimpact to the Consolidated Financial Statements. However, the impact of the new accounting guidance will depend on the performance of the reporting units and the market conditions at the time of adoption.
 • After adoption, the guidance may result in more frequent goodwill impairment losses due to the removal of the second condition.
 • The Firm plans to adopt the new guidance on January 1, 2020.
(a)Early adoption is permitted.


FORWARD-LOOKING STATEMENTS
From time to time, the Firm has made and will make forward-looking statements. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “anticipate,” “target,” “expect,” “estimate,” “intend,” “plan,” “goal,” “believe,” or other words of similar meaning. Forward-looking statements provide JPMorgan Chase’s current expectations or forecasts of future events, circumstances, results or aspirations. JPMorgan Chase’s disclosures in this Form 10-Q contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Firm also may make forward-looking statements in its other documents filed or furnished with the SEC. In addition, the Firm’s senior management may make forward-looking statements orally to investors, analysts, representatives of the media and others.
All forward-looking statements are, by their nature, subject to risks and uncertainties, many of which are beyond the Firm’s control. JPMorgan Chase’s actual future results may differ materially from those set forth in its forward-looking statements. While there is no assurance that any list of risks and uncertainties or risk factors is complete, below are certain factors which could cause actual results to differ from those in the forward-looking statements:
Economic, financial, reputational and other impacts of the COVID-19 pandemic;
Local, regional and global business, economic and political conditions and geopolitical events;
Changes in laws and regulatory requirements, including capital and liquidity requirements affecting the Firm’s businesses, and the ability of the Firm to address those requirements;
Heightened regulatory and governmental oversight and scrutiny of JPMorgan Chase’s business practices, including dealings with retail customers;
Changes in trade, monetary and fiscal policies and laws;
Changes in income tax laws and regulations;
Securities and capital markets behavior, including changes in market liquidity and volatility;
Changes in investor sentiment or consumer spending or savings behavior;
Ability of the Firm to manage effectively its capital and liquidity, including approval of its capital plans by banking regulators;
Changes in credit ratings assigned to the Firm or its subsidiaries;
Damage to the Firm’s reputation;
Ability of the Firm to appropriately address social and environmental and sustainability concerns that may arise, including from its business activities;
Ability of the Firm to deal effectively with an economic slowdown or other economic or market disruption, including, but not limited to, in the interest rate environment;
 
Technology changes instituted by the Firm, its counterparties or competitors;
The effectiveness of the Firm’s control agenda;
Ability of the Firm to develop or discontinue products and services, and the extent to which products or services previously sold by the Firm (including but not limited to mortgages and asset-backed securities) require the Firm to incur liabilities or absorb losses not contemplated at their initiation or origination;
Acceptance of the Firm’s new and existing products and services by the marketplace and the ability of the Firm to innovate and to increase market share;
Ability of the Firm to attract and retain qualified employees;
Ability of the Firm to control expenses;
Competitive pressures;
Changes in the credit quality of the Firm’s clients, customers and counterparties;
Adequacy of the Firm’s risk management framework, disclosure controls and procedures and internal control over financial reporting;
Adverse judicial or regulatory proceedings;
Changes in applicable accounting policies, including the introduction of new accounting standards;
Ability of the Firm to determine accurate values of certain assets and liabilities;
Occurrence of natural or man-made disasters or calamities, including health emergencies, the spread of infectious diseases, pandemics or conflictsoutbreaks of hostilities, or the effects of climate change, and the Firm’s ability to deal effectively with disruptions caused by the foregoing;
Ability of the Firm to maintain the security of its financial, accounting, technology, data processing and other operational systems and facilities;
Ability of the Firm to withstand disruptions that may be caused by any failure of its operational systems or those of third parties;
Ability of the Firm to effectively defend itself against cyberattacks and other attempts by unauthorized parties to access information of the Firm or its customers or to disrupt the Firm’s systems; and
The other risks and uncertainties detailed in Part I,II,
Item 1A: Risk Factors in this form 10-Q and Part I, Item 1A: Risk Factors in JPMorgan Chase’s 20182019 Form 10-K.
Any forward-looking statements made by or on behalf of the Firm speak only as of the date they are made, and JPMorgan Chase does not undertake to update any forward-looking statements. The reader should, however, consult any further disclosures of a forward-looking nature the Firm may make in any subsequent Form 10-Ks, Quarterly Reports on Form 10-Qs, or Current Reports on Form 8-K.


JPMorgan Chase & Co.
Consolidated statements of income (unaudited)
 Three months ended
September 30,		 Nine months ended
September 30,		 Three months ended
June 30,		 Six months ended
June 30,
(in millions, except per share data) 2019
 2018
 2019
 2018
 2020
 2019
 2020
 2019
Revenue                
Investment banking fees $1,967
 $1,832
 $5,658
 $5,736
 $2,850
 $1,851
 $4,716
 $3,691
Principal transactions 3,449
 2,964
 11,239
 10,698
 7,621
 3,714
 10,558
 7,790
Lending- and deposit-related fees(a) 1,626
 1,542
 4,643
 4,514
 1,431
 1,624
 3,137
 3,183
Asset management, administration and commissions(a) 4,351
 4,310
 12,818
 12,923
 4,266
 4,264
 8,806
 8,301
Investment securities gains/(losses) 78
 (46) 135
 (371)
Investment securities gains 26
 44
 259
 57
Mortgage fees and related income 887
 262
 1,562
 1,051
 917
 279
 1,237
 675
Card income(b) 1,283
 1,328
 3,923
 3,623
 974
 1,281
 1,969
 2,508
Other income 1,472
 1,160
 4,239
 4,041
 1,042
 1,292
 2,198
 2,767
Noninterest revenue 15,113
 13,352
 44,217
 42,215
 19,127
 14,349
 32,880
 28,972
Interest income (a)
 21,121
 19,439
 64,113
 55,499
 16,112
 21,603
 35,273
 42,992
Interest expense (a)
 6,893
 5,531
 21,034
 14,794
 2,259
 7,205
 6,981
 14,141
Net interest income 14,228
 13,908
 43,079
 40,705
 13,853
 14,398
 28,292
 28,851
Total net revenue 29,341
 27,260
 87,296
 82,920
 32,980
 28,747
 61,172
 57,823
                
Provision for credit losses 1,514
 948
 4,158
 3,323
 10,473
 1,149
 18,758
 2,644
                
Noninterest expense                
Compensation expense 8,583
 8,108
 26,067
 25,308
 9,509
 8,547
 18,404
 17,484
Occupancy expense 1,110
 1,014
 3,238
 2,883
 1,080
 1,060
 2,146
 2,128
Technology, communications and equipment expense 2,494
 2,219
 7,236
 6,441
 2,590
 2,378
 5,168
 4,742
Professional and outside services 2,056
 2,086
 6,307
 6,333
 1,999
 2,212
 4,027
 4,251
Marketing(b) 945
 798
 2,686
 2,396
 481
 777
 1,281
 1,609
Other expense 1,234
 1,398
 3,624
 4,313
 1,283
 1,282
 2,707
 2,390
Total noninterest expense 16,422
 15,623
 49,158
 47,674
 16,942
 16,256
 33,733
 32,604
Income before income tax expense 11,405
 10,689
 33,980
 31,923
 5,565
 11,342
 8,681
 22,575
Income tax expense 2,325
 2,309
 6,069
 6,515
 878
 1,690
 1,129
 3,744
Net income $9,080
 $8,380
 $27,911
 $25,408
 $4,687
 $9,652
 $7,552
 $18,831
Net income applicable to common stockholders $8,606
 $7,948
 $26,551
 $24,067
 $4,265
 $9,192
 $6,698
 $17,945
Net income per common share data                
Basic earnings per share $2.69
 $2.35
 $8.17
 $7.04
 $1.39
 $2.83
 $2.17
 $5.48
Diluted earnings per share 2.68
 2.34
 8.15
 7.00
 1.38
 2.82
 2.17
 5.46
                
Weighted-average basic shares 3,198.5
 3,376.1
 3,248.7
 3,416.5
 3,076.3
 3,250.6
 3,086.1
 3,274.3
Weighted-average diluted shares 3,207.2
 3,394.3
 3,258.0
 3,436.2
 3,081.0
 3,259.7
 3,090.8
 3,283.9


(a)In the secondfirst quarter of 2019,2020, the Firm implementedreclassified certain presentation changes that impacted interest incomefees from asset management, administration and interest expense, but had no effect on net interest income. These changes were applied retrospectivelycommissions to lending- and accordingly, prior perioddeposit-related fees. Prior-period amounts werehave been revised to conform with the current presentation. Refer
(b)In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to Note 6 for additional information.be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.

The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.




JPMorgan Chase & Co.
Consolidated statements of comprehensive income (unaudited)
 Three months ended
September 30,		 Nine months ended
September 30,		 Three months ended
June 30,		 Six months ended
June 30,
(in millions) 2019
 2018
 2019
 2018
 2020
 2019
 2020
 2019
Net income $9,080
 $8,380
 $27,911
 $25,408
 $4,687
 $9,652
 $7,552
 $18,831
Other comprehensive income/(loss), after–tax                
Unrealized gains/(losses) on investment securities 479
 (819) 2,986
 (2,280) 2,744
 1,093
 3,863
 2,507
Translation adjustments, net of hedges (165) (31) (90) 84
 142
 99
 (188) 75
Fair value hedges (1) 34
 87
 (74) 16
 86
 104
 88
Cash flow hedges 195
 (88) 430
 (327) 234
 97
 2,699
 235
Defined benefit pension and OPEB plans 46
 19
 123
 78
 (7) 41
 26
 77
DVA on fair value option elected liabilities 132
 (402) (229) 125
 (1,758) 256
 716
 (361)
Total other comprehensive income/(loss), after–tax 686
 (1,287) 3,307
 (2,394) 1,371
 1,672
 7,220
 2,621
Comprehensive income $9,766
 $7,093
 $31,218
 $23,014
 $6,058
 $11,324
 $14,772
 $21,452

The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.


JPMorgan Chase & Co.
Consolidated balance sheets (unaudited)
(in millions, except share data)September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
Assets      
Cash and due from banks$21,215
 $22,324
$20,544
 $21,704
Deposits with banks235,382
 256,469
473,185
 241,927
Federal funds sold and securities purchased under resale agreements (included $13,705 and $13,235 at fair value)
257,391
 321,588
Securities borrowed (included $5,784 and $5,105 at fair value)
138,336
 111,995
Trading assets (included assets pledged of $138,827 and $89,073)
495,875
 413,714
Investment securities (included $353,421 and $230,394 at fair value and assets pledged of $12,518 and $11,432)
394,251
 261,828
Loans (included $5,760 and $3,151 at fair value)
945,218
 984,554
Federal funds sold and securities purchased under resale agreements (included $243,953 and $14,561 at fair value)
256,980
 249,157
Securities borrowed (included $42,525 and $6,237 at fair value)
142,704
 139,758
Trading assets (included assets pledged of $158,131 and $111,522)
526,042
 411,103
Available-for-sale securities (amortized cost of $476,383 and $345,306; included assets pledged of $28,475 and $10,325)
485,883
 350,699
Held-to-maturity securities (net of allowance for credit losses of $23)
72,908
 47,540
Investment securities, net of allowance for credit losses558,791
 398,239
Loans (included $5,923 and $7,104 at fair value)
978,518
 959,769
Allowance for loan losses(13,235) (13,445)(32,092) (13,123)
Loans, net of allowance for loan losses931,983
 971,109
946,426
 946,646
Accrued interest and accounts receivable88,988
 73,200
72,260
 72,861
Premises and equipment25,117
 14,934
26,301
 25,813
Goodwill, MSRs and other intangible assets53,078
 54,349
51,669
 53,341
Other assets (included $8,916 and $9,630 at fair value and assets pledged of $2,834 and $3,457)
123,045
 121,022
Other assets (included $12,528 and $9,111 at fair value and assets pledged of $3,124 and $3,349)
138,213
 126,830
Total assets(a)
$2,764,661
 $2,622,532
$3,213,115
 $2,687,379
Liabilities      
Deposits (included $29,355 and $23,217 at fair value)
$1,525,261
 $1,470,666
Federal funds purchased and securities loaned or sold under repurchase agreements (included $933 and $935 at fair value)
247,766
 182,320
Short-term borrowings (included $6,497 and $7,130 at fair value)
48,893
 69,276
Deposits (included $21,512 and $28,589 at fair value)
$1,931,029
 $1,562,431
Federal funds purchased and securities loaned or sold under repurchase agreements (included $189,341 and $549 at fair value)
235,647
 183,675
Short-term borrowings (included $19,934 and $5,920 at fair value)
48,014
 40,920
Trading liabilities138,343
 144,773
165,212
 119,277
Accounts payable and other liabilities (included $2,411 and $3,269 at fair value)
225,063
 196,710
Beneficial interests issued by consolidated VIEs (included $39 and $28 at fair value)
18,515
 20,241
Long-term debt (included $71,957 and $54,886 at fair value)
296,472
 282,031
Accounts payable and other liabilities (included $3,318 and $3,728 at fair value)
230,916
 210,407
Beneficial interests issued by consolidated VIEs (included $40 and $36 at fair value)
20,828
 17,841
Long-term debt (included $74,758 and $75,745 at fair value)
317,003
 291,498
Total liabilities(a)
2,500,313
 2,366,017
2,948,649
 2,426,049
Commitments and contingencies (refer to Notes 22, 23 and 24)


 


Commitments and contingencies (refer to Notes 23, 24 and 25)


 


Stockholders’ equity      
Preferred stock ($1 par value; authorized 200,000,000 shares; issued 2,836,250 and 2,606,750 shares)
28,363
 26,068
Preferred stock ($1 par value; authorized 200,000,000 shares; issued 3,006,250 and 2,699,250 shares)
30,063
 26,993
Common stock ($1 par value; authorized 9,000,000,000 shares; issued 4,104,933,895 shares)
4,105
 4,105
4,105
 4,105
Additional paid-in capital88,512
 89,162
88,125
 88,522
Retained earnings217,888
 199,202
221,732
 223,211
Accumulated other comprehensive income/(loss)1,800
 (1,507)8,789
 1,569
Shares held in restricted stock units (“RSU”) Trust, at cost (472,953 shares)(21) (21)
Treasury stock, at cost (968,448,971 and 829,167,674 shares)
(76,299) (60,494)
Shares held in restricted stock units (“RSU”) Trust, at cost (236,476 and 472,953 shares)
(11) (21)
Treasury stock, at cost (1,057,329,408 and 1,020,912,567 shares)
(88,337) (83,049)
Total stockholders’ equity264,348
 256,515
264,466
 261,330
Total liabilities and stockholders’ equity$2,764,661
 $2,622,532
$3,213,115
 $2,687,379

(a)The following table presents information on assets and liabilities related to VIEs that are consolidated by the Firm at September 30, 2019, and December 31, 2018. The assets of the consolidated VIEs are used to settle the liabilities of those entities. The holders of the beneficial interests generally do not have recourse to the general credit of JPMorgan Chase. The assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation. Refer to Note 13 for a further discussion.
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. Refer to Note 1 for further information.
(a) The following table presents information on assets and liabilities related to VIEs that are consolidated by the Firm at June 30, 2020, and December 31, 2019. The assets of the consolidated VIEs are used to settle the liabilities of those entities. The holders of the beneficial interests generally do not have recourse to the general credit of JPMorgan Chase. The assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation. Refer to Note 14 for a further discussion.
(in millions)September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
Assets      
Trading assets$1,461
 $1,966
$2,265
 $2,633
Loans53,022
 59,456
38,384
 42,931
All other assets974
 1,013
1,569
 881
Total assets$55,457
 $62,435
$42,218
 $46,445
Liabilities      
Beneficial interests issued by consolidated VIEs$18,515
 $20,241
$20,828
 $17,841
All other liabilities301
 312
243
 447
Total liabilities$18,816
 $20,553
$21,071
 $18,288
The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.

JPMorgan Chase & Co.
Consolidated statements of changes in stockholders’ equity (unaudited)
 Three months ended September 30,  Nine months ended September 30,  Three months ended June 30, Six months ended June 30,
(in millions, except per share data) 2019
 2018
 2019
 2018
 2020 2019 2020 2019
Preferred stock                
Balance at the beginning of the period $26,993
 $26,068
 $26,068
 $26,068
 $30,063
 $26,993
 $26,993
 $26,068
Issuance 2,250
 1,696
 4,100
 1,696
 —
 —
 4,500
 1,850
Redemption (880) —
 (1,805) —
 —
 —
 (1,430) (925)
Balance at September 30 28,363
 27,764
 28,363
 27,764
Balance at June 30 30,063
 26,993
 30,063
 26,993
                
Common stock                
Balance at the beginning and end of the period 4,105
 4,105
 4,105
 4,105
 4,105
 4,105
 4,105
 4,105
                
Additional paid-in capital                
Balance at the beginning of the period 88,359
 89,392
 89,162
 90,579
 87,857
 88,170
 88,522
 89,162
Shares issued and commitments to issue common stock for employee shared-based compensation awards, and related tax effects 156
 179
 (604) (897) 268
 189
 (392) (760)
Other (3) (238) (46) (349) —
 —
 (5) (43)
Balance at September 30 88,512
 89,333
 88,512
 89,333
Balance at June 30 88,125
 88,359
 88,125
 88,359
                
Retained earnings                
Balance at the beginning of the period 212,093
 189,881
 199,202
 177,676
 220,226
 205,437
 223,211
 199,202
Cumulative effect of changes in accounting principles —
 —
 62
 (183)
Cumulative effect of changes in accounting principle —
 —
 (2,650) 62
Net income 9,080
 8,380
 27,911
 25,408
 4,687
 9,652
 7,552
 18,831
Dividends declared:                
Preferred stock (423) (379) (1,201) (1,167) (401) (404) (822) (778)
Common stock ($0.90 and $0.80 per share and $2.50 and $1.92 per share, respectively)
 (2,862) (2,702) (8,086) (6,554)
Balance at September 30 217,888
 195,180
 217,888
 195,180
Common stock ($0.90 and $0.80 per share and $1.80 and $1.60 per share, respectively)
 (2,780) (2,592) (5,559) (5,224)
Balance at June 30 221,732
 212,093
 221,732
 212,093
                
Accumulated other comprehensive income/(loss)                
Balance at the beginning of the period 1,114
 (1,138) (1,507) (119) 7,418
 (558) 1,569
 (1,507)
Cumulative effect of changes in accounting principles —
 —
 —
 88
Other comprehensive income/(loss), after-tax 686
 (1,287) 3,307
 (2,394) 1,371
 1,672
 7,220
 2,621
Balance at September 30 1,800
 (2,425) 1,800
 (2,425)
Balance at June 30 8,789
 1,114
 8,789
 1,114
                
Shares held in RSU Trust, at cost                
Balance at the beginning and end of the period (21) (21) (21) (21)
Balance at the beginning of the period

 (21) (21) (21) (21)
Liquidation of RSU Trust 10
 —
 10
 —
Balance at June 30 (11) (21) (11) (21)
                
Treasury stock, at cost                
Balance at the beginning of the period (69,428) (50,829) (60,494) (42,595) (88,386) (64,289) (83,049) (60,494)
Repurchase (6,949) (4,416) (17,250) (14,055) —
 (5,210) (6,397) (10,301)
Reissuance 78
 265
 1,445
 1,670
 49
 71
 1,109
 1,367
Balance at September 30 (76,299) (54,980) (76,299) (54,980)
Balance at June 30 (88,337) (69,428) (88,337) (69,428)
                
Total stockholders’ equity $264,348
 $258,956
 $264,348
 $258,956
 $264,466
 $263,215
 $264,466
 $263,215


Effective January 1, 2020, the Firm adopted the CECL accounting guidance. Refer to Note 1 for further information.
The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.


JPMorgan Chase & Co.
Consolidated statements of cash flows (unaudited)
Nine months ended September 30,Six months ended June 30,
(in millions)2019
 2018
2020
 2019
Operating activities      
Net income$27,911
 $25,408
$7,552
 $18,831
Adjustments to reconcile net income to net cash used in operating activities:      
Provision for credit losses4,158
 3,323
18,758
 2,644
Depreciation and amortization6,229
 5,716
4,346
 4,084
Deferred tax (benefit)/expense(440) (323)(4,846) (42)
Other1,645
 2,179
1,197
 1,164
Originations and purchases of loans held-for-sale(53,934) (68,235)(29,412) (35,908)
Proceeds from sales, securitizations and paydowns of loans held-for-sale60,510
 68,214
27,811
 44,995
Net change in:      
Trading assets(96,125) (44,427)(126,476) (111,562)
Securities borrowed(26,162) (17,344)(2,777) (18,586)
Accrued interest and accounts receivable(16,089) (11,335)374
 (15,416)
Other assets(21,181) 2,909
(24,157) (10,146)
Trading liabilities12,774
 21,580
69,341
 12,765
Accounts payable and other liabilities19,661
 26,677
18,940
 8,790
Other operating adjustments4,004
 (577)2,317
 3,653
Net cash provided by/(used in) operating activities(77,039) 13,765
Net cash (used in) operating activities(37,032) (94,734)
Investing activities      
Net change in:      
Federal funds sold and securities purchased under resale agreements64,207
 (19,259)(7,580) 53,757
Held-to-maturity securities:      
Proceeds from paydowns and maturities2,239
 2,268
5,632
 1,315
Purchases(11,682) (8,613)(5,014) (818)
Available-for-sale securities:      
Proceeds from paydowns and maturities41,378
 29,618
27,070
 30,547
Proceeds from sales43,460
 34,322
65,975
 35,983
Purchases(200,262) (46,530)(242,608) (106,085)
Proceeds from sales and securitizations of loans held-for-investment52,739
 20,154
12,185
 31,291
Other changes in loans, net(25,977) (49,755)(33,372) (16,903)
Net purchases of assets pursuant to nonrecourse advances provided by the FRBB under the MMLF(3,787) —
All other investing activities, net(4,283) (1,987)(2,118) (1,663)
Net cash (used in) investing activities(38,181) (39,782)
Net cash provided by/(used in) investing activities(183,617) 27,424
Financing activities      
Net change in:      
Deposits77,147
 15,274
382,784
 62,795
Federal funds purchased and securities loaned or sold under repurchase agreements65,428
 22,719
51,894
 19,343
Short-term borrowings(20,577) 12,974
7,992
 (9,907)
Beneficial interests issued by consolidated VIEs5,017
 975
3,619
 9,346
Proceeds from long-term borrowings45,155
 54,842
57,744
 29,159
Payments of long-term borrowings(51,936) (69,636)(42,944) (38,384)
Proceeds from issuance of preferred stock4,100
 1,655
4,500
 1,850
Redemption of preferred stock(1,805) —
(1,430) (925)
Treasury stock repurchased(17,250) (14,055)(6,517) (10,301)
Dividends paid(9,056) (6,989)(6,342) (6,081)
All other financing activities, net(217) (1,440)136
 (426)
Net cash provided by financing activities96,006
 16,319
451,436
 56,469
Effect of exchange rate changes on cash and due from banks and deposits with banks(2,982) (2,509)(689) 86
Net decrease in cash and due from banks and deposits with banks(22,196) (12,207)
Net increase/(decrease) in cash and due from banks and deposits with banks230,098
 (10,755)
Cash and due from banks and deposits with banks at the beginning of the period278,793
 431,304
263,631
 278,793
Cash and due from banks and deposits with banks at the end of the period$256,597
 $419,097
$493,729
 $268,038
Cash interest paid$20,790
 $15,144
$9,239
 $13,794
Cash income taxes paid, net3,478
 2,197
3,844
 2,892


The Notes to Consolidated Financial Statements (unaudited) are an integral part of these statements.

Refer to the Glossary of Terms and Acronyms on pages 168–172191-199 for definitions of terms and acronyms used throughout the Notes to Consolidated Financial Statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
Note 1 – Basis of presentation
JPMorgan Chase & Co. (“JPMorgan Chase” or “the Firm”), a financial holding company incorporated under Delaware law in 1968, is a leading global financial services firm and one of the largest banking institutions in the U.S., with operations worldwide. The Firm is a leader in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing and asset management. Refer to Note 2526 for a further discussion of the Firm’s business segments.
The accounting and financial reporting policies of JPMorgan Chase and its subsidiaries conform to U.S. GAAP. Additionally, where applicable, the policies conform to the accounting and reporting guidelines prescribed by regulatory authorities.
The unaudited Consolidated Financial Statements prepared in conformity with U.S. GAAP require management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expense, and the disclosures of contingent assets and liabilities. Actual results could be different from these estimates. In the opinion of management, all normal, recurring adjustments have been included such that this interim financial information is fairly presented.stated.
These unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements, and related notes thereto, included in JPMorgan Chase’s 20182019 Form 10-K.
Certain amounts reported in prior periods have been reclassified to conform with the current presentation.
Consolidation
The Consolidated Financial Statements include the accounts of JPMorgan Chase and other entities in which the Firm has a controlling financial interest. All material intercompany balances and transactions have been eliminated.
Assets held for clients in an agency or fiduciary capacity by the Firm are not assets of JPMorgan Chase and are not included on the Consolidated balance sheets.
The Firm determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a voting interest entity or a variable interest entity.
Refer to Notes 1 and 14 of JPMorgan Chase’s 20182019 Form     10-K for a further description of JPMorgan Chase’s accounting policies regarding consolidation.
Offsetting assets and liabilities
U.S. GAAP permits entities to present derivative receivables and derivative payables with the same counterparty and the related cash collateral receivables and payables on a net
basis on the Consolidated balance sheets when a legally enforceable master netting agreement exists. U.S. GAAP also permits securities financing activities to be presented on a net basis when specified conditions are met, including the existence of a legally enforceable master netting agreement. The Firm has elected to net such balances when the specified conditions are met. Refer to Note 1 of JPMorgan Chase’s 20182019 Form 10-K for further information on offsetting assets and liabilities.
Income tax expense
Accounting standard adopted January 1, 2020
Financial Instruments – Credit Losses (“CECL”)
The adoption of this guidance established a single allowance framework for all financial assets measured at amortized cost and certain off-balance sheet credit exposures. This framework requires that management’s estimate reflects credit losses over the instrument’s remaining expected life and considers expected future changes in macroeconomic conditions. Refer to Note 13 for further information.
The following table presents the impacts to the allowance for credit losses and retained earnings upon adoption of this guidance on January 1, 2020:
(in billions)December 31, 2019CECL adoption impactJanuary 1, 2020
Allowance for credit losses   
Consumer, excluding credit card(a)
$2.6
$0.4
$3.0
Credit card5.7
5.5
11.2
Wholesale(a)
6.0
(1.6)4.4
Firmwide$14.3
$4.3
$18.6
    
Retained earnings   
Firmwide allowance increase $4.3
 
Balance sheet reclassification(b)
 (0.8) 
Total pre-tax impact 3.5
 
Tax effect (0.8) 
Decrease to retained earnings $2.7
 
(a)In conjunction with the adoption of CECL, the Firm reclassified risk-rated business banking and auto dealer loans and lending-related commitments held in CCB from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Accordingly, $0.6 billion of the allowance for credit losses at December 31, 2019 and $(0.2) billion of the CECL adoption impact were reclassified.
(b)Represents the recognition of the nonaccretable difference on purchased credit deteriorated loans and the Firm's election to recognize the reserve for uncollectible accrued interest on credit card loans in the allowance, both of which resulted in a corresponding increase to loans.
Securities Financing Agreements
As permitted by the guidance, the Firm elected the fair value option for certain securities financing agreements. The difference between their carrying amount and fair value was immaterial and was recorded as part of the Firm’s effective tax rate was 20.4% and 17.9%cumulative-effect adjustment. Refer to Note 11 for further information.
Investment securities
Upon adoption, HTM securities are presented net of an allowance for credit losses. The guidance also amended the previous other-than-temporary impairment (“OTTI”) model for AFS securities to incorporate an allowance. Refer to Note 10 for further information.
Credit quality disclosures
As a result of the adoption of this guidance, the Firm expanded credit quality disclosures for financial assets measured at amortized cost particularly within the retained loan portfolios. Refer to Note 12 for further information.
PCD loans
The adoption resulted in a change in the three and nine months ended September 30, 2019, respectively, and 21.6% and 20.4%accounting for PCI loans, which are considered purchased credit deteriorated (“PCD”) loans under CECL. Upon adoption, the Firm recognized the nonaccretable difference on PCD loans in the respective 2018 periods. For the nine months ended September 30, 2019, the effective tax rate reflected the recognition of $1.0 billionallowance, which resulted in tax benefits relateda corresponding increase to loans. PCD loans are subject to the resolutionFirm’s nonaccrual and charge-off policies and are now reported in the consumer, excluding credit card portfolio’s residential real estate loan class. Refer to Note 12 for further information.
Changes in credit portfolio segments and classes
In conjunction with the adoption of certain tax audits, which reducedCECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer excluding credit card portfolio segment to the wholesale portoflio segment, to align with the methodology applied when determining the allowance. The Firm also revised its loan classes. Prior- period amounts have been revised to conform with the current presentation. Refer to Note 12 for further information.
Accrued interest receivables
As permitted by the guidance, the Firm elected to continue classifying accrued interest on loans, including accrued but unbilled interest on credit card loans, and investment securities in accrued interest and accounts receivables on the Consolidated balance sheets. For credit card loans, accrued interest once billed is then recognized in the loan balances, with the related allowance recorded in the allowance for credit losses. Changes in the allowance for credit losses on accrued interest on credit card loans are recognized in the provision for credit losses and charge-offs are recognized by reversing interest income. For other loans and securities, the Firm generally does not recognize an allowance for credit losses on accrued interest receivables, consistent with its policy to write them off no later than 90 days past due by reversing interest income.
Capital transition provisions
As disclosed in the Firm’s effective tax rate2019 Form 10-K, the Firm initially elected to phase-in the January 1, 2020 (“day 1”) CECL adoption impact to retained earnings of $2.7 billion to CET1 capital, at 25% per year in each of 2020 to 2023. As part of their response to the impact of the COVID-19 pandemic, on March 31, 2020, the federal banking agencies issued an interim final rule that provided the option to delay the effects of CECL on regulatory capital for two years, followed by 3.0%a three-year transition period (“CECL capital transition provisions”). Refer to Note 24 of JPMorgan Chase’s 2018 Form 10-K22 for further information.

Note 2 – Fair value measurement
Refer to Note 2 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the Firm’s valuation methodologies for assets, liabilities and lending-related commitments measured at fair value and the fair value hierarchy.



The following table presents the assets and liabilities reported at fair value as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, by major product category and fair value hierarchy.
Assets and liabilities measured at fair value on a recurring basisAssets and liabilities measured at fair value on a recurring basis




Assets and liabilities measured at fair value on a recurring basis





Fair value hierarchy
Derivative
netting
adjustments(f)

Fair value hierarchy
Derivative
netting
adjustments(f)

          
September 30, 2019 (in millions)Level 1Level 2
Level 3
Total fair value
June 30, 2020 (in millions)Level 1Level 2
Level 3
Derivative
netting
adjustments(f)
Total fair value
Federal funds sold and securities purchased under resale agreements$—
$13,705

$—

$—
$13,705
$—
$243,953

$—

$243,953
Securities borrowed—
5,784

—

—
5,784
—
42,525

—

42,525
Trading assets:























Debt instruments:























Mortgage-backed securities:























U.S. GSEs and government agencies(a)
—
70,617

811

—
71,428
—
68,115

469

—
68,584
Residential – nonagency—
2,253

24

—
2,277
—
2,314

23

—
2,337
Commercial – nonagency—
1,613

5

—
1,618
—
1,477

2

—
1,479
Total mortgage-backed securities—
74,483

840

—
75,323
—
71,906

494

—
72,400
U.S. Treasury, GSEs and government agencies(a)
76,953
9,446

—

—
86,399
117,168
11,886

—

—
129,054
Obligations of U.S. states and municipalities—
6,229

627

—
6,856
—
7,484

8

—
7,492
Certificates of deposit, bankers’ acceptances and commercial paper—
2,180
 —
 —
2,180
—
2,058
 —
 —
2,058
Non-U.S. government debt securities38,162
36,634
 146
 —
74,942
32,563
34,972
 167
 —
67,702
Corporate debt securities—
20,461
 484
 —
20,945
—
20,792
 946
 —
21,738
Loans(b)
—
43,308
 1,746
 —
45,054
—
38,060
 2,678
 —
40,738
Asset-backed securities—
2,996
 38
 —
3,034
—
2,375
 39
 —
2,414
Total debt instruments115,115
195,737
 3,881
 —
314,733
149,731
189,533
 4,332
 —
343,596
Equity securities100,829
249
 170
 —
101,248
85,042
81
 191
 —
85,314
Physical commodities(c)
7,690
3,075
 —
 —
10,765
5,094
3,680
 —
 —
8,774
Other—
13,172
 332
 —
13,504
—
13,088
 379
 —
13,467
Total debt and equity instruments(d)
223,634
212,233
 4,383
 —
440,250
239,867
206,382
 4,902
 —
451,151
Derivative receivables:          
Interest rate1,312
372,834
 1,787
 (347,426)28,507
2,210
404,569
 2,213
 (371,964)37,028
Credit—
15,072
 645
 (14,879)838
—
14,153
 780
 (13,762)1,171
Foreign exchange3,681
158,893
 558
 (150,451)12,681
158
162,834
 803
 (151,220)12,575
Equity—
44,064
 2,314
 (38,969)7,409
—
63,304
 4,628
 (53,075)14,857
Commodity—
20,969
 269
 (15,096)6,142
—
25,405
 213
 (16,403)9,215
Total derivative receivables4,993
611,832
 5,573
 (566,821)55,577
2,368
670,265
 8,637
 (606,424)74,846
Total trading assets(e)
228,627
824,065
 9,956
 (566,821)495,827
242,235
876,647
 13,539
 (606,424)525,997
Available-for-sale securities:          
Mortgage-backed securities:          
U.S. GSEs and government agencies(a)
—
105,581
 —
 —
105,581
5
152,301
 —
 —
152,306
Residential – nonagency—
12,901
 1
 —
12,902
—
18,269
 —
 —
18,269
Commercial – nonagency—
5,324
 —
 —
5,324
—
6,805
 —
 —
6,805
Total mortgage-backed securities—
123,806
 1
 —
123,807
5
177,375
 —
 —
177,380
U.S. Treasury and government agencies141,529
—
 —
 —
141,529
214,462
—
 —
 —
214,462
Obligations of U.S. states and municipalities—
31,064
 —
 —
31,064
—
30,426
 —
 —
30,426
Certificates of deposit—
74
 —
 —
74
—
—
 —
 —
—
Non-U.S. government debt securities13,604
8,554
 —
 —
22,158
13,743
10,317
 —
 —
24,060
Corporate debt securities—
1,634
 —
 —
1,634
—
674
 —
 —
674
Asset-backed securities:          
Collateralized loan obligations—
27,908
 —
 —
27,908
—
30,798
 —
 —
30,798
Other—
5,247
 —
 —
5,247
—
8,083
 —
 —
8,083
Total available-for-sale securities155,133
198,287
 1
 —
353,421
228,210
257,673
 —
 —
485,883
Loans—
5,759
 1
 —
5,760
—
5,662
 261
 —
5,923
Mortgage servicing rights—
—
 4,419
 —
4,419
—
—
 3,080
 —
3,080
Other assets(e)
7,467
37
 746
 —
8,250
6,969
4,361
 541
 —
11,871
Total assets measured at fair value on a recurring basis$391,227
$1,047,637
 $15,123
 $(566,821)$887,166
$477,414
$1,430,821
 $17,421
 $(606,424)$1,319,232
Deposits$—
$25,719
 $3,636
 $—
$29,355
$—
$18,295
 $3,217
 $—
$21,512
Federal funds purchased and securities loaned or sold under repurchase agreements—
933
 —
 —
933
—
189,341
 —
 —
189,341
Short-term borrowings—
4,496
 2,001
 —
6,497
—
17,629
 2,305
 —
19,934
Trading liabilities:     

     

Debt and equity instruments(d)
66,515
23,970
 68
 —
90,553
84,681
22,995
 59
 —
107,735
Derivative payables:     

     

Interest rate1,206
335,401
 2,106
 (328,490)10,223
2,052
365,150
 2,317
 (356,749)12,770
Credit—
16,100
 962
 (14,903)2,159
—
15,009
 917
 (13,846)2,080
Foreign exchange3,583
160,760
 1,399
 (150,726)15,016
140
175,118
 1,398
 (160,479)16,177
Equity—
45,109
 5,782
 (40,288)10,603
—
62,046
 6,664
 (52,748)15,962
Commodity—
25,495
 316
 (16,022)9,789
—
26,637
 510
 (16,659)10,488
Total derivative payables4,789
582,865
 10,565
 (550,429)47,790
2,192
643,960
 11,806
 (600,481)57,477
Total trading liabilities71,304
606,835
 10,633
 (550,429)138,343
86,873
666,955
 11,865
 (600,481)165,212
Accounts payable and other liabilities2,355
37
 19
 —
2,411
2,648
579
 91
 —
3,318
Beneficial interests issued by consolidated VIEs—
39
 —
 —
39
—
40
 —
 —
40
Long-term debt—
49,608
 22,349
 —
71,957
—
52,030
 22,728
 —
74,758
Total liabilities measured at fair value on a recurring basis$73,659
$687,667
 $38,638
 $(550,429)$249,535
$89,521
$944,869
 $40,206
 $(600,481)$474,115




Fair value hierarchy
Derivative
netting
adjustments(f)
 
Fair value hierarchy
Derivative
netting
adjustments(f)
 
          
December 31, 2018 (in millions)Level 1Level 2
Level 3
 Total fair value
December 31, 2019 (in millions)Level 1Level 2
Level 3
Derivative
netting
adjustments(f)
 Total fair value
Federal funds sold and securities purchased under resale agreements$—
$13,235

$—

$—
 $13,235
$—
$14,561

$—

 $14,561
Securities borrowed—
5,105

—

—
 5,105
—
6,237

—

 6,237
Trading assets: 
 
    
 
   
Debt instruments: 
 
    
 
   
Mortgage-backed securities: 
 
    
 
   
U.S. GSEs and government agencies(a)
—
76,249

549

—
 76,798
—
44,510

797

—
 45,307
Residential – nonagency—
1,798

64

—
 1,862
—
1,977

23

—
 2,000
Commercial – nonagency—
1,501

11

—
 1,512
—
1,486

4

—
 1,490
Total mortgage-backed securities—
79,548

624

—
 80,172
—
47,973

824

—
 48,797
U.S. Treasury, GSEs and government agencies(a)
51,477
7,702

—

—
 59,179
78,289
10,295

—

—
 88,584
Obligations of U.S. states and municipalities—
7,121

689

—
 7,810
—
6,468

10

—
 6,478
Certificates of deposit, bankers’ acceptances and commercial paper—
1,214

—

—
 1,214
—
252

—

—
 252
Non-U.S. government debt securities27,878
27,056

155

—
 55,089
26,600
27,169

155

—
 53,924
Corporate debt securities—
18,655

334

—
 18,989
—
17,956

558

—
 18,514
Loans(b)
—
40,047

1,706

—
 41,753
—
47,047

1,382

—
 48,429
Asset-backed securities—
2,756

127

—
 2,883
—
2,593

37

—
 2,630
Total debt instruments79,355
184,099

3,635

—
 267,089
104,889
159,753

2,966

—
 267,608
Equity securities71,119
482

232

—
 71,833
71,890
244

196

—
 72,330
Physical commodities(c)
5,182
1,855

—

—
 7,037
3,638
3,579

—

—
 7,217
Other—
13,192

301

—
 13,493
—
13,896

232

—
 14,128
Total debt and equity instruments(d)
155,656
199,628

4,168

—
 359,452
180,417
177,472

3,394

—
 361,283
Derivative receivables: 







 

 







 

Interest rate682
266,380

1,642

(245,490) 23,214
721
311,173

1,400

(285,873) 27,421
Credit—
19,235

860

(19,483) 612
—
14,252

624

(14,175) 701
Foreign exchange771
166,238

676

(154,235) 13,450
117
137,938

432

(129,482) 9,005
Equity—
46,777

2,508

(39,339) 9,946
—
43,642

2,085

(39,250) 6,477
Commodity—
20,339

131

(13,479) 6,991
—
17,058

184

(11,080) 6,162
Total derivative receivables1,453
518,969

5,817

(472,026) 54,213
838
524,063

4,725

(479,860) 49,766
Total trading assets(e)
157,109
718,597

9,985

(472,026) 413,665
181,255
701,535

8,119

(479,860) 411,049
Available-for-sale securities: 







 

 







 

Mortgage-backed securities: 







 

 







 

U.S. GSEs and government agencies(a)
—
68,646

—

—
 68,646
—
110,117

—

—
 110,117
Residential – nonagency—
8,519

1

—
 8,520
—
12,989

1

—
 12,990
Commercial – nonagency—
6,654

—

—
 6,654
—
5,188

—

—
 5,188
Total mortgage-backed securities—
83,819

1

—
 83,820
—
128,294

1

—
 128,295
U.S. Treasury and government agencies56,059
—

—

—
 56,059
139,436
—

—

—
 139,436
Obligations of U.S. states and municipalities—
37,723

—

—
 37,723
—
29,810

—

—
 29,810
Certificates of deposit—
75

—

—
 75
—
77

—

—
 77
Non-U.S. government debt securities15,313
8,789

—

—
 24,102
12,966
8,821

—

—
 21,787
Corporate debt securities—
1,918

—

—
 1,918
—
845

—

—
 845
Asset-backed securities: 







 

 







 

Collateralized loan obligations—
19,437

—

—
 19,437
—
24,991

—

—
 24,991
Other—
7,260

—

—
 7,260
—
5,458

—

—
 5,458
Total available-for-sale securities71,372
159,021

1

—
 230,394
152,402
198,296

1

—
 350,699
Loans—
3,029

122

—
 3,151
—
7,104

—

—
 7,104
Mortgage servicing rights—
—

6,130

—
 6,130
—
—

4,699

—
 4,699
Other assets(e)
7,810
195

927

—
 8,932
7,305
452

724

—
 8,481
Total assets measured at fair value on a recurring basis$236,291
$899,182

$17,165

$(472,026) $680,612
$340,962
$928,185

$13,543

$(479,860) $802,830
Deposits$—
$19,048

$4,169

$—
 $23,217
$—
$25,229

$3,360

$—
 $28,589
Federal funds purchased and securities loaned or sold under repurchase agreements—
935

—

—
 935
—
549

—

—
 549
Short-term borrowings—
5,607

1,523

—
 7,130
—
4,246

1,674

—
 5,920
Trading liabilities: 
 


 

 
 


 

Debt and equity instruments(d)
80,199
22,755

50

—
 103,004
59,047
16,481

41

—
 75,569
Derivative payables: 



    



   
Interest rate1,526
239,576

1,680

(234,998) 7,784
795
276,746

1,732

(270,670) 8,603
Credit—
19,309

967

(18,609) 1,667
—
14,358

763

(13,469) 1,652
Foreign exchange695
163,549

973

(152,432) 12,785
109
143,960

1,039

(131,950) 13,158
Equity—
46,462

4,733

(41,034) 10,161
—
47,261

5,480

(40,204) 12,537
Commodity—
21,158

1,260

(13,046) 9,372
—
19,685

200

(12,127) 7,758
Total derivative payables2,221
490,054

9,613

(460,119) 41,769
904
502,010

9,214

(468,420) 43,708
Total trading liabilities82,420
512,809

9,663

(460,119) 144,773
59,951
518,491

9,255

(468,420) 119,277
Accounts payable and other liabilities3,063
196

10

—
 3,269
3,231
452

45

—
 3,728
Beneficial interests issued by consolidated VIEs—
27

1

—
 28
—
36

—

—
 36
Long-term debt—
35,468

19,418

—
 54,886
—
52,406

23,339

—
 75,745
Total liabilities measured at fair value on a recurring basis$85,483
$574,090

$34,784

$(460,119) $234,238
$63,182
$601,409

$37,673

$(468,420) $233,844
(a)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, included total U.S. GSE obligations of $133.6$153.3 billion and $92.3$104.5 billion, respectively, which were mortgage-related.
(b)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, included within trading loans were $16.1$14.3 billion and $13.2$19.8 billion, respectively, of residential first-lien mortgages, and $4.2$2.0 billion and $2.3$3.4 billion, respectively, of commercial first-lien mortgages. Residential mortgage loans include conforming mortgage loans originated with the intent to sell to U.S. GSEs and government agencies of $10.3$7.1 billion and $7.6$13.6 billion, respectively.
(c)Physical commodities inventories are generally accounted for at the lower of cost or net realizable value. “Net realizable value” is a term defined in U.S. GAAP as not exceeding fair value less costs to sell (“transaction costs”). Transaction costs for the Firm’s physical commodities inventories are either not applicable or immaterial to the value of the inventory. Therefore, net realizable value approximates fair value for the Firm’s physical commodities


inventories. When fair value hedging has been applied (or when net realizable value is below cost), the carrying value of physical commodities approximates fair value, because under fair value hedge accounting, the cost basis is adjusted for changes in fair value. Refer to Note 45 for a further discussion of the Firm’s hedge accounting relationships. To provide consistent fair value disclosure information, all physical commodities inventories have been included in each period presented.
(d)Balances reflect the reduction of securities owned (long positions) by the amount of identical securities sold but not yet purchased (short positions).
(e)Certain investments that are measured at fair value using the net asset value per share (or its equivalent) as a practical expedient are not required to be classified in the fair value hierarchy. At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, the fair values of these investments, which include certain hedge funds, private equity funds, real estate and other funds, were $714$702 million and $747$684 million, respectively. Included in these balances at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, were trading assets of $48$45 million and $49$54 million, respectively, and other assets of $666$657 million and $698$630 million, respectively.
(f)As permitted under U.S. GAAP, the Firm has elected to net derivative receivables and derivative payables and the related cash collateral received and paid when a legally enforceable master netting agreement exists. The level 3 balances would be reduced if netting were applied, including the netting benefit associated with cash collateral.
Level 3 valuations
Refer to Note 2 of JPMorgan Chase’s 20182019 Form 10-K for further information on the Firm’s valuation process and a detailed discussion of the determination of fair value for individual financial instruments.
The following table presents the Firm’s primary level 3 financial instruments, the valuation techniques used to measure the fair value of those financial instruments, the significant unobservable inputs, the range of values for those inputs and for certain instruments, the weighted or arithmetic averages of such inputs. While the determination to classify an instrument within level 3 is based on the significance of the unobservable inputs to the overall fair value measurement, level 3 financial instruments typically include observable components (that is, components that are actively quoted and can be validated to external sources) in addition to the unobservable components. The level 1 and/or level 2 inputs are not included in the table. In addition, the Firm manages the risk of the observable components of level 3 financial instruments using securities and derivative positions that are classified within levels 1 or 2 of the fair value hierarchy.
The range of values presented in the table is representative of the highest and lowest level input used to value the significant groups of instruments within a product/instrument classification. Where provided, the weighted averages of the input values presented in the table are calculated based on the fair value of the instruments that the input is being used to value.
In the Firm’s view, the input range, weighted and the weightedarithmetic average valuevalues do not reflect the degree of input uncertainty or an assessment of the reasonableness of the Firm’s estimates and assumptions. Rather, they reflect the characteristics of the various instruments held by the Firm and the relative distribution of instruments within the range of characteristics. For example, two option contracts may have
similar levels of market risk exposure and valuation uncertainty, but may have significantly different implied volatility levels because the option contracts have different underlyings, tenors, or strike prices. The input range and weighted average values will therefore vary from period-to-period and parameter-to-parameter based on the characteristics of the instruments held by the Firm at each balance sheet date.
For the Firm’s derivatives and structured notes positions classified within level 3 at September 30, 2019, interest rate correlation inputs used in estimating fair value were concentrated towards the upper end of the range; equity correlation, equity-FX, and equity-IR correlation inputs were concentrated in the middle of the range; commodity correlation inputs were concentrated in the middle of the range; credit correlation inputs were concentrated towards the lower end of the range; and the interest rate-foreign exchange (“IR-FX”) correlation inputs were distributed across the range. In addition, the interest rate spread volatility inputs used in estimating fair value were distributed across the range; equity volatilities and commodity volatilities were concentrated towards the lower end of the range; and forward commodity prices used in estimating the fair value of commodity derivatives were concentrated towards the upper end of the range. Prepayment speed inputs used in estimating the fair value of interest rate derivatives were concentrated towards the lower end of the range. Recovery rate inputs used in estimating the fair value of credit derivatives were distributed across the range; credit spreads and conditional default rates were concentrated towards the lower end of the range; loss severity inputs were concentrated towards the upper end of the range and price inputs were concentrated towards the lower end of the range.



Level 3 inputs(a)
Level 3 inputs(a)
      
Level 3 inputs(a)
 
September 30, 2019      
June 30, 2020June 30, 2020 
Product/Instrument
Fair value
(in millions)
 Principal valuation technique
Unobservable inputs(g)
Range of input valuesWeighted average 
Fair value
(in millions)
 Principal valuation technique
Unobservable inputs(g)
Range of input values
Average(i)
Residential mortgage-backed securities and loans(b)
$1,132
 Discounted cash flowsYield0 %–19% 5%$1,035
 Discounted cash flowsYield(9)%–25% 5%
 Prepayment speed0 %–22% 14%  Prepayment speed0%–44% 12%
  Conditional default rate0 %–4% 1%  Conditional default rate0%–30% 12%
  Loss severity0 %–100% 2%  Loss severity0%–110% 7%
Commercial mortgage-backed securities and loans(c)
147
 Market comparablesPrice$0
–$102
 $80
538
 Market comparablesPrice$0–$101 $85
Obligations of U.S. states and municipalities627
 Market comparablesPrice$68
–$100
 $97
8
 Market comparablesPrice$80–$100 $97
Corporate debt securities484
 Market comparablesPrice$4
–$116
 $79
946
 Market comparablesPrice$3–$119 $69
Loans(d)
194
 Discounted cash flowsYield5 %–22% 7%160
 Discounted cash flowsYield5%–30% 8%
1,115
 Market comparablesPrice$12
–$101
 $78
1,700
 Market comparablesPrice$6–$104 $76
Asset-backed securities38
 Market comparablesPrice$1
–$100
 $53
39
 Market comparablesPrice$1–$79 $49
Net interest rate derivatives(388) Option pricingInterest rate spread volatility20 bps–30 bps (139) Option pricingInterest rate volatility7%–121% 24%
  Interest rate correlation(28)%–96%    Interest rate spread volatility20bps–30bps 25bps
  IR-FX correlation53 %–60%    Interest rate correlation(65)%–94% 43%
69
 Discounted cash flowsPrepayment speed4 %–30%    IR-FX correlation(50)%–35% 0%
35
 Discounted cash flowsPrepayment speed3%–30% 10%
Net credit derivatives(353) Discounted cash flowsCredit correlation30 %–60%  (175) Discounted cash flowsCredit correlation29%–64% 44%
  Credit spread4 bps–1,315 bps    Credit spread7bps–1,443bps 481bps
  Recovery rate15 %–70%    Recovery rate3%–70% 47%
  Conditional default rate2 %–93%    Conditional default rate2%–66% 24%
  Loss severity100%    Loss severity100% 100%
36
 Market comparablesPrice$1
–$115
  38
 Market comparablesPrice$1–$115 $71
Net foreign exchange derivatives(679) Option pricingIR-FX correlation(58)%–60%  (441) Option pricingIR-FX correlation(58)%–70% 12%
(162) Discounted cash flowsPrepayment speed9%  (154) Discounted cash flowsPrepayment speed9% 9%
Net equity derivatives(3,468) Option pricingEquity volatility11 %–82%  (2,036) Option pricing
Forward equity price(h)
64%–103% 98%
  Equity correlation10 %–98%    Equity volatility4%–123% 36%
  Equity-FX correlation(81)%–59%    Equity correlation25%–100% 79%
  Equity-IR correlation25 %–60%    Equity-FX correlation(77)%–55% (17)%
  Equity-IR correlation20%–35% 28%
Net commodity derivatives(47) Option pricingForward commodity price$30
–$ 61 per barrel(297) Option pricingForward industrial metal price$ 1,209 / MT–$ 16,649 / MT $ 6,670 / MT
  Forward power price$ 13 / MWH–$ 80 / MWH $ 25 / MWH
  Commodity volatility5 %–111%    Commodity volatility4%–112% 27%
  Commodity correlation(48)%–95%    Commodity correlation(45)%–95% 30%
MSRs4,419
 Discounted cash flowsRefer to Note 14  3,080
 Discounted cash flowsRefer to Note 15 
Other assets303
 Discounted cash flowsCredit spread45 bps 45 bps412
 Discounted cash flowsCredit spread45bps 45bps
  Yield12% 12%  Yield12% 12%
775
 Market comparablesPrice$18
–$115
 $36
508
 Market comparablesPrice$30–$122 $40
Long-term debt, short-term borrowings, and deposits(e)
27,986
 Option pricingInterest rate spread volatility20 bps–30 bps 28,250
 Option pricingInterest rate volatility7%–121% 24%
 Interest rate correlation(28)%–96%    Interest rate correlation(65)%–94% 43%
 IR-FX correlation(58)%–60%    IR-FX correlation(50)%–35% 0%
 Equity correlation10 %–98%    Equity correlation25%–100% 79%
 Equity-FX correlation(81)%–59%    Equity-FX correlation(77)%–55% (17)%
 Equity-IR correlation25 %–60%    Equity-IR correlation20%–35% 28%
Other level 3 assets and liabilities, net(f)
229
      208
 
(a)The categories presented in the table have been aggregated based upon the product type, which may differ from their classification on the Consolidated balance sheets. Furthermore, the inputs presented for each valuation technique in the table are, in some cases, not applicable to every instrument valued using the technique as the characteristics of the instruments can differ.
(b)Comprises U.S. GSEs and government agency securities of $811$469 million, nonagency securities of $24$23 million and trading loans of $297$543 million.
(c)Comprises nonagency securities of $5$2 million, trading loans of $141$275 million and non-trading loans of $1$261 million.
(d)Comprises trading loans.
(e)Long-term debt, short-term borrowings and deposits include structured notes issued by the Firm that are financial instruments that typically contain embedded derivatives. The estimation of the fair value of structured notes includes the derivative features embedded within the instrument. The significant unobservable inputs are broadly consistent with those presented for derivative receivables.
(f)Includes level 3 assets and liabilities that are insignificant both individually and in aggregate.
(g)Price is a significant unobservable input for certain instruments. When quoted market prices are not readily available, reliance is generally placed on price-based internal valuation techniques. The price input is expressed assuming a par value of $100.
(h)Forward equity price is expressed as a percentage of the current equity price.
(i)Amounts represent weighted averages except for derivative related inputs where arithmetic averages are used.


Changes in and ranges of unobservable inputs
Refer to Note 2 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the impact on fair value of changes in unobservable inputs and the relationships between unobservable inputs as well as a description of attributes of the underlying instruments and external market factors that affect the range of inputs used in the valuation of the Firm’s positions.
Changes in level 3 recurring fair value measurements
The following tables include a rollforward of the Consolidated balance sheets amounts (including changes in fair value) for financial instruments classified by the Firm within level 3 of the fair value hierarchy for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019. When a determination is made to classify a financial instrument within level 3, the determination is based on the significance of the unobservable inputs to the overall
fair value measurement. However, level 3 financial instruments
typically include, in addition to the unobservable or level 3 components, observable components (that is, components that are actively quoted and can be validated to external sources); accordingly, the gains and losses in the table below include changes in fair value due in part to observable factors that are part of the valuation methodology. Also, the Firm risk-manages the observable components of level 3 financial instruments using securities and derivative positions that are classified within level 1 or 2 of the fair value hierarchy; as these level 1 and level 2 risk management instruments are not included below, the gains or losses in the following tables do not reflect the effect of the Firm’s risk management activities related to such level 3 instruments.





Fair value measurements using significant unobservable inputs  Fair value measurements using significant unobservable inputs  
Three months ended
September 30, 2019
(in millions)		Fair value at
July 1,
2019		Total realized/unrealized gains/(losses) 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2019		Change in unrealized gains/(losses) related
to financial instruments held at September 30, 2019
Purchases(f)
Sales 
Settlements(g)
Three months ended
June 30, 2020
(in millions)		Fair value at
April 1,
2020		Total realized/unrealized gains/(losses) 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2020
Change in unrealized gains/(losses) related
to financial instruments held at June 30, 2020
Purchases(f)
Sales 
Settlements(g)
Assets:(a)
                    
Trading assets:                    
Debt instruments:                    
Mortgage-backed securities:                    
U.S. GSEs and government agencies$617
 $(71) $424
$(104) $(45)$—
$(10) $811
 $(70) $519
 $(10) $5
$(5) $(40)$—
$—
 $469
 $(8) 
Residential – nonagency42
 —
 2
(3) —
—
(17) 24
 (1) 24
 —
 2
(2) (1)—
—
 23
 —
 
Commercial – nonagency9
 —
 3
(5) —
—
(2) 5
 —
 3
 —
 —
—
 —
—
(1) 2
 —
 
Total mortgage-backed securities668
 (71) 429
(112) (45)—
(29) 840
 (71) 546
 (10) 7
(7) (41)—
(1) 494
 (8) 
U.S. Treasury, GSEs and government agencies
—
 —
 —
—
 —
—
—
 —
 —
 
Obligations of U.S. states and municipalities680
 (2) 27
(77) (1)—
—
 627
 (2) 9
 —
 —
—
 (1)—
—
 8
 —
 
Non-U.S. government debt securities190
 (1) 40
(74) —
3
(12) 146
 (1) 175
 16
 49
(68) (5)—
—
 167
 14
 
Corporate debt securities562
 45
 56
(167) —
17
(29) 484
 3
 953
 —
 69
(56) (9)65
(76) 946
 3
 
Loans1,778
 (44) 152
(82) (132)211
(137) 1,746
 (46) 3,354
 (50) 167
(98) (464)517
(748) 2,678
 (47) 
Asset-backed securities33
 —
 11
(2) (2)3
(5) 38
 (2) 52
 (5) 1
—
 (2)—
(7) 39
 1
 
Total debt instruments3,911
 (73) 715
(514) (180)234
(212) 3,881
 (119) 5,089
 (49) 293
(229) (522)582
(832) 4,332
 (37) 
Equity securities147
 (14) 10
(10) —
46
(9) 170
 (16) 213
 (65) 14
(1) —
73
(43) 191
 (44) 
Other311
 18
 35
(15) (15)—
(2) 332
 23
 221
 165
 1
—
 (9)2
(1) 379
 184
 
Total trading assets – debt and equity instruments4,369
 (69)
(c) 
760
(539) (195)280
(223) 4,383
 (112)
(c) 
5,523
 51
(c) 
308
(230) (531)657
(876) 4,902
 103
(c) 
Net derivative receivables:(b)
                    
Interest rate(544) 88
 39
(15) 53
10
50
 (319) (15) (136) 753
 21
(17) (622)(180)77
 (104) 447
 
Credit(232) (65) 3
(3) (23)3
—
 (317) (68) (111) (46) 30
(6) 16
11
(31) (137) (41) 
Foreign exchange(193) (653) 2
(1) (1)6
(1) (841) (657) (927) 182
 1
(5) 123
8
23
 (595) (249) 
Equity(2,560) (382) 174
(118) (377)(203)(2) (3,468) (362) (826) (1,036) 530
(541) (54)99
(208) (2,036) (1,215) 
Commodity(908) 8
 22
(69) 6
18
876
 (47) 40
 (425) 140
 7
(13) 9
2
(17) (297) 179
 
Total net derivative receivables(4,437) (1,004)
(c) 
240
(206) (342)(166)923
 (4,992) (1,062)
(c) 
(2,425) (7)
(c) 
589
(582) (528)(60)(156) (3,169) (879)
(c) 
Available-for-sale securities:                    
Mortgage-backed securities—
 —
 1
—
 —
—
—
 1
 —
 —
 —
 —
—
 —
—
—
 —
 —
 
Asset-backed securities—
 —
 —
—
 —
—
—
 —
 —
 
Total available-for-sale securities—
 —

1
—
 —
—
—
 1
 —

—
 —

—
—
 —
—
—
 —
 —

Loans5
 —

—
—
 (4)—
—
 1
 —

283
 (26)
(c) 
—
—
 —
4
—
 261
 (27)
(c) 
Mortgage servicing rights5,093
 (447)
(d) 
388
(359) (256)—
—
 4,419
 (447)
(d) 
3,267
 (111)
(d) 
169
2
 (247)—
—
 3,080
 (111)
(d) 
Other assets861
 (56)
(c) 
19
(72) (6)—
—
 746
 (56)
(c) 
416
 50
(c) 
35
—
 —
40
—
 541
 50
(c) 
                    
Fair value measurements using significant unobservable inputs  Fair value measurements using significant unobservable inputs  
Three months ended
September 30, 2019
(in millions)		Fair value at
July 1, 2019		Total realized/unrealized (gains)/losses 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2019		Change in unrealized (gains)/
losses related
to financial instruments held at September 30, 2019
PurchasesSalesIssuances
Settlements(g)
Three months ended
June 30, 2020
(in millions)		Fair value at
April 1,
2020		Total realized/unrealized (gains)/losses 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2020		Change in unrealized (gains)/losses related
to financial instruments held at June 30, 2020
PurchasesSalesIssuances
Settlements(g)
Liabilities:(a)
                    
Deposits$4,066
 $—

$—
$—
$153
$(188)$12
$(407) $3,636
 $16
(c)(e) 
$3,179
 $194
(c)(e) 
$—
$—
$80
$(256)$261
$(241) $3,217
 $160
(c)(e) 
Short-term borrowings2,052
 24
(c)(e) 
—
—
949
(1,040)17
(1) 2,001
 28
(c)(e) 
2,039
 98
(c)(e) 
—
—
925
(747)12
(22) 2,305
 85
(c)(e) 
Trading liabilities – debt and equity instruments45
 —

(5)25
—
1
2
—
 68
 —

61
 —

(1)—
—
(5)7
(3) 59
 —

Accounts payable and other liabilities92
 (6)
(c) 
(71)4
—
—
—
—
 19
 (2)
(c) 
15
 4
(c) 
—
32
—
—
40
—
 91
 3
(c) 
Beneficial interests issued by consolidated VIEs—
 —

—
—
—
—
—
—
 —
 —

—
 —

—
—
—
—
—
—
 —
 —

Long-term debt21,863
 187
(c)(e) 
—
—
2,230
(1,758)49
(222) 22,349
 89
(c)(e) 
20,141
 2,705
(c)(e) 
—
—
1,600
(1,809)608
(517) 22,728
 2,194
(c)(e) 



Fair value measurements using significant unobservable inputs

 Fair value measurements using significant unobservable inputs

 
Three months ended
September 30, 2018
(in millions)		Fair value at
July 1,
2018		 Total realized/unrealized gains/(losses)
 

Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2018		Change in unrealized gains/(losses) related
to financial instruments held at September 30, 2018
Purchases(f)
Sales
 
Settlements(g)
 
Three months ended
June 30, 2019
(in millions)		Fair value at
April 1,
2019		Total realized/unrealized gains/(losses)
 

Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2019		Change in unrealized gains/(losses) related
to financial instruments held at June 30, 2019
Purchases(f)
Sales 
Settlements(g)
 
Assets:(a)

 


 


 









 


 



 








Trading assets:
 


 


 









 


 



 








Debt instruments:
 


 


 









 


 



 








Mortgage-backed securities:
 


 


 









 


 



 








U.S. GSEs and government agencies$478
 $2

$14
$(28)
 $(17)
$83
$(3)
$529

$—

$412
 $(25)
$318
$(68) 
$(20)
$—
$—

$617

$(24)
Residential – nonagency87
 1

—
(6)
 (3)
18
(20)
77

1

85
 1

11
(14) 
(19)
—
(22)
42

—

Commercial – nonagency18
 (1)
—
—

 



9
(13)
13

(1)
17
 —

4
—
 
(12)
—
—

9

(1)
Total mortgage-backed securities583
 2

14
(34)
 (20)
110
(36)
619

—

514
 (24)
333
(82) 
(51)
—
(22)
668

(25)
U.S. Treasury, GSEs and government agencies—
 —
 —
—
  —
 —
—
 —
 —
 
Obligations of U.S. states and municipalities736
 8

26
(70)
 (1)
—
—

699

7

623
 1

57
(1) 
—

—
—

680

—

Non-U.S. government debt securities183
 (9)
44
(29)
 (2)
1
(24)
164

(9)
170
 —

117
(103) 
—

9
(3)
190

—

Corporate debt securities274
 (2)
156
(87)
 (4)
82
(24)
395

(3)
568
 7

61
(62) 
(53)
51
(10)
562

22

Loans1,986
 17

188
(146)
 (199)
48
(361)
1,533

3

1,741
 56

385
(216) 
(156)
139
(171)
1,778

68

Asset-backed securities87
 6

5
(7)
 (13)
5
(7)
76

3

119
 2

2
(58) 
(30)
—
(2)
33

2

Total debt instruments3,849
 22

433
(373)
 (239)
246
(452)
3,486

1

3,735
 42

955
(522) 
(290)
199
(208)
3,911

67

Equity securities288
 20

6
(48)
 



82
(19)
329

(18)
202
 (12)
8
(3) 
—

21
(69)
147

(12)
Other406
 30

13
—

 (37)
2
(1)
413

10

304
 20

3
—
 
(15)
—
(1)
311

35

Total trading assets – debt and equity instruments4,543
 72
(c) 
452
(421)
 (276)
330
(472)
4,228

(7)
(c) 
4,241
 50
(c) 
966
(525) 
(305)
220
(278)
4,369

90
(c) 
Net derivative receivables:(b)


 







 


 










 






 



 








Interest rate489
 236

28
(22)
 (101)
68
(7)
691

216

(147) (341)
28
(60) 
(57)
(6)39

(544)
(459)
Credit(24) (19)
1
—

 47

6
16

27

(15)
(115) (127)
13
(1) 
4

1
(7)
(232)
(139)
Foreign exchange(245) (56)
29
(7)
 (49)
(2)28

(302)
(54)
(356) 58

10
(8) 
114

(17)6

(193)
82

Equity(2,578) (94)
643
(635)
 622

(251)16

(2,277)
(121)
(2,066) (21)
34
(158) 
(284)
(148)83

(2,560)
(91)
Commodity(752) 318

—
—

 (113)
15
7

(525)
138

(665) (171)
7
(83) 
21

(17)—

(908)
(151)
Total net derivative receivables(3,110) 385
(c) 
701
(664)
 406

(164)60

(2,386)
164
(c) 
(3,349) (602)
(c) 
92
(310) 
(202)
(187)121

(4,437)
(758)
(c) 
Available-for-sale securities:   
 
  
 
 
 
   
  
 
 
 
 
Mortgage-backed securities1
 —

—
—

 —

—
—

1

—

—
 —

—
—
 
—

—
—

—

—

Asset-backed securities147
 —

—
—

 (86)
—
—

61

—

Total available-for-sale securities148
 —

—
—

 (86)
—
—

62

—

—
 —

—
—
 
—

—
—

—

—

Loans159
 (1)
(c) 
1
—

 (19)
—
—

140

(1)
(c) 
123
 1
(c) 
—
—
 
(119)
—
—

5

—

Mortgage servicing rights6,241
 98
(d) 
291
(2)
 (195)
—
—

6,433

98
(d) 
5,957
 (826)
(d) 
426
(217) 
(247)
—
—

5,093

(826)
(d) 
Other assets1,225
 (160)
(c) 
2
—
  (7) 3
—
 1,063
 (160)
(c) 
841
 (89)
(c) 
142
(8)  (26) 1
—
 861
 (92)
(c) 
                            

Fair value measurements using significant unobservable inputs

Fair value measurements using significant unobservable inputs

Three months ended
September 30, 2018
(in millions)		Fair value at
July 1,
2018		 Total realized/unrealized (gains)/losses

 
 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2018		Change in unrealized (gains)/losses related
to financial instruments held at September 30, 2018
PurchasesSalesIssuances
Settlements(g)

Three months ended
June 30, 2019
(in millions)		Fair value at
April 1,
2019		Total realized/unrealized (gains)/losses

 

 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2019		Change in unrealized (gains)/losses related
to financial instruments held at June 30, 2019
PurchasesSales Issuances
Settlements(g)

Liabilities:(a)

 


 

  








 


 


  







Deposits$4,305
 $(84)
(c)(e) 
$—
$—
$517
 $(170)
$1
$(129)
$4,440

$(82)
(c)(e) 
$4,528
 $89
(c)(e) 
$—
$—
 $92
$(292)
$—
$(351)
$4,066

$104
(c)(e) 
Short-term borrowings2,209
 (47)
(c)(e) 
—
—
713
 (885)
6
(25)
1,971

(31)
(c)(e) 
1,502
 72
(c)(e) 
—
—
 1,037
(624)
67
(2)
2,052

28
(c)(e) 
Trading liabilities – debt and equity instruments43
 36
(c) 
(6)19
—
 (2)
7
(1)
96

36
(c) 
52
 —

(5)5
 —
—

4
(11)
45

—

Accounts payable and other liabilities8
 1
(c) 
—
—
—
 —

3
—

12

1
(c) 
15
 (1)
(c) 
(3)80
 —
—

1
—

92

(1)
(c) 
Beneficial interests issued by consolidated VIEs1
 —

—
—
—
 —

—
—

1

—

—
 —

—
—
 —
—

—
—

—

—

Long-term debt17,632
(i) 
194
(c)(e) 
—
—
3,551
 (1,809)
59
(219)
19,408
(i) 
192
(c)(e) 
21,655
 455
(c)(e) 
—
—
 2,648
(2,729)
200
(366)
21,863

621
(c)(e) 


 Fair value measurements using significant unobservable inputs  
Nine months ended
September 30, 2019
(in millions)		Fair value at
January 1,
2019		Total realized/unrealized gains/(losses)      
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2019		Change in unrealized gains/(losses) related
to financial instruments held at September 30, 2019
Purchases(f)
Sales  
Settlements(g)
 
Assets:(a)
                 
Trading assets:                 
Debt instruments:                 
Mortgage-backed securities:                 
U.S. GSEs and government agencies$549
 $(111) $747
$(272)  $(83) $1
$(20) $811
 $(116) 
Residential – nonagency64
 25
 83
(86)  (20) 15
(57) 24
 (1) 
Commercial – nonagency11
 2
 19
(24)  (14) 15
(4) 5
 1
 
Total mortgage-backed securities624
 (84) 849
(382)  (117) 31
(81) 840
 (116) 
U.S. Treasury, GSEs and government agencies
—
 —
 —
—
  —
 —
—
 —
 —
 
Obligations of U.S. states and municipalities689
 12
 85
(152)  (7) —
—
 627
 13
 
Non-U.S. government debt securities155
 (2) 228
(231)  —
 14
(18) 146
 3
 
Corporate debt securities334
 74
 340
(236)  (53) 96
(71) 484
 15
 
Loans1,706
 95
 609
(416)  (408) 509
(349) 1,746
 44
 
Asset-backed securities127
 —
 30
(81)  (39) 23
(22) 38
 (3) 
Total debt instruments3,635
 95
 2,141
(1,498)  (624) 673
(541) 3,881
 (44) 
Equity securities232
 (28) 33
(92)  (22) 142
(95) 170
 (21) 
Other301
 42
 50
(16)  (41) 1
(5) 332
 55
 
Total trading assets – debt and equity instruments4,168
 109
(c) 
2,224
(1,606)  (687) 816
(641) 4,383
 (10)
(c) 
Net derivative receivables:(b)
                 
Interest rate(38) (575) 86
(102)
(i) 
 174
(i) 
22
114
 (319) (694) 
Credit(107) (209) 16
(5)  (13) 7
(6) (317) (169) 
Foreign exchange(297) (840) 13
(18)  294
 (19)26
 (841) (815) 
Equity(2,225) 328
 335
(573)  (1,062) (418)147
 (3,468) (1,193) 
Commodity(1,129) 370
 32
(240)  51
 2
867
 (47) 634
 
Total net derivative receivables(3,796) (926)
(c) 
482
(938)  (556) (406)1,148
 (4,992) (2,237)
(c) 
Available-for-sale securities:                 
Mortgage-backed securities1
 —
 1
—
  (1) —
—
 1
 —
 
Asset-backed securities—
 —
 —
—
  —
 —
—
 —
 —
 
Total available-for-sale securities1
 —
 1
—
  (1) —
—
 1
 —
 
Loans122
 4
(c) 
—
—
  (125) —
—
 1
 —
 
Mortgage servicing rights6,130
 (1,572)
(d) 
1,250
(687)  (702) —
—
 4,419
 (1,572)
(d) 
Other assets927
 (152)
(c) 
170
(160)  (33) 1
(7) 746
 (145)
(c) 
                  
 Fair value measurements using significant unobservable inputs  
Nine months ended
September 30, 2019
(in millions)		Fair value at
January 1, 2019		Total realized/unrealized (gains)/losses      
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2019		Change in unrealized (gains)/
losses related
to financial instruments held at September 30, 2019
PurchasesSales Issuances
Settlements(g)
 
Liabilities:(a)
                 
Deposits$4,169
 $241
(c)(e) 
$—
$—
 $580
$(504) $12
$(862) $3,636
 $250
(c)(e) 
Short-term borrowings1,523
 142
(c)(e) 
—
—
 2,637
(2,265) 85
(121) 2,001
 74
(c)(e) 
Trading liabilities – debt and equity instruments50
 —
 (12)41
 —
1
 9
(21) 68
 (1)
(c) 
Accounts payable and other liabilities10
 (7)
(c) 
(79)94
 —
—
 1
—
 19
 4
(c) 
Beneficial interests issued by consolidated VIEs1
 (1)
(c) 
—
—
 —
—
 —
—
 —
 —
 
Long-term debt19,418
 1,915
(c)(e) 
—
—
 6,929
(5,675) 522
(760) 22,349
 2,010
(c)(e) 




Fair value measurements using significant unobservable inputs
  Fair value measurements using significant unobservable inputs  
Nine months ended
September 30, 2018
(in millions)		Fair value at
January 1,
2018		Total realized/unrealized gains/(losses)    
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2018		Change in unrealized gains/(losses) related
to financial instruments held at September 30, 2018
Purchases(f)
Sales  
Settlements(g)
 
Six months ended
June 30, 2020
(in millions)		Fair value at
Jan 1,
2020		Total realized/unrealized gains/(losses) 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2020
Change in unrealized gains/(losses) related
to financial instruments held at June 30, 2020
Purchases(f)
Sales 
Settlements(g)
Assets:(a)
                      
Trading assets:                      
Debt instruments:                      
Mortgage-backed securities:                      
U.S. GSEs and government agencies$307
$5
 $348
$(126)  $(56) $92
$(41) $529
 $3
 $797
 $(149) $24
$(121) $(82)$—
$—
 $469
 $(139) 
Residential – nonagency60
1
 45
(19)  (6) 58
(62) 77
 4
 23
 (1) 4
(2) (1)—
—
 23
 2
 
Commercial – nonagency11
2
 7
(8)  (13) 30
(16) 13
 (1) 4
 —
 1
—
 (1)1
(3) 2
 4
 
Total mortgage-backed securities378
8
 400
(153)  (75) 180
(119) 619
 6
 824
 (150) 29
(123) (84)1
(3) 494
 (133) 
U.S. Treasury, GSEs and government agencies1
—
 —
—
  —
 —
(1) —
 —
 
Obligations of U.S. states and municipalities744
(3) 107
(70)  (79) —
—
 699
 (3) 10
 —
 —
(1) (1)—
—
 8
 —
 
Non-U.S. government debt securities78
(19) 395
(213)  (2) 18
(93) 164
 (18) 155
 4
 139
(125) (5)—
(1) 167
 (6) 
Corporate debt securities312
(6) 297
(227)  (15) 249
(215) 395
 (1) 558
 (55) 361
(98) (9)292
(103) 946
 (11) 
Loans2,719
58
 1,223
(1,680)  (528) 422
(681) 1,533
 (22) 1,382
 (211) 866
(260) (517)2,305
(887) 2,678
 (174) 
Asset-backed securities153
15
 64
(29)  (53) 18
(92) 76
 8
 37
 (7) 37
(15) (3)—
(10) 39
 —
 
Total debt instruments4,385
53
 2,486
(2,372)  (752) 887
(1,201) 3,486
 (30) 2,966
 (419) 1,432
(622) (619)2,598
(1,004) 4,332
 (324) 
Equity securities295
(1) 99
(108)  (1) 86
(41) 329
 11
 196
 (103) 24
(5) —
155
(76) 191
 (79) 
Other690
(209) 47
(40)  (75) 3
(3) 413
 (250) 232
 164
 10
(5) (21)2
(3) 379
 184
 
Total trading assets – debt and equity instruments5,370
(157)
(c) 
2,632
(2,520)  (828) 976
(1,245) 4,228
 (269)
(c) 
3,394
 (358)
(c) 
1,466
(632) (640)2,755
(1,083) 4,902
 (219)
(c) 
Net derivative receivables:(b)
                      
Interest rate264
576
 83
(77)  (234) 40
39
 691
 498
 (332) 1,395
 87
(67) (863)(352)28
 (104) 286
 
Credit(35)19
 3
(7)  22
 5
20
 27
 7
 (139) 62
 48
(134) (17)71
(28) (137) 28
 
Foreign exchange(396)184
 42
(15)  (46) (114)43
 (302) 42
 (607) (157) 39
(9) 109
8
22
 (595) (118) 
Equity(3,409)688
 1,467
(1,919)  1,043
 (324)177
 (2,277) 31
 (3,395) 2,001
 589
(1,089) 529
(557)(114) (2,036) 2,619
 
Commodity(674)468
 —
—
  (287) 7
(39) (525) 158
 (16) (263) 11
(28) 18
(4)(15) (297) (276) 
Total net derivative receivables(4,250)1,935
(c) 
1,595
(2,018)  498
 (386)240
 (2,386) 736
(c) 
(4,489) 3,038
(c) 
774
(1,327) (224)(834)(107) (3,169) 2,539
(c) 
Available-for-sale securities:                      
Mortgage-backed securities1
—
 —
—
  —
 —
—
 1
 —
 1
 —
 —
—
 (1)—
—
 —
 —
 
Asset-backed securities276
1
 —
—
  (216) —
—
 61
 1
 
Total available-for-sale securities277
1
(j) 
—
—
  (216) —
—
 62
 1
(j) 
1
 —
 —
—
 (1)—
—
 —
 —
 
Loans276
(5)
(c) 
123
—
  (180) —
(74) 140
 (5)
(c) 
—
 (37)
(c) 
—
—
 —
298
—
 261
 (37)
(c) 
Mortgage servicing rights6,030
576
(d) 
770
(401)  (542) —
—
 6,433
 576
(d) 
4,699
 (1,493)
(d) 
442
(73) (495)—
—
 3,080
 (1,493)
(d) 
Other assets1,265
(210)
(c) 
49
(16)  (28) 4
(1) 1,063
 (217)
(c) 
724
 (32)
(c) 
37
(28) (200)40
—
 541
 (34)
(c) 
                      
Fair value measurements using significant unobservable inputs  Fair value measurements using significant unobservable inputs  
Nine months ended
September 30, 2018
(in millions)		Fair value at
January 1,
2018		Total realized/unrealized (gains)/losses     
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
September 30, 2018		Change in unrealized (gains)/losses related
to financial instruments held at September 30, 2018
PurchasesSalesIssuances
Settlements(g)
 
Six months ended
June 30, 2020
(in millions)		Fair value at
Jan 1,
2020		Total realized/unrealized (gains)/losses 
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2020		Change in unrealized (gains)/losses related
to financial instruments held at June 30, 2020
PurchasesSalesIssuances
Settlements(g)
Liabilities:(a)
                      
Deposits$4,142
$(125)
(c)(e) 
$—
$—
$1,272
 $(425) $2
$(426) $4,440
 $(115)
(c)(e) 
$3,360
 $45
(c)(e) 
$—
$—
$466
$(428)$265
$(491) $3,217
 $58
(c)(e) 
Short-term borrowings1,665
(229)
(c)(e) 
—
—
2,783
 (2,245) 61
(64) 1,971
 26
(c)(e) 
1,674
 (247)
(c)(e) 
—
—
2,540
(1,676)52
(38) 2,305
 (37)
(c)(e) 
Trading liabilities – debt and equity instruments39
28
(c) 
(68)95
—
 (1) 9
(6) 96
 11
(c) 
41
 3
(c) 
(76)7
—
(5)93
(4) 59
 2
(c) 
Accounts payable and other liabilities13
—
 (6)1
—
 —
 4
—
 12
 —
 45
 (4)
(c) 
(23)33
—
—
40
—
 91
 (4)
(c) 
Beneficial interests issued by consolidated VIEs39
—
 —
—
—
 (38) —
—
 1
 —
 —
 —
 —
—
—
—
—
—
 —
 —
 
Long-term debt16,125
(396)
(c)(e) 
—
—
9,792
(i) 
(6,195)
(i) 
653
(571) 19,408
(i) 
(576)
(c)(e) 
23,339
 (1,405)
(c)(e) 
—
—
6,207
(5,358)978
(1,033) 22,728
 (476)
(c)(e) 





 
Fair value measurements using significant unobservable inputs

  
Six months ended
June 30, 2019
(in millions)		Fair value at
Jan 1,
2019		Total realized/unrealized gains/(losses)      
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2019
Change in unrealized gains/(losses) related
to financial instruments held at June 30, 2019
Purchases(f)
Sales  
Settlements(g)
 
Assets:(a)
                 
Trading assets:                 
Debt instruments:                 
Mortgage-backed securities:                 
U.S. GSEs and government agencies$549
 $(40) $323
$(168)  $(38) $1
$(10) $617
 $(37) 
Residential – nonagency64
 25
 81
(83)  (20) 15
(40) 42
 —
 
Commercial – nonagency11
 2
 16
(19)  (14) 15
(2) 9
 —
 
Total mortgage-backed securities624
 (13) 420
(270)  (72) 31
(52) 668
 (37) 
Obligations of U.S. states and municipalities689
 14
 58
(75)  (6) —
—
 680
 15
 
Non-U.S. government debt securities155
 (1) 188
(157)  —
 11
(6) 190
 2
 
Corporate debt securities334
 29
 284
(69)  (53) 79
(42) 562
 35
 
Loans1,706
 139
 457
(334)  (276) 298
(212) 1,778
 128
 
Asset-backed securities127
 —
 19
(79)  (37) 20
(17) 33
 —
 
Total debt instruments3,635
 168
 1,426
(984)  (444) 439
(329) 3,911
 143
 
Equity securities232
 (14) 23
(82)  (22) 96
(86) 147
 (11) 
Other301
 24
 15
(1)  (26) 1
(3) 311
 45
 
Total trading assets – debt and equity instruments4,168
 178
(c) 
1,464
(1,067)  (492) 536
(418) 4,369
 177
(c) 
Net derivative receivables:(b)
                 
Interest rate(38) (663) 47
(87)
(i) 
 121
(i) 
12
64
 (544) (725) 
Credit(107) (144) 13
(2)  10
 4
(6) (232) (155) 
Foreign exchange(297) (187) 11
(17)  295
 (25)27
 (193) (144) 
Equity(2,225) 710
 161
(455)  (685) (215)149
 (2,560) (134) 
Commodity(1,129) 362
 10
(171)  45
 (16)(9) (908) 485
 
Total net derivative receivables(3,796) 78
(c) 
242
(732)  (214) (240)225
 (4,437) (673)
(c) 
Available-for-sale securities:                 
Mortgage-backed securities1
 —
 —
—
  (1) —
—
 —
 —
 
Total available-for-sale securities1
 —
 —
—
  (1) —
—
 —
 —
 
Loans122
 4
(c) 
—
—
  (121) —
—
 5
 5
(c) 
Mortgage servicing rights6,130
 (1,125)
(d) 
862
(328)  (446) —
—
 5,093
 (1,125)
(d) 
Other assets927
 (96)
(c) 
151
(88)  (27) 1
(7) 861
 (98)
(c) 
                  
 Fair value measurements using significant unobservable inputs  
Six months ended
June 30, 2019
(in millions)		Fair value at
Jan 1,
2019		Total realized/unrealized (gains)/losses      
Transfers into
level 3(h)
Transfers (out of) level 3(h)
Fair value at
June 30, 2019		Change in unrealized (gains)/losses related
to financial instruments held at June 30, 2019
PurchasesSales Issuances
Settlements(g)
 
Liabilities:(a)
                 
Deposits$4,169
 $241
(c)(e) 
$—
$—
 $427
$(316) $—
$(455) $4,066
 $246
(c)(e) 
Short-term borrowings1,523
 118
(c)(e) 
—
—
 1,688
(1,225) 68
(120) 2,052
 115
(c)(e) 
Trading liabilities – debt and equity instruments50
 —
 (7)16
 —
—
 7
(21) 45
 1
(c) 
Accounts payable and other liabilities10
 (1)
(c) 
(8)90
 —
—
 1
—
 92
 (1)
(c) 
Beneficial interests issued by consolidated VIEs1
 (1)
(c) 
—
—
 —
—
 —
—
 —
 —
 
Long-term debt19,418
 1,728
(c)(e) 
—
—
 4,699
(3,917) 473
(538) 21,863
 2,039
(c)(e) 
(a)Level 3 assets as a percentage of total Firm assets accounted for at fair value (including assets measured at fair value on a nonrecurring basis) were 1% and 2% and 3% at SeptemberJune 30, 20192020 and December 31, 2018,2019, respectively. Level 3 liabilities as a percentage of total Firm liabilities accounted for at fair value (including liabilities measured at fair value on a nonrecurring basis) were 15%8% and 16%, at both SeptemberJune 30, 20192020 and December 31, 2018,2019, respectively.

(b)All level 3 derivatives are presented on a net basis, irrespective of the underlying counterparty.
(c)Predominantly reported in principal transactions revenue, except for changes in fair value for CCB mortgage loans and lending-related commitments originated with the intent to sell, and mortgage loan purchase commitments, which are reported in mortgage fees and related income.
(d)Changes in fair value for MSRs are reported in mortgage fees and related income.
(e)
Realized (gains)/losses due to DVA for fair value option elected liabilities are reported in principal transactions revenue, and they were not material for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively. Unrealized (gains)/losses are reported in OCI, and they were $(62)$940 million and $123(5) million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively and $108$(199) million and $170 million for the ninesix months ended SeptemberJune 30, 20192020 and were 0t material for the nine months ended September 30, 2018.2019
(f)Loan originations are included in purchases.
(g)Includes financial assets and liabilities that have matured, been partially or fully repaid, impacts of modifications, deconsolidations associated with beneficial interests in VIEs and other items.
(h)All transfers into and/or out of level 3 are based on changes in the observability and/or significance of the valuation inputs and are assumed to occur at the beginning of the quarterly reporting period in which they occur.
(i)The prior periodPrior-period amounts have been revised to conform with the current period presentation.
(j)Realized gains/(losses) on AFS securities, as well as other-than-temporary impairment (“OTTI”) losses that are recorded in earnings, are reported in investment securities gains/(losses). Unrealized gains/(losses) are reported in OCI. There were 0 realized gains/(losses) recorded in income on AFS securities for the three and nine months ended September 30, 2019 and 2018, respectively. Unrealized gains/(losses) recorded on AFS securities in OCI were 0 for both the three months ended September 30, 2019 and 2018, respectively and 0 and $1 million for the nine months ended September 30, 2019 and 2018, respectively.
Level 3 analysis
Consolidated balance sheets changes
Level 3 assets, including assets measured at fair value on a nonrecurring basis, were 0.6% of total Firm assets at SeptemberJune 30, 2019.2020. The following describes significant changes to level 3 assets since December 31, 2018,2019, for those items measured at fair value on a recurring basis. Refer to Assets and liabilities measured at fair value on a nonrecurring basis on page 97112 for further information on changes impacting items measured at fair value on a nonrecurring basis.
Three and ninesix months ended SeptemberJune 30, 20192020
Level 3 assets were $15.1$17.4 billion at SeptemberJune 30, 2019,2020, reflecting a decrease of $1.4 billion and $2.0$1.7 billion from June 30, 2019March 31, 2020 and an increase of $3.9 billion from December 31, 2018, respectively.2019.
The decrease for the three months ended SeptemberJune 30, 20192020 was predominantly driven by a reduction of $674by:
$676 million decrease in MSRstrading loans due to settlements.
•
$507 million decrease in gross equity derivative receivables due to settlements.
The increase for the six months ended June 30, 2020 was driven by:
$1.3 billion increase in trading loans due to transfers
$813 million increase in gross interest rate derivative receivables and a reduction of $619 million$2.5 billion increase in gross equity derivative receivables due to settlements.gains net of settlements,
Thepartially offset by
$1.6 billion decrease for the nine months ended September 30, 2019 was predominantly driven by a reduction of approximately $1.7 billion in MSRs. MSRs due to losses.
Refer to the Gains and losses sectionsections below for additional information.
Transfers between levels for instruments carried at fair value on a recurring basis
For both the three and nine months ended SeptemberJune 30, 2019, there were no individually2020, significant transfers from level 2 to level 3.
For the three and nine months ended September 30, 2019, individually significant transfers frominto level 3 to level 2 included $906the following:
$657 million of total debt and $927equity instruments, predominantly trading loans, driven by a decrease in observability.
$802 million respectively of gross commoditiesequity derivative receivables and $703 million of gross equity derivative payables as a result of a decrease in observability and an increase in observability.the significance of unobservable inputs.
$608 million of long-term debt driven by a decrease in observability and an increase in the significance of unobservable inputs for certain structured notes.
For the threesix months ended SeptemberJune 30, 2018, there were no individually2020, significant transfers from level 2 to level 3.
For the nine months ended September 30, 2018, significant transfers from level 2 tointo level 3 included the following:
$1.02.8 billion of total debt and equity instruments, predominantly trading loans, driven by a decrease in observability.
$1.8 billion of gross equity derivative receivables, $776 million of gross interest rate derivative payables and $2.4 billion of gross equity derivative payables as a result of a decrease in observability and an increase in the significance of unobservable inputs.
$978 million of long-term debt driven by a decrease in observability and an increase in the significance of unobservable inputs for certain structured notes.
For the three and six months ended SeptemberJune 30, 2018, there were no individually2020, significant transfers from level 3 to level 2.
For the nine months ended September 30, 2018, significant transfers from level 3 tointo level 2 included the following:
$1.2876 million and $1.1 billion, respectively, of total debt and equity instruments, the majority of which werepredominantly trading loans, driven by an increase in observability.
$1.0854 million and $1.1 billion, respectively, of gross equity derivative receivables and $1.2 billion$646 million and $965 million, respectively, of gross equity derivative payables as a result of an increase in observability and a decrease in the significance of unobservable inputs.
$517 million and $1.0 billion, respectively, of long-term debt driven by an increase in observability and a decrease in the significance of unobservable inputs for certain structured notes.
For the three and six months ended June 30, 2019, there were no significant transfers from level 2 into level 3 or from level 3 into level 2.
All transfers are based on changes in the observability and/or significance of the valuation inputs and are assumed to occur at the beginning of the quarterly reporting period in which they occur.

Gains and losses
The following describes significant components of total realized/unrealized gains/(losses) for instruments measured at fair value on a recurring basis for the periods indicated. These amounts exclude any effects of the Firm’s risk management activities where the financial instruments are classified as level 1 and 2 of the fair value hierarchy. Refer to Changes in level 3 recurring fair value measurements rollforward tables on pages 90–95105-111 for further information on these instruments.

Three months ended SeptemberJune 30, 20192020
$1.6 billion43 million of net losses on assets, predominantlyprimarily driven by market movements in net derivative receivables due to market movements and MSRs largely reflecting faster prepayment speeds on lower rates. Refer to Note 14 for information on MSRs.receivables.
$205 million of net losses on liabilities, none of which were individually significant.
Three months ended September 30, 2018
$394 million of net gains on assets and $100 million of net gains on liabilities, none of which were individually significant.
Nine months ended September 30, 2019
$2.5 billion of net losses on assets, driven by net derivative receivables due to market movements and MSRs reflecting faster prepayment speeds on lower rates. Refer to Note 14 for information on MSRs.
$2.33.0 billion of net losses on liabilities, predominantly driven by market movements in long-term debt.
NineThree months ended SeptemberJune 30, 20182019
$2.1 billion of net gains on assets predominantly driven by market movements in derivative receivables.
•
$1.5 billion of net losses on assets, driven by derivative receivables due to market movements and MSRs reflecting updates to model inputs and faster prepayment speeds on lower rates.
•
$722615 millionof net losses on liabilities, largely due to market movements in long-term debt.
Six months ended June 30, 2020
•
$1.1 billion of net gains on assets, driven by gains in net interest rate derivative receivables and net equity derivative receivables due to market movements largely offset by losses in MSRs reflecting faster prepayment speeds on lower rates. Refer to Note 15 for additional information on MSRs.
•
$1.6 billion of net gains on liabilities, none of which were individually significant.predominantly driven by market movements in long-term debt.
Six months ended June 30, 2019
•
$1.0 billion of net losses on assets, predominantly driven by MSRs reflecting updates to model inputs and faster prepayment speeds on lower rates.
•
$2.1 billion of net losses on liabilities, predominantly driven by market movements in long-term debt.



Credit and funding adjustments — derivatives
The following table provides the impact of credit and funding adjustments on principal transactions revenue in the respective periods, excluding the effect of any associated hedging activities. The FVA presented below includes the impact of the Firm’s own credit quality on the inception value of liabilities as well as the impact of changes in the Firm’s own credit quality over time.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 2019
 2018
2020
 2019
 2020
 2019
Credit and funding adjustments:              
Derivatives CVA$55
 $66
 $71
 $223
$207
 $(44) $(718) $16
Derivatives FVA(83) 88
 (20) 102
676
 (89) (345) 63

Refer to Note 2 of JPMorgan Chase’s 20182019 Form 10-K for further information about both credit and funding adjustments, as well as information about valuation adjustments on fair value option elected liabilities.

Assets and liabilities measured at fair value on a nonrecurring basis
The following tables present the assets and liabilities held as of SeptemberJune 30, 20192020 and 2018,2019, respectively, for which a nonrecurring fair value adjustment wasadjustments were recorded during the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, by major product category and fair value hierarchy.
Fair value hierarchy Total fair valueFair value hierarchy Total fair value
September 30, 2019 (in millions)Level 1
Level 2
 Level 3
 
June 30, 2020 (in millions)Level 1
Level 2
 Level 3
 Total fair value
Loans$—
$5,338
(b) 
$246
(c) 
$5,584
$—
$1,793
(c) 
$823
(d) 
Other assets(a)
—
18
 775
 793
—
4
 392
 396
Total assets measured at fair value on a nonrecurring basis$—
$5,356
 $1,021
 $6,377
$—
$1,797
 $1,215
 $3,012
Accounts payable and other liabilities(b)
—
—
 95
  
95
Total liabilities measured at fair value on a nonrecurring basis$—
$—
 $95
 $95
Fair value hierarchy Total fair valueFair value hierarchy Total fair value
September 30, 2018 (in millions)Level 1
Level 2
 Level 3
 
June 30, 2019 (in millions)Level 1
Level 2
 Level 3
 Total fair value
Loans$—
$492
 $243
 $735
$—
$1,716
(e) 
$141
 
Other assets—
216
 826
 1,042
—
13
 713
 726
Total assets measured at fair value on a nonrecurring basis$—
$708
 $1,069
 $1,777
$—
$1,729
 $854
 $2,583
(a)Primarily includes equity securities without readily determinable fair values that were adjusted based on observable price changes in orderly transactions from an identical or similar investment of the same issuer (measurement alternative). Of the $775$392 million in level 3 assets measured at fair value on a nonrecurring basis as of SeptemberJune 30, 2019, $6382020, $209 million related to such equity securities.securities adjusted based on the measurement alternative. These equity securities are classified as level 3 due to the infrequency of the observable prices and/or the restrictions on the shares.
(b)Represents at June 30, 2020 the net markdowns associated with $3.4 billion of held-for-sale positions related to unfunded commitments in the bridge financing portfolio. There were 0 liabilities measured at fair value on a nonrecurring basis at June 30, 2019.
(c)Primarily includes certain mortgage loans that were reclassified to held-for-sale.
(c)(d)Of the $246$823 million in level 3 assets measured at fair value on a nonrecurring basis as of SeptemberJune 30, 2019, $2002020, $372 million related to residential real estate loans carried at the net realizable value of the underlying collateral (e.g., collateral-dependent loans and other loans charged off in accordance with regulatory guidance)loans). These amounts are classified as level 3 as they are valued using information from broker’s price opinions, appraisals and automated valuation models and discounted based upon the Firm’s experience with actual liquidation values. These discounts ranged from 14%15% to 49%46% with a weighted average of 29%28%.
There were no material liabilities measured at fair value on a nonrecurring basis at September 30, 2019 and 2018.
(e)Prior-period amounts have been revised to conform with the current presentation.
Nonrecurring fair value changes
The following table presents the total change in value of assets and liabilities for which a fair value adjustment hasadjustments have been recognized for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, related to assets and liabilities held at those dates.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30, 
(in millions)2019
 2018
 2019
 2018
2020 2019 2020 2019 
Loans$(142)
(b) 
$(22) $(232)
(b) 
$(36)$(39)
(b) 
$(79)
(d) 
$(303)
(b) 
$(100)
(d) 
Other assets(a)
23
  
(117) 123
 383
(39)
  
13
 (206) 90
 
Accounts payable and other liabilities465
(c) 
—
 (95)
(c) 
—
 
Total nonrecurring fair value gains/(losses)$(119) $(139) $(109) $347
$387
 $(66) $(604) $(10) 
(a)Included $34$(4) million and $(113)$16 million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively and $132$(158) million and $384$95 million for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, of net (losses)/gains as a result of the measurement alternative.
(b)Primarily includesIncludes the impact of certain mortgage loans that were reclassified to held-for-sale.
(c)Represents marks on held-for-sale positions related to unfunded commitments in the bridge financing portfolio.
(d)Prior-period amounts have been revised to conform with the current presentation.
Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information about the measurement of impaired collateral-dependent loans, and other loans where the carrying value is based on the fair value of the underlying collateral (e.g., residential mortgage loans charged off in accordance with regulatory guidance).loans.


Equity securities without readily determinable fair values
The Firm measures certain equity securities without readily determinable fair values at cost less impairment (if any), plus or minus observable price changes from an identical or similar investment of the same issuer, with such changes recognized in earnings.other income.
In its determination of the new carrying values upon observable price changes, the Firm may adjust the prices if deemed necessary to arrive at the Firm’s estimated fair values. Such adjustments may include adjustments to reflect the different rights and obligations of similar securities, and other adjustments that are consistent with the Firm’s valuation techniques for private equity direct investments.
The following table presents the carrying value of equity securities without readily determinable fair values still held as of SeptemberJune 30, 20192020 and 2018,2019, that are measured under the measurement alternative and the related adjustments recorded during the periods presented for those securities with observable price changes. These securities are included in the nonrecurring fair value tables when applicable price changes are observable.
Three months ended Nine months endedThree months ended Six months ended
September 30, September 30,June 30 June 30
As of or for the period ended,              
(in millions)2019 2018 2019 20182020 2019 2020 2019
Other assets              
Carrying value(a)
$2,771
 $1,801
 $2,771
 $1,801
$2,620
 $1,704
 $2,620
 $1,704
Upward carrying value changes(b)
34
 14
 169
 540
4
 52
 13
 136
Downward carrying value changes/impairment(c)
—
 (127) (37) (156)(9) (36) (171) (42)
(a)The carrying value as of December 31, 20182019 was $1.5$2.4 billion.
(b)The cumulative upward carrying value changes between January 1, 2018 and SeptemberJune 30, 20192020 were $479$541 million.
(c)The cumulative downward carrying value changes/impairment between January 1, 2018 and SeptemberJune 30, 20192020 were $(197)$(368) million.
Included in other assets above is the Firm’s interest in approximately 40 million Visa Class B shares, recorded at a nominal carrying value. These shares are subject to certain transfer restrictions currently and will be convertible into Visa Class A shares upon final resolution of certain litigation matters involving Visa. The conversion rate of Visa Class B shares into Visa Class A shares is 1.6228 at SeptemberJune 30, 2019,2020, and may be adjusted by Visa depending on developments related to the litigation matters.

Additional disclosures about the fair value of financial instruments that are not carried on the Consolidated balance sheets at fair value
The following table presents by fair value hierarchy classification the carrying values and estimated fair values at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, of financial assets and liabilities, excluding financial instruments that are carried at fair value on a recurring basis, and their classification within the fair value hierarchy.
 June 30, 2020 December 31, 2019
  Estimated fair value hierarchy   Estimated fair value hierarchy 
(in billions)
Carrying
value
Level 1Level 2Level 3
Total estimated
fair value
 
Carrying
value
Level 1Level 2Level 3
Total estimated
fair value
Financial assets           
Cash and due from banks$20.5
$20.5
$—
$—
$20.5
 $21.7
$21.7
$—
$—
$21.7
Deposits with banks473.2
473.2
—
—
473.2
 241.9
241.9
—
—
241.9
Accrued interest and accounts receivable71.4
—
71.4
—
71.4
 71.3
—
71.2
0.1
71.3
Federal funds sold and securities purchased under resale agreements13.0
—
13.0
—
13.0
 234.6
—
234.6
—
234.6
Securities borrowed100.2
—
100.2
—
100.2
 133.5
—
133.5
—
133.5
Investment securities, held-to-maturity72.9
—
76.1
—
76.1
 47.5
0.1
48.8
—
48.9
Loans, net of allowance for loan losses(a)
940.5
—
215.9
752.5
968.4
 939.5
—
214.1
734.9
949.0
Other69.5
—
68.3
1.3
69.6
 61.3
—
60.6
0.8
61.4
Financial liabilities           
Deposits$1,909.5
$—
$1,909.7
$—
$1,909.7
 $1,533.8
$—
$1,534.1
$—
$1,534.1
Federal funds purchased and securities loaned or sold under repurchase agreements46.3
—
46.3
—
46.3
 183.1
—
183.1
—
183.1
Short-term borrowings28.1
—
28.1
—
28.1
 35.0
—
35.0
—
35.0
Accounts payable and other liabilities188.8
—
184.7
3.8
188.5
 164.0
0.1
160.0
3.5
163.6
Beneficial interests issued by consolidated VIEs20.8
—
20.9
—
20.9
 17.8
—
17.9
—
17.9
Long-term debt242.2
—
239.8
3.4
243.2
 215.5
—
218.3
3.5
221.8
 September 30, 2019 December 31, 2018
  Estimated fair value hierarchy   Estimated fair value hierarchy 
(in billions)
Carrying
value
Level 1Level 2Level 3
Total estimated
fair value
 
Carrying
value
Level 1Level 2Level 3
Total estimated
fair value
Financial assets           
Cash and due from banks$21.2
$21.2
$—
$—
$21.2
 $22.3
$22.3
$—
$—
$22.3
Deposits with banks235.4
235.4
—
—
235.4
 256.5
256.5
—
—
256.5
Accrued interest and accounts receivable87.9
—
87.9
—
87.9
 72.0
—
71.9
0.1
72.0
Federal funds sold and securities purchased under resale agreements243.7
—
243.7
—
243.7
 308.4
—
308.4
—
308.4
Securities borrowed132.6
—
132.6
—
132.6
 106.9
—
106.9
—
106.9
Investment securities, held-to-maturity40.8
—
42.4
—
42.4
 31.4
—
31.5
—
31.5
Loans, net of allowance for loan losses(a)
926.2
—
218.9
720.7
939.6
 968.0
—
241.5
728.5
970.0
Other60.6
—
59.8
0.9
60.7
 60.5
—
59.6
1.0
60.6
Financial liabilities           
Deposits$1,495.9
$—
$1,496.3
$—
$1,496.3
 $1,447.4
$—
$1,447.5
$—
$1,447.5
Federal funds purchased and securities loaned or sold under repurchase agreements246.8
—
246.8
—
246.8
 181.4
—
181.4
—
181.4
Short-term borrowings42.4
—
42.4
—
42.4
 62.1
—
62.1
—
62.1
Accounts payable and other liabilities181.5
0.7
177.0
3.4
181.1
 160.6
0.2
157.0
3.0
160.2
Beneficial interests issued by consolidated VIEs18.5
—
18.5
—
18.5
 20.2
—
20.2
—
20.2
Long-term debt and junior subordinated deferrable interest debentures224.3
—
223.5
3.4
226.9
 227.1
—
224.6
3.3
227.9

(a)Fair value is typically estimated using a discounted cash flow model that incorporates the characteristics of the underlying loans (including principal, contractual interest rate and contractual fees) and other key inputs, including expected lifetime credit losses, interest rates, prepayment rates, and primary origination or secondary market spreads. For certain loans, the fair value is measured based on the value of the underlying collateral. Carrying value of the loan takes into account the loan’s allowance for loan losses, which represents the loan’s expected credit losses over its remaining expected life. The difference between the estimated fair value and carrying value of a financial asset or liabilityloan is the result of the different methodologies usedgenerally attributable to determinechanges in market interest rates, including credit spreads, market liquidity premiums and other factors that affect the fair value as compared withof a loan but do not affect its carrying value. For example, credit losses are estimated for a financial asset’s remaining life in a fair value calculation but are estimated for a loss emergence period in the allowance for loan loss calculation; future loan income (interest and fees) is incorporated in a fair value calculation but is generally not considered in the allowance for loan losses.
The majority of the Firm’s lending-related commitments are not carried at fair value on a recurring basis on the Consolidated balance sheets. The carrying value of the wholesale allowance for lending-related commitments and the estimated fair value of these wholesale lending-related commitments were as follows for the periods indicated.
September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
 Estimated fair value hierarchy   Estimated fair value hierarchy  Estimated fair value hierarchy   Estimated fair value hierarchy 
(in billions)
Carrying value(a)
Level 1Level 2Level 3Total estimated fair value 
Carrying value(a)
Level 1Level 2Level 3
Total estimated fair value(b)
Carrying value(a) (b)
Level 1Level 2Level 3Total estimated fair value 
Carrying value(a)
Level 1Level 2Level 3Total estimated fair value
Wholesale lending-related commitments$1.1
$—
$—
$1.9
$1.9
 $1.0
$—
$—
$1.9
$1.9
$2.1
$—
$—
$2.4
$2.4
 $1.2
$—
$—
$1.9
$1.9
(a)Excludes the current carrying values of the guarantee liability and the offsetting asset, each of which is recognized at fair value at the inception of the guarantees.
(b)The prior period amounts have been revisedIncludes the wholesale allowance for lending-related commitments and net markdowns associated with held-for-sale positions related to conform withunfunded commitments in the current period presentation.bridge financing portfolio.
The Firm does not estimate the fair value of consumer off-balance sheet lending-related commitments. In many cases, the Firm can reduce or cancel these commitments by providing the borrower notice or, in some cases as permitted by law, without notice. Refer to page 161156 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of the valuation of lending-related commitments.

Note 3 – Fair value option
Refer to Note 3 of JPMorgan Chase’s 2018 Form 10-K for a discussion of the primary financial instruments for which theThe fair value option wasprovides an option to elect fair value as an alternative measurement for selected financial assets, financial liabilities, unrecognized firm commitments, and written loan commitments.
The Firm has elected to measure certain instruments at fair value for several reasons including to mitigate income statement volatility caused by the differences between the measurement basis of elected instruments (e.g., certain instruments that otherwise would be accounted for those electionson an accrual basis) and the determinationassociated risk management arrangements that are accounted for on a fair value basis, as well as to better reflect those instruments that are managed on a fair value basis.
The Firm’s election of instrument-specific credit risk, where relevant.fair value includes the following instruments:
•
Loans purchased or originated as part of securitization warehousing activity, subject to bifurcation accounting, or managed on a fair value basis, including lending-related commitments
•
Certain securities financing agreements
•
Owned beneficial interests in securitized financial assets that contain embedded credit derivatives, which would otherwise be required to be separately accounted for as a derivative instrument
•
Structured notes, which are predominantly financial instruments that contain embedded derivatives, that are issued as part of client-driven activities
•
Certain long-term beneficial interests issued by CIB’s consolidated securitization trusts where the underlying assets are carried at fair value
Changes in fair value under the fair value option election
The following table presents the changes in fair value included in the Consolidated statements of income for the three and six months ended September June 30, 20192020 and 2018,2019, for items for which the fair value option was elected. The profit and loss information presented below only includes the financial instruments that were elected to be measured at fair value; related risk management instruments, which are required to be measured at fair value, are not included in the table.
Three months ended September 30,Three months ended June 30,
2019 20182020 2019
(in millions)Principal transactions All other income
Total changes in fair
value recorded (e)
 Principal transactions All other income
Total changes in fair value recorded (e)
Principal transactions All other income
Total changes in fair
value recorded (e)
 Principal transactions All other income
Total changes in fair value recorded (e)
Federal funds sold and securities purchased under resale agreements$(23) $—
 $(23) $(23) $—
 $(23)$(299) $—
 $(299) $22
 $—
 $22
Securities borrowed99
 —
 99
 (24) —
 (24)(58) —
 (58) 43
 —
 43
Trading assets:                      
Debt and equity instruments, excluding loans546
 —
 546
 (45) 5
(c) 
(40)1,209
 —
 1,209
 204
 —
 204
Loans reported as trading assets:                      
Changes in instrument-specific credit risk111
 (4)
(c) 
107
 122
 1
(c) 
123
413
 38
(c) 
451
 199
 2
(c) 
201
Other changes in fair value74
 320
(c) 
394
 (6) 49
(c) 
43
(22) 754
(c) 
732
 120
 328
(c) 
448
Loans:                      
Changes in instrument-specific credit risk(4) —
 (4) (1) —
 (1)(42) —
 (42) (13) —
 (13)
Other changes in fair value—
 —
 —
 1
 —
 1
4
 —
 4
 1
 —
 1
Other assets(6) —
 (6) 2
 16
(d) 
18
28
 25
(d) 
53
 2
 3
(d) 
5
Deposits(a)
(397) —
 (397) 32
 —
 32
(362) —
 (362) (696) —
 (696)
Federal funds purchased and securities loaned or sold under repurchase agreements2
 —
 2
 8
 —
 8
181
 —
 181
 (15) —
 (15)
Short-term borrowings(a)
173
 —
 173
 (25) —
 (25)(631) —
 (631) (70) —
 (70)
Trading liabilities—
 —
 —
 2
 —
 2
—
 —
 —
 2
 —
 2
Other liabilities1
 —
 1
 —
 —
 —
(11) —
 (11) (4) —
 (4)
Long-term debt(a)(b)
(614) —
 (614) 259
 —
 259
(3,581) (2)
(c) 
(3,583) (1,770) —
 (1,770)



























Nine months ended September 30,Six months ended June 30,
2019 20182020 2019
(in millions)Principal transactions All other income
Total changes in fair
value recorded (e)
 Principal transactions All other income
Total changes in fair value recorded (e)
Principal transactions All other income
Total changes in fair
value recorded (e)
 Principal transactions All other income
Total changes in fair value recorded (e)
Federal funds sold and securities purchased under resale agreements$10
 $—
 $10
 $(49) $—
 $(49)$244
 $—
 $244
 $33
 $—
 $33
Securities borrowed179
 —
 179
 (22) —
 (22)168
 —
 168
 80
 —
 80
Trading assets:                      
Debt and equity instruments, excluding loans2,104
 —
 2,104
 (490) 6
(c) 
(484)(1,229) (1)
(c) 
(1,230) 1,558
 —
 1,558
Loans reported as trading assets:                      
Changes in instrument-specific credit risk558
 1
(c) 
559
 458
 5
(c) 
463
(176) 15
(c) 
(161) 447
 5
(c) 
452
Other changes in fair value274
 885
(c) 
1,159
 64
 24
(c) 
88
253
 1,495
(c) 
1,748
 200
 565
(c) 
765
Loans:                      
Changes in instrument-specific credit risk(12) —
 (12) (2) —
 (2)(46) —
 (46) (8) —
 (8)
Other changes in fair value1
 —
 1
 (1) —
 (1)23
 —
 23
 1
 —
 1
Other assets(3) 3
(d) 
—
 4
 6
(d) 
10
89
 8
(d) 
97
 3
 3
(d) 
6
Deposits(a)
(1,589) —
 (1,589) 371
 —
 371
(465) —
 (465) (1,192) —
 (1,192)
Federal funds purchased and securities loaned or sold under repurchase agreements(18) —
 (18) 27
 —
 27
(78) —
 (78) (20) —
 (20)
Short-term borrowings(a)
(601) —
 (601) 86
 —
 86
1,089
 —
 1,089
 (774) —
 (774)
Trading liabilities5
 —
 5
 1
 —
 1
—
 —
 —
 5
 —
 5
Other liabilities(7) —
 (7) —
 —
 —
(46) —
 (46) (8) —
 (8)
Long-term debt(a)(b)
(5,220) —
 (5,220) 1,486
 —
 1,486
600
 3
(c) 
603
 (4,606) —
 (4,606)
(a)Unrealized gains/(losses) due to instrument-specific credit risk (DVA) for liabilities for which the fair value option has been elected isare recorded in OCI, while realized gains/(losses) are recorded in principal transactions revenue. Realized gains/(losses) due to instrument-specific credit risk recorded in principal transactions revenue were not$21 million and $19 million for the three and six months ended June 30, 2020, respectively. The amounts were 0t material for the three and ninesix months ended SeptemberJune 30, 2019 and 2018, respectively.2019.
(b)Long-term debt measured at fair value predominantly relates to structured notes. Although the risk associated with the structured notes is actively managed, the gains/(losses) reported in this table do not include the income statement impact of the risk management instruments used to manage such risk.
(c)Reported in mortgage fees and related income.
(d)Reported in other income.
(e)Changes in fair value exclude contractual interest, which is included in interest income and interest expense for all instruments other than hybrid financial instruments. Refer to Note 67 for further information regarding interest income and interest expense.




Difference between aggregate fair value and aggregate remaining contractual principal balance outstanding
The following table reflects the difference between the aggregate fair value and the aggregate remaining contractual principal balance outstanding as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, for loans, long-term debt and long-term beneficial interests for which the fair value option has been elected.
September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
(in millions)Contractual principal outstanding
Fair valueFair value over/(under) contractual principal outstanding Contractual principal outstanding Fair valueFair value over/(under) contractual principal outstandingContractual principal outstanding
Fair valueFair value over/(under) contractual principal outstanding Contractual principal outstanding Fair valueFair value over/(under) contractual principal outstanding
Loans(a)







    






    
Nonaccrual loans






    






    
Loans reported as trading assets$3,884

$1,151
$(2,733) $4,240
 $1,350
$(2,890)$4,566

$1,931
$(2,635) $3,717
 $1,111
$(2,606)
Loans181

151
(30) 39
 —
(39)282

225
(57) 178
 139
(39)
Subtotal4,065

1,302
(2,763) 4,279
 1,350
(2,929)4,848

2,156
(2,692) 3,895
 1,250
(2,645)
All other performing loans






    






    
Loans reported as trading assets45,315

43,903
(1,412) 42,215
 40,403
(1,812)40,481

38,807
(1,674) 48,570
 47,318
(1,252)
Loans5,686

5,609
(77) 3,186
 3,151
(35)5,788

5,698
(90) 7,046
 6,965
(81)
Total loans$55,066

$50,814
$(4,252) $49,680
 $44,904
$(4,776)$51,117

$46,661
$(4,456) $59,511
 $55,533
$(3,978)
Long-term debt






    






    
Principal-protected debt$40,750
(c) 
$37,635
$(3,115) $32,674
(c) 
$28,718
$(3,956)$41,280
(c) 
$40,717
$(563) $40,124
(c) 
$39,246
$(878)
Nonprincipal-protected debt(b)
NA

34,322
NA
 NA
 26,168
NA
NA

34,041
NA
 NA
 36,499
NA
Total long-term debtNA

$71,957
NA
 NA
 $54,886
NA
NA

$74,758
NA
 NA
 $75,745
NA
Long-term beneficial interests              
Nonprincipal-protected debt(b)
NA

$39
NA
 NA
 $28
NA
NA

$40
NA
 NA
 $36
NA
Total long-term beneficial interestsNA

$39
NA
 NA
 $28
NA
NA

$40
NA
 NA
 $36
NA
(a)There were 0 performing loans that were ninety days or more past due as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively.
(b)Remaining contractual principal is not applicable to nonprincipal-protected structured notes and long-term beneficial interests. Unlike principal-protected structured notes and long-term beneficial interests, for which the Firm is obligated to return a stated amount of principal at maturity, nonprincipal-protected structured notes and long-term beneficial interests do not obligate the Firm to return a stated amount of principal at maturity, but for structured notes to return an amount based on the performance of an underlying variable or derivative feature embedded in the note. However, investors are exposed to the credit risk of the Firm as issuer for both nonprincipal-protected and principal-protected notes.
(c)Where the Firm issues principal-protected zero-coupon or discount notes, the balance reflects the contractual principal payment at maturity or, if applicable, the contractual principal payment at the Firm’s next call date.
At September June 30, 2019,2020, and December 31, 2018,2019, the contractual amount of lending-related commitments for which the fair value option was elected was $6.5$12.1 billion and $6.9$8.6 billion, respectively, with a corresponding fair value of $(91)$(121) million and $(82)$(120) million, respectively. Refer to Note 2728 of JPMorgan Chase’s 20182019 Form 10-K, and Note 2223 of this Form 10-Q for further information regarding off-balance sheet lending-related financial instruments. Prior-period amounts have been revised to conform with the current presentation.
Structured note products by balance sheet classification and risk component
The following table presents the fair value of structured notes, by balance sheet classification and the primary risk type.
September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
(in millions)Long-term debtShort-term borrowingsDepositsTotal Long-term debtShort-term borrowingsDepositsTotalLong-term debtShort-term borrowingsDepositsTotal Long-term debtShort-term borrowingsDepositsTotal
Risk exposure      
Interest rate$33,402
$54
$17,547
$51,003
 $24,137
$62
$12,372
$36,571
$37,317
$286
$10,190
$47,793
 $35,470
$34
$16,692
$52,196
Credit5,207
817
—
6,024
 4,009
995
—
5,004
5,119
494
—
5,613
 5,715
875
—
6,590
Foreign exchange3,570
45
8
3,623
 3,169
157
38
3,364
3,929
121
4
4,054
 3,862
48
5
3,915
Equity27,644
5,565
8,190
41,399
 21,382
5,422
7,368
34,172
27,416
4,984
7,508
39,908
 29,294
4,852
8,177
42,323
Commodity504
7
1,352
1,863
 372
34
1,207
1,613
417
24
1,500
1,941
 472
32
1,454
1,958
Total structured notes$70,327
$6,488
$27,097
$103,912
 $53,069
$6,670
$20,985
$80,724
$74,198
$5,909
$19,202
$99,309
 $74,813
$5,841
$26,328
$106,982




Note 4 – Credit risk concentrations
Concentrations of credit risk arise when a number of clients, counterparties or customers are engaged in similar business activities or activities in the same geographic region, or when they have similar economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions.
JPMorgan Chase regularly monitors various segments of its credit portfolios to assess potential credit risk concentrations and to obtain additional collateral when deemed necessary and permitted under the Firm’s agreements. Senior management is significantly involved in the credit approval and review process, and risk levels are adjusted as needed to reflect the Firm’s risk appetite.
In theFirm’sconsumer portfolio, concentrations are managed primarily by product and by U.S. geographic region, with a key focus on trends and concentrations at the portfolio level, where potential credit risk concentrations can be remedied through changes in underwriting policies and portfolio guidelines. Refer to Note 12 for additional information on the geographic composition of theFirm’sconsumer loan portfolios. In the wholesale portfolio, credit risk concentrations are evaluated primarily by industry and monitored regularly on both an aggregate portfolio level and on an individual client or counterparty basis.
The Firm’s wholesale exposure is managed through loan syndications and participations, loan sales, securitizations, credit derivatives, master netting agreements, collateral and other risk-reduction techniques. Refer to Note 12 for additional information on loans.
The Firm does not believe that its exposure to any particular loan product or industry segment (e.g., real estate), or its exposure to residential real estate loans with high LTV ratios,results in a significant concentration of credit risk.
Terms of loan products and collateral coverage are included in the Firm’s assessment when extending credit and establishing its allowance for loan losses.

The table below presents both on–balance sheet and off–balance sheet consumer and wholesale-related credit exposure by the Firm’s 3credit portfolio segments as of June 30, 2020, and December 31, 2019. The wholesale industry of risk category is generally based on the client or counterparty’s primary business activity.
In conjunction with the adoption of CECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Refer to Note 1 for further information.
 June 30, 2020 December 31, 2019
 
Credit exposure(h)
On-balance sheet
Off-balance sheet(j)
 
Credit exposure(h)
On-balance sheet
Off-balance sheet(j)
(in millions)Loans Derivatives LoansDerivatives
Consumer, excluding credit card$354,265
$308,917
(i) 
$—
$45,348
 $338,170
$298,001
$—
$40,169
Credit card(a)
815,492
141,656
 —
673,836
 819,644
168,924
—
650,720
Total consumer-related(a)
1,169,757
450,573
 —
719,184
 1,157,814
466,925
—
690,889
Wholesale-related(b)
          
Real Estate148,656
122,202
 1,581
24,873
 150,805
117,709
619
32,477
Consumer & Retail110,160
47,705
 2,532
59,923
 106,986
36,985
1,424
68,577
Individuals and Individual Entities(c)
109,563
96,890
 1,762
10,911
 105,018
94,616
694
9,708
Industrials66,179
26,058
 1,752
38,369
 62,483
22,063
878
39,542
Healthcare60,471
21,028
 3,298
36,145
 50,824
17,607
2,078
31,139
Technology, Media &
Telecommunications		60,461
17,637
 3,791
39,033
 60,033
15,322
2,766
41,945
Asset Managers60,270
26,911
 9,186
24,173
 51,856
24,008
7,160
20,688
Banks & Finance Cos49,970
26,985
 6,870
16,115
 50,786
31,191
5,165
14,430
Oil & Gas43,035
14,141
 996
27,898
 41,641
13,101
852
27,688
Automotive38,294
19,085
 1,691
17,518
 35,118
18,844
368
15,906
State & Municipal Govt(d)
36,824
16,830
 2,597
17,397
 30,095
13,271
2,000
14,824
Utilities32,078
5,858
 3,242
22,978
 34,843
5,157
2,573
27,113
Transportation18,089
8,892
 1,847
7,350
 14,497
5,253
715
8,529
Chemicals & Plastics17,172
5,129
 752
11,291
 17,499
4,864
459
12,176
Central Govt16,385
2,985
 12,233
1,167
 14,865
2,840
10,477
1,548
Metals & Mining15,790
5,874
 757
9,159
 15,586
5,364
402
9,820
Insurance14,804
1,808
 3,193
9,803
 12,348
1,356
2,282
8,710
Securities Firms8,233
531
 4,863
2,839
 7,344
757
4,507
2,080
Financial Markets Infrastructure7,724
110
 5,860
1,754
 4,121
13
2,482
1,626
All other(e)
82,968
50,128
 6,043
26,797
 78,006
51,357
1,865
24,784
Subtotal997,126
516,787
 74,846
405,493
 944,754
481,678
49,766
413,310
Loans held-for-sale and loans at fair value11,158
11,158
 —
—
 11,166
11,166
—
—
Receivables from customers and other(f)
22,403
—
 —
—
 33,706
—
—
—
Total wholesale-related1,030,687
527,945
 74,846
405,493
 989,626
492,844
49,766
413,310
Total exposure(g)(h)
$2,200,444
$978,518
 $74,846
$1,124,677
 $2,147,440
$959,769
$49,766
$1,104,199
(a)Also includes commercial card lending-related commitments primarily in CB and CIB.
(b)The industry rankings presented in the table as of December 31, 2019, are based on the industry rankings of the corresponding exposures at June 30, 2020, not actual rankings of such exposures at December 31, 2019.
(c)Individuals and Individual Entities predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts.
(d)
In addition to the credit risk exposure to states and municipal governments (both U.S. and non-U.S.) at June 30, 2020, and December 31, 2019, noted above, the Firm held: $7.5 billion and $6.5 billion, respectively, of trading assets; $30.4 billion and $29.8 billion, respectively, of AFS securities; and $4.8 billion at both periods of HTM securities, issued by U.S. state and municipal governments. Refer to Note 2 and Note 10 for further information.
(e)
All other includes: SPEs and Private education and civic organizations, representing approximately 90% and 10%, respectively, at both June 30, 2020, and December 31, 2019. Refer to Note 14 for more information on exposures to SPEs.
(f)Receivables from customers primarily represent held-for-investment margin loans to brokerage clients in CIB and AWM that are collateralized by assets maintained in the clients’ brokerage accounts (e.g., cash on deposit, liquid and readily marketable debt or equity securities), as such generally no allowance for credit losses is held against these receivables. To manage its credit risk the Firm establishes margin requirements and monitors the required margin levels on an ongoing basis, and requires clients to deposit additional cash or other collateral, or to reduce positions, when appropriate. These receivables are reported within accrued interest and accounts receivable on the Firm’s Consolidated balance sheets.
(g)Excludes cash placed with banks of $484.2 billion and $254.0 billion, at June 30, 2020, and December 31, 2019, respectively, which is predominantly placed with various central banks, primarily Federal Reserve Banks.
(h)Credit exposure is net of risk participations and excludes the benefit of credit derivatives used in credit portfolio management activities held against derivative receivables or loans and liquid securities and other cash collateral held against derivative receivables.
(i)At June 30, 2020, included $19.9 billion of loans in Business Banking under the PPP. PPP loans are guaranteed by the SBA. Other than in certain limited circumstances, the Firm typically does not recognize charge-offs, classify as nonaccrual nor record an allowance for loan losses on government guaranteed loans.
(j)Represents lending-related financial instruments.

Note 5 – Derivative instruments
JPMorgan Chase makes markets in derivatives for clients and also uses derivatives to hedge or manage its own risk exposures. Refer to Note 5 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of the Firm’s use of and accounting policies regarding derivative instruments.
The Firm’s disclosures are based on the accounting treatment and purpose of these derivatives. A limited number of the Firm’s derivatives are designated in hedge
 
accounting relationships and are disclosed according to the type of hedge (fair value hedge, cash flow hedge, or net investment hedge). Derivatives not designated in hedge accounting relationships include certain derivatives that are used to manage certain risks associated with specified assets orand liabilities (“specified risk management” positions) as well as derivatives used in the Firm’s market-making businesses or for other purposes.

The following table outlines the Firm’s primary uses of derivatives and the related hedge accounting designation or disclosure category.
Type of DerivativeUse of DerivativeDesignation and disclosure
Affected
segment or unit
10-Q page reference
Manage specifically identified risk exposures in qualifying hedge accounting relationships:
•
Interest rate
Hedge fixed rate assets and liabilitiesFair value hedgeCorporate109-110126-127
•
Interest rate
Hedge floating-rate assets and liabilitiesCash flow hedgeCorporate111128
•
Foreign exchange
Hedge foreign currency-denominated assets and liabilitiesFair value hedgeCorporate109-110126-127
•
Foreign exchange
Hedge foreign currency-denominated forecasted revenue and expenseCash flow hedgeCorporate111128
•
Foreign exchange
Hedge the value of the Firm’s investments in non-U.S. dollar functional currency entitiesNet investment hedgeCorporate112129
•
Commodity
Hedge commodity inventoryFair value hedgeCIB109-110126-127
Manage specifically identified risk exposures not designated in qualifying hedge accounting relationships:
•
Interest rate
Manage the risk of theassociated with mortgage pipeline,commitments, warehouse loans and MSRsSpecified risk managementCCB112129
•
Credit
Manage the credit risk ofassociated with wholesale lending exposuresSpecified risk managementCIB112129
•
Interest rate and foreign exchange
Manage the risk ofassociated with certain other specified assets and liabilitiesSpecified risk managementCorporate112129
Market-making derivatives and other activities:
•
Various
Market-making and related risk managementMarket-making and otherCIB112129
•
Various
Other derivativesMarket-making and otherCIB, AWM, Corporate112129



Notional amount of derivative contracts
The following table summarizes the notional amount of derivative contracts outstanding as of September June 30, 2019,2020, and December 31, 2018.2019.
Notional amounts(b)
Notional amounts(b)
(in billions)September 30, 2019
December 31, 2018
June 30, 2020
December 31, 2019
Interest rate contracts  
Swaps$25,099
$21,763
$23,899
$21,228
Futures and forwards4,887
3,562
5,338
3,152
Written options4,290
3,997
3,633
3,938
Purchased options4,697
4,322
4,033
4,361
Total interest rate contracts38,973
33,644
36,903
32,679
Credit derivatives(a)
1,365
1,501
1,250
1,242
Foreign exchange contracts  
Cross-currency swaps3,886
3,548
3,730
3,604
Spot, futures and forwards7,111
5,871
7,201
5,577
Written options832
835
750
700
Purchased options852
830
752
718
Total foreign exchange contracts12,681
11,084
12,433
10,599
Equity contracts  
Swaps389
346
349
406
Futures and forwards131
101
122
142
Written options692
528
675
646
Purchased options632
490
633
611
Total equity contracts1,844
1,465
1,779
1,805
Commodity contracts  
Swaps148
134
133
147
Spot, futures and forwards218
156
212
211
Written options166
135
154
135
Purchased options153
120
141
124
Total commodity contracts685
545
640
617
Total derivative notional amounts$55,548
$48,239
$53,005
$46,942
(a)Refer to the Credit derivatives discussion on page 113130 for more information on volumes and types of credit derivative contracts.
(b)Represents the sum of gross long and gross short third-party notional derivative contracts.
While the notional amounts disclosed above give an indication of the volume of the Firm’s derivatives activity, the notional amounts significantly exceed, in the Firm’s view, the possible losses that could arise from such transactions. For most derivative contracts, the notional amount is not exchanged; it is used simply as a reference amount used to calculate payments.

Impact of derivatives on the Consolidated balance sheets
The following table summarizes information on derivative receivables and payables (before and after netting adjustments) that are reflected on the Firm’s Consolidated balance sheets as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, by accounting designation (e.g., whether the derivatives were designated in qualifying hedge accounting relationships or not) and contract type.
Free-standing derivative receivables and payables(a)
Free-standing derivative receivables and payables(a)
          
Free-standing derivative receivables and payables(a)
          
Gross derivative receivables   Gross derivative payables  Gross derivative receivables   Gross derivative payables  
September 30, 2019
(in millions)		Not designated as hedges Designated as hedges Total derivative receivables 
Net derivative receivables(b)
 Not designated as hedges 
Designated
as hedges
 Total derivative payables 
Net derivative payables(b)
June 30, 2020
(in millions)		Not designated as hedges Designated as hedges Total derivative receivables 
Net derivative receivables(b)
 Not designated as hedges 
Designated
as hedges
 Total derivative payables 
Net derivative payables(b)
Trading assets and liabilities                              
Interest rate$375,082
 $851
 $375,933
 $28,507
 $338,711
 $2
 $338,713
 $10,223
$408,225
 $767
 $408,992
 $37,028
 $369,518
 $1
 $369,519
 $12,770
Credit15,717
 —
 15,717
 838
 17,062
 —
 17,062
 2,159
14,933
 —
 14,933
 1,171
 15,926
 —
 15,926
 2,080
Foreign exchange162,364
 768
 163,132
 12,681
 164,583
 1,159
 165,742
 15,016
162,460
 1,335
 163,795
 12,575
 176,032
 624
 176,656
 16,177
Equity46,378
 —
 46,378
 7,409
 50,891
 —
 50,891
 10,603
67,932
 —
 67,932
 14,857
 68,710
 —
 68,710
 15,962
Commodity20,985
 253
 21,238
 6,142
 25,470
 341
 25,811
 9,789
24,771
 847
 25,618
 9,215
 26,045
 1,102
 27,147
 10,488
Total fair value of trading assets and liabilities$620,526
 $1,872
 $622,398
 $55,577
 $596,717
 $1,502
 $598,219
 $47,790
$678,321
 $2,949
 $681,270
 $74,846
 $656,231
 $1,727
 $657,958
 $57,477
                              
Gross derivative receivables   Gross derivative payables  Gross derivative receivables   Gross derivative payables  
December 31, 2018
(in millions)		Not designated as hedges Designated as hedges Total derivative receivables 
Net derivative receivables(b)
 Not designated as hedges Designated
as hedges		 Total derivative payables 
Net derivative payables(b)
December 31, 2019
(in millions)		Not designated as hedges Designated as hedges Total derivative receivables 
Net derivative receivables(b)
 Not designated as hedges Designated
as hedges		 Total derivative payables 
Net derivative payables(b)
Trading assets and liabilities                              
Interest rate$267,871
 $833
 $268,704
 $23,214
 $242,782
 $—
 $242,782
 $7,784
$312,451
 $843
 $313,294
 $27,421
 $279,272
 $1
 $279,273
 $8,603
Credit20,095
 —
 20,095
 612
 20,276
 —
 20,276
 1,667
14,876
 —
 14,876
 701
 15,121
 —
 15,121
 1,652
Foreign exchange167,057
 628
 167,685
 13,450
 164,392
 825
 165,217
 12,785
138,179
 308
 138,487
 9,005
 144,125
 983
 145,108
 13,158
Equity49,285
 —
 49,285
 9,946
 51,195
 —
 51,195
 10,161
45,727
 —
 45,727
 6,477
 52,741
 —
 52,741
 12,537
Commodity20,223
 247
 20,470
 6,991
 22,297
 121
 22,418
 9,372
16,914
 328
 17,242
 6,162
 19,736
 149
 19,885
 7,758
Total fair value of trading assets and liabilities$524,531
 $1,708
 $526,239
 $54,213
 $500,942
 $946
 $501,888
 $41,769
$528,147
 $1,479
 $529,626
 $49,766
 $510,995
 $1,133
 $512,128
 $43,708

(a)Balances exclude structured notes for which the fair value option has been elected. Refer to Note 3 for further information.
(b)As permitted under U.S. GAAP, the Firm has elected to net derivative receivables and derivative payables and the related cash collateral receivables and payables when a legally enforceable master netting agreement exists.


Derivatives netting
The following tables present, as of September June 30, 2019,2020, and December 31, 2018, 2019, gross and net derivative receivables and payables by contract and settlement type. Derivative receivables and payables, as well as the related cash collateral from the same counterparty have been netted on the Consolidated balance sheets where the Firm has obtained an appropriate legal opinion with respect to the master netting agreement. Where such a legal opinion has not been either sought or obtained, amounts are not eligible for netting on the Consolidated balance sheets, and those derivative receivables and payables are shown separately in the tables below.
In addition to the cash collateral received and transferred that is presented on a net basis with derivative receivables and payables, the Firm receives and transfers additional collateral (financial instruments and cash). These amounts mitigate counterparty credit risk associated with the Firm’s derivative instruments, but are not eligible for net presentation:
•
collateral that consists of non-cash financial instruments (generally U.S. government and agency securities and other G7 government securities) and cash collateral held at third-party custodians, which are shown separately as “Collateral not nettable on the Consolidated balance sheets” in the tables below, up to the fair value exposure amount.amount;
•
the amount of collateral held or transferred that exceeds the fair value exposure at the individual counterparty level, as of the date presented, which is excluded from the tables below; and
•
collateral held or transferred that relates to derivative receivables or payables where an appropriate legal opinion has not been either sought or obtained with respect to the master netting agreement, which is excluded from the tables below.
September 30, 2019 December 31, 2018 June 30, 2020 December 31, 2019
(in millions)(in millions)Gross derivative receivablesAmounts netted on the Consolidated balance sheetsNet derivative receivables Gross derivative receivables Amounts netted on the Consolidated balance sheetsNet derivative receivables(in millions)Gross derivative receivablesAmounts netted on the Consolidated balance sheetsNet derivative receivables Gross derivative receivables Amounts netted on the Consolidated balance sheetsNet derivative receivables
U.S. GAAP nettable derivative receivablesU.S. GAAP nettable derivative receivables           U.S. GAAP nettable derivative receivables           
Interest rate contracts:Interest rate contracts:          Interest rate contracts:          
Over-the-counter (“OTC”)Over-the-counter (“OTC”)$356,075
$(332,566) $23,509
 $258,227
 $(239,498) $18,729
 Over-the-counter (“OTC”)$387,069
$(356,834) $30,235
 $299,205
 $(276,255) $22,950
 
OTC–clearedOTC–cleared14,438
(14,343) 95
 6,404
 (5,856) 548
 OTC–cleared14,434
(14,315) 119
 9,442
 (9,360) 82
 
Exchange-traded(a)
Exchange-traded(a)
577
(517) 60
 322
 (136) 186
 
Exchange-traded(a)
875
(815) 60
 347
 (258) 89
 
Total interest rate contractsTotal interest rate contracts371,090
(347,426) 23,664
 264,953
 (245,490) 19,463
 Total interest rate contracts402,378
(371,964) 30,414
 308,994
 (285,873) 23,121
 
Credit contracts:Credit contracts:          Credit contracts:          
OTCOTC11,168
(10,682) 486
 12,648
 (12,261) 387
 OTC11,598
(10,840) 758
 10,743
 (10,317) 426
 
OTC–clearedOTC–cleared4,321
(4,197) 124
 7,267
 (7,222) 45
 OTC–cleared2,946
(2,922) 24
 3,864
 (3,858) 6
 
Total credit contractsTotal credit contracts15,489
(14,879) 610
 19,915
 (19,483) 432
 Total credit contracts14,544
(13,762) 782
 14,607
 (14,175) 432
 
Foreign exchange contracts:Foreign exchange contracts:          Foreign exchange contracts:          
OTCOTC160,181
(150,271) 9,910
 163,862
 (153,988) 9,874
 OTC160,126
(150,502) 9,624
 136,252
 (129,324) 6,928
 
OTC–clearedOTC–cleared176
(174) 2
 235
 (226) 9
 OTC–cleared736
(715) 21
 185
 (152) 33
 
Exchange-traded(a)
Exchange-traded(a)
20
(6) 14
 32
 (21) 11
 
Exchange-traded(a)
24
(3) 21
 10
 (6) 4
 
Total foreign exchange contractsTotal foreign exchange contracts160,377
(150,451) 9,926
 164,129
 (154,235) 9,894
 Total foreign exchange contracts160,886
(151,220) 9,666
 136,447
 (129,482) 6,965
 
Equity contracts:Equity contracts:          Equity contracts:          
OTCOTC22,195
(20,281) 1,914
 26,178
 (23,879) 2,299
 OTC26,510
(24,792) 1,718
 23,106
 (20,820) 2,286
 
Exchange-traded(a)
Exchange-traded(a)
21,678
(18,688) 2,990
 18,876
 (15,460) 3,416
 
Exchange-traded(a)
31,829
(28,283) 3,546
 19,654
 (18,430) 1,224
 
Total equity contractsTotal equity contracts43,873
(38,969) 4,904
 45,054
 (39,339) 5,715
 Total equity contracts58,339
(53,075) 5,264
 42,760
 (39,250) 3,510
 
Commodity contracts:Commodity contracts:          Commodity contracts:          
OTCOTC7,714
(5,954) 1,760
 7,448
 (5,261) 2,187
 OTC12,803
(9,066) 3,737
 7,093
 (5,149) 1,944
 
OTC–clearedOTC–cleared26
(25) 1
 —
 —
 —
 OTC–cleared35
(35) —
 28
 (28) —
 
Exchange-traded(a)
Exchange-traded(a)
9,151
(9,117) 34
 8,815
 (8,218) 597
 
Exchange-traded(a)
7,544
(7,302) 242
 6,154
 (5,903) 251
 
Total commodity contractsTotal commodity contracts16,891
(15,096) 1,795
 16,263
 (13,479) 2,784
 Total commodity contracts20,382
(16,403) 3,979
 13,275
 (11,080) 2,195
 
Derivative receivables with appropriate legal opinionDerivative receivables with appropriate legal opinion607,720
(566,821) 40,899
(d) 
510,314
 (472,026) 38,288
(d) 
Derivative receivables with appropriate legal opinion656,529
(606,424) 50,105
(d) 
516,083
 (479,860) 36,223
(d) 
Derivative receivables where an appropriate legal opinion has not been either sought or obtainedDerivative receivables where an appropriate legal opinion has not been either sought or obtained14,678
  14,678
 15,925
   15,925
 Derivative receivables where an appropriate legal opinion has not been either sought or obtained24,741
  24,741
 13,543
   13,543
 
Total derivative receivables recognized on the Consolidated balance sheetsTotal derivative receivables recognized on the Consolidated balance sheets$622,398
  $55,577
 $526,239
   $54,213
 Total derivative receivables recognized on the Consolidated balance sheets$681,270
  $74,846
 $529,626
   $49,766
 
Collateral not nettable on the Consolidated balance sheets(b)(c)
Collateral not nettable on the Consolidated balance sheets(b)(c)
  (13,224)     (13,046) 
Collateral not nettable on the Consolidated balance sheets(b)(c)
  (18,711)     (14,226) 
Net amountsNet amounts  $42,353
     $41,167
 Net amounts  $56,135
     $35,540
 



September 30, 2019 December 31, 2018 June 30, 2020 December 31, 2019
(in millions)(in millions)Gross derivative payablesAmounts netted on the Consolidated balance sheetsNet derivative payables Gross derivative payables Amounts netted on the Consolidated balance sheetsNet derivative payables(in millions)Gross derivative payablesAmounts netted on the Consolidated balance sheetsNet derivative payables Gross derivative payables Amounts netted on the Consolidated balance sheetsNet derivative payables
U.S. GAAP nettable derivative payablesU.S. GAAP nettable derivative payables          U.S. GAAP nettable derivative payables          
Interest rate contracts:Interest rate contracts:          Interest rate contracts:          
OTCOTC$321,553
$(313,017) $8,536
 $233,404
 $(228,369) $5,035
 OTC$352,062
$(341,400) $10,662
 $267,311
 $(260,229) $7,082
 
OTC–clearedOTC–cleared15,176
(14,960) 216
 7,163
 (6,494) 669
 OTC–cleared14,945
(14,645) 300
 10,217
 (10,138) 79
 
Exchange-traded(a)
Exchange-traded(a)
585
(513) 72
 210
 (135) 75
 
Exchange-traded(a)
721
(704) 17
 365
 (303) 62
 
Total interest rate contractsTotal interest rate contracts337,314
(328,490) 8,824
 240,777
 (234,998) 5,779
 Total interest rate contracts367,728
(356,749) 10,979
 277,893
 (270,670) 7,223
 
Credit contracts:Credit contracts:          Credit contracts:          
OTCOTC13,130
(11,254) 1,876
 13,412
 (11,895) 1,517
 OTC12,657
(11,068) 1,589
 11,570
 (10,080) 1,490
 
OTC–clearedOTC–cleared3,797
(3,649) 148
 6,716
 (6,714) 2
 OTC–cleared2,780
(2,778) 2
 3,390
 (3,389) 1
 
Total credit contractsTotal credit contracts16,927
(14,903) 2,024
 20,128
 (18,609) 1,519
 Total credit contracts15,437
(13,846) 1,591
 14,960
 (13,469) 1,491
 
Foreign exchange contracts:Foreign exchange contracts:          Foreign exchange contracts:          
OTCOTC162,336
(150,537) 11,799
 160,930
 (152,161) 8,769
 OTC172,678
(159,750) 12,928
 142,360
 (131,792) 10,568
 
OTC–clearedOTC–cleared190
(185) 5
 274
 (268) 6
 OTC–cleared736
(726) 10
 186
 (152) 34
 
Exchange-traded(a)
Exchange-traded(a)
14
(4) 10
 16
 (3) 13
 
Exchange-traded(a)
22
(3) 19
 12
 (6) 6
 
Total foreign exchange contractsTotal foreign exchange contracts162,540
(150,726) 11,814
 161,220
 (152,432) 8,788
 Total foreign exchange contracts173,436
(160,479) 12,957
 142,558
 (131,950) 10,608
 
Equity contracts:Equity contracts:          Equity contracts:          
OTCOTC27,010
(21,600) 5,410
 29,437
 (25,544) 3,893
 OTC30,160
(24,481) 5,679
 27,594
 (21,778) 5,816
 
Exchange-traded(a)
Exchange-traded(a)
20,365
(18,688) 1,677
 16,285
 (15,490) 795
 
Exchange-traded(a)
30,605
(28,267) 2,338
 20,216
 (18,426) 1,790
 
Total equity contractsTotal equity contracts47,375
(40,288) 7,087
 45,722
 (41,034) 4,688
 Total equity contracts60,765
(52,748) 8,017
 47,810
 (40,204) 7,606
 
Commodity contracts:Commodity contracts:          Commodity contracts:          
OTCOTC10,450
(6,874) 3,576
 8,930
 (4,838) 4,092
 OTC13,899
(9,185) 4,714
 8,714
 (6,235) 2,479
 
OTC–clearedOTC–cleared25
(25) —
 —
 —
 —
 OTC–cleared44
(44) —
 30
 (30) —
 
Exchange-traded(a)
Exchange-traded(a)
10,004
(9,123) 881
 8,259
 (8,208) 51
 
Exchange-traded(a)
7,486
(7,430) 56
 6,012
 (5,862) 150
 
Total commodity contractsTotal commodity contracts20,479
(16,022) 4,457
 17,189
 (13,046) 4,143
 Total commodity contracts21,429
(16,659) 4,770
 14,756
 (12,127) 2,629
 
Derivative payables with appropriate legal opinionDerivative payables with appropriate legal opinion584,635
(550,429) 34,206
(d) 
485,036
 (460,119) 24,917
(d) 
Derivative payables with appropriate legal opinion638,795
(600,481) 38,314
(d) 
497,977
 (468,420) 29,557
(d) 
Derivative payables where an appropriate legal opinion has not been either sought or obtainedDerivative payables where an appropriate legal opinion has not been either sought or obtained13,584
  13,584
 16,852
   16,852
 Derivative payables where an appropriate legal opinion has not been either sought or obtained19,163
  19,163
 14,151
   14,151
 
Total derivative payables recognized on the Consolidated balance sheetsTotal derivative payables recognized on the Consolidated balance sheets$598,219
  $47,790
 $501,888
   $41,769
 Total derivative payables recognized on the Consolidated balance sheets$657,958
  $57,477
 $512,128
   $43,708
 
Collateral not nettable on the Consolidated balance sheets(b)(c)
Collateral not nettable on the Consolidated balance sheets(b)(c)
  (9,236)     (4,449) 
Collateral not nettable on the Consolidated balance sheets(b)(c)
  (12,607)     (7,896) 
Net amountsNet amounts  $38,554
     $37,320
 Net amounts  $44,870
     $35,812
 
(a)Exchange-traded derivative balances that relate to futures contracts are settled daily.
(b)Represents liquid security collateral as well as cash collateral held at third-party custodians related to derivative instruments where an appropriate legal opinion has been obtained. For some counterparties, the collateral amounts of financial instruments may exceed the derivative receivables and derivative payables balances. Where this is the case, the total amount reported is limited to the net derivative receivables and net derivative payables balances with that counterparty.
(c)Derivative collateral relates only to OTC and OTC-cleared derivative instruments.
(d)Net derivatives receivable included cash collateral netted of $78.8$80.7 billion and $55.2$65.9 billion at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively. Net derivatives payable included cash collateral netted of $62.4$74.7 billion and $43.3$54.4 billion at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively. Derivative cash collateral relates to OTC and OTC-cleared derivative instruments.


Liquidity risk and credit-related contingent features
Refer to Note 5 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed discussion of liquidity risk and credit-related contingent features related to the Firm’s derivative contracts.
The following table shows the aggregate fair value of net derivative payables related to OTC and OTC-cleared derivatives that contain contingent collateral or termination features that may be triggered upon a ratings downgrade, and the associated collateral the Firm has posted in the normal course of business, at SeptemberJune 30, 2019,2020, and December 31, 2018.2019.
OTC and OTC-cleared derivative payables containing downgrade triggers
(in millions)September 30, 2019  December 31, 2018 June 30, 2020  December 31, 2019 
Aggregate fair value of net derivative payables $15,466
 $9,396
 $27,255
 $14,819
Collateral posted 14,388
 8,907
 26,527
 13,329

The following table shows the impact of a single-notch and two-notch downgrade of the long-term issuer ratings of JPMorgan Chase & Co. and its subsidiaries, predominantly JPMorgan Chase Bank, N.A., at SeptemberJune 30, 2019,2020, and December 31, 2018, 2019, related to OTC and OTC-cleared derivative contracts with contingent collateral or termination features that may be triggered upon a ratings downgrade. Derivatives contracts generally require additional collateral to be posted or terminations to be triggered when the predefined threshold rating is breached. A downgrade by a single rating agency that does not result in a rating lower than a preexisting corresponding rating provided by another major rating agency will generally not result in additional collateral (except in certain instances in which additional initial margin may be required upon a ratings downgrade), nor in termination payments requirements. The liquidity impact in the table is calculated based upon a downgrade below the lowest current rating of the rating agencies referred to in the derivative contract.
Liquidity impact of downgrade triggers on OTC and OTC-cleared derivativesLiquidity impact of downgrade triggers on OTC and OTC-cleared derivatives   Liquidity impact of downgrade triggers on OTC and OTC-cleared derivatives   
September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
(in millions)Single-notch downgradeTwo-notch downgrade Single-notch downgradeTwo-notch downgradeSingle-notch downgradeTwo-notch downgrade Single-notch downgradeTwo-notch downgrade
Amount of additional collateral to be posted upon downgrade(a)
$223
$1,420
 $76
$947
$191
$1,295
 $189
$1,467
Amount required to settle contracts with termination triggers upon downgrade(b)
184
1,475
 172
764
182
2,273
 104
1,398
(a)Includes the additional collateral to be posted for initial margin.
(b)Amounts represent fair values of derivative payables, and do not reflect collateral posted.
Derivatives executed in contemplation of a sale of the underlying financial asset
In certain instances the Firm enters into transactions in which it transfers financial assets but maintains the economic exposure to the transferred assets by entering into a derivative with the same counterparty in contemplation of the initial transfer. The Firm generally accounts for such transfers as collateralized financing transactions as described in Note 10,11, but in limited circumstances they may qualify to be accounted for as a sale and a derivative under U.S. GAAP. The amount of such transfers accounted for as a sale where the associated derivative was outstanding was not material at both SeptemberJune 30, 20192020 and December 31, 2018.2019.

Impact of derivatives on the Consolidated statements of income
The following tables provide information related to gains and losses recorded on derivatives based on their hedge accounting designation or purpose.
Fair value hedge gains and losses
The following tables present derivative instruments, by contract type, used in fair value hedge accounting relationships, as well as pre-tax gains/(losses) recorded on such derivatives and the related hedged items for the three and ninesix months ended SeptemberJune 30, 2020 and 2019, and 2018, respectively. The Firm includes gains/(losses) on the hedging derivative in the same line item in the Consolidated statements of income as the related hedged item.
Gains/(losses) recorded in income 
Income statement impact of
excluded components(e)
 OCI impactGains/(losses) recorded in income 
Income statement impact of
excluded components(e)
 OCI impact
Three months ended September 30, 2019
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Three months ended June 30, 2020
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Contract type          
Interest rate(a)(b)
$1,770
$(1,550)$220
 $—
$228
 $—
$464
$(288)$176
 $—
$205
 $—
Foreign exchange(c)
(167)293
126
 (224)126
 (1)(304)338
34
 (121)34
 21
Commodity(d)
278
(232)46
 —
49
 —
(1,730)1,771
41
 —
44
 —
Total$1,881
$(1,489)$392
 $(224)$403
 $(1)$(1,570)$1,821
$251
 $(121)$283
 $21
Gains/(losses) recorded in income 
Income statement impact of
excluded components(e)

 OCI impactGains/(losses) recorded in income 
Income statement impact of
excluded components(e)

 OCI impact
Three months ended September 30, 2018
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Three months ended June 30, 2019
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Contract type          
Interest rate(a)(b)
$(870)$1,032
$162
 $—
$160
 $—
$1,762
$(1,556)$206
 $—
$196
 $—
Foreign exchange(c)
277
(165)112
 (137)112
 45
426
(301)125
 (229)125
 112
Commodity(d)
454
(461)(7) —
(5) —
(154)175
21
 —
17
 —
Total$(139)$406
$267
 $(137)$267
 $45
$2,034
$(1,682)$352
 $(229)$338
 $112
Gains/(losses) recorded in income 
Income statement impact of
excluded components(e)
 OCI impactGains/(losses) recorded in income 
Income statement impact of
excluded components(e)
 OCI impact
Nine months ended September 30, 2019
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Six months ended June 30, 2020
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Contract type          
Interest rate(a)(b)
$4,996
$(4,399)$597
 $—
$596
 $—
$4,551
$(4,076)$475
 $—
$419
 $—
Foreign exchange(c)
(31)401
370
 (675)370
 114
272
(150)122
 (300)122
 136
Commodity(d)
(164)237
73
 —
67
 —
(202)289
87
 —
93
 —
Total$4,801
$(3,761)$1,040
 $(675)$1,033
 $114
$4,621
$(3,937)$684
 $(300)$634
 $136
Gains/(losses) recorded in income 
Income statement impact of
excluded components(e)
 OCI impactGains/(losses) recorded in income 
Income statement impact of
excluded components(e)
 OCI impact
Nine months ended September 30, 2018
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Six months ended June 30, 2019
(in millions)		DerivativesHedged itemsIncome statement impact Amortization approachChanges in fair value 
Derivatives - Gains/(losses) recorded in OCI(f)
Contract type          
Interest rate(a)(b)
$(2,747)$3,214
$467
 $—
$459
 $—
$3,226
$(2,849)$377
 $—
$368
 $—
Foreign exchange(c)
797
(452)345
 (404)345
 (96)136
108
244
 (451)244
 115
Commodity(d)
649
(626)23
 —
29
 —
(442)469
27
 —
18
 —
Total$(1,301)$2,136
$835
 $(404)$833
 $(96)$2,920
$(2,272)$648
 $(451)$630
 $115
(a)Primarily consists of hedges of the benchmark (e.g., London Interbank Offered Rate (“LIBOR”)) interest rate risk of fixed-rate long-term debt and AFS securities. Gains and losses were recorded in net interest income.
(b)Excludes the amortization expense associated with the inception hedge accounting adjustment applied to the hedged item. This expense is recorded in net interest income and substantially offsets the income statement impact of the excluded components. Also excludes the accrual of interest on interest rate swaps and the related hedged items.
(c)Primarily consists of hedges of the foreign currency risk of long-term debt and AFS securities for changes in spot foreign currency rates. Gains and losses related to the derivatives and the hedged items due to changes in foreign currency rates and the income statement impact of excluded components were recorded primarily in principal transactions revenue and net interest income.
(d)Consists of overall fair value hedges of physical commodities inventories that are generally carried at the lower of cost or net realizable value (net realizable value approximates fair value). Gains and losses were recorded in principal transactions revenue.
(e)The assessment of hedge effectiveness excludes certain components of the changes in fair values of the derivatives and hedged items such as forward points on foreign exchange forward contracts, time values and cross-currency basis spreads. TheExcluded components may impact earnings either through amortization of the initial amount of the excluded components may be amortized into income over the life of the derivative, or changes inthrough fair value may bechanges recognized in the current period earnings.period.
(f)Represents the change in value of amounts excluded from the assessment of effectiveness under the amortization approach, predominantly cross-currency basis spreads. The amount excluded at inception of the hedge is recognized in earnings over the life of the derivative.


As of SeptemberJune 30, 20192020 and December 31, 2018, 2019, the following amounts were recorded on the Consolidated balance sheets related to certain cumulative fair value hedge basis adjustments that are expected to reverse through the income statement in future periods as an adjustment to yield.
 
Carrying amount of the hedged items(a)(b)
 
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items:

 
Carrying amount of the hedged items(a)(b)
 
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items:

September 30, 2019
(in millions)		 Active hedging relationships
Discontinued hedging relationships(d)
Total
June 30, 2020
(in millions)		 
Carrying amount of the hedged items(a)(b)
 Active hedging relationships
Discontinued hedging relationships(d)(e)
Total
Assets      
Investment securities - AFS

 $123,914
(c) 
$3,664
$261
$3,925
 $144,081
(c) 
$7,478
$246
$7,724
Liabilities        
Long-term debt $163,494
 $9,957
$125
$10,082
 $185,123
 $14,771
$3,809
$18,580
Beneficial interests issued by consolidated VIEs 2,362
 —
(11)(11) 1,595
 —
(4)(4)
        
 
Carrying amount of the hedged items(a)(b)
 Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items: 
Carrying amount of the hedged items(a)(b)
 Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items:
December 31, 2018
(in millions)		 Active hedging relationships
Discontinued hedging relationships(d)
Total
December 31, 2019
(in millions)		 
Carrying amount of the hedged items(a)(b)
 Active hedging relationships
Discontinued hedging relationships(d)(e)
Total
Assets      
Investment securities - AFS
 $55,313
(c) 
$(1,105)$381
$(724) $125,860
(c) 
$2,110
$278
$2,388
Liabilities        
Long-term debt $139,915
 $141
$8
$149
 $157,545
 $6,719
$161
$6,880
Beneficial interests issued by consolidated VIEs 6,987
 —
(33)(33) 2,365
 —
(8)(8)
(a)Excludes physical commodities with a carrying value of $10.3$8.2 billion and $6.8$6.5 billion at SeptemberJune 30, 20192020 and December 31, 2018,2019, respectively, to which the Firm applies fair value hedge accounting. As a result of the application of hedge accounting, these inventories are carried at fair value, thus recognizing unrealized gains and losses in current periods. GivenSince the Firm exits these positions at fair value, there is no incremental impact to net income in future periods.
(b)Excludes hedged items where only foreign currency risk is the designated hedged risk, as basis adjustments related to foreign currency hedges will not reverse through the income statement in future periods. At SeptemberJune 30, 20192020 and December 31, 2018,2019, the carrying amount excluded for available-for-saleAFS securities is $15.3$19.2 billion and $14.6$14.9 billion, respectively, and for long-term debt is $4.1$7.8 billion and $7.3$2.8 billion, respectively.
(c)Carrying amount represents the amortized cost.
(d)Represents basis adjustments existing on the balance sheet date associated with hedged items no longer designated inthat have been de-designated from qualifying fair value hedging relationships for which an associatedrelationships.
(e)Positive amounts related to assets represent cumulative fair value hedge basis adjustment exists at the balance sheet date.adjustments that will reduce net interest income in future periods. Positive (negative) amounts related to liabilities represent cumulative fair value hedge basis adjustments that will increase (reduce) net interest income in future periods.


Cash flow hedge gains and losses
The following tables present derivative instruments, by contract type, used in cash flow hedge accounting relationships, and the pre-tax gains/(losses) recorded on such derivatives, for the three and ninesix months ended SeptemberJune 30, 2020 and 2019, and 2018, respectively. The Firm includes the gain/(loss) on the hedging derivative in the same line item in the Consolidated statements of income as the change in cash flows on the related hedged item.
 Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Three months ended September 30, 2019
(in millions)		Amounts reclassified from AOCI to incomeAmounts recorded in OCITotal change
in OCI
for period
Contract type   
Interest rate(a)
$(16)$290
$306
Foreign exchange(b)
(21)(68)(47)
Total$(37)$222
$259
    
 Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Three months ended September 30, 2018
(in millions)		Amounts reclassified from AOCI to incomeAmounts recorded in OCITotal change
in OCI
for period
Contract type   
Interest rate(a)
$10
$(30)$(40)
Foreign exchange(b)
(19)(92)(73)
Total$(9)$(122)$(113)
 Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Nine months ended September 30, 2019
(in millions)		Amounts reclassified from AOCI to incomeAmounts recorded in OCI
Total change
in OCI
for period
Contract type   
Interest rate(a)
$(12)$501
$513
Foreign exchange(b)
(90)(37)53
Total$(102)$464
$566
Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Nine months ended September 30, 2018
(in millions)		Amounts reclassified from AOCI to incomeAmounts recorded in OCI
Total change
in OCI
for period
Three months ended June 30, 2020
(in millions)		Amounts reclassified
from AOCI to income		 Amounts recorded
in OCI		Total change
in OCI for period
Contract type    
Interest rate(a)
$36
$(141)$(177)$127
 $412
$285
Foreign exchange(b)
26
(224)(250)(34) (10)24
Total$62
$(365)$(427)$93
 $402
$309
   
Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Three months ended June 30, 2019
(in millions)		Amounts reclassified
from AOCI to income		 Amounts recorded
in OCI
Total change
in OCI for period
Contract type   
Interest rate(a)
$2
 $155
$153
Foreign exchange(b)
(28) (54)(26)
Total$(26) $101
$127
   
Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Six months ended June 30, 2020
(in millions)		Amounts reclassified
from AOCI to income		 Amounts recorded
in OCI		Total change
in OCI for period
Contract type   
Interest rate(a)
$118
 $3,873
$3,755
Foreign exchange(b)
(17) (220)(203)
Total$101
 $3,653
$3,552
   
Derivatives gains/(losses) recorded in income and other comprehensive income/(loss)
Six months ended June 30, 2019
(in millions)		Amounts reclassified
from AOCI to income		 
Amounts recorded
in OCI
Total change
in OCI for period
Contract type   
Interest rate(a)
$4
 $211
$207
Foreign exchange(b)
(69) 31
100
Total$(65) $242
$307
(a)Primarily consists of hedges of LIBOR-indexed floating-rate assets and floating-rate liabilities. Gains and losses were recorded in net interest income.
(b)Primarily consists of hedges of the foreign currency risk of non-U.S. dollar-denominated revenue and expense. The income statement classification of gains and losses follows the hedged item – primarily noninterest revenue and compensation expense.
The Firm did not experience any forecasted transactions that failed to occur for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
Over the next 12 months, the Firm expects that approximately $(130) $498 million (after-tax) of net lossesgains recorded in AOCI at SeptemberJune 30, 2019,2020, related to cash flow hedges will be recognized in income. For cash flow hedges that have been terminated, the maximum length of time over which the derivative results recorded in AOCI will be recognized in earnings is approximately fiveten years, corresponding to the timing of the originally hedged forecasted cash flows.
For open cash flow hedges, the maximum length of time over which forecasted transactions are hedged is approximately seven years. The Firm’s longer-dated forecasted transactions relate to core lending and borrowing activities.


Net investment hedge gains and losses
The following table presents hedging instruments, by contract type, that were used in net investment hedge accounting relationships, and the pre-tax gains/(losses) recorded on such instruments for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
Gains/(losses) recorded in income and other comprehensive income/(loss)Gains/(losses) recorded in income and other comprehensive income/(loss)
2019 20182020 2019
Three months ended September 30,
(in millions)
Amounts recorded in
income(a)(b)
Amounts recorded in OCI 
Amounts recorded in
income(a)(b)
Amounts recorded in OCI
Three months ended June 30,
(in millions)
Amounts recorded in
income(a)(b)
Amounts recorded in OCI 
Amounts recorded in
income(a)(b)
Amounts recorded in OCI
Foreign exchange derivatives $17
 $866
 $2
 $311
 $(81) $(413) $27
 $(123)
                
Gains/(losses) recorded in income and other comprehensive income/(loss)Gains/(losses) recorded in income and other comprehensive income/(loss)
2019 20182020 2019
Nine months ended September 30,
(in millions)
Amounts recorded in
income(a)(b)
Amounts recorded in OCI 
Amounts recorded in
income(a)(b)(c)
Amounts recorded in OCI
Six months ended June 30,
(in millions)
Amounts recorded in
income(a)(b)
Amounts recorded in OCI 
Amounts recorded in
income(a)(b)
Amounts recorded in OCI
Foreign exchange derivatives $65
 $705
 $(8) $1,126
 $(71) $1,176
 $48
 $(161)
(a)
Certain components of hedging derivatives are permitted to be excluded from the assessment of hedge effectiveness, such as forward points on foreign exchange forward contracts. The Firm elects to record changes in fair value of these amounts directly in other income.
(b)
Excludes amounts reclassified from AOCI to income on the sale or liquidation of hedged entities. During the nine months ended September 30, 2019, theThe Firm reclassified pre-tax (losses) of $(8) million and net pre-tax gains of $5 million to other income related to the liquidation of certain legal entities. Duringentities during the ninethree and six months ended SeptemberJune 30, 2018, the Firm reclassified net pre-tax losses of $23 million2020 and 2019, respectively. Refer to other expense related to the liquidation of a legal entity.
(c)The prior period amount has been revised to conform with the current period presentation.Note 20 for further information.

Gains and losses on derivatives used for specified risk management purposes
The following table presents pre-tax gains/(losses) recorded on a limited number of derivatives, not designated in hedge accounting relationships, that are used to manage risks associated with certain specified assets and liabilities, including certain risks arising from the mortgage pipeline,commitments, warehouse loans, MSRs, wholesale lending exposures, and foreign currency-denominated assets and liabilities.
Derivatives gains/(losses)
recorded in income
 
Derivatives gains/(losses)
recorded in income
Three months ended September 30, Nine months ended September 30, Three months ended June 30, Six months ended June 30,
(in millions)20192018 20192018 20202019 20202019
Contract type       
Interest rate(a)
$769
$(42) $1,718
$(277) $644
$657
 $1,936
$949
Credit(b)
(21)(7) (33)(17) (100)(2) (39)(12)
Foreign exchange(c)
40
52
 15
167
(d) 
(28)(75) 78
(25)
Total$788
$3
 $1,700
$(127)
(d) 
$516
$580
 $1,975
$912

(a)Primarily represents interest rate derivatives used to hedge the interest rate risk inherent in the mortgage pipeline,commitments, warehouse loans and MSRs, as well as written commitments to originate warehouse loans. Gains and losses were recorded predominantly in mortgage fees and related income.
(b)Relates to credit derivatives used to mitigate credit risk associated with lending exposures in the Firm’s wholesale businesses. These derivatives do not include credit derivatives used to mitigate counterparty credit risk arising from derivative receivables, which is included in gains and losses on derivatives related to market-making activities and other derivatives. Gains and losses were recorded in principal transactions revenue.
(c)Primarily relates to derivatives used to mitigate foreign exchange risk of specified foreign currency-denominated assets and liabilities. Gains and losses were recorded in principal transactions revenue.
(d)The prior period amounts have been revised to conform with the current period presentation.
 
Gains and losses on derivatives related to market-making activities and other derivatives
The Firm makes markets in derivatives in order to meet the needs of customers and uses derivatives to manage certain risks associated with net open risk positions from its market-making activities, including the counterparty credit risk arising from derivative receivables. All derivatives not included in the hedge accounting or specified risk management categories above are included in this category. Gains and losses on these derivatives are primarily recorded in principal transactions revenue. Refer to Note 5 6 for information on principal transactions revenue.

Credit derivatives
Refer to Note 5 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed discussion of credit derivatives. The following tables present a summary of the notional amounts of credit derivatives and credit-related notes the Firm sold and purchased as of June 30, 2020 and December 31, 2019. The Firm does not use notional amounts of credit derivatives as the primary measure of risk management for such derivatives, because the notional amount does not take into account the probability of the occurrence of a credit event, the recovery value of the reference obligation, or related cash instruments and economic hedges, each of which reduces, in the Firm’s view, the risks associated with such derivatives.
Total credit derivatives and credit-related notes
Maximum payout/Notional amountMaximum payout/Notional amount
September 30, 2019 (in millions)Protection sold
Protection
purchased with
identical underlyings(b)
Net protection (sold)/purchased(c)
 
Other protection purchased(d)
June 30, 2020 (in millions)Protection sold
Protection purchased with identical underlyings(b)
Net protection (sold)/purchased(c)
 
Other protection purchased(d)
Credit derivatives          
Credit default swaps$(610,946) $623,709
$12,763
 $3,630
$(576,962) $596,882
$19,920
 $4,515
Other credit derivatives(a)
(55,919) 61,847
5,928
 8,503
(28,069) 35,496
7,427
 8,522
Total credit derivatives(666,865) 685,556
18,691
 12,133
(605,031) 632,378
27,347
 13,037
Credit-related notes—
 —
—
 9,297
—
 —
—
 9,228
Total$(666,865) $685,556
$18,691
 $21,430
$(605,031) $632,378
$27,347
 $22,265
          
Maximum payout/Notional amountMaximum payout/Notional amount
December 31, 2018 (in millions)Protection sold
Protection
purchased with
identical underlyings(b)
Net protection (sold)/purchased(c)
 
Other protection purchased(d)
December 31, 2019 (in millions)Protection sold
Protection purchased with identical underlyings(b)
Net protection (sold)/purchased(c)
 
Other protection purchased(d)
Credit derivatives          
Credit default swaps$(697,220) $707,282
$10,062
 $4,053
$(562,338) $571,892
$9,554
 $3,936
Other credit derivatives(a)
(41,244) 42,484
1,240
 8,488
(44,929) 52,007
7,078
 7,364
Total credit derivatives(738,464) 749,766
11,302
 12,541
(607,267) 623,899
16,632
 11,300
Credit-related notes—
 —
—
 8,425
—
 —
—
 9,606
Total$(738,464) $749,766
$11,302
 $20,966
$(607,267) $623,899
$16,632
 $20,906
(a)Other credit derivatives predominantly consist of credit swap options and total return swaps.
(b)Represents the total notional amount of protection purchased where the underlying reference instrument is identical to the reference instrument on protection sold; the notional amount of protection purchased for each individual identical underlying reference instrument may be greater or lower than the notional amount of protection sold.
(c)Does not take into account the fair value of the reference obligation at the time of settlement, which would generally reduce the amount the seller of protection pays to the buyer of protection in determining settlement value.
(d)Represents protection purchased by the Firm on referenced instruments (single-name, portfolio or index) where the Firm has not sold any protection on the identical reference instrument.
The following tables summarize the notional amounts by the ratings, maturity profile, and total fair value, of credit derivatives and credit-related notes as of September June 30, 2019,2020, and December 31, 2018, 2019, where JPMorgan Chase is the seller of protection. The maturity profile is based on the remaining contractual maturity of the credit derivative contracts. The ratings profile is based on the rating of the reference entity on which the credit derivative contract is based. The ratings and maturity profile of credit derivatives and credit-related notes where JPMorgan Chase is the purchaser of protection are comparable to the profile reflected below.
Protection sold — credit derivatives and credit-related notes ratings(a)/maturity profile
Protection sold — credit derivatives and credit-related notes ratings(a)/maturity profile
   
Protection sold — credit derivatives and credit-related notes ratings(a)/maturity profile
   
September 30, 2019
(in millions)		<1 year 1–5 years >5 years 
Total
notional amount
 
Fair value of receivables(b)
 
Fair value of payables(b)
 Net fair value
June 30, 2020
(in millions)		<1 year 1–5 years >5 years 
Total
notional amount
 
Fair value of receivables(b)
 
Fair value of payables(b)
 Net fair value
Risk rating of reference entity                          
Investment-grade$(106,698) $(316,946) $(75,615) $(499,259) $5,621
 $(1,260) $4,361
$(94,891) $(320,604) $(37,397) $(452,892) $3,970
 $(2,297) $1,673
Noninvestment-grade(39,180) (103,249) (25,177) (167,606) 4,699
 (3,415) 1,284
(37,051) (106,115) (8,973) (152,139) 2,346
 (4,950) (2,604)
Total$(145,878) $(420,195) $(100,792) $(666,865) $10,320
 $(4,675) $5,645
$(131,942) $(426,719) $(46,370) $(605,031) $6,316
 $(7,247) $(931)
December 31, 2018
(in millions)		<1 year 1–5 years >5 years 
Total
notional amount
 
Fair value of receivables(b)
 
Fair value of payables(b)
 Net fair value
December 31, 2019
(in millions)		<1 year 1–5 years >5 years 
Total
notional amount
 
Fair value of receivables(b)
 
Fair value of payables(b)
 Net fair value
Risk rating of reference entity                          
Investment-grade$(115,443) $(402,325) $(43,611) $(561,379) $5,720
 $(2,791) $2,929
$(114,460) $(311,407) $(42,129) $(467,996) $6,153
 $(911) $5,242
Noninvestment-grade(45,897) (119,348) (11,840) (177,085) 4,719
 (5,660) (941)(41,661) (87,769) (9,841) (139,271) 4,281
 (2,882) 1,399
Total$(161,340) $(521,673) $(55,451) $(738,464) $10,439
 $(8,451) $1,988
$(156,121) $(399,176) $(51,970) $(607,267) $10,434
 $(3,793) $6,641

(a)The ratings scale is primarily based on external credit ratings defined by S&P and Moody’s.
(b)Amounts are shown on a gross basis, before the benefit of legally enforceable master netting agreements andincluding cash collateral received by the Firm.netting.

Note 56 – Noninterest revenue and noninterest expense
Noninterest revenue
Refer to Note 6 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the components of and accounting policies for the Firm’s noninterest revenue.
Investment banking fees
The following table presents the components of investment banking fees.

Three months ended September 30,
Nine months ended September 30,Three months ended June 30,
Six months ended June 30,
(in millions)2019
 2018

2019
20182020
 2019

2020
2019
Underwriting













Equity$517

$417

$1,293

$1,342
$974

$515

$1,301

$776
Debt955

836

2,720

2,596
1,279

820

2,323

1,765
Total underwriting1,472

1,253

4,013

3,938
2,253

1,335

3,624

2,541
Advisory495

579

1,645

1,798
597

516

1,092

1,150
Total investment banking fees$1,967

$1,832

$5,658

$5,736
$2,850

$1,851

$4,716

$3,691

Principal transactions
The following table presents all realized and unrealized gains and losses recorded in principal transactions revenue. This table excludes interest income and interest expense on trading assets and liabilities, which are an integral part of the overall performance of the Firm’s client-driven market-making activities in CIB and cash deployment activities in Treasury and CIO. Refer to Note 67 for further information on interest income and interest expense.
Trading revenue is presented primarily by instrument type. The Firm’s client-driven market-making businesses generally utilize a variety of instrument types in connection with their market-making and related risk-management activities; accordingly, the trading revenue presented in the table below is not representative of the total revenue of any individual line of business.LOB.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30, 
(in millions)2019
 2018
 2019 20182020
 2019
 2020 2019 
Trading revenue by instrument type               
Interest rate(a)$835
 $338
 $1,901
 $1,784
$1,519
 $463
(d) 
$1,971
 $1,262
(d) 
Credit(b)328
 202
 1,375
 1,230
1,953
(c) 
474
(d) 
1,251
(c) 
1,093
(d) 
Foreign exchange892
 937
 2,509
 2,706
1,425
 737
(d) 
2,892
 1,625
(d) 
Equity1,003
 1,363
 4,530
 4,376
2,058
 1,914
(d) 
3,406
 3,275
(d) 
Commodity372
 277
 982
 800
591
 229
(d) 
1,028
 612
(d) 
Total trading revenue3,430
 3,117
 11,297
 10,896
7,546
 3,817
 10,548
 7,867
 
Private equity gains/(losses)(a)
19
 (153) (58) (198)75
 (103) 10
 (77) 
Principal transactions$3,449
 $2,964
 $11,239
 $10,698
$7,621
 $3,714
 $10,558
 $7,790
 

(a)The third quarterIncludes the impact of 2018 included markdownschanges in funding valuation adjustments on derivatives.
(b)Includes the impact of approximately $220 millionchanges in credit valuation adjustments on certain private equity investmentsderivatives, net of the associated hedging activities.
(c)Includes marks on held-for-sale positions, including unfunded commitments, in Corporate,the bridge financing portfolio.
(d)Prior-period amounts were revised to conform with $170 million recorded within principal transactions revenue and $50 million in other income.the current presentation.

 
Lending- and deposit-related fees
The following table presents the components of lending- and deposit-related fees.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 2019
 20182020
 2019
 2020
 2019
Lending-related fees$286
 $284
 $861
 $838
$288
 $285
 $579
 $575
Deposit-related fees(a)1,340
 1,258
 3,782
 3,676
1,143
 1,339
 2,558
 2,608
Total lending- and deposit-related fees$1,626
 $1,542
 $4,643
 $4,514
$1,431
 $1,624
 $3,137
 $3,183

(a)In the first quarter of 2020, the Firm reclassified certain fees from asset management, administration and commissions to lending- and deposit-related fees. Prior-period amounts have been revised to conform with the current presentation.
Asset management, administration and commissions
The following table presents the components of Firmwide asset management, administration and commissions.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 2019 20182020
 2019
 2020 2019
Asset management fees              
Investment management fees(a)
$2,738
 $2,716
 $8,013
 $8,081
$2,717
 $2,698
 $5,502
 $5,275
All other asset management fees(b)
82
 79
 229
 211
75
 78
 168
 147
Total asset management fees2,820
 2,795
 8,242
 8,292
2,792
 2,776
 5,670
 5,422
              
Total administration fees(c)
567
 533
 1,646
 1,651
546
 544
 1,100
 1,079
              
Commissions and other fees              
Brokerage commissions(d)634
 604
 1,861
 1,887
715
 641
 1,579
 1,227
All other commissions and fees(e)330
 378
 1,069
 1,093
213
 303
 457
 573
Total commissions and fees964
 982
 2,930
 2,980
928
 944
 2,036
 1,800
Total asset management, administration and commissions$4,351
 $4,310
 $12,818
 $12,923
$4,266
 $4,264
 $8,806
 $8,301
(a)Represents fees earned from managing assets on behalf of the Firm’s clients, including investors in Firm-sponsored funds and owners of separately managed investment accounts.
(b)Represents fees for services that are ancillary to investment management services, such as commissions earned on the sales or distribution of mutual funds to clients.
(c)Predominantly includes fees for custody, securities lending, funds services and securities clearance.
(d)Represents commissions earned when the Firm acts as a broker, by facilitating its clients’ purchases and sales of securities and other financial instruments.
(e)In the first quarter of 2020, the Firm reclassified certain fees from asset management, administration and commissions to lending- and deposit-related fees. Prior-period amounts have been revised to conform with the current presentation.




Card income
The following table presents the components of card income:
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 2019
 2018
2020
 2019
 2020
 2019
Interchange and merchant processing income$5,127
 $4,781
 $15,032
 $13,863
$3,940
 $5,184
 $8,722
 $9,905
Rewards costs and partner payments(a)
(3,669) (3,276) (10,515) (9,687)(2,816) (3,695) (6,398) (6,978)
Other card income(b)
(175) (177) (594) (553)(150) (208) (355) (419)
Total card income$1,283
 $1,328
 $3,923
 $3,623
$974
 $1,281
 $1,969
 $2,508
(a)The three and nine months ended September 30, 2018, included an adjustment toIn the second quarter of 2020, the Firm reclassified certain spend-based credit card rewards liabilityreward costs from marketing expense to be a reduction of approximately $330 million.card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.
(b)Predominantly represents annual fees and newthe amortization of account origination costs which are deferred and recognized on a straight-line basis over a 12-month period.annual fees.

Refer to Note 1415 Goodwill and MSRs for information on mortgage fees and related income.
Refer to Note 16 Leases17 for information on operating lease income included within other income.
Noninterest expense
Other expense
Other expense on the Firm’s Consolidated statements of income included the following:
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 2019
 2018
2020
 2019
 2020
 2019
Legal expense/(benefit)$10
 $20
 $(2) $90
$118
 $69
 $315

$(12)
FDIC-related expense114
 349
 378
 1,100
218
 121
 317

264


 
Note 67 – Interest income and Interest expense
Refer to Note 7 of JPMorgan Chase’s 20182019 Form 10-K for a description of JPMorgan Chase’s accounting policies regarding interest income and interest expense.
The following table presents the components of interest income and interest expense.

Three months ended
September 30,		 Nine months ended
September 30,		Three months ended
June 30,		 Six months ended
June 30,
(in millions)2019

2018
 2019
 2018
2020

2019
 2020
 2019
Interest income              
Loans(a)
$12,586

$12,207
 $38,192
 $34,915
$10,622

$12,726
 $22,554
 $25,606
Taxable securities2,132

1,402
 5,712
 4,098
2,154

1,875
 4,387
 3,580
Non-taxable securities(b)
318

394
 1,021
 1,199
307

340
 607
 703
Total investment securities(a)
2,450

1,796
 6,733
 5,297
2,461

2,215
 4,994
 4,283
Trading assets - debt instruments2,659

2,155
 8,343
 6,369
2,355

2,915
 4,816
 5,684
Federal funds sold and securities purchased under resale agreements1,542

952
 4,865
 2,490
601

1,676
 1,696
 3,323
Securities borrowed(c)
434

248
 1,298
 549
(175)
467
 (23) 864
Deposits with banks898

1,585
 3,200
 4,449
70

1,132
 639
 2,302
All other interest-earning assets(c)(d)
552

496
 1,482
 1,430
All other interest-earning assets(d)
178

472
 597
 930
Total interest income(c)
21,121

19,439
 64,113
 55,499
16,112

21,603
 35,273
 42,992
Interest expense              
Interest-bearing deposits2,409
 1,621
 7,010
 4,021
349
 2,413
 1,924
 4,601
Federal funds purchased and securities loaned or sold under repurchase agreements1,241
 827
 3,577
 2,164
131
 1,226
 918
 2,336
Short-term borrowings(e)
261
 288
 1,051
 757
124
 363
 275
 790
Trading liabilities – debt and all other interest-bearing liabilities(c)(f)
660
 617
 2,141
 1,674
(43) 762
 329
 1,481
Long-term debt2,188
 2,056
 6,796
 5,812
1,639
 2,266
 3,386
 4,608
Beneficial interest issued by consolidated VIEs134
 122
 459
 366
59
 175
 149
 325
Total interest expense(c)
6,893
 5,531
 21,034
 14,794
2,259
 7,205
 6,981
 14,141
Net interest income14,228
 13,908
 43,079
 40,705
13,853
 14,398
 28,292
 28,851
Provision for credit losses1,514
 948
 4,158
 3,323
10,473
 1,149
 18,758
 2,644
Net interest income after provision for credit losses$12,714
 $12,960
 $38,921
 $37,382
$3,380
 $13,249
 $9,534
 $26,207
(a)Includes the amortization/accretion of unearned income (e.g., purchase premiums/discounts, net deferred fees/costs, etc.).
(b)Represents securities which are tax-exempt for U.S. federal income tax purposes.
(c)In the second quarter of 2019, the Firm implemented certain presentation changes that impacted
Negative interest income andis related to the impact of current interest rates combined with the fees paid on client-driven securities borrowed balances. The negative interest expense but had no effect on netrelated to prime brokerage customer payables is recognized in interest income. These changes were made to align the accounting treatment between the balance sheetexpense and the related interest income or expense, primarily by offsetting interest incomereported within trading liabilities - debt and expense for certain prime brokerage-related held-for-investment customer receivables and payables that are currently presented as a single margin account on the balance sheet. These changes were applied retrospectively and, accordingly, prior period amounts were revised to conform with the current presentation.all other interest-bearing liabilities.
(d)Includes interest earned on prime brokerage-related held-for-investment customer receivables, which are classified in accrued interest and accounts receivable, and all other interest-earning assets which are classified in other assets on the Consolidated balance sheets.
(e)Includes commercial paper.
(f)Other interest-bearing liabilities includeincludes interest expense on prime brokerage-related customer payables.

Note 78 – Pension and other postretirement employee benefit plans
Refer to Note 8 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of JPMorgan Chase’s pension and OPEB plans.
The following table presents the components of net periodic benefit costs reported in the Consolidated statements of income for the Firm’s U.S. and non-U.S. defined benefit pension, defined contribution and OPEB plans.
(in millions)Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
20192018 20192018 20192018 2019201820202019 20202019 20202019 20202019
Pension plans OPEB plans Pension plans OPEB plansPension plans OPEB plans Pension plans OPEB plans
Components of net periodic benefit cost              
Benefits earned during the period$88
$88
 $—
$—
 $266
$267
 $—
$—
$8
$89
 $—
$—
 $16
$178
 $—
$—
Interest cost on benefit obligations148
139
 6
6
 447
417
 18
18
121
149
 5
6
 240
299
 10
12
Expected return on plan assets(227)(246) (28)(25) (686)(741) (84)(77)(192)(229) (28)(28) (383)(459) (55)(56)
Amortization:        
        
Net (gain)/loss42
26
 —
—
 125
78
 —
—
3
41
 —
—
 7
83
 —
—
Prior service (credit)/cost—
(7) —
—
 2
(19) —
—
1
1
 —
—
 2
2
 —
—
Net periodic defined benefit cost51
—
 (22)(19) 154
2
 (66)(59)(59)51
 (23)(22) (118)103
 (45)(44)
Other defined benefit pension plans(a)
7
6
 NA
NA
 20
21
 NA
NA
10
7
 NA
NA
 19
13
 NA
NA
Total defined benefit plans58
6
 (22)(19) 174
23
 (66)(59)(49)58
 (23)(22) (99)116
 (45)(44)
Total defined contribution plans255
229
 NA
NA
 718
661
 NA
NA
321
243
 NA
NA
 620
463
 NA
NA
Total pension and OPEB cost included in noninterest expense$313
$235
 $(22)$(19) $892
$684
 $(66)$(59)$272
$301
 $(23)$(22) $521
$579
 $(45)$(44)
(a)Includes various defined benefit pension plans which are individually immaterial.
The following table presents the fair values of plan assets for the U.S. defined benefit pension and OPEB plans and for the material non-U.S. defined benefit pension plans.
(in billions)September 30,
2019
 December 31, 2018
June 30,
2020
 December 31, 2019
Fair value of plan assets      
Defined benefit pension plans$20.1
 $18.1
$20.6
 $20.4
OPEB plans2.9
 2.6
3.0
 3.0

There are 0 expected contributions to the U.S. defined benefit pension plan for 2019.2020.

Note 89 – Employee share-based incentives
Refer to Note 9 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the accounting policies and other information relating to employee share-based incentives.
The Firm recognized the following noncash compensation expense related to its various employee share-based incentive plans in its Consolidated statements of income.
Three months ended
September 30,		 Nine months ended
September 30,		Three months ended
June 30,		 Six months ended
June 30,
(in millions)2019
 2018
 2019
 2018
2020
 2019
 2020
 2019
Cost of prior grants of RSUs, performance share units (“PSUs”) and stock appreciation rights (“SARs”) that are amortized over their applicable vesting periods$265
 $282
 $882
 $956
Cost of prior grants of RSUs, performance share units (“PSUs”) and employee stock options that are amortized over their applicable vesting periods$276
 $278
 $610
 $617
Accrual of estimated costs of share-based awards to be granted in future periods including those to full-career eligible employees294
 240
 900
 852
526
 292
 836
 606
Total noncash compensation expense related to employee share-based incentive plans$559
 $522
 $1,782
 $1,808
$802
 $570
 $1,446
 $1,223

In the first quarter of 2019, 2020, in connection with its annual incentive grant for the 20182019 performance year, the Firm granted 21 15 million RSUs and 630 496 thousand PSUswith weighted-average grant date fair values of $98.98 $135.64 per RSU and $98.96$135.30 per PSU.

Note 910 – Investment securities
Investment securities consist of debt securities that are classified as AFS or HTM. Debt securities classified as trading assets are discussed in Note 2. Predominantly all of the Firm’s AFS and HTM securities are held by Treasury and CIO in connection with its asset-liability management activities. At September 30, 2019, the investment securities portfolio consisted of debt securities with an average credit rating of AA+ (based upon external ratings where available,
and where not available, based primarily upon internal ratings which correspond to ratings as defined by S&P and Moody’s). Refer to Note 10 of JPMorgan Chase’s 20182019 Form 10-K for additional information regarding the investment securities portfolio.

Effective January 1, 2020, the Firm adopted the CECL accounting guidance, which also amended the AFS
securities impairment guidance. Refer to Note 1 for further information.
During the first quarter of 2020, the Firm transferred $26.1 billion of U.S. GSE and government agency MBS from AFS to HTM for capital management purposes. These securities were transferred at fair value in a non-cash transaction. AOCI included pretax unrealized gains of $1.0 billion on the securities at the date of transfer.
The amortized costs and estimated fair values of the investment securities portfolio were as follows for the dates indicated.
September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
(in millions)Amortized costGross unrealized gainsGross unrealized lossesFair value Amortized costGross unrealized gainsGross unrealized lossesFair value
Amortized cost(e)
Gross unrealized gainsGross unrealized lossesFair value 
Amortized cost(e)
Gross unrealized gainsGross unrealized lossesFair value
Available-for-sale securities              
Mortgage-backed securities:              
U.S. GSEs and government agencies(a)
$103,086
$2,556
$61
 $105,581
 $69,026
$594
$974
 $68,646
$147,398
$5,074
$166
 $152,306
 $107,811
$2,395
$89
 $110,117
Residential:              
U.S.10,083
273
6
 10,350
 5,877
79
31
 5,925
12,721
458
34
 13,145
 10,223
233
6
 10,450
Non-U.S.2,490
64
2
 2,552
 2,529
72
6
 2,595
5,100
55
31
 5,124
 2,477
64
1
 2,540
Commercial5,228
100
4
 5,324
 6,758
43
147
 6,654
6,712
186
93
 6,805
 5,137
64
13
 5,188
Total mortgage-backed securities120,887
2,993
73
 123,807
 84,190
788
1,158
 83,820
171,931
5,773
324
 177,380
 125,648
2,756
109
 128,295
U.S. Treasury and government agencies141,646
376
493
 141,529
 55,771
366
78
 56,059
212,345
2,701
584
 214,462
 139,162
449
175
 139,436
Obligations of U.S. states and municipalities28,871
2,193
—
 31,064
 36,221
1,582
80
 37,723
28,353
2,083
10
 30,426
 27,693
2,118
1
 29,810
Certificates of deposit74
—
—
 74
 75
—
—
 75
—
—
—
 —
 77
—
—
 77
Non-U.S. government debt securities21,644
524
10
 22,158
 23,771
351
20
 24,102
23,634
433
7
 24,060
 21,427
377
17
 21,787
Corporate debt securities1,596
39
1
 1,634
 1,904
23
9
 1,918
671
9
6
 674
 823
22
—
 845
Asset-backed securities:              
Collateralized loan obligations27,942
18
52
 27,908
 19,612
1
176
 19,437
31,369
19
590
 30,798
 25,038
9
56
 24,991
Other5,199
57
9
 5,247
 7,225
57
22
 7,260
8,080
67
64
 8,083
 5,438
40
20
 5,458
Total available-for-sale securities(b)347,859
6,200
638
 353,421
 228,769
3,168
1,543
 230,394
476,383
11,085
1,585
 485,883
 345,306
5,771
378
 350,699
Held-to-maturity securities(c)              
Mortgage-backed securities:              
U.S. GSEs and government agencies(a)
35,976
1,250
20
 37,206
 26,610
134
200
 26,544
62,811
2,836
14
 65,633
 36,523
1,165
62
 37,626
Commercial572
25
—
 604
 —
—
—
 —
Total mortgage-backed securities35,976
1,250
20
 37,206
 26,610
134
200
 26,544
63,383
2,861
14
 66,237
 36,523
1,165
62
 37,626
U.S. Treasury and government agencies

51
—
—
 51
 —
—
—
 —
51
2
—
 53
 51
—
1
 50
Obligations of U.S. states and municipalities4,803
317
—
 5,120
 4,824
105
15
 4,914
4,839
387
—
 5,241
 4,797
299
—
 5,096
Total held-to-maturity securities40,830
1,567
20
 42,377
 31,434
239
215
 31,458
Total investment securities$388,689
$7,767
$658
 $395,798
 $260,203
$3,407
$1,758
 $261,852
Asset-backed securities:       
Collateralized loan obligations4,635
—
60
 4,576
 6,169
—
—
 6,169
Total held-to-maturity securities, net of allowance for credit losses(d)
72,908
3,250
74
 76,107
 47,540
1,464
63
 48,941
Total investment securities, net of allowance for credit losses(d)
$549,291
$14,335
$1,659
 $561,990
 $392,846
$7,235
$441
 $399,640

(a)Includes AFS U.S. GSE obligations with fair values of $78.8$98.3 billion and $50.7$78.5 billion, and HTM U.S. GSE obligations with amortized cost of $30.8$53.8 billion and $20.9$31.6 billion, at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively. As of SeptemberJune 30, 2019,2020, mortgage-backed securities issued by Fannie Mae and Freddie Mac each exceeded 10% of JPMorgan Chase’s total stockholders’ equity; the amortized cost and fair value of such securities was $69.8were $97.7 billion and $72.0$102.0 billion, and $37.8$50.9 billion and $38.8$52.7 billion, respectively.
(b)There was 0 allowance for credit losses on AFS securities at June 30, 2020.
(c)The Firm purchased $4.8 billion and $5.0 billion of HTM securities for the three and six months ended June 30, 2020, respectively, and $818 million for both the three and six months ended June 30, 2019.
(d)HTM securities measured at amortized cost are reported net of allowance for credit losses of $23 million at June 30, 2020.
(e)Excludes $2.2 billion and $1.9 billion of accrued interest receivables at June 30, 2020 and December 31, 2019, respectively. The Firm did 0t reverse through interest income any accrued interest receivables for the three and six months ended June 30, 2020 and 2019.



At June 30, 2020, the investment securities portfolio consisted of debt securities with an average credit rating of AA+ (based upon external ratings where available, and where not available, based primarily upon internal risk ratings). Risk ratings are used to identify the credit quality of securities and differentiate risk within the portfolio. The Firm’s internal risk ratings generally align with the qualitative characteristics (e.g., borrower capacity to meet financial commitments and vulnerability to changes in the
Investment
economic environment) defined by S&P and Moody’s, however the quantitative characteristics (e.g., probability of default (“PD”) and loss given default (“LGD”)) may differ as they reflect internal historical experiences and assumptions.Risk ratings are assigned at acquisition, are reviewed on a regular and ongoing basis by Credit Risk Management and are adjusted as necessary over the life of the investment for updated information affecting the issuer’s ability to fulfill its obligations.
AFS securities impairment
The following tables present the fair value and gross unrealized losses for investment securities by aging category for AFS securities at SeptemberJune 30, 2019,2020 and December 31, 2018.2019. The tables exclude U.S. Treasury and government agency securities and U.S. GSE and government agency MBS with unrealized losses of $750 million and $264 million, at June 30, 2020 and December 31, 2019, respectively; changes in the value of these securities are generally driven by changes in interest rates rather than changes in their credit profile given the explicit or implicit guarantees provided by the U.S. government.
 Investment securities with gross unrealized losses
 Less than 12 months 12 months or more  
September 30, 2019 (in millions)Fair value
Gross
unrealized losses
 Fair value
Gross
unrealized losses
Total fair valueTotal gross unrealized losses
Available-for-sale securities       
Mortgage-backed securities:       
U.S. GSEs and government agencies$8,505
$37
 $2,952
$24
$11,457
$61
Residential:       
U.S. 
—
—
 558
6
558
6
Non-U.S.47
—
 472
2
519
2
Commercial752
4
 165
—
917
4
Total mortgage-backed securities9,304
41
 4,147
32
13,451
73
U.S. Treasury and government agencies84,152
489
 540
4
84,692
493
Obligations of U.S. states and municipalities41
—
 23
—
64
—
Certificates of deposit74
—
 —
—
74
—
Non-U.S. government debt securities3,189
6
 1,357
4
4,546
10
Corporate debt securities83
—
 36
1
119
1
Asset-backed securities:       
Collateralized loan obligations7,086
8
 6,684
44
13,770
52
Other506
3
 1,598
6
2,104
9
Total available-for-sale securities104,435
547
 14,385
91
118,820
638
Held-to-maturity securities       
Mortgage-backed securities       
U.S. GSEs and government agencies2,240
20
 86
—
2,326
20
Total mortgage-backed securities2,240
20
 86
—
2,326
20
U.S. Treasury and government agencies

51
—
 —
—
51
—
Obligations of U.S. states and municipalities—
—
 —
—
—
—
Total held-to-maturity securities2,291
20
 86
—
2,377
20
Total investment securities
 with gross unrealized losses
$106,726
$567
 $14,471
$91
$121,197
$658


 Available-for-sale securities with gross unrealized losses
 Less than 12 months 12 months or more  
June 30, 2020 (in millions)Fair value
Gross
unrealized losses
 Fair value
Gross
unrealized losses
Total fair valueTotal gross unrealized losses
Available-for-sale securities       
Mortgage-backed securities:       
Residential:       
U.S. 
$2,570
$28
 $259
$6
$2,829
$34
Non-U.S.3,764
28
 261
3
4,025
31
Commercial1,950
61
 177
32
2,127
93
Total mortgage-backed securities8,284
117
 697
41
8,981
158
Obligations of U.S. states and municipalities410
10
 —
—
410
10
Certificates of deposit—
—
 —
—
—
—
Non-U.S. government debt securities3,183
4
 808
3
3,991
7
Corporate debt securities390
6
 —
—
390
6
Asset-backed securities:       
Collateralized loan obligations24,866
456
 5,003
134
29,869
590
Other1,471
23
 925
41
2,396
64
Total available-for-sale securities with gross unrealized losses$38,604
$616
 $7,433
$219
$46,037
$835
Investment securities with gross unrealized lossesAvailable-for-sale securities with gross unrealized losses
Less than 12 months 12 months or more Less than 12 months 12 months or more 
December 31, 2018 (in millions)Fair value
Gross
unrealized losses
 Fair value
Gross
unrealized losses
Total fair valueTotal gross unrealized losses
December 31, 2019 (in millions)Fair value
Gross
unrealized losses
 Fair value
Gross
unrealized losses
Total fair valueTotal gross unrealized losses
Available-for-sale securities      
Mortgage-backed securities:      
U.S. GSEs and government agencies$17,656
$318
 $22,728
$656
$40,384
$974
Residential:      
U.S.623
4
 1,445
27
2,068
31
$1,072
$3
 $423
$3
$1,495
$6
Non-U.S.907
5
 165
1
1,072
6
13
—
 420
1
433
1
Commercial974
6
 3,172
141
4,146
147
1,287
12
 199
1
1,486
13
Total mortgage-backed securities20,160
333
 27,510
825
47,670
1,158
2,372
15
 1,042
5
3,414
20
U.S. Treasury and government agencies4,792
7
 2,391
71
7,183
78
Obligations of U.S. states and municipalities1,808
15
 2,477
65
4,285
80
186
1
 —
—
186
1
Certificates of deposit75
—
 —
—
75
—
77
—
 —
—
77
—
Non-U.S. government debt securities3,123
5
 1,937
15
5,060
20
3,970
13
 1,406
4
5,376
17
Corporate debt securities478
8
 37
1
515
9
—
—
 —
—
—
—
Asset-backed securities:      
Collateralized loan obligations18,681
176
 —
—
18,681
176
10,364
11
 7,756
45
18,120
56
Other1,208
6
 2,354
16
3,562
22
1,639
9
 753
11
2,392
20
Total available-for-sale securities50,325
550
 36,706
993
87,031
1,543
Held-to-maturity securities   
Mortgage-backed securities   
U.S. GSEs and government agencies4,385
23
 7,082
177
11,467
200
Total mortgage-backed securities4,385
23
 7,082
177
11,467
200
U.S. Treasury and government agencies

—
—
 —
—
—
—
Obligations of U.S. states and municipalities12
—
 1,114
15
1,126
15
Total held-to-maturity securities4,397
23
 8,196
192
12,593
215
Total investment securities with gross unrealized losses$54,722
$573
 $44,902
$1,185
$99,624
$1,758
Total available-for-sale securities with gross unrealized losses$18,608
$49
 $10,957
$65
$29,565
$114


Other-than-temporary
As a result of the adoption of the amended AFS securities impairment guidance, an allowance for credit losses on AFS securities is required for impaired securities if a credit loss exists.
AFS securities are considered impaired if the fair value is less than the amortized cost (excluding accrued interest receivable).
The Firm recognizes unrealizedimpairment losses on investment securities that it intendsin earnings if the Firm has the intent to sell as OTTI. The Firm does not intend to sell any of the remaining investment securities with an unrealized loss in AOCI as of September 30, 2019, anddebt security, or if it is more likely than not likely that the Firm will be required to sell these securitiesthe debt security before recovery of theirits amortized cost. In these circumstances the impairment loss recognized in earnings is equal to the full difference between the amortized cost basis. Further,(excluding accrued interest receivable and net of allowance if applicable) and the fair value of the securities.
For impaired debt securities that the Firm has the intent and ability to hold, the securities are evaluated to determine if a credit loss exists. If it is determined that a credit loss exists, that loss is recognized as an allowance for credit losses through the provision for credit losses in the Consolidated Statements of Income, limited by the amount of impairment. Any impairment not due to credit losses is recorded in OCI.
Factors considered in evaluating credit losses include adverse conditions specifically related to the industry, geographic area or financial condition of the issuer or underlying collateral of a security; and payment structure of the security.
When assessing securities issued in a securitization for credit losses, the Firm estimates cash flows considering relevant market and economic data, underlying loan-level data, and structural features of the securitization, such as subordination, excess spread, overcollateralization or other forms of credit enhancement, and compares the losses projected for the underlying collateral (“pool losses”) against the level of credit enhancement in the securitization structure to determine whether these features are sufficient to absorb the pool losses, or whether a credit loss exists.
For beneficial interests in securitizations that are rated below “AA” at their acquisition, or that can be contractually prepaid or otherwise settled in such a way that the Firm would not recover substantially all of its recorded investment, the Firm evaluates impairment for credit losses when there is an adverse change in expected cash flows.
Unrealized losses on AFS securities increased during the period ended June 30, 2020 as credit spreads widened during the first quarter amid volatile financial markets in connection with the COVID-19 pandemic and tightened in the second quarter. The increase was largely related to collateralized loan obligations which had gross unrealized losses of $590 million as of June 30, 2020 compared to $2.0 billion as of March 31, 2020. Approximately 99% of these collateralized loan obligations are rated “AAA”, and the average credit enhancement was 37%. Credit enhancement in collateralized loan obligations is primarily in the form of overcollateralization, which is the excess of the par amount of collateral over the par amount of securities. Management assessed the projected collateral performance and the structural protections of these securities including underlying loan defaults and loss severity to determine if a credit loss exists. Based on this assessment, the Firm believes the unrealized losses on collateralized loan obligations are not due to credit losses.
Allowance for credit losses
Based on its assessment, the Firm did not recognize any credit-related OTTIan allowance for credit losses duringon impaired AFS securities as of January 1 or June 30, 2020.


HTM securities – credit risk
The adoption of the nine months ended September 30, 2019CECL accounting guidance requires management to estimate expected credit losses on HTM securities over the remaining expected life and 2018. Accordingly,recognize this estimate as an allowance for credit losses. As a result of the adoption of this guidance, the Firm believes that the investment securities withrecognized an unrealized loss in AOCIallowance for credit losses on HTM obligations of U.S. states and municipalities of $10 million as a cumulative-effect adjustment to retained earnings as of SeptemberJanuary 1, 2020.
Credit quality indicator
The primary credit quality indicator for HTM securities is the risk rating assigned to each security. At June 30, 2019,2020, all HTM securities were rated investment grade and were current and accruing, with approximately 95% rated AAA.
Allowance for credit losses
The allowance for credit losses on HTM obligations of U.S. states and municipalities and commercial mortgage-backed securities is calculated by applying statistical credit loss factors (estimated PD and LGD) to the amortized cost (excluding accrued interest receivable). The credit loss factors are not other-than-temporarily impaired.derived using a weighted average of five internally developed eight-quarter macroeconomic scenarios, followed by a single year straight-line interpolation to revert to long run historical information for periods beyond the forecast period. Refer to Note 10 of JPMorgan Chase’s 2018 Form 10-K13 for additionalfurther information on other-than-temporary impairment.the eight-quarter macroeconomic forecast.
The allowance for credit losses on HTM collateralized loan obligations is calculated as the difference between the amortized cost (excluding accrued interest receivable) and the present value of the cash flows expected to be collected, discounted at the security’s effective interest rate. These cash flow estimates are developed based on expectations of underlying collateral performance derived using the eight-quarter macroeconomic forecast and the single year straight-line interpolation, as well as considering the structural features of the security.
The application of different inputs and assumptions into the calculation of the allowance for credit losses is subject to significant management judgment, and emphasizing one input or assumption over another, or considering other inputs or assumptions, could affect the estimate of the allowance for credit losses on HTM securities.
The allowance for credit losses on HTM securities was $23 million as of June 30, 2020, reflecting $4 million and $13 million recognized in the provision for credit losses for the three and six months ended June 30, 2020, respectively.
 
InvestmentSelected impacts of investment securities gains and losses
The following table presents realized gains and losses and OTTI from AFS securities that were recognized in income.on the Consolidated statements of income
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
2018
  2019
2018
2020
2019
  2020
2019
Realized gains$78
$58
 $454
$137
$624
$115
 $1,719
$376
Realized losses—
(103) (319)(507)(598)(71) (1,460)(319)
OTTI losses(a)
—
(1) —
(1)
Net investment securities gains/(losses)$78
$(46) $135
$(371)
Net investment securities gains$26
$44
 $259
$57
   
Provision for credit losses$4
NA
 13
NA

(a) Represents OTTI losses recognized in income on investment securities theThe Firm intends to sell. Excludes realized losses on securities sold of $21 million for the nine months ended September 30, 2018 that had been previously reported as an OTTI loss due to the intentiondid not intend to sell any impaired AFS securities in the securities.periods presented.

Changes in the credit loss component of credit-impaired debt securities
The cumulative credit loss component, including any changes therein, of OTTI losses that have been recognized in income related to AFS securities was not material as of and during the nine month periods ended September 30, 2019 and 2018.


Contractual maturities and yields
The following table presents the amortized cost and estimated fair value at SeptemberJune 30, 2019,2020, of JPMorgan Chase’s investment securities portfolio by contractual maturity.
By remaining maturity
September 30, 2019 (in millions)
Due in one
year or less
Due after one year through five yearsDue after five years through 10 years
Due after
10 years(b)
 Total
By remaining maturity
June 30, 2020 (in millions)
Due in one
year or less
Due after one year through five yearsDue after five years through 10 years
Due after
10 years(b)
 Total
Available-for-sale securities      
Mortgage-backed securities      
Amortized cost$14
$59
$10,230
$110,584
 $120,887
$2
$386
$12,793
$158,750
 $171,931
Fair value14
60
10,476
113,257
 123,807
2
399
13,130
163,849
 177,380
Average yield(a)
3.59%2.73%2.92%3.45% 3.40%2.16%2.03%1.89%3.06% 2.97%
U.S. Treasury and government agencies







  







  
Amortized cost$10,904
$95,139
$25,557
$10,046
 $141,646
$42,482
$112,121
$45,140
$12,602
 $212,345
Fair value10,901
95,231
25,659
9,738
 141,529
42,514
113,598
46,326
12,024
 214,462
Average yield(a)
1.99%1.96%2.02%2.04% 1.98%0.29%0.71%0.96%0.54% 0.67%
Obligations of U.S. states and municipalities







  







  
Amortized cost$170
$228
$1,089
$27,384
 $28,871
Fair value172
236
1,135
29,521
 31,064
Average yield(a)
3.32%4.00%5.60%4.94% 4.95%
Certificates of deposit







  
Amortized cost$74
$—
$—
$—
 $74
$74
$231
$1,132
$26,916
 $28,353
Fair value74
—
—
—
 74
74
241
1,212
28,899
 30,426
Average yield(a)
0.49%—%—%—% 0.49%3.63%4.47%4.84%4.58% 4.59%
Non-U.S. government debt securities







  







  
Amortized cost$6,342
$11,580
$3,416
$306
 $21,644
$8,268
$10,518
$4,547
$301
 $23,634
Fair value6,350
11,870
3,633
305
 22,158
8,293
10,778
4,667
322
 24,060
Average yield(a)
2.23%1.99%1.34%1.67% 1.95%1.48%1.48%1.01%1.67% 1.39%
Corporate debt securities







  







  
Amortized cost$216
$718
$662
$—
 $1,596
$131
$303
$237
$—
 $671
Fair value218
737
679
—
 1,634
131
303
240
—
 674
Average yield(a)
4.83%3.91%3.78%—% 3.98%3.85%2.89%3.00%—% 3.11%
Asset-backed securities







  







  
Amortized cost$—
$1,873
$9,411
$21,857
 $33,141
$146
$3,629
$14,167
$21,507
 $39,449
Fair value—
1,876
9,412
21,867
 33,155
146
3,647
13,956
21,132
 38,881
Average yield(a)
—%2.94%3.17%3.03% 3.06%1.05%2.23%2.19%1.87% 2.01%
Total available-for-sale securities







  







  
Amortized cost$17,720
$109,597
$50,365
$170,177
 $347,859
$51,103
$127,188
$78,016
$220,076
 $476,383
Fair value17,729
110,010
50,994
174,688
 353,421
51,160
128,966
79,531
226,226
 485,883
Average yield(a)
2.12%2.00%2.47%3.55% 2.83%0.50%0.83%1.40%2.99% 1.89%
Held-to-maturity securities







  







  
Mortgage-backed securities







  







  
Amortized cost$—
$—
$4,655
$31,321
 $35,976
$—
$—
$6,234
$57,157
 $63,391
Fair value—
—
5,049
32,157
 37,206
—
—
6,931
59,306
 66,237
Average yield(a)
—%—%3.29%3.12% 3.14%—%—%2.92%2.93% 2.92%
U.S. Treasury and government agencies

      
Amortized cost

$—
$51
$—
$—
 $51
$—
$51
$—
$—
 $51
Fair value

—
51
—
—
 51
—
53
—
—
 53
Average yield(a)

—%1.47%—%—% 1.47%—%1.44%—%—% 1.44%
Obligations of U.S. states and municipalities







  







  
Amortized cost$—
$—
$55
$4,748
 $4,803
$—
$36
$201
$4,617
 $4,854
Fair value—
—
58
5,062
 5,120
—
37
218
4,986
 5,241
Average yield(a)
—%—%3.89%4.02% 4.02%—%3.65%3.81%3.94% 3.94%
Asset-backed securities   
Amortized cost$—
$—
$4,635
$—
 $4,635
Fair value—
—
4,576
—
 4,576
Average yield(a)
—%—%2.24%—% 2.24%
Total held-to-maturity securities







  







  
Amortized cost$—
$51
$4,710
$36,069
 $40,830
$—
$87
$11,070
$61,774
 $72,931
Fair value—
51
5,107
37,219
 42,377
—
90
11,725
64,292
 76,107
Average yield(a)
—%1.47%3.30%3.24% 3.24%—%2.35%2.65%3.00% 2.95%
(a)Average yield is computed using the effective yield of each security owned at the end of the period, weighted based on the amortized cost of each security. The effective yield considers the contractual coupon, amortization of premiums and accretion of discounts, and the effect of related hedging derivatives. Taxable-equivalent amounts are used where applicable. The effective yield excludes unscheduled principal prepayments; and accordingly, actual maturities of securities may differ from their contractual or expected maturities as certain securities may be prepaid. However, for certain callable debt securities, the average yield is calculated to the earliest call date.
(b)Substantially all of the Firm’s U.S. residential MBS and collateralized mortgage obligations are due in 10 years or more, based on contractual maturity. The estimated weighted-average life, which reflects anticipated future prepayments, is approximately 54 years for agency residential MBS, 3 years for agency residential collateralized mortgage obligations and 3 years for nonagency residential collateralized mortgage obligations.

Note 1011 – Securities financing activities
JPMorgan Chase enters into resale, repurchase, securities borrowed and securities loaned agreements (collectively, “securities financing agreements”) primarily to finance the Firm’s inventory positions, acquire securities to cover short sales, accommodate customers’ financing needs, settle other securities obligations and to deploy the Firm’s excess cash.
Securities financing agreements are treated as collateralized financings on the Firm’s Consolidated balance sheets. Where appropriate under applicable accounting guidance, securities financing agreements with the same counterparty are reported on a net basis. Refer to Note 11 of JPMorgan Chase’s 2018 Form 10-K1 for afurther discussion of accounting policies relating tothe offsetting of assets and liabilities. Fees received and paid in connection with securities financing activities.agreements are recorded over the life of the agreement in interest income and interest expense on the Consolidated statements of income.
The Firm has elected the fair value option for certain securities financing agreements. Refer to Note 3 for further information regarding the fair value option. The securities borrowed and securities lendingfinancing agreements for which the fair value option has been elected.elected are reported within securities purchased under resale agreements, securities loaned or sold under repurchase agreements, and securities borrowed on the Consolidated balance sheets. Generally, for agreements carried at fair value, current-period interest accruals are recorded within interest income and interest expense, with changes in fair value reported in principal transactions revenue. However, for financial instruments containing embedded derivatives that would be separately accounted for in accordance with accounting guidance for hybrid instruments, all changes in fair value, including any interest elements, are reported in principal transactions revenue.
Securities financing agreements not elected under the fair value option are measured at amortized cost. As a result of the Firm’s credit risk mitigation practices described below, the Firm did not hold any allowance for credit losses with respect to resale and securities borrowed arrangements as of June 30, 2020 and December 31, 2019.
Credit risk mitigation practices
Securities financing agreements expose the Firm primarily to credit and liquidity risk. To manage these risks, the Firm monitors the value of the underlying securities (predominantly high-quality securities collateral, including government-issued debt and U.S. GSEs and government agencies MBS) that it has received from or provided to its counterparties compared to the value of cash proceeds and exchanged collateral, and either requests additional collateral or returns securities or collateral when appropriate. Margin levels are initially established based upon the counterparty, the type of underlying securities, and the permissible collateral, and are monitored on an ongoing basis.
In resale and securities borrowed agreements, the Firm is exposed to credit risk to the extent that the value of the securities received is less than initial cash principal advanced and any collateral amounts exchanged. In repurchase and securities loaned agreements, credit risk exposure arises to the extent that the value of underlying securities advanced exceeds the value of the initial cash principal received, and any collateral amounts exchanged.
Additionally, the Firm typically enters into master netting agreements and other similar arrangements with its counterparties, which provide for the right to liquidate the underlying securities and any collateral amounts exchanged in the event of a counterparty default. It is also the Firm’s policy to take possession, where possible, of the securities underlying resale and securities borrowed agreements. Refer to Note 2324 for further information regarding assets pledged and collateral received in securities financing agreements.


The table below summarizes the gross and net amounts of the Firm’s securities financing agreements as of September June 30, 20192020 and December 31, 2018. 2019. When the Firm has obtained an appropriate legal opinion with respect to a master netting agreement with a counterparty and where other relevant netting criteria under U.S. GAAP are met, the Firm nets, on the Consolidated balance sheets, the
balances outstanding under its securities financing agreements with the same counterparty. In addition, the Firm exchanges securities and/or cash collateral with its counterparty to reduce the economic exposure with the counterparty, but
such collateral is not eligible for net Consolidated balance sheet presentation. Where the Firm has obtained an appropriate legal opinion with respect to the counterparty master netting agreement, such collateral, along with securities financing balances that do not meet all these relevant netting criteria under U.S. GAAP, is presented in the table below as “Amounts not nettable on the Consolidated balance sheets,” and reduces the “Net amounts” presented. Where a legal opinion has not been either sought or obtained, the securities financing balances are presented gross in the “Net amounts” below.
September 30, 2019June 30, 2020
(in millions)Gross amountsAmounts netted on the Consolidated balance sheets
Amounts presented on the Consolidated balance sheets(b)
Amounts not nettable on the Consolidated balance sheets(c)
Net
amounts(d)
Gross amountsAmounts netted on the Consolidated balance sheetsAmounts presented on the Consolidated balance sheets
Amounts not nettable on the Consolidated balance sheets(b)
Net
amounts(c)
Assets      
Securities purchased under resale agreements$630,033
$(372,650)$257,383
$(244,241) $13,142
$604,876
$(347,896)$256,980
$(241,154) $15,826
Securities borrowed160,304
(21,968)138,336
(104,517) 33,819
165,490
(22,786)142,704
(102,470) 40,234
Liabilities      
Securities sold under repurchase agreements$608,618
$(372,650)$235,968
$(213,150) $22,818
$577,216
$(347,896)$229,320
$(214,124) $15,196
Securities loaned and other(a)
34,104
(21,968)12,136
(11,878) 258
30,291
(22,786)7,505
(7,003) 502
December 31, 2018December 31, 2019
(in millions)Gross amountsAmounts netted on the Consolidated balance sheets
Amounts presented on the Consolidated balance sheets(b)
Amounts not nettable on the Consolidated balance sheets(c)
Net
amounts(d)
Gross amountsAmounts netted on the Consolidated balance sheetsAmounts presented on the Consolidated balance sheets
Amounts not nettable on the Consolidated balance sheets(b)
Net
amounts(c)
Assets      
Securities purchased under resale agreements$691,116
$(369,612)$321,504
$(308,854)
$12,650
$628,609
$(379,463)$249,146
$(233,818) $15,328
Securities borrowed132,955
(20,960)111,995
(79,747) 32,248
166,718
(26,960)139,758
(104,990) 34,768
Liabilities      
Securities sold under repurchase agreements$541,587
$(369,612)$171,975
$(149,125)
$22,850
$555,172
$(379,463)$175,709
$(151,566) $24,143
Securities loaned and other(a)
33,700
(20,960)12,740
(12,358) 382
36,649
(26,960)9,689
(9,654) 35
(a)Includes securities-for-securities lending agreements of $2.4$3.3 billion and $3.3$3.7 billion at SeptemberJune 30, 20192020 and December 31, 2018,2019, respectively, accounted for at fair value, where the Firm is acting as lender. In the Consolidated balance sheets, the Firm recognizes the securities received at fair value within other assets and the obligation to return those securities within accounts payable and other liabilities.
(b)Includes securities financing agreements accounted for at fair value. At September 30, 2019 and December 31, 2018, included securities purchased under resale agreements of $13.7 billion and $13.2 billion, respectively; securities sold under repurchase agreements of $933 million and $935 million, respectively; and securities borrowed of $5.8 billion and $5.1 billion, respectively. There were 0 securities loaned accounted for at fair value in either period.
(c)In some cases, collateral exchanged with a counterparty exceeds the net asset or liability balance with that counterparty. In such cases, the amounts reported in this column are limited to the related net asset or liability with that counterparty.
(d)(c)Includes securities financing agreements that provide collateral rights, but where an appropriate legal opinion with respect to the master netting agreement has not been either sought or obtained. At SeptemberJune 30, 20192020 and December 31, 2018,2019, included $9.1$11.3 billion and $7.9$11.0 billion, respectively, of securities purchased under resale agreements; $30.6$37.2 billion and $30.3$31.9 billion, respectively, of securities borrowed; $21.9$13.9 billion and $21.5$22.7 billion, respectively, of securities sold under repurchase agreements; and $96$33 million and $25$7 million, respectively, of securities loaned and other.


The tables below present as of September June 30, 2019,2020, and December 31, 2018 2019 the types of financial assets pledged in securities financing agreements and the remaining contractual maturity of the securities financing agreements.
Gross liability balanceGross liability balance
September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
(in millions)Securities sold under repurchase agreements Securities loaned and other Securities sold under repurchase agreements Securities loaned and otherSecurities sold under repurchase agreements Securities loaned and other Securities sold under repurchase agreements Securities loaned and other
Mortgage-backed securities              
U.S. GSEs and government agencies$33,399
 $—
 $34,311
(a) 
$—
$58,171
 $—
 $34,119
 $—
Residential - nonagency1,804
 —
 2,165
 —
588
 —
 1,239
 —
Commercial - nonagency1,778
 —
 1,390
 —
1,273
 —
 1,612
 —
U.S. Treasury, GSEs and government agencies366,820
 8
 317,578
(a) 
69
320,996
 93
 334,398
 29
Obligations of U.S. states and municipalities1,400
 —
 1,150
 —
1,650
 —
 1,181
 —
Non-U.S. government debt165,568
 1,769
 154,900
 4,313
156,353
 2,337
 145,548
 1,528
Corporate debt securities13,067
 1,361
 13,898
 428
21,359
 1,092
 13,826
 1,580
Asset-backed securities1,746
 —
 3,867
 —
981
 —
 1,794
 —
Equity securities23,036
 30,966
 12,328
 28,890
15,845
 26,769
 21,455
 33,512
Total$608,618
 $34,104
 $541,587
 $33,700
$577,216
 $30,291
 $555,172
 $36,649
 Remaining contractual maturity of the agreements
 Overnight and continuous     
Greater than
90 days
  
June 30, 2020 (in millions) Up to 30 days 30 – 90 days  Total
Total securities sold under repurchase agreements$233,743
 $215,316
 $60,712
 $67,445
 $577,216
Total securities loaned and other28,407
 26
 531
 1,327
 30,291
 Remaining contractual maturity of the agreements
 Overnight and continuous     
Greater than
90 days
  
December 31, 2019 (in millions) Up to 30 days 30 – 90 days  Total
Total securities sold under repurchase agreements$225,134
 $195,816
(a) 
$56,020
(a) 
$78,202
(a) 
$555,172
Total securities loaned and other32,028
 1,706
 937
 1,978
 36,649
(a)The prior periodPrior-period amounts have been revised to conform with the current period presentation.
 Remaining contractual maturity of the agreements
 Overnight and continuous    
Greater than
90 days
 
September 30, 2019 (in millions) Up to 30 days 30 – 90 daysTotal
Total securities sold under repurchase agreements$336,082
 $132,662
 $53,504
$86,370
$608,618
Total securities loaned and other30,172
 231
 748
2,953
34,104
 Remaining contractual maturity of the agreements
 Overnight and continuous    
Greater than
90 days
 
December 31, 2018 (in millions) Up to 30 days 30 – 90 daysTotal
Total securities sold under repurchase agreements$247,579
 $174,971
 $71,637
$47,400
$541,587
Total securities loaned and other28,402
 997
 2,132
2,169
33,700
Transfers not qualifying for sale accounting
At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, the Firm held $654$662 million and $2.1 billion,$743 million, respectively, of financial assets for which the rights have been transferred to third parties; however, the transfers did not qualify as a sale in accordance with U.S. GAAP. These transfers have been recognized as collateralized financing transactions. The transferred assets are recorded in trading assets and loans, and the corresponding liabilities are recorded predominantly in short-term borrowings on the Consolidated balance sheets. The prior period amount has been revised to conform with the current period presentation.

Note 1112 – Loans
Loan accounting framework
The accounting for a loan depends on management’s strategy for the loan, and on whether the loan was credit-impaired at the date of acquisition.loan. The Firm accounts for loans based on the following categories:
•
Originated or purchased loans held-for-investment (i.e., “retained”), other than PCI loans
Loans held-for-sale
Loans at fair value
PCIEffective January 1, 2020, the Firm adopted the CECL accounting guidance. Refer to Note 1 for further information.
The following provides a detailed accounting discussion of these loan categories:
Loans held-for-investment
Originated or purchased loans held-for-investment are recorded at the principal amount outstanding, net of the following: charge-offs; interest applied to principal (for loans accounted for on the cost recovery method); unamortized discounts and premiums; and net deferred loan fees or costs. Credit card loans also include billed finance charges and fees.
Interest income
Interest income on performing loans held-for-investment is accrued and recognized as interest income at the contractual rate of interest. Purchase price discounts or premiums, as well as net deferred loan fees or costs, are amortized into interest income over the contractual life of the loan as an adjustment of yield.
The Firm classifies accrued interest on loans, including accrued but unbilled interest on credit card loans, in accrued interest and accounts receivables on the Consolidated balance sheets. For credit card loans, accrued interest once billed is then recognized in the loan balances, with the related allowance recorded in the allowance for credit losses. Changes in the allowance for credit losses on accrued interest on credit card loans are recognized in the provision for credit losses and charge-offs are recognized by reversing interest income. For other loans, the Firm generally does not recognize an allowance for credit losses on accrued interest receivables, consistent with its policy to write them off no later than 90 days past due by reversing interest income.
Nonaccrual loans
Nonaccrual loans are those on which the accrual of interest has been suspended. Loans (other than credit card loans and certain consumer loans insured by U.S. government agencies) are placed on nonaccrual status and considered nonperforming when full payment of principal and interest is not expected, regardless of delinquency status, or when principal and interest has been in default for a period of 90 days or more, unless the loan is both well-secured and in the process of collection. A loan is determined to be past due when the minimum payment is not received from the borrower by the contractually specified due date or for
 
certain loans (e.g., residential real estate loans), when a monthly payment is due and unpaid for 30 days or more. Finally, collateral-dependent loans are typically maintained on nonaccrual status.
On the date a loan is placed on nonaccrual status, all interest accrued but not collected is reversed against interest income. In addition, the amortization of deferred amounts is suspended. Interest income on nonaccrual loans may be recognized as cash interest payments are received (i.e., on a cash basis) if the recorded loan balance is deemed fully collectible; however, if there is doubt regarding the ultimate collectibility of the recorded loan balance, all interest cash receipts are applied to reduce the carrying value of the loan (the cost recovery method). For consumer loans, application of this policy typically results in the Firm recognizing interest income on nonaccrual consumer loans on a cash basis.
A loan may be returned to accrual status when repayment is reasonably assured and there has been demonstrated performance under the terms of the loan or, if applicable, the terms of the restructured loan.
As permitted by regulatory guidance, credit card loans are generally exempt from being placed on nonaccrual status; accordingly, interest and fees related to credit card loans continue to accrue until the loan is charged off or paid in full.
Allowance for loan losses
The allowance for loan losses represents the estimated expected credit losses in the held-for-investment loan portfolio at the balance sheet date and is recognized on the balance sheet as a contra asset, which brings the amortized cost to the net carrying value. Changes in the allowance for loan losses are recorded in the provision for credit losses on the Firm’s Consolidated statements of income. Refer to Note 1213 for further information on the Firm’s accounting policies for the allowance for loan losses.
Charge-offs
Consumer loans are generally charged off or charged down to the net realizable value of JPMorgan Chase’s 2018 Form 10-Kthe underlying collateral (i.e., fair value less estimated costs to sell), with an offset to the allowance for loan losses, upon reaching specified stages of delinquency in accordance with standards established by the FFIEC. Residential real estate loans, unmodified credit card loans and scored business banking loans are generally charged off no later than 180 days past due. Scored auto and modified credit card loans are charged off no later than 120 days past due.
Certain consumer loans are charged off or charged down to their net realizable value earlier than the FFIEC charge-off standards in certain circumstances as follows:
•
Loans modified in a TDR that are determined to be collateral-dependent.

•
Loans to borrowers who have experienced an event that suggests a loss is either known or highly certain are subject to accelerated charge-off standards (e.g., residential real estate and auto loans are charged off within 60 days of receiving notification of a bankruptcy filing).
•
Auto loans upon repossession of the automobile.
Other than in certain limited circumstances, the Firm typically does not recognize charge-offs on the government-guaranteed portion of loans.
Wholesale loans are charged off when it is highly certain that a detailed discussionloss has been realized. The determination of whether to recognize a charge-off includes many factors, including the prioritization of the Firm’s claim in bankruptcy, expectations of the workout/restructuring of the loan and valuation of the borrower’s equity or the loan collateral.
When a loan is charged down to the estimated net realizable value, the determination of the fair value of the collateral depends on the type of collateral (e.g., securities, real estate). In cases where the collateral is in the form of liquid securities, the fair value is based on quoted market prices or broker quotes. For illiquid securities or other financial assets, the fair value of the collateral is generally estimated using a discounted cash flow model.
For residential real estate loans, including accountingcollateral values are based upon external valuation sources. When it becomes likely that a borrower is either unable or unwilling to pay, the Firm utilizes a broker’s price opinion, appraisal and/or an automated valuation model of the home based on an exterior-only valuation (“exterior opinions”), which is then updated at least every twelve months, or more frequently depending on various market factors. As soon as practicable after the Firm receives the property in satisfaction of a debt (e.g., by taking legal title or physical possession), the Firm generally obtains an appraisal based on an inspection that includes the interior of the home (“interior appraisals”). Exterior opinions and interior appraisals are discounted based upon the Firm’s experience with actual liquidation values as compared with the estimated values provided by exterior opinions and interior appraisals, considering state-specific factors.
For commercial real estate loans, collateral values are generally based on appraisals from internal and external valuation sources. Collateral values are typically updated every six to twelve months, either by obtaining a new appraisal or by performing an internal analysis, in accordance with the Firm’s policies. The Firm also considers both borrower- and market-specific factors, which may result in obtaining appraisal updates or broker price opinions at more frequent intervals.
Loans held-for-sale
Loans held-for-sale are measured at the lower of cost or fair value, with valuation changes recorded in noninterest revenue. For consumer loans, the valuation is performed on a portfolio basis. For wholesale loans, the valuation is performed on an individual loan basis.
Interest income on loans held-for-sale is accrued and recognized based on the contractual rate of interest.
Loan origination fees or costs and purchase price discounts or premiums are deferred in a contra loan account until the related loan is sold. The deferred fees or costs and discounts or premiums are an adjustment to the basis of the loan and therefore are included in the periodic determination of the lower of cost or fair value adjustments and/or the gain or loss recognized at the time of sale.
Because these loans are recognized at the lower of cost or fair value, the Firm’s allowance for loan losses and charge-off policies do not apply to these loans. However, loans held-for-sale are subject to the nonaccrual policies described above.
Loans at fair value
Loans used in a market-making strategy or risk managed on a fair value basis are measured at fair value, with changes in fair value recorded in noninterest revenue.
Interest income on these loans is accrued and recognized based on the contractual rate of interest. Changes in fair value are recognized in noninterest revenue. Loan origination fees are recognized upfront in noninterest revenue. Loan origination costs are recognized in the associated expense category as incurred.
Because these loans are recognized at fair value, the Firm’s allowance for loan losses and charge-off policies do not apply to these loans. However, loans at fair value are subject to the nonaccrual policies described above.
Refer to Note 3 of this Form 10-Q for further information on the Firm’s elections of fair value accounting under the fair value option. Refer to Note 2 of this Form 10-Qand Note 3 for further information on loans carried at fair value and classified as trading assets.


Loan classification changes
Loans in the held-for-investment portfolio that management decides to sell are transferred to the held-for-sale portfolio at the lower of cost or fair value on the date of transfer. Credit-related losses are charged against the allowance for loan losses; non-credit related losses such as those due to changes in interest rates or foreign currency exchange rates are recognized in noninterest revenue.
In the event that management decides to retain a loan in the held-for-sale portfolio, the loan is transferred to the held-for-investment portfolio at amortized cost on the date of transfer. These loans are subsequently assessed for impairment based on the Firm’s allowance methodology. Refer to Note 13 for a further discussion of the methodologies used in establishing the Firm’s allowance for loan losses.
Loan modifications
The Firm seeks to modify certain loans in conjunction with its loss mitigation activities. Through the modification, JPMorgan Chase grants one or more concessions to a borrower who is experiencing financial difficulty in order to minimize the Firm’s economic loss and avoid foreclosure or repossession of the collateral, and to ultimately maximize payments received by the Firm from the borrower. The concessions granted vary by program and by borrower-specific characteristics, and may include interest rate reductions, term extensions, payment delays, principal forgiveness, or the acceptance of equity or other assets in lieu of payments. Such modifications are accounted for and reported as TDRs. Loans with short-term and other insignificant modifications that are not considered concessions are not TDRs.
Loans, except for credit card loans, modified in a TDR are generally placed on nonaccrual status, although in many cases such loans were already on nonaccrual status prior to modification. These loans may be returned to performing status (the accrual of interest is resumed) if the following criteria are met: (i) the borrower has performed under the modified terms for a minimum of six months and/or 6 payments, and (ii) the Firm has an expectation that repayment of the modified loan is reasonably assured based on, for example, the borrower’s debt capacity and level of future earnings, collateral values, LTV ratios, and other current market considerations. In certain limited and well-defined circumstances in which the loan is current at the modification date, such loans are not placed on nonaccrual status at the time of modification.
Loans modified in TDRs are generally measured for impairment using the Firm’s established asset-specific allowance methodology, which considers the expected re-default rates for the modified loans. A loan modified in a TDR generally remains subject tothe asset-specific component of the allowance throughout its remaining life, regardless of whether the loan is performing and has been returned to accrual status. Refer to Note 13 for further
discussion of the methodology used to estimate the Firm’s asset-specific allowance.
The Firm has granted various forms of assistance to customers and clients impacted by the COVID-19 pandemic, including payment deferrals and covenant modifications. The majority of the Firm’s COVID-19 related loan modifications have not been considered TDRs as:
•
they represent short-term or other insignificant modifications, whether under the Firm’s regular loan modification assessments or as permitted by regulatory guidance, or
•
the Firm has elected to apply the option to suspend the application of accounting guidance for TDRs as provided under section 4013 of the CARES Act.
To the extent that certain modifications do not meet any of the above criteria, the Firm accounts for them as TDRs.
As permitted by regulatory guidance, the Firm does not place loans with deferrals granted due to COVID-19 on nonaccrual status where such loans are not otherwise reportable as nonaccrual. The Firm considers expected losses of principal and accrued interest associated with all COVID-19 related loan modifications in its allowance for credit losses.
Assistance provided in response to the COVID-19 pandemic could delay the recognition of delinquencies, nonaccrual status, and net charge-offs for those customers who would have otherwise moved into past due or nonaccrual status.
Foreclosed property
The Firm acquires property from borrowers through loan restructurings, workouts, and foreclosures. Property acquired may include real property (e.g., residential real estate, land, and buildings) and commercial and personal property (e.g., automobiles, aircraft, railcars, and ships).
The Firm recognizes foreclosed property upon receiving assets in satisfaction of a loan (e.g., by taking legal title or physical possession). For loans collateralized by real property, the Firm generally recognizes the asset received at foreclosure sale or upon the execution of a deed in lieu of foreclosure transaction with the borrower. Foreclosed assets are reported in other assets on the Consolidated balance sheets and initially recognized at fair value less estimated costs to sell. Each quarter the fair value of the acquired property is reviewed and adjusted, if necessary, to the lower of cost or fair value. Subsequent adjustments to fair value are charged/credited to noninterest revenue. Operating expense, such as real estate taxes and maintenance, are charged to other expense.

Loan portfolio
The Firm’s loan portfolio is divided into three3 portfolio segments, which are the same segments used by the Firm to determine the allowance for loan losses: Consumer, excluding credit card; Credit card; and Wholesale. Within each portfolio segment the Firm monitors and assesses the credit risk in the following classes of loans, based on the risk characteristics of each loan class.
In conjunction with the adoption of CECL, the Firm revised its classes of loans. Prior-period amounts have been revised to conform with the current presentation:
•
The consumer, excluding credit card portfolio segment’s residential mortgage and home equity loans and lending-related commitments have been combined into a residential real estate class.
•
Upon adoption of CECL, the Firm elected to discontinue the pool-level accounting for PCI loans and to account for these loans on an individual loan basis. PCI loans are considered PCD loans under CECL and are subject to the Firm’s nonaccrual and charge-off policies. PCD loans are now reported in the consumer, excluding credit card portfolio segment’s residential real estate class.
•
Risk-rated business banking and auto dealer loans and lending-related commitments held in CCB were reclassified from the consumer, excluding credit card portfolio segment, to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. The remaining scored auto and business banking loans and lending-related commitments have been combined into an auto and other class.
•
The wholesale portfolio segment’s classes, previously based on the borrower’s primary business activity, have been revised to align with the loan classifications as defined by the bank regulatory agencies, based on the loan’s collateral, purpose, and type of borrower.
Consumer, excluding
credit card(a)
 Credit card 
Wholesale(f)(c)
• Residential real estate – excluding PCI
• Residential mortgage(b)(a)
• Home equityAuto and other(c)(b)
Other consumer loans(d)
• Auto
• Consumer & Business Banking(e)
Residential real estate – PCI
• Home equity
• Prime mortgage
• Subprime mortgage
• Option ARMs
 • Credit card loans 
• Secured by real estate
• Commercial and industrial
• Real estate
• Financial institutions
• Governments & Agencies
• Other(g)(d)
(a)
Includes loans held in CCB, scored prime mortgage and scored home equity loans held in AWMCCB and primeAWM,and scored mortgage loans held in Corporate.
(b)Predominantly includes primeIncludes scored auto and business banking loans (including option ARMs).and overdrafts.
(c)Includes seniorloans held in CIB, CB, AWM, Corporate as well as risk-rated business banking and junior lien home equity loans.auto dealer loans held in CCB for which the wholesale methodology is applied when determining the allowance for loan losses.
(d)Includes certain business bankingloans to financial institutions, states and auto dealer risk-ratedpolitical subdivisions, SPEs, nonprofits, personal investment companies and trusts, as well as loans that apply the wholesale methodology for determining the allowance for loan losses; these loans are managed by CCB, and therefore, for consistency in presentation, are included with the other consumer loan classes.
(e)Predominantly includes Business Banking loans.
(f)Includes loans held in CIB, CB, AWM and Corporate. Excludes scored prime mortgage and scored home equity loans held in AWM and prime mortgage loans held in Corporate. Classes are internally defined and may not align with regulatory definitions.
(g)Includes loans to:to individuals and individual entities (predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts), SPEs and Private education and civic organizations.AWM). Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for more information on SPEs.

The following tables summarize the Firm’s loan balances by portfolio segment.
September 30, 2019Consumer, excluding credit card 
Credit card(a)
 Wholesale Total 
June 30, 2020Consumer, excluding credit card Credit card Wholesale 
Total(a)
 
(in millions)Consumer, excluding credit card 
Credit card(a)
 Wholesale Total  
Retained
(b) 
$307,005
 $141,656
 $516,787
 $965,448
(b) 
Held-for-sale4,821
 —
 5,750
 10,571
 1,912
 —
 5,235
 7,147
 
At fair value—
 —
 5,760
 5,760
 —
 —
 5,923
 5,923
 
Total$336,630
 $159,571
 $449,017
 $945,218
 $308,917
 $141,656
 $527,945
 $978,518
 
                
December 31, 2018Consumer, excluding credit card 
Credit card(a)
 Wholesale Total 
December 31, 2019Consumer, excluding credit card Credit card Wholesale 
Total(a)
 
(in millions)Consumer, excluding credit card 
Credit card(a)
 Wholesale Total  
Retained
(b) 
$294,999
 $168,924
 $481,678
 $945,601
(b) 
Held-for-sale95
 16
 11,877
 11,988
 3,002
 —
 4,062
 7,064
 
At fair value—
 —
 3,151
 3,151
 —
 —
 7,104
 7,104
 
Total$373,732
 $156,632
 $454,190
 $984,554
 $298,001
 $168,924
 $492,844
 $959,769
 
(a)Includes accrued interest and fees net of an allowance for the uncollectible portionExcludes $2.9 billion of accrued interest receivables at both June 30, 2020, and fee income.December 31, 2019. The Firm wrote off accrued interest receivables of $34 million and $11 million for the three months ended June 30, 2020 and 2019, respectively, and $48 million and $23 million for the six months ended June 30, 2020 and 2019, respectively.
(b)Loans (other than PCI loans and loansthose for which the fair value option has been elected) are presented net of unamortized discounts and premiums and net deferred loan fees or costs. These amounts were not material as of SeptemberJune 30, 2019,2020, and December 31, 2018.2019.


The following tables providetable provides information about the carrying value of retained loans purchased, sold and reclassified to held-for-sale during the periods indicated. Reclassifications of loans to held-for sale are non-cash transactions. The Firm manages its exposure to credit risk on an ongoing basis. Selling loans is one way that the Firm reduces its credit exposures. Loans that were reclassified to held-for-sale and sold in a subsequent period are excluded from the sales line of this table.

 
2019 20182020 2019
Three months ended September 30,
(in millions)		 
Consumer, excluding
credit card
Credit cardWholesaleTotal 
Consumer, excluding
credit card
Credit cardWholesaleTotal
Three months ended June 30,
(in millions)
Consumer, excluding
credit card
Credit cardWholesaleTotal 
Consumer, excluding
credit card
Credit cardWholesaleTotal
Purchases 
$259
(a)(b) 
$—
$453
$712
 $561
(a)(b) 
$—
$285
$846
$228
(b)(c) 
$—
$242
$470
 $234
(b)(c) 
$—
$359
$593
Sales 
14,970

—
5,559
20,529
 1,789
 —
4,197
5,986
24

—
3,549
3,573
 6,851
 —
5,405
12,256
Retained loans reclassified to held-for-sale 
3,889
 —
359
4,248
 —

—
666
666
Retained loans reclassified to held-for-sale(a)
679
 —
282
961
 948

—
924
1,872
               
 2019 20182020 2019
Nine months ended September 30,
(in millions)		 
Consumer, excluding
credit card
Credit cardWholesaleTotal 
Consumer, excluding
credit card
Credit cardWholesaleTotal
Six months ended June 30,
(in millions)
Consumer, excluding
credit card
Credit cardWholesaleTotal 
Consumer, excluding
credit card
Credit cardWholesaleTotal
Purchases $1,044
(a)(b) 
$—
$1,041
$2,085
 $2,164
(a)(b) 
$—
$1,915
$4,079
$1,400
(b)(c) 
$—
$628
$2,028
 $785
(b)(c) 
$—
$588
$1,373
Sales 30,484
 —
16,404
46,888
 4,661
 —
12,829
17,490
348
 —
9,001
9,349
 15,509
 —
10,850
26,359
Retained loans reclassified to held-for-sale 8,950
 —
1,784
10,734
 36
 —
1,926
1,962
Retained loans reclassified to held-for-sale(a)
827
 —
751
1,578
 5,061
 —
1,425
6,486

(a)Purchases predominantly representReclassifications of loans to held-for-sale are non-cash transactions.
(b)Predominantly includes purchases of residential real estate loans, including the Firm’s voluntary repurchaserepurchases of certain delinquent loans from loan pools as permitted by Government National Mortgage Association (“Ginnie Mae”) guidelines.guidelines for the three months ended June 30, 2020 and 2019. The Firm typically elects to repurchase these delinquent loans as it continues to service them and/or manage the foreclosure process in accordance with applicable requirements of Ginnie Mae, FHA, RHS, and/or VA.
(b)(c)Excludes purchases of retained loans sourced through the correspondent origination channel and underwritten in accordance with the Firm’s standards. Such purchases were $4.7$3.8 billion and $5.6$4.3 billion for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $12.2$7.4 billion and $14.5$7.5 billion for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.

Gains and losses on sales of loans
Net gainsgains/(losses) on sales of loans and lending-related commitments (including adjustments to record loans and lending-related commitments held-for-sale at the lower of cost or fair value) recognized in noninterest revenue were $254$725 million and $433($188) million for the three and ninesix months ended SeptemberJune 30, 2019, respectively.2020, respectively, of which $42 million and ($100) million, respectively, were related to loans. Gains and losses on sales of loans were 0t material for the three and ninesix months ended SeptemberJune 30, 2018.2019. In addition, the sale of loans may also result in write downs, recoveries or changes in the allowance recognized in the provision for credit losses.

Consumer, excluding credit card loan portfolio
Consumer loans, excluding credit card loans, consist primarily of scored residential mortgages, home equity loans and lines of credit, auto loans and consumer and business banking loans, with a focus on serving the prime consumer credit market. The portfolio also includes home equity loans secured by junior liens, prime mortgage loans with an interest-only payment period and certain payment-option loans that may result in negative amortization.
The following table provides information about retained consumer loans, excluding credit card, by class.
(in millions)September 30,
2019
December 31,
2018
Residential real estate – excluding PCI  
Residential mortgage$197,456
$231,078
Home equity24,954
28,340
Other consumer loans  
Auto61,410
63,573
Consumer & Business Banking26,699
26,612
Residential real estate – PCI  
Home equity7,753
8,963
Prime mortgage4,164
4,690
Subprime mortgage1,797
1,945
Option ARMs7,576
8,436
Total retained loans$331,809
$373,637
(in millions)June 30,
2020
December 31,
2019
Residential real estate$235,381
$243,317
Auto and other(a)
71,624
51,682
Total retained loans$307,005
$294,999
Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information on consumer
(a)At June 30, 2020, included $19.9 billion of loans in Business Banking under the PPP.
Delinquency rates are the primary credit quality indicators.indicator for consumer loans. Loans that are more than 30 days past due provide an early warning of borrowers who may be experiencing financial difficulties and/or who may be unable or unwilling to repay the loan. As the loan continues to age, it becomes more clear whether the borrower is likely either unable or unwilling to pay. In the case of residential real estate loans, late-stage delinquencies (greater than 150 days past due) are a strong indicator of loans that will ultimately result in a foreclosure or similar liquidation transaction. In addition to delinquency rates, other credit quality indicators for consumer loans vary based on the class of loan, as follows:
•
For residential real estate loans, the current estimated LTV ratio, or the combined LTV ratio in the case of junior lien loans, is an indicator of the potential loss severity in the event of default. Additionally, LTV or combined LTV ratios can provide insight into a borrower’s continued willingness to pay, as the delinquency rate of high-LTV loans tends to be greater than that for loans where the borrower has equity in the collateral. The geographic distribution of the loan collateral also provides insight as to the credit quality of the portfolio, as factors such as the regional economy, home price changes and specific events such as natural disasters, will affect credit quality. The borrower’s current or “refreshed” FICO score is a secondary credit quality indicator for certain loans, as FICO scores are an indication of the borrower’s credit payment history. Thus, a loan to a borrower with a low FICO score (less than 660 ) is considered to be of higher risk than a loan to a borrower with a higher FICO score. Further, a loan to a borrower with a high LTV ratio and a low FICO score is at greater risk of default than a loan to a borrower that has both a high LTV ratio and a high FICO score.
•
For scored auto and business banking loans, geographic distribution is an indicator of the credit performance of the portfolio. Similar to residential real estate loans, geographic distribution provides insights into the portfolio performance based on regional economic activity and events.



Residential real estate – excluding PCI loans
The following table provides information by classon delinquency, which is the primary credit quality indicator for retained residential real estate – excluding PCI loans.
Residential real estate – excluding PCI loans      
(in millions, except ratios)Residential mortgage  Home equity  Total residential real estate – excluding PCI
Sep 30,
2019
Dec 31,
2018
  Sep 30,
2019
Dec 31,
2018
  Sep 30,
2019
Dec 31,
2018
Loan delinquency(a)
          
Current$196,354
$225,899
  $24,398
$27,611
  $220,752
$253,510
30–149 days past due691
2,763
  355
453
  1,046
3,216
150 or more days past due411
2,416
  201
276
  612
2,692
Total retained loans$197,456
$231,078
  $24,954
$28,340
  $222,410
$259,418
% of 30+ days past due to total retained loans(b)
0.53%0.48%  2.23%2.57%  0.72%0.71%
90 or more days past due and government guaranteed(c)
$40
$2,541
  $—
$—
  $40
$2,541
Nonaccrual loans1,629
1,765
  1,208
1,323
  2,837
3,088
Current estimated LTV ratios(d)(e)
         

Greater than 125% and refreshed FICO scores:         

Equal to or greater than 660$25
$25
  $4
$6
  $29
$31
Less than 66020
13
  2
1
  22
14
101% to 125% and refreshed FICO scores:         

Equal to or greater than 66022
37
  68
111
  90
148
Less than 66035
53
  23
38
  58
91
80% to 100% and refreshed FICO scores:          
Equal to or greater than 6604,650
3,977
  697
986
  5,347
4,963
Less than 660212
281
  214
326
  426
607
Less than 80% and refreshed FICO scores:         

Equal to or greater than 660185,438
212,505
  20,394
22,632
  205,832
235,137
Less than 6606,035
6,457
  2,842
3,355
  8,877
9,812
No FICO/LTV available952
813
  710
885
  1,662
1,698
U.S. government-guaranteed67
6,917
  —
—
  67
6,917
Total retained loans$197,456
$231,078
  $24,954
$28,340
  $222,410
$259,418
Geographic region(f)
          
California$66,166
$74,759
  $5,074
$5,695
  $71,240
$80,454
New York25,442
28,847
  5,074
5,769
  30,516
34,616
Illinois13,304
15,249
  1,868
2,131
  15,172
17,380
Texas12,345
13,769
  1,640
1,819
  13,985
15,588
Florida10,195
10,704
  1,366
1,575
  11,561
12,279
Washington7,638
8,304
  762
869
  8,400
9,173
Colorado7,577
8,140
  458
521
  8,035
8,661
New Jersey5,749
7,302
  1,447
1,642
  7,196
8,944
Massachusetts5,610
6,574
  208
236
  5,818
6,810
Arizona3,862
4,434
  986
1,158
  4,848
5,592
All other(g)
39,568
52,996
  6,071
6,925
  45,639
59,921
Total retained loans$197,456
$231,078
  $24,954
$28,340
  $222,410
$259,418
(in millions, except ratios)June 30, 2020 December 31, 2019
Term loans by origination year Revolving loans Total Total
20202019201820172016Prior to 2016 Within the revolving periodConverted to term loans  
Loan delinquency(a)(b)
             
Current$23,657
$39,483
$18,433
$27,209
$36,404
$61,747
 $7,870
$17,919
 $232,722
 $239,979
30–149 days past due9
17
25
37
46
996
 11
390
 1,531
 1,910
150 or more days past due—
1
9
12
6
836
 12
252
 1,128
 1,428
Total retained loans$23,666
$39,501
$18,467
$27,258
$36,456
$63,579
 $7,893
$18,561
 $235,381
 $243,317
% of 30+ days past due to total retained loans(c)
0.04%0.05%0.18%0.18%0.14%2.82% 0.29%3.46% 1.11% 1.35%
(a)Individual delinquency classifications include mortgage loans insured by U.S. government agencies as follows: current included $20$9 million and $2.8 billion;$17 million; 30–149 days past due included $16$15 million and $2.1 billion;$20 million; and 150 or more days past due included $31$24 million and $2.0 billion$26 million at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively.
(b)At SeptemberJune 30, 2019,2020, loans under payment deferral programs offered in response to the COVID-19 pandemic which are still within their deferral period and performing according to their modified terms are generally not considered delinquent.
(c)At June 30, 2020, and December 31, 2018,2019, residential mortgagereal estate loans excluded mortgage loans insured by U.S. government agencies of $47$39 million and $4.1 billion,$46 million, respectively, that are 30 or more days past due. These amounts have been excluded based upon the government guarantee.
(c)These balances, which are 90 days or more past due, were excluded from nonaccrual loans as the loans are guaranteed by U.S government agencies. Typically the principal balance of the loans is insured and interest is guaranteed at a specified reimbursement rate subject to meeting agreed-upon servicing guidelines. At September 30, 2019, and December 31, 2018, these balances included $38 million and $999 million, respectively, of loans that are no longer accruing interest based on the agreed-upon servicing guidelines. For the remaining balance, interest is being accrued at the guaranteed reimbursement rate. There were 0 loans that were not guaranteed by U.S. government agencies that are 90 or more days past due and still accruing interest at September 30, 2019, and December 31, 2018.
(d)Represents the aggregate unpaid principal balance of loans divided by the estimated current property value. Current property values are estimated, at a minimum, quarterly, based on home valuation models using nationally recognized home price index valuation estimates incorporating actual data to the extent available and forecasted data where actual data is not available. These property values do not represent actual appraised loan level collateral values; as such, the resulting ratios are necessarily imprecise and should be viewed as estimates. Current estimated combined LTV for junior lien home equity loans considers all available lien positions, as well as unused lines, related to the property.
(e)Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.
(f)The geographic regions presented in the table are ordered based on the magnitude of the corresponding loan balances at September 30, 2019.
(g)At September 30, 2019, and December 31, 2018, included mortgage loans insured by U.S. government agencies of $67 million and $6.9 billion, respectively. These amounts have been excluded from the geographic regions presented based upon the government guarantee.

Approximately 37%34% of the home equity portfoliototal revolving loans are senior lien loans; the remaining balance are junior lien HELOANs or HELOCs.loans. The following table provideslien position the Firm holds is considered in the Firm’s delinquency statisticsallowance for junior lien home equitycredit losses. Revolving loans and lines of credit as of September 30, 2019, and December 31, 2018.
 Total loans Total 30+ day delinquency rate
(in millions, except ratios)Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
 
HELOCs:(a)
     
Within the revolving period(b)
$5,625
$5,608
 0.37%0.25%
Beyond the revolving period9,283
11,286
 2.47
2.80
HELOANs827
1,030
 2.42
2.82
Total$15,735
$17,924
 1.72%2.00%
(a)These HELOCs are predominantly revolvingthat have been converted to term loans for a 10-year period, after which time the HELOC converts to a loan with a 20-year amortization period, but also include HELOCs that allow interest-only payments beyond the revolving period.
(b)The Firm manages the risk of HELOCs during their revolving period by closing or reducing the undrawn line to the extent permitted by law when borrowers are experiencing financial difficulty.
HELOCs beyond the revolving period and HELOANs have higher delinquency rates than HELOCsthose that are still within the revolving period. That is primarily because the fully-amortizing payment that is generally required for those products is higher than the minimum payment options available for HELOCsrevolving loans within the revolving period. The higher delinquency rates associated with amortizing HELOCs and HELOANs are factored into the Firm’s allowance for loan losses.







ImpairedNonaccrual loans and other credit quality indicators
The following table below sets forthprovides information about the Firm’s on nonaccrual and other credit quality indicators for retained residential real estate impaired loans, excluding PCI loans. These loans are considered to be impaired as they have been modified in a TDR. All impaired loans are evaluated for an asset-specific allowance as described in Note 13 of JPMorgan Chase’s 2018 Form 10-K.

(in millions)		Residential mortgage Home equity Total residential real estate – excluding PCI
Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
Impaired loans        
With an allowance$2,958
$3,381
 $1,062
$1,142
 $4,020
$4,523
Without an allowance(a)
1,160
1,184
 899
870
 2,059
2,054
Total impaired loans(b)(c)
$4,118
$4,565
 $1,961
$2,012
 $6,079
$6,577
Allowance for loan losses related to impaired loans$63
$88
 $14
$45
 $77
$133
Unpaid principal balance of impaired loans(d)
5,578
6,207
 3,355
3,466
 8,933
9,673
Impaired loans on nonaccrual status(e)
1,376
1,459
 981
955
 2,357
2,414
(in millions, except weighted-average data)June 30, 2020
December 31, 2019
 
Nonaccrual loans(a)(b)(c)(d)
$4,106
$2,780
 
90 or more days past due and government guaranteed(e)
32
38
 

   
Current estimated LTV ratios(f)(g)
   
Greater than 125% and refreshed FICO scores:   
Equal to or greater than 660$19
$31
 
Less than 66026
38
 
101% to 125% and refreshed FICO scores:   
Equal to or greater than 660134
134
 
Less than 660115
132
 
80% to 100% and refreshed FICO scores:   
Equal to or greater than 6605,175
5,953
 
Less than 660698
764
 
Less than 80% and refreshed FICO scores:   
Equal to or greater than 660213,412
219,469
 
Less than 66013,869
14,681
 
No FICO/LTV available1,885
2,052
 
U.S. government-guaranteed48
63
 
Total retained loans$235,381
$243,317
 
    
Weighted average LTV ratio(f)(h)
55%55% 
Weighted average FICO(g)(h)
761
758
 
    
Geographic region(i)
   
California$78,422
$82,147
 
New York31,944
31,996
 
Illinois14,473
15,587
 
Texas14,289
14,474
 
Florida13,788
13,668
 
Washington8,592
8,990
 
Colorado8,307
8,447
 
New Jersey7,547
7,752
 
Massachusetts5,942
6,210
 
Arizona5,037
5,171
 
All other(j)
47,040
48,875
 
Total retained loans$235,381
$243,317
 
(a)RepresentsIncludes collateral-dependent residential real estate loans that are charged off to the fair value of the underlying collateral less cost to sell. The Firm reports, in accordance with regulatory guidance, residential real estate loans that have been discharged under Chapter 7 bankruptcy and not reaffirmed by the borrower (“Chapter 7 loans”) as collateral-dependent nonaccrual TDRs, regardless of their delinquency status. At SeptemberJune 30, 2019,2020, approximately 7% of Chapter 7 residential real estate loans included approximately 12% of residential mortgages and 7% of home equity that were 30 days or more past due.due, respectively.
(b)At SeptemberJune 30, 2019, and December 31, 2018, $16 million and $4.12020, nonaccrual loans included $1.3 billion respectively, of PCD loans. Prior to the adoption of CECL, nonaccrual loans modified subsequent to repurchase from Ginnie Mae in accordance withexcluded PCI loans as the standardsFirm recognized interest income on each pool of PCI loans as each of the appropriate government agency (i.e., FHA, VA, RHS) are not included in the table above. When such loans perform subsequent to modification in accordance with Ginnie Mae guidelines, they are generally sold back into Ginnie Mae loan pools. Modified loans that do not re-perform become subject to foreclosure.pools was performing.
(c)PredominantlyGenerally, all impairedconsumer nonaccrual loans inhave an allowance. In accordance with regulatory guidance, certain nonaccrual loans that are considered collateral-dependent have been charged off to the table above are infair value of their underlying collateral less costs to sell. If the U.S.value of the underlying collateral has subsequently improved, the related allowance may be negative.
(d)RepresentsThe related interest income on nonaccrual loans recorded on a cash basis was $37 million and $42 million and $80 million and $84 million for the contractual amount of principal owed at Septemberthree and six months ended June 30, 2020 and 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors including charge-offs, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans.respectively.
(e)These balances are excluded from nonaccrual loans as the loans are guaranteed by U.S government agencies. Typically the principal balance of the loans is insured and interest is guaranteed at a specified reimbursement rate subject to meeting agreed-upon servicing guidelines. At SeptemberJune 30, 20192020, and December 31, 2018, nonaccrual loans2019, these balances included $1.9 billion$32 million and $2.0 billion,$34 million, respectively, of TDRs for whichloans that are no longer accruing interest based on the borrowersagreed-upon servicing guidelines. For the remaining balance, interest is being accrued at the guaranteed reimbursement rate. There were less than0 loans that were not guaranteed by U.S. government agencies that are 90 or more days past due. Refer to the Loan accounting framework in Note 12 of JPMorgan Chase’s 2018 Form 10-K for additional information about loans modified in a TDR that are on nonaccrual status.due and still accruing interest at June 30, 2020, and December 31, 2019.

The following tables present average impaired loans and the related interest income reported by the Firm.
Three months ended September 30,
(in millions)		Average impaired loans 
Interest income on
impaired loans(a)
 
Interest income on impaired
loans on a cash basis(a)
2019
2018
 2019
2018
 2019
2018
Residential mortgage$4,200
$4,872
 $55
$61
 $17
$19
Home equity1,938
2,065
 33
33
 21
21
Total residential real estate – excluding PCI$6,138
$6,937
 $88
$94
 $38
$40
         
Nine months ended September 30,
(in millions)		Average impaired loans 
Interest income on
impaired loans(a)
 
Interest income on impaired
loans on a cash basis(a)
2019
2018
 2019
2018
 2019
2018
Residential mortgage$4,390
$5,242
 $171
$197
 $52
$58
Home equity1,973
2,092
 99
98
 62
63
Total residential real estate – excluding PCI$6,363
$7,334
 $270
$295
 $114
$121
(a)(f)Generally, interest income onRepresents the aggregate unpaid principal balance of loans modified in TDRs is recognized on a cash basis untildivided by the borrower has madeestimated current property value. Current property values are estimated, at a minimum, quarterly, based on home valuation models using nationally recognized home price index valuation estimates incorporating actual data to the extent available and forecasted data where actual data is not available. Current estimated combined LTV for junior lien home equity loans considers all available lien positions, as well as unused lines, related to the property.
(g)Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.
(h)Excludes loans with no FICO and/or LTV data available.
(i)The geographic regions presented in the table are ordered based on the magnitude of 6 payments under the new terms, unlesscorresponding loan balances at June 30, 2020.
(j)At June 30, 2020, and December 31, 2019, included mortgage loans insured by U.S. government agencies of $48 million and $63 million, respectively. These amounts have been excluded from the loan is deemed to be collateral-dependent.geographic regions presented based upon the government guarantee.


Loan modifications
Modifications of residential real estate loans excluding PCI loans,where the Firm grants concessions to borrowers who are experiencing financial difficulty are generally accounted for and reported as TDRs. Loans with short-term or other insignificant modifications that are not considered concessions are not TDRs. The carrying value of new TDRs was $196 million and $124 million for the three months ended June 30, 2020 and 2019, respectively, and $338 million and $274 million for the six months ended June 30, 2020 and 2019, respectively. There were no additional commitments to lend to borrowers whose residential real estate loans excluding PCI loans, have been modified in TDRs.
 
The following table presents new TDRs reported by the Firm.
 Three months ended September 30, Nine months ended September 30,
(in millions)2019
2018
 2019
2018
Residential mortgage$50
$67
 $181
$314
Home equity100
55
 214
241
Total residential real estate – excluding PCI$150
$122
 $395
$555



Nature and extent of modifications
The U.S. Treasury’s Making Home AffordableFirm’s proprietary modification programs as well as the Firm’s proprietary modification government programs, including U.S. GSE programs, generally provide various concessions to financially troubled borrowers including, but not limited to, interest rate reductions, term or payment extensions and deferraldelays of principal and/or interest payments that would otherwise have been required under the terms of the original agreement.
The following tables provide table provides information about how residential real estate loans excluding PCI loans, were modified in TDRs under the Firm’s loss mitigation programs described above during the periods presented. These tables exclude This table excludes Chapter 7 loans where the sole concession granted is the discharge of debt.debt and loans with short-term or other insignificant modifications that are not considered concessions.

Three months ended September 30, 
Total residential
real estate –
excluding PCI
Residential mortgage Home equity 
2019
2018
 2019
2018
 2019
2018
Three months ended June 30,Six months ended June 30,
2020
2019
2020
2019
Number of loans approved for a trial modification365
513
 854
586
 1,219
1,099
849
1,283
2,845
3,225
Number of loans permanently modified307
719
 855
939
 1,162
1,658
2,104
1,244
3,585
2,794
Concession granted:(a)
      



Interest rate reduction78%58% 93%77% 89%69%41%68%56%73%
Term or payment extension94
83
 59
88
 68
86
45
80
60
74
Principal and/or interest deferred21
30
 6
11
 10
19
6
16
8
14
Principal forgiveness7
9
 4
7
 5
8
2
4
3
5
Other(b)
53
36
 85
58
 76
49
72
54
65
57
     
Nine months ended September 30, Total residential
real estate –
excluding PCI
Residential mortgage Home equity 
2019
2018
 2019
2018
 2019
2018
Number of loans approved for a trial modification1,603
1,789
 1,786
1,895
 3,389
3,684
Number of loans permanently modified1,178
2,374
 2,778
4,005
 3,956
6,379
Concession granted:(a)
     
Interest rate reduction65%36% 83%57% 78%49%
Term or payment extension91
49
 64
62
 72
57
Principal and/or interest deferred26
47
 7
22
 13
31
Principal forgiveness6
7
 5
7
 5
7
Other(b)
44
40
 71
58
 63
52
(a)Represents concessions granted in permanent modifications as a percentage of the number of loans permanently modified. The sum of the percentages exceeds 100% because predominantly all of the modifications include more than one type of concession. Concessions offered on trial modifications are generally consistent with those granted on permanent modifications.
(b)Includes variable interest rate to fixed interest rate modifications and forbearancespayment delays that meet the definition of a TDR for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018. Forbearances suspend or reduce monthly payments for a specific period of time to address a temporary hardship.2019.

Financial effects of modifications and redefaults
The following tables providetable provides information about the financial effects of the various concessions granted in modifications of residential real estate loans, excluding PCI loans under the loss mitigation programs described above and about redefaults of certain loans modified in TDRs for the periods presented. The following tables presenttable presents only the financial effects of permanent modifications and do not include temporary concessions offered through trial modifications. These tablesThis table also excludeexcludes Chapter 7 loans where the sole concession granted is the discharge of debt.
Three months ended September 30,
(in millions, except weighted-average data)		Residential mortgage Home equity Total residential real estate – excluding PCI
2019
2018
 2019
2018
 2019
2018
(in millions, except weighted-average data)Three months ended June 30,Six months ended June 30,
2020
2019
2020
2019
Weighted-average interest rate of loans with interest rate reductions – before TDR5.68%6.13% 5.50%5.69% 5.57%5.89%5.00%5.76%5.13%5.86%
Weighted-average interest rate of loans with interest rate reductions – after TDR3.99
4.23
 3.30
3.83
 3.58
4.01
3.36
4.14
3.42
4.06
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR21
22
 19
18
 20
21
21
19
21
20
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR39
39
 39
39
 39
39
39
39
39
39
Charge-offs recognized upon permanent modification$—
$—
 $—
$—
 $—
$—
$2
$1
$2
$1
Principal deferred5
7
 1
2
 6
9
4
7
9
11
Principal forgiven1
3
 1
1
 2
4
1
2
3
4
Balance of loans that redefaulted within one year of permanent modification(a)
$36
$27
 $17
$19
 $53
$46
$38
$39
$108
$87
     
Nine months ended September 30,
(in millions, except weighted-average data)		Residential mortgage Home equity Total residential real estate – excluding PCI
2019
2018
 2019
2018
 2019
2018
Weighted-average interest rate of loans with interest rate reductions – before TDR6.08%5.45% 5.56%5.34% 5.77%5.39%
Weighted-average interest rate of loans with interest rate reductions – after TDR4.36
3.64
 3.60
3.39
 3.90
3.49
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR21
24
 20
18
 20
22
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR39
38
 40
39
 39
38
Charge-offs recognized upon permanent modification$1
$—
 $—
$1
 $1
$1
Principal deferred13
17
 4
7
 17
24
Principal forgiven3
9
 3
5
 6
14
Balance of loans that redefaulted within one year of permanent modification(a)
$87
$69
 $45
$49
 $132
$118
(a)Represents loans permanently modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within one year of the modification. The dollar amounts presented represent the balance of such loans at the end of the reporting period in which such loans defaulted. For residential real estate loans modified in TDRs, payment default is deemed to occur when the loan becomes 2 contractual payments past due. In the event that a modified loan redefaults, it is probable that the loan will ultimatelygenerally be liquidated through foreclosure or another similar type of liquidation transaction. Redefaults of loans modified within the last 12twelve months may not be representative of ultimate redefault levels.


At September June 30, 2019, 2020, the weighted-average estimated remaining lives of residential real estate loans excluding PCI loans, permanently modified in TDRs were 10 years for residential mortgage and 9 years for home equity. 6 years. The estimated remaining lives of these loans reflect estimated prepayments, both voluntary and involuntary (i.e., foreclosures and other forced liquidations).
 

Active and suspended foreclosure
At September June 30, 2019,2020, and December 31, 2018,2019, the Firm had non-PCI residential real estate loans, excluding those insured by U.S. government agencies, with a carrying value of $546$987 million and $653 million,$1.2 billion, respectively, that were not included in REO, but were in the process of active or suspended foreclosure.

Other consumer loansAuto and other
The following table below provides information on delinquency, which is the primary credit quality indicator for retained auto and other consumer retained loan classes, including auto and business banking loans.
(in millions, except ratios)Auto 
Consumer &
Business Banking
 Total other consumer
Sep 30, 2019
Dec 31, 2018
 Sep 30, 2019
Dec 31, 2018
 Sep 30, 2019
Dec 31, 2018
Loan delinquency        
Current$60,872
$62,984
 $26,346
$26,249
 $87,218
$89,233
30–119 days past due534
589
 231
252
 765
841
120 or more days past due4
—
 122
111
 126
111
Total retained loans$61,410
$63,573
 $26,699
$26,612
 $88,109
$90,185
% of 30+ days past due to total retained loans0.88%0.93% 1.32%1.36% 1.01%1.06%
Nonaccrual loans(a)
112
128
 268
245
 380
373
Geographic region(b)
        
California$8,016
$8,330
 $5,744
$5,520
 $13,760
$13,850
Texas6,644
6,531
 3,042
2,993
 9,686
9,524
New York3,627
3,863
 4,339
4,381
 7,966
8,244
Illinois3,438
3,716
 1,737
2,046
 5,175
5,762
Florida3,280
3,256
 1,565
1,502
 4,845
4,758
Arizona1,990
2,084
 1,268
1,491
 3,258
3,575
Ohio1,900
1,973
 1,189
1,305
 3,089
3,278
New Jersey1,920
1,981
 805
723
 2,725
2,704
Michigan1,279
1,357
 1,264
1,329
 2,543
2,686
Louisiana1,598
1,587
 768
860
 2,366
2,447
All other27,718
28,895
 4,978
4,462
 32,696
33,357
Total retained loans$61,410
$63,573
 $26,699
$26,612
 $88,109
$90,185
Loans by risk ratings(c)
        
Noncriticized$13,823
$15,749
 $18,738
$18,743
 $32,561
$34,492
Criticized performing394
273
 747
751
 1,141
1,024
Criticized nonaccrual—
—
 218
191
 218
191
 June 30, 2020 December 31, 2019

(in millions, except ratios)
Term Loans by origination year Revolving loans   
2020 2019201820172016Prior to 2016 Within the revolving periodConverted to term loansTotal Total
Loan delinquency(a)
             
Current$31,068
(b) 
$16,012
$9,744
$6,516
$3,438
$1,540
 $2,776
$186
$71,280
 $51,005
30–119 days past due46
 84
64
41
37
26
 16
7
321
 667
120 or more days past due—
 1
2
1
1
1
 10
7
23
 10
Total retained loans$31,114
 $16,097
$9,810
$6,558
$3,476
$1,567
 $2,802
$200
$71,624
 $51,682
% of 30+ days past due to total retained loans0.15% 0.53%0.67%0.64%1.09%1.72% 0.93%7.00%0.48% 1.31%
(a)At June 30, 2020, loans under payment deferral programs offered in response to the COVID-19 pandemic which are still within their deferral period and performing according to their modified terms are generally not considered delinquent.
(b)At June 30, 2020, included $19.9 billion of loans in Business Banking under the PPP. PPP loans are guaranteed by the SBA. Other than in certain limited circumstances, the Firm typically does not recognize charge-offs, classify as nonaccrual nor record an allowance for loan losses on government guaranteed loans.

Nonaccrual and other credit quality indicators
The following table provides information on nonaccrual and other credit quality indicators for retained auto and other consumer loans.
(in millions, except ratios)Total Auto and other
Jun 30, 2020
Dec 31, 2019
Nonaccrual loans(a)(b)(c)
140
146
   
Geographic region(d)
  
California$11,563
$7,795
New York8,658
3,706
Texas7,639
5,457
Florida4,295
3,025
Illinois3,711
2,443
New Jersey2,529
1,798
Arizona2,312
1,347
Ohio2,094
1,490
Colorado1,750
1,247
Michigan1,728
892
All other25,345
22,482
Total retained loans$71,624
$51,682
(a)There were 0 loans that were 90 or more days past due and still accruing interest at SeptemberJune 30, 2019,2020, and December 31, 2018.2019.
(b)All nonaccrual auto and other consumer loans generally have an allowance.
(c)
Interest income on nonaccrual loans recognized on a cash basis was not material for the three and six months ended June 30, 2020 and 2019.
(d)The geographic regions presented in this table are ordered based on the magnitude of the corresponding loan balances at SeptemberJune 30, 2019.
(c)For risk-rated business banking and auto loans, the primary credit quality indicator is the risk rating of the loan, including whether the loans are considered to be criticized and/or nonaccrual.


Other consumer impaired loans and loan
modifications
The table below sets forth information about the Firm’s other consumer impaired loans, including risk-rated business banking and auto loans that have been placed on nonaccrual status, and loans that have been modified in TDRs.
(in millions)September 30,
2019
 December 31,
2018
Impaired loans   
With an allowance$242
 $222
Without an allowance(a)
20
 29
Total impaired loans(b)(c)
$262
 $251
Allowance for loan losses related to impaired loans$68
 $63
Unpaid principal balance of impaired loans(d)
357
 355
Impaired loans on nonaccrual status240
 229
(a)When discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged off and/or there have been interest payments received and applied to the loan balance.
(b)Predominantly all other consumer impaired loans are in the U.S.
(c)Other consumer average impaired loans were $254 million and $271 million for the three months ended September 30, 2019 and 2018, respectively, and $248 million and $281 million for the nine months ended September 30, 2019 and 2018, respectively. The related interest income on impaired loans, including those on a cash basis, was not material for the three and nine months ended September 30, 2019 and 2018.
(d)Represents the contractual amount of principal owed at September 30, 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs, interest payments received and applied to the principal balance, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans.2020.
 
Loan modifications
Certain other consumer loan modifications are considered to be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All of these TDRsLoans with short-term or other insignificant modifications that are reported as impaired loans. Refer to Notenot considered concessions are not TDRs. 12 of JPMorgan Chase’s 2018 Form 10-K for further information on other consumer loans modified in TDRs.
At September 30, 2019 and December 31, 2018, other consumer loans modified in TDRs were $77 million and $79 million, respectively. The impact of these modifications, as well as new TDRs, were not material to the Firm for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018. 2019. Additional commitments to lend to borrowers whose loans have been modified in TDRs as of September June 30, 20192020 and December 31, 2018 2019 were not material. TDRs



Credit card loan portfolio
The credit card portfolio segment includes credit card loans originated and purchased by the Firm. Delinquency rates are the primary credit quality indicator for credit card loans as they provide an early warning that borrowers may be experiencing difficulties (30 days past due); information on nonaccrual status werethose borrowers that have been delinquent for a longer period of time (90 days past due) is also considered. In addition to delinquency rates, the geographic distribution of the loans provides insight as to the credit quality of the portfolio based on the regional economy. $55 million
While the borrower’s credit score is another general indicator of credit quality, the Firm does not view credit scores as a primary indicator of credit quality because the borrower’s credit score tends to be a lagging indicator. The
distribution of such scores provides a general indicator of credit quality trends within the portfolio; however, the score does not capture all factors that would be predictive of future credit performance. Refreshed FICO score information, which is obtained at least quarterly, for a statistically significant random sample of the credit card portfolio is indicated in the following table. FICO is considered to be the industry benchmark for credit scores.
The Firm generally originates new card accounts to prime consumer borrowers. However, certain cardholders’ FICO scores may decrease over time, depending on the performance of the cardholder and $57 million at September 30, 2019 and December 31, 2018, respectively.changes in the credit score calculation.

Purchased credit-impaired loans
Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-KThe following table provides information on delinquency, which is the primary credit quality indicator for a detailed discussion of PCI loans, including the related accounting policies.
Residential real estate – PCI loans
The table below sets forth information about the Firm’s consumer, excludingretained credit card PCI loans.

(in millions, except ratios)		Home equity
Prime mortgage
Subprime mortgage
Option ARMs
Total PCI
Sep 30,
2019
Dec 31,
2018

Sep 30,
2019
Dec 31,
2018

Sep 30,
2019
Dec 31,
2018

Sep 30,
2019
Dec 31,
2018

Sep 30,
2019
Dec 31,
2018
Carrying value(a)
$7,753
$8,963

$4,164
$4,690

$1,797
$1,945

$7,576
$8,436

$21,290
$24,034
Loan delinquency (based on unpaid principal balance)



















Current$7,543
$8,624

$3,759
$4,226

$1,915
$2,033

$6,876
$7,592

$20,093
$22,475
30–149 days past due234
278

241
259

247
286

362
398

1,084
1,221
150 or more days past due165
242

183
223

99
123

350
457

797
1,045
Total loans$7,942
$9,144

$4,183
$4,708

$2,261
$2,442

$7,588
$8,447

$21,974
$24,741
% of 30+ days past due to total loans5.02%5.69%
10.14%10.24%
15.30%16.75%
9.38%10.12%
8.56%9.16%
Current estimated LTV ratios (based on unpaid principal balance)(b)(c)

















Greater than 125% and refreshed FICO scores:























Equal to or greater than 660$13
$17

$2
$1

$—
$—

$3
$3

$18
$21
Less than 66010
13

6
7

7
9

5
7

28
36
101% to 125% and refreshed FICO scores:























Equal to or greater than 66096
135

6
6

7
4

18
17

127
162
Less than 66046
65

19
22

24
35

18
33

107
155
80% to 100% and refreshed FICO scores:























Equal to or greater than 660643
805

58
75

52
54

102
119

855
1,053
Less than 660271
388

71
112

109
161

128
190

579
851
Lower than 80% and refreshed FICO scores:























Equal to or greater than 6605,031
5,548

2,559
2,689

809
739

4,932
5,111

13,331
14,087
Less than 6601,613
1,908

1,283
1,568

1,155
1,327

2,093
2,622

6,144
7,425
No FICO/LTV available219
265

179
228

98
113

289
345

785
951
Total unpaid principal balance$7,942
$9,144

$4,183
$4,708

$2,261
$2,442

$7,588
$8,447

$21,974
$24,741
Geographic region (based on unpaid principal balance)(d)




















California$4,704
$5,420

$2,280
$2,578

$549
$593

$4,355
$4,798

$11,888
$13,389
Florida865
976

295
332

218
234

630
713

2,008
2,255
New York469
525

338
365

249
268

452
502

1,508
1,660
Illinois207
233
 139
154
 115
123
 181
199
 642
709
Washington348
419

85
98

38
44

155
177

626
738
New Jersey184
210

117
134

81
88

222
258

604
690
Massachusetts56
65

103
113

69
73

216
240

444
491
Maryland43
48

89
95

90
96

160
178

382
417
Virginia47
54

82
91

35
37

190
211

354
393
Arizona138
165

60
69

39
43

99
112

336
389
All other881
1,029

595
679

778
843

928
1,059

3,182
3,610
Total unpaid principal balance$7,942
$9,144

$4,183
$4,708

$2,261
$2,442

$7,588
$8,447

$21,974
$24,741

(in millions, except ratios)
June 30, 2020 December 31, 2019
Within the revolving period
Converted to term loans(b)
Total Total
Loan delinquency(a)
     
Current and less than 30 days past due
and still accruing		$137,953
$1,285
$139,238
 $165,767
30–89 days past due and still accruing1,004
91
1,095
 1,550
90 or more days past due and still accruing1,277
46
1,323
 1,607
Total retained loans$140,234
$1,422
$141,656
 $168,924
Loan delinquency ratios     
% of 30+ days past due to total retained loans1.63%9.63%1.71% 1.87%
% of 90+ days past due to total retained loans0.91
3.23
0.93
 0.95
(a)Carrying value includes the effect of fair value adjustments that were appliedAt June 30, 2020, loans under payment deferral programs offered in response to the consumer PCI portfolio at the date of acquisition.COVID-19 pandemic which are still within their deferral period and performing according to their modified terms are generally not considered delinquent.
(b)Represents the aggregate unpaid principal balance of loans divided by the estimated current property value. Current property values are estimated, at a minimum, quarterly, based on home valuation models using nationally recognized home price index valuation estimates incorporating actual data to the extent available and forecasted data where actual data is not available. These property values do not represent actual appraised loan level collateral values; as such, the resulting ratios are necessarily imprecise and should be viewed as estimates. Current estimated combined LTV for junior lien home equity loans considers all available lien positions, as well as unused lines, related to the property.
(c)Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.
(d)The geographic regions presented in the table are ordered based on the magnitude of the corresponding loan balances at September 30, 2019.TDRs.

Other credit quality indicators
Approximately 26% of the PCI home equity portfolio are senior lien loans; the remaining balance are junior lien HELOANs or HELOCs.The following table represents the Firm’s delinquency statistics for PCI junior lien home equity loans and lines of credit based on the unpaid principal balance as of September 30, 2019, and December 31, 2018.
 Total loans Total 30+ day delinquency rate
(in millions, except ratios)Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
 
HELOCs(a)(b)
5,623
6,531
 3.66%4.00%
HELOANs234
280
 2.99
3.57
Total$5,857
$6,811
 3.64%3.98%
(a)In general, these HELOCs are revolving loans for a 10-year period, after which time the HELOC converts to an interest-only loan with a balloon payment at the end of the loan’s term. Substantially all HELOCs are beyond the revolving period.
(b)Includes loans modified into fixed rate amortizing loans.
The table below presents the accretable yield activity for the Firm’s PCI consumer loans for the three and nine months ended September 30, 2019 and 2018, and represents the Firm’s estimate of gross interest income expected to be earned over the remaining life of the PCI loan portfolios. The table excludes the cost to fund the PCI portfolios, and therefore the accretable yield does not represent net interest income expected to be earned on these portfolios.
 Total PCI
(in millions, except ratios)Three months ended September 30, Nine months ended September 30,
20192018 20192018
Beginning balance$7,699
$8,722
 $8,422
$11,159
Accretion into interest income(272)(303) (841)(958)
Changes in interest rates on variable-rate loans(308)37
 (402)(231)
Other changes in expected cash flows(a)
255
46
 195
(1,468)
Balance at September 30$7,374
$8,502
 $7,374
$8,502
Accretable yield percentage5.27%4.95% 5.32%4.88%
(a)Other changes in expected cash flows may vary from period to period as the Firm continues to refine its cash flow model, for example cash flows expected to be collected due to the impact of modifications and changes in prepayment assumptions.
Active and suspended foreclosure
At September 30, 2019, and December 31, 2018, the Firm had PCI residential real estate loans with an unpaid principal balance of $776 million and $964 million, respectively, that were not included in REO, but were in the process of active or suspended foreclosure.

Credit card loan portfolio
Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for furtherprovides information on the credit card loan portfolio, includingother credit quality indicators.
The table below sets forth information about the Firm’s indicators for retained credit card loans.
(in millions, except ratios)September 30,
2019
December 31,
2018
June 30, 2020
December 31, 2019
Loan delinquency 
Current and less than 30 days
past due and still accruing
$156,629
$153,746
30–89 days past due and still accruing1,500
1,426
90 or more days past due and still accruing1,442
1,444
Total retained loans$159,571
$156,616
Loan delinquency ratios 
% of 30+ days past due
to total retained loans
1.84%1.83%
% of 90+ days past due
to total retained loans
0.90
0.92
Geographic region(a)
  
California$24,313
$23,757
$20,756
$25,783
Texas15,790
15,085
14,280
16,728
New York13,940
13,601
11,907
14,544
Florida10,101
9,770
9,389
10,830
Illinois9,125
8,938
7,954
9,579
New Jersey6,821
6,739
5,835
7,165
Ohio5,093
5,094
4,615
5,406
Pennsylvania4,918
4,996
4,420
5,245
Colorado4,543
4,309
4,015
4,763
Michigan3,942
3,912
3,546
4,164
All other60,985
60,415
54,939
64,717
Total retained loans$159,571
$156,616
$141,656
$168,924
Percentage of portfolio based on carrying value with estimated refreshed FICO scores  
Equal to or greater than 66083.6%84.2%83.3%84.0%
Less than 66015.6
15.0
16.0
15.4
No FICO available0.8
0.8
0.7
0.6

(a)The geographic regions presented in the table are ordered based on the magnitude of the corresponding loan balances at SeptemberJune 30, 2019.

Credit card impaired loans and loan modifications
Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for a detailed discussion of impaired credit card loans, including credit card loan modifications.
The table below sets forth information about the Firm’s impaired credit card loans. All of these loans are considered to be impaired as they have been modified in TDRs.
(in millions)September 30,
2019
December 31,
2018
Impaired credit card loans with an allowance(a)(b)(c)
$1,423
$1,319
Allowance for loan losses related to impaired credit card loans488
440
(a)The carrying value and the unpaid principal balance are the same for credit card impaired loans.
(b)There were no impaired loans without an allowance.
(c)Predominantly all impaired credit card loans are in the U.S.2020.
The following table presents average balances of impaired credit card loans and interest income recognized on those loans.
 Three months ended September 30, Nine months ended September 30,
(in millions)2019
2018
 2019
2018
Average impaired credit card loans$1,406
$1,267
 $1,371
$1,245
Interest income on impaired credit card loans18
17
 53
48

Loan modifications
The Firm may offer one of a number of loan modification programs granting concessions to credit card borrowers who are experiencing financial difficulty. MostThe Firm grants concessions for most of the credit card loans have been modified under long-term programs for borrowers who are experiencing financial difficulties.programs. These modifications involve placing the customer on a fixed payment plan, generally for 60 months, and typically include reducing the interest rate on the credit card. Substantially all modifications under the Firm’s long-term programs are considered to be TDRs. New enrollments in these loan modification programs were $242 million and $215 million for the three months ended September 30, 2019 and 2018, respectively, and $717 million and $640 million for the nine months ended September 30, 2019 and 2018, respectively. For all periods disclosed, new enrollments were less than 1% of total retained credit card loans.Loans with short-term or other insignificant modifications that are not considered concessions are not TDRs.
Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for additional information about credit card loan modifications.
 
Financial effects of modifications and redefaults
The following table provides information about the financial effects of the concessions granted on credit card loans modified in TDRs and redefaults for the periods presented. For all periods disclosed, new enrollments were less than 1% of total retained credit card loans.
(in millions, except
weighted-average data)
Three months ended September 30, Nine months ended September 30,
2019
2018
 2019
2018
Weighted-average interest rate of loans –
before TDR
19.18%18.25% 19.23%17.82%
Weighted-average interest rate of loans –
after TDR
4.65
5.10
 4.80
5.12
Loans that redefaulted within one year of modification(a)
$42
$31
 $108
$82
(in millions, except
weighted-average data)
Three months ended June 30,Six months ended June 30,
2020
2019
2020
2019
Balance of new TDRs(a)
$151
$226
$428
$475
Weighted-average interest rate of loans – before TDR17.93%19.38%18.50%19.25%
Weighted-average interest rate of loans – after TDR5.16
4.71
4.42
4.88
Balance of loans that redefaulted within one year of modification(b)
$25
$32
$61
$66
(a)Represents the outstanding balance prior to modification.
(b)Represents loans modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within one year of the modification. The amounts presented represent the balance of such loans as of the end of the quarter in which they defaulted.
For credit card loans modified in TDRs, payment default is deemed to have occurred when the borrower misses two2 consecutive contractual payments. A substantial portion of these loans are expected to be charged-off in accordance with the Firm’s standard charge-off policy. Based on historical experience, the estimated weighted-average default rate forDefaulted modified credit card loans was expectedremain in the modification program and continue to be 34.30% and 33.38% as of September 30, 2019, and December 31, 2018, respectively.charged off in accordance with the Firm’s standard charge-off policy.

Wholesale loan portfolio
Wholesale loans include loans made to a variety of clients, ranging from large corporate and institutional clients to high-net-worth individuals.
The primary credit quality indicator for wholesale loans is the internal risk rating assigned to each loan. Risk ratings are used to identify the credit quality of loans and differentiate risk within the portfolio. Risk ratings on loans consider the PD and the LGD. The PD is the likelihood that a loan will default. The LGD is the estimated loss on the loan that would be realized upon the default of the borrower and takes into consideration collateral and structural support for each credit facility.
Management considers several factors to determine an appropriate internal risk rating, including the obligor’s debt capacity and financial flexibility, the level of the obligor’s earnings, the amount and sources for repayment, the level and nature of contingencies, management strength, and the industry and geography in which the obligor operates. The Firm’s internal risk ratings generally align with the qualitative characteristics (e.g., borrower capacity to meet financial commitments and vulnerability to changes in the economic environment) defined by S&P and Moody’s, however the quantitative characteristics (e.g., PD and LGD) may differ as they reflect internal historical experiences and assumptions. The Firm considers internal ratings equivalent to BBB-/Baa3 or higher as investment grade, and these ratings have a lower PD and/or lower LGD than non-investment grade ratings.
Noninvestment-grade ratings are further classified as noncriticized and criticized, and the criticized portion is further subdivided into performing and nonaccrual loans, representing management’s assessment of the collectibility of principal and interest. Criticized loans have a higher PD than noncriticized loans. The Firm’s definition of criticized aligns with the U.S. banking regulatory definition of criticized exposures, which consist of special mention, substandard and doubtful categories.
 
each loan.Risk ratings are reviewed on a regular and ongoing basis by Credit Risk Management and are adjusted as necessary for updated information affecting the obligor’s ability to fulfill its obligations.
As noted above, the risk rating of a loan considers the industry in which the obligor conducts its operations. As part of the overall credit risk management framework, the Firm focuses on the management and diversification of its industry and client exposures, with particular attention paid to industries with actual or potential credit concern. Refer to Note 12 and Note 13 of JPMorgan Chase’s 2018 Form 10-K4 for further informationdetail on these risk ratings.industry concentrations.


The table below providesfollowing tables provide information by class of receivableon internal risk rating, which is the primary credit quality indicator for the retained loans in the Wholesale portfolio segment.wholesale loans.
Commercial
 and industrial
 Real estate Financial
institutions		Governments & Agencies 
Other(d)
Total
retained loans		Secured by real estate Commercial and industrial 
Other(b)
 Total retained loans
(in millions,
except ratios)
Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		Dec 31,
2018		Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		Dec 31,
2018		Sep 30,
2019		Dec 31,
2018		Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		 Dec 31,
2019		 Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		 Dec 31,
2019
Loans by risk ratings                  
Investment-grade$61,709
$73,497
 $101,379
$100,107
 $39,492
$32,178
$12,905
$13,984
 $121,813
$119,963
$337,298
$339,729
$94,986
$96,611
 $81,008
(a) 
$80,489
 $195,825
$186,344
 $371,819
(a) 
$363,444
Noninvestment-grade:         

 

      
Noncriticized52,484
51,720
 13,574
14,876
 16,123
15,316
206
201
 11,059
11,478
93,446
93,591
25,451
22,493
 70,827
 60,437
 29,019
27,591
 125,297
 110,521
Criticized performing3,743
3,738
 808
620
 202
150
—
2
 540
182
5,293
4,692
1,763
1,131
 13,274
 4,399
 1,211
1,126
 16,248
 6,656
Criticized nonaccrual1,291
851
 65
134
 22
4
—
—
 92
161
1,470
1,150
436
183
 2,016
 844
 971
30
 3,423
 1,057
Total noninvestment-
grade
57,518
56,309
 14,447
15,630
 16,347
15,470
206
203
 11,691
11,821
100,209
99,433
27,650
23,807
 86,117
 65,680
 $31,201
28,747
 144,968
 118,234
Total retained loans$119,227
$129,806
 $115,826
$115,737
 $55,839
$47,648
$13,111
$14,187
 $133,504
$131,784
$437,507
$439,162
$122,636
$120,418
 $167,125
 $146,169
 $227,026
$215,091
 $516,787
 $481,678
% of total criticized exposure to
total retained loans
4.22%3.54% 0.75%0.65% 0.40%0.32%—%0.01% 0.47%0.26%1.55%1.33%
% of investment-grade to total retained loans

77.45%80.23% 48.47% 55.07% 86.26%86.63% 71.95% 75.45%
% of total criticized to total retained loans1.79
1.09
 9.15
 3.59
 0.96
0.54
 3.81
 1.60
% of criticized nonaccrual
to total retained loans
1.08
0.66
 0.06
0.12
 0.04
0.01
—
—
 0.07
0.12
0.34
0.26
0.36
0.15
 1.21
 0.58
 0.43
0.01
 0.66
 0.22
       
Loans by geographic
distribution(a)
       
Total non-U.S.$28,850
$29,572
 $3,202
$2,967
 $17,112
$18,524
$2,699
$3,150
 $48,394
$48,433
$100,257
$102,646
Total U.S.90,377
100,234
 112,624
112,770
 38,727
29,124
10,412
11,037
 85,110
83,351
337,250
336,516
Total retained loans$119,227
$129,806
 $115,826
$115,737
 $55,839
$47,648
$13,111
$14,187
 $133,504
$131,784
$437,507
$439,162
       
       
Loan
delinquency(b)
       
Current and less than 30 days past due and still accruing$117,621
$128,678
 $115,733
$115,533
 $55,764
$47,622
$13,097
$14,165
 $132,844
$130,918
$435,059
$436,916
30–89 days past due
and still accruing
279
109
 22
67
 51
12
13
18
 568
702
933
908
90 or more days
past due and
still accruing(c)
36
168
 6
3
 2
10
1
4
 —
3
45
188
Criticized nonaccrual1,291
851
 65
134
 22
4
—
—
 92
161
1,470
1,150
Total
retained loans
$119,227
$129,806
 $115,826
$115,737
 $55,839
$47,648
$13,111
$14,187
 $133,504
$131,784
$437,507
$439,162
 Secured by real estate  

(in millions)
June 30, 2020 December 31, 2019
Term loans by origination year Revolving loans    
20202019201820172016Prior to 2016 Within the revolving periodConverted to term loans Total Total
Loans by risk ratings             
Investment-grade$10,876
$20,927
$13,665
$13,091
$15,492
$19,724
 $1,211
$—
 $94,986
 $96,611
Noninvestment-grade1,155
3,539
4,096
2,971
2,859
12,349
 680
1
 27,650
 23,807
Total retained loans$12,031
$24,466
$17,761
$16,062
$18,351
$32,073
 $1,891
$1
 $122,636
 $120,418
 Commercial and industrial  

(in millions)
June 30, 2020 December 31, 2019
Term loans by origination year Revolving loans    
2020 2019201820172016Prior to 2016 Within the revolving periodConverted to term loans Total Total
Loans by risk ratings              
Investment-grade$19,971
(a) 
$8,997
$4,152
$2,993
$1,216
$1,376
 $42,302
$1
 $81,008
 $80,489
Noninvestment-grade8,837
 11,245
6,978
3,277
965
3,081
 51,620
114
 86,117
 65,680
Total retained loans$28,808
 $20,242
$11,130
$6,270
$2,181
$4,457
 $93,922
$115
 $167,125
 $146,169
 
Other(b)
  

(in millions)
June 30, 2020 December 31, 2019
Term loans by origination year Revolving loans    
20202019201820172016Prior to 2016 Within the revolving periodConverted to term loans Total Total
Loans by risk ratings             
Investment-grade$20,953
$13,365
$9,021
$6,928
$4,239
$15,143
 $125,880
$296
 $195,825
 $186,344
Noninvestment-grade5,462
2,848
2,455
475
194
893
 18,626
248
 31,201
 28,747
Total retained loans$26,415
$16,213
$11,476
$7,403
$4,433
$16,036
 $144,506
$544
 $227,026
 $215,091
(a)At June 30, 2020, included $8.0 billion of loans under the PPP, of which $7.4 billion is included in commercial and industrial. PPP loans are guaranteed by the SBA. Other than in certain limited circumstances, the Firm typically does not recognize charge-offs, classify as nonaccrual nor record an allowance for loan losses on government guaranteed loans.
(b)Includes loans to financial institutions, states and political subdivisions, SPEs, nonprofits, personal investment companies and trusts, as well as loans to individuals and individual entities (predominantly Wealth Management clients within AWM). Refer to Note 14 of JPMorgan Chase’s 2019 Form 10-K for more information on SPEs.

The following table presents additional information on retained loans secured by real estate, which consists of loans secured wholly or substantially by a lien or liens on real property at origination.

(in millions, except ratios)
Multifamily Other commercial Total retained loans secured by real estate
Jun 30,
2020
Dec 31,
2019
 Jun 30,
2020
Dec 31,
2019
 Jun 30,
2020
Dec 31,
2019
Retained loans secured by real estate$75,074
$73,840
 $47,562
$46,578
 $122,636
$120,418
Criticized570
340
 1,629
974
 2,199
1,314
% of total criticized to total retained loans secured by real estate0.76%0.46% 3.43%2.09% 1.79%1.09%
Criticized nonaccrual$52
$28
 $384
$155
 $436
$183
% of criticized nonaccrual loans to total retained loans secured by real estate0.07%0.04% 0.81%0.33% 0.36%0.15%
Geographic distribution and delinquency
The following table provides information on the geographic distribution and delinquency for retained wholesale loans.
 Secured by real estate 
Commercial
 and industrial
 Other Total
retained loans
(in millions,
 except ratios)
Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		Dec 31,
2019
Loans by geographic distribution(a)
           
Total U.S.$120,016
$117,836
 $127,251
$111,954
 $164,931
$150,512
 $412,198
$380,302
Total non-U.S.2,620
2,582
 39,874
34,215
 62,095
64,579
 104,589
101,376
Total retained loans$122,636
$120,418

$167,125
$146,169

$227,026
$215,091

$516,787
$481,678
Loan delinquency(b)



















Current and less than 30 days past due and still accruing$122,038
$120,119

$164,503
$144,839

$225,181
$214,641

$511,722
$479,599
30–89 days past due and still accruing140
115

559
449

807
415

1,506
979
90 or more days past due and still accruing(c)
22
1

47
37

67
5

136
43
Criticized nonaccrual436
183

2,016
844

971
30

3,423
1,057
Total retained loans$122,636
$120,418

$167,125
$146,169

$227,026
$215,091

$516,787
$481,678
(a)The U.S. and non-U.S. distribution is determined based predominantly on the domicile of the borrower.
(b)The credit quality of wholesale loans is assessed primarily through ongoing review and monitoring of an obligor’s ability to meet contractual obligations rather than relying on the past due status, which is generally a lagging indicator of credit quality. ReferGenerally excludes loans that were under payment deferral programs offered in response to Note 12 of JPMorgan Chase’s 2018 Form 10-K for a further discussion.the COVID-19 pandemic. 
(c)Represents loans that are considered well-collateralized and therefore still accruing interest.
(d)Other includes individuals and individual entities (predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts), SPEs and Private education and civic organizations. Refer to Note 14 of JPMorgan Chase’s 2018 Form 10-K for more information on SPEs.

Nonaccrual loans
The following table presents additionalprovides information on the real estate class of loans within the Wholesale portfolio for the periods indicated. Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information on real estateretained wholesale nonaccrual loans.

(in millions, except ratios)
Multifamily Other commercial Total real estate loans
Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
Real estate retained loans$79,169
$79,184
 $36,657
$36,553
 $115,826
$115,737
Criticized exposure533
388
 340
366
 873
754
% of total criticized exposure to total real estate retained loans0.67%0.49% 0.93%1.00% 0.75%0.65%
Criticized nonaccrual$34
$57
 $31
$77
 $65
$134
% of criticized nonaccrual loans to total real estate retained loans0.04%0.07% 0.08%0.21% 0.06%0.12%

Wholesale impaired retained loans and loan modifications
Wholesale impaired retained loans consist of loans that have been placed on nonaccrual status and/or that have been modified in a TDR. All impaired loans are evaluated for an asset-specific allowance as described in Note 13 of JPMorgan Chase’s 2018 Form 10-K.
The table below sets forth information about the Firm’s wholesale impaired retained loans.

(in millions)
Commercial
and industrial
 Real estate 
Financial
institutions
 
Governments &
 Agencies
 Other 
Total
retained loans
 
Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		Dec 31,
2018		 Sep 30,
2019		 Dec 31,
2018		 
Impaired loans                   
With an allowance$1,068
$807
 $46
$107
 $22
$4
 $—
$—
 $96
$152
 $1,232
 $1,070
 
Without an allowance(a)
279
140
 21
27
 —
—
 —
—
 4
13
 304
 180
 
Total impaired loans
$1,347
$947
 $67
$134
 $22
$4
 $—
$—
 $100
$165
 $1,536
(c) 
$1,250
(c) 
Allowance for loan losses related to impaired loans$320
$252
 $13
$25
 $7
$1
 $—
$—
 $2
$19
 $342
 $297
 
Unpaid principal balance of impaired loans(b)
1,532
1,043
 104
203
 23
4
 —
—
 336
473
 1,995
 1,723
 
 
(in millions)
Secured by real estate 
Commercial
and industrial
 Other 
Total
retained loans
Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		Dec 31,
2019		 Jun 30,
2020		Dec 31,
2019
Nonaccrual loans(a)
           
With an allowance$348
$169
 $1,842
$688
 $871
$28
 $3,061
$885
Without an allowance(b)
88
14
 174
156
 100
2
 362
172
Total nonaccrual loans(c)
$436
$183
 $2,016
$844
 $971
$30
 $3,423
$1,057
(a)Loans that were modified in response to the COVID-19 pandemic continue to be risk-rated in accordance with the Firm’s overall credit risk management framework. As of June 30, 2020, predominantly all of these loans were considered performing.
(b)When the discounted cash flows, collateral value or market price equals or exceeds the recorded investment inamortized cost of the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged-offcharged off and/or there have been interest payments received and applied to the loan balance.
(b)Represents the contractual amount of principal owed at September 30, 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs; interest payments received and applied to the carrying value; net deferred loan fees or costs; and unamortized discount or premiums on purchased loans.
(c)Based upon the domicile of the borrower, largely consists of loans in the U.S.
The following table presents the Firm’s average impaired retained loans for the periods indicated.
 Three months ended September 30, Nine months ended September 30,
(in millions)2019
2018
 2019
2018
Commercial and industrial$1,073
$838
 $1,082
$1,095
Real estate80
134
 105
138
Financial institutions9
45
 11
76
Governments & Agencies—
—
 —
—
Other123
202
 207
214
Total(a)
$1,285
$1,219
 $1,405
$1,523
(a)The related interestInterest income on accruing impairednonaccrual loans and interest income recognized on a cash basis were not material for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
Loan modifications
Certain loan modifications are considered to be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All TDRsLoans with short-term or other insignificant modifications that are reported as impaired loans in the tables above. TDRs were $498 million and $576 million as of September 30, 2019, and December 31, 2018, respectively. not considered concessions are not TDRs.The impact of these modifications, as well as new TDRs, were not material to the Firm for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.

2019.

Note 1213 – Allowance for credit losses
Effective January 1, 2020, the Firm adopted the CECL accounting guidance. The adoption of this guidance established a single allowance framework for all financial assets measured at amortized cost and certain off-balance sheet credit exposures. This framework requires that management’s estimate reflects credit losses over the instrument’s remaining expected life and considers expected future changes in macroeconomic conditions. Refer to Note 13 of 1 for further information.
JPMorgan Chase’s 2018 Form 10-Kallowance for a detailed discussioncredit losses comprises:
•
the allowance for loan losses, which covers the Firm’s retained loan portfolios (scored and risk-rated) and is presented separately on the balance sheet,
•
the allowance for lending-related commitments, which is presented on the balance sheet in accounts payable and other liabilities, and
•
the allowance for credit losses on investment securities, which covers the Firm’s HTM and AFS securities and is recognized within Investment Securities on the balance sheet.
The income statement effect of all changes in the allowance for credit losses is recognized in the provision for credit losses.
Determining the appropriateness of the allowance for credit losses is complex and requires significant judgment by management about the effect of matters that are inherently uncertain. At least quarterly, the allowance for credit losses is reviewed by the CRO, the CFO and the Controller of the Firm. Subsequent evaluations of credit exposures, considering the macroeconomic conditions, forecasts and other factors then prevailing, may result in significant changes in the allowance for credit losses in future periods.
The Firm’s policies used to determine its allowance for loan losses and its allowance for lending-related commitments are described in the following paragraphs. Refer to Note 10 for a description of the policies used to determine the allowance for credit losses on investment securities.
Methodology for allowances for loan losses and lending-related commitments
The allowance for loan losses and allowance for lending-related commitments represents expected credit losses over the remaining expected life of retained loans and lending-related commitments that are not unconditionally cancellable. The Firm does not record an allowance for future draws on unconditionally cancellable lending-related commitments (e.g., credit cards). Expected losses related accounting policies.to accrued interest on credit card loans and certain performing, modified loans to borrowers impacted by COVID-19 are included in the Firm’s allowance for loan losses. However, the Firm does not record an allowance on other accrued interest receivables, due to its policy to write them off no later than 90 days past due by reversing interest income.
The expected life of each instrument is determined by considering its contractual term, expected prepayments, cancellation features, and certain extension and call options. The expected life of funded credit card loans is generally estimated by considering expected future payments on the credit card account, and determining how much of those amounts should be allocated to repayments of the funded loan
balance (as of the balance sheet date) versus other account activity. This allocation is made using an approach that incorporates the payment application requirements of the Credit Card Accountability Responsibility and Disclosure Act of 2009, generally paying down the highest interest rate balances first.
The estimate of expected credit losses includes expected recoveries of amounts previously charged off or expected to be charged off, even if such recoveries result in a negative allowance.
Collective and Individual Assessments
When calculating the allowance for loan losses and the allowance for lending-related commitments, the Firm assesses whether exposures share similar risk characteristics. If similar risk characteristics exist, the Firm estimates expected credit losses collectively, considering the risk associated with a particular pool and the probability that the exposures within the pool will deteriorate or default. The assessment of risk characteristics is subject to significant management judgement. Emphasizing one characteristic over another or considering additional characteristics could affect the allowance.
•
Relevant risk characteristics for the consumer portfolio include product type, delinquency status, current FICO scores, geographic distribution, and, for collateralized loans, current LTV ratios.
•
Relevant risk characteristics for the wholesale portfolio include LOB, geography, risk rating, delinquency status, level and type of collateral, industry, credit enhancement, product type, facility purpose, tenor, and payment terms.
The majority of the Firm’s credit exposures share risk characteristics with other similar exposures, and as a result are collectively assessed for impairment (“portfolio-based component”). The portfolio-based component covers consumer loans, performing risk-rated loans and certain lending-related commitments.
If an exposure does not share risk characteristics with other exposures, the Firm generally estimates expected credit losses on an individual basis, considering expected repayment and conditions impacting that individual exposure (“asset-specific component”). The asset-specific component covers modified PCD loans, loans modified or reasonably expected to be modified in a TDR, collateral-dependent loans, as well as, risk-rated loans that have been placed on nonaccrual status.
Portfolio-based component
The portfolio-based component begins with a quantitative calculation that considers the likelihood of the borrower changing delinquency status or moving from one risk rating to another. The quantitative calculation covers expected credit losses over an instrument’s expected life and is estimated by applying credit loss factors to the Firm’s estimated exposure at default. The credit loss factors incorporate the probability of borrower default as well as loss severity in the event of default. They are derived using a weighted average of five internally developed macroeconomic scenarios over an eight-quarter forecast period, followed by a single year straight-line interpolation to revert to long run historical information for periods beyond the eight-quarter forecast period. The five

macroeconomic scenarios consist of a central, relative adverse, extreme adverse, relative upside and extreme upside scenario, and are updated by the Firm’s central forecasting team. The scenarios take into consideration the Firm’s overarching economic outlook, internal perspectives from subject matter experts across the Firm, and market consensus and involve a governed process that incorporates feedback from senior management across LOBs, Corporate Finance and Risk Management.
The COVID-19 pandemic has stressed many MEVs to degrees not experienced in recent history, which creates additional challenges in the use of modeled credit loss estimates and increases the reliance on management judgment. During the second quarter, certain MEVs were well outside the range of historical experience on which the Firm’s models had been calibrated and therefore adjustments were required to appropriately address these economic circumstances. For example, while forecasted U.S. employment rates in certain of the Firm’s scenarios are higher than historical experience, such rates are developed on a reported basis and do not reflect the significant mitigating impact of current government unemployment benefits and other stimulus programs. Consequently, management considered such mitigating impact to arrive at an effective unemployment rate, which informed modeled credit loss estimates, particularly in the consumer portfolio. In addition, for the wholesale portfolio, management used the historical relationship between credit spreads and portfolio default rates to inform the adjustment of the Firm’s modeled loss estimates. 
The quantitative calculation is further adjusted to take into consideration model imprecision, emerging risk assessments, trends and other subjective factors that are not yet reflected in the calculation. These adjustments are accomplished in part by analyzing the historical loss experience, including during stressed periods, for each major product or model. Management applies judgement in making this adjustment, including taking into account uncertainties associated with the economic and political conditions, quality of underwriting standards, borrower behavior, credit concentrations or deterioration within an industry, product or portfolio, as well as other relevant internal and external factors affecting the credit quality of the portfolio. In certain instances, the interrelationships between these factors create further uncertainties.
In the second quarter of 2020, these qualitative adjustments also consider additional weight placed on the relative and extreme adverse scenarios, as a result of increased uncertainty related to the COVID-19 pandemic.
The application of different inputs into the quantitative calculation, and the assumptions used by management to adjust the quantitative calculation, are subject to significant management judgment, and emphasizing one input or assumption over another, or considering other inputs or assumptions, could affect the estimate of the allowance for loan losses and the allowance for lending-related commitments.
Asset-specific component
To determine the asset-specific component of the allowance, collateral-dependent loans (including those loans for which foreclosure is probable) and larger, nonaccrual risk-rated loans in the wholesale portfolio segment are generally evaluated individually, while smaller loans (both scored and risk-rated) are aggregated for evaluation using factors relevant for the respective class of assets.
The Firm generally measures the asset-specific allowance as the difference between the amortized cost of the loan and the present value of the cash flows expected to be collected, discounted at the loan’s original effective interest rate. Subsequent changes in impairment are generally recognized as an adjustment to the allowance for loan losses. For collateral-dependent loans, the fair value of collateral less estimated costs to sell is used to determine the charge-off amount for declines in value (to reduce the amortized cost of the loan to the fair value of collateral) or the amount of negative allowance that should be recognized (for recoveries of prior charge-offs associated with improvements in the fair value of collateral).
The asset-specific component of the allowance for loan losses that have been or are expected to be modified in TDRs incorporates the effect of the modification on the loan’s expected cash flows (including forgone interest, principal forgiveness, as well as other concessions), and also the potential for redefault. For residential real estate loans modified in or expected to be modified in TDRs, the Firm develops product-specific probability of default estimates, which are applied at a loan level to compute expected losses. In developing these probabilities of default, the Firm considers the relationship between the credit quality characteristics of the underlying loans and certain assumptions about housing prices and unemployment, based upon industry-wide data. The Firm also considers its own historical loss experience to-date based on actual redefaulted modified loans. For credit card loans modified in or expected to be modified in TDRs, expected losses incorporate projected delinquencies and charge-offs based on the Firm’s historical experience by type of modification program. For wholesale loans modified or expected to be modified in TDRs, expected losses incorporate management’s expectation of the borrower’s ability to repay under the modified terms.
Estimating the timing and amounts of future cash flows is highly judgmental as these cash flow projections rely upon estimates such as loss severities, asset valuations, default rates (including redefault rates on modified loans), the amounts and timing of interest or principal payments (including any expected prepayments) or other factors that are reflective of current and expected market conditions. These estimates are, in turn, dependent on factors such as the duration of current overall economic conditions, industry-, portfolio-, or borrower-specific factors, the expected outcome of insolvency proceedings as well as, in certain circumstances, other economic factors. All of these estimates and assumptions require significant management judgment and certain assumptions are highly subjective.

Allowance for credit losses and related information
The table below summarizes information about the allowances for loan losses and lending-related commitments, and includes a breakdown of loans and lending-related commitments by impairment methodology. Refer to Note 10 for further information on the allowance for credit losses on investment securities.
The adoption of the CECL accounting guidance resulted in a change in the accounting for PCI loans, which are considered PCD loans. In conjunction with the adoption of CECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Refer to Note 1 for further information.
2019 2018 
2020(e)
 2019
Nine months ended September 30,
(in millions)
Consumer, excluding
credit card
Credit card WholesaleTotal Consumer, excluding credit card Credit card WholesaleTotal 
Six months ended June 30,
(in millions)
Consumer, excluding
credit card
Credit cardWholesaleTotal Consumer, excluding credit cardCredit cardWholesaleTotal
Allowance for loan losses             
Beginning balance at January 1,$4,146
$5,184
 $4,115
$13,445
 $4,579
 $4,884
 $4,141
$13,604
 $2,538
$5,683
$4,902
$13,123
 $3,434
$5,184
$4,827
$13,445
Cumulative effect of a change in accounting principle297
5,517
(1,642)4,172
 NA
NA
NA
NA
Gross charge-offs702
4,050
 270
5,022
 776
 3,777
 264
4,817
 425
2,863
491
3,779
 445
2,725
176
3,346
Gross recoveries(420)(433) (34)(887) (681) (370) (146)(1,197) 
Gross recoveries collected(348)(372)(30)(750) (270)(283)(29)(582)
Net charge-offs282
3,617
 236
4,135
 95
 3,407
 118
3,620
 77
2,491
461
3,029
 175
2,442
147
2,764
Write-offs of PCI loans(a)
132
—
 —
132
 151
 —
 —
151
 NA
NA
NA
NA
 89
—
—
89
Provision for loan losses(265)4,017
 296
4,048
 (152) 3,557
 (111)3,294
 2,115
9,091
6,619
17,825
 (246)2,642
173
2,569
Other—
(1) 10
9
 1
 —
 —
1
 (1)—
2
1
 —
(1)6
5
Ending balance at September 30,$3,467
$5,583
 $4,185
$13,235
 $4,182
 $5,034
 $3,912
$13,128
 
Ending balance at June 30,$4,872
$17,800
$9,420
$32,092
 $2,924
$5,383
$4,859
$13,166
   
Allowance for lending-related commitments   
Beginning balance at January 1,$12
$—
$1,179
$1,191
 $12
$—
$1,043
$1,055
Cumulative effect of a change in accounting principle133
—
(35)98
 NA
NA
NA
NA
Provision for lending-related commitments95
—
825
920
 —
—
75
75
Other1
—
(1)—
 —
—
(1)(1)
Ending balance at June 30,$241
$—
$1,968
$2,209
 $12
$—
$1,117
$1,129
   
Total allowance for credit losses$5,113
$17,800
$11,388
$34,301
 $2,936
$5,383
$5,976
$14,295
             
Allowance for loan losses by impairment methodology             
Asset-specific(b)
$145
$488
(c) 
$342
$975
 $204
 $421
(c) 
$280
$905
 $263
$642
$757
$1,662
 $87
$472
$346
$905
Formula-based2,066
5,095
 3,843
11,004
 2,154
 4,613
 3,632
10,399
 
Portfolio-based4,609
17,158
8,663
30,430
 1,538
4,911
4,513
10,962
PCI1,256
—
 —
1,256
 1,824
 —
 —
1,824
 NA
NA
NA
NA
 1,299
—
—
1,299
Total allowance for loan losses$3,467
$5,583
 $4,185
$13,235
 $4,182
 $5,034
 $3,912
$13,128
 $4,872
$17,800
$9,420
$32,092
 $2,924
$5,383
$4,859
$13,166
             
Loans by impairment methodology             
Asset-specific$6,341
$1,423
 $1,536
$9,300
 $7,046
 $1,284
 $1,051
$9,381
 
Formula-based304,178
158,148
 435,971
898,297
 343,703
 146,572
 422,783
913,058
 
Asset-specific(b)
$16,749
$1,422
$3,849
$22,020
 $6,374
$1,388
$1,483
$9,245
Portfolio-based290,256
140,234
512,938
943,428
 286,059
156,180
474,002
916,241
PCI21,290
—
 —
21,290
 25,209
 —
 3
25,212
 NA
NA
NA
NA
 22,242
—
—
22,242
Total retained loans$331,809
$159,571
 $437,507
$928,887
 $375,958
 $147,856
 $423,837
$947,651
 $307,005
$141,656
$516,787
$965,448
 $314,675
$157,568
$475,485
$947,728
             
Impaired collateral-dependent loans          
Collateral-dependent loans   
Net charge-offs$28
$—
 $23
$51
 $15
 $—
 $—
$15
 $56
$—
$22
$78
 $14
$—
$13
$27
Loans measured at fair value of collateral less cost to sell2,083
—
 113
2,196
 2,077
 —
 258
2,335
 3,505
—
166
3,671
 2,093
—
88
2,181
             
Allowance for lending-related commitments          
Beginning balance at January 1,$33
$—
 $1,022
$1,055
 $33
 $—
 $1,035
$1,068
 
Provision for lending-related commitments—
—
 110
110
 —
 —
 29
29
 
Other—
—
 —
—
 —
 —
 —
—
 
Ending balance at September 30,$33
$—
 $1,132
$1,165
 $33
 $—
 $1,064
$1,097
 
          
Allowance for lending-related commitments by impairment methodology             
Asset-specific$—
$—
 $135
$135
 $—
 $—
 $71
$71
 $—
$—
$115
$115
 $—
$—
$136
$136
Formula-based33
—
 997
1,030
 33
 —
 993
1,026
 
Total allowance for lending-related commitments$33
$—
 $1,132
$1,165
 $33
 $—
 $1,064
$1,097
 
Portfolio-based241
—
1,853
2,094
 12
—
981
993
Total allowance for lending-related commitments(c)
$241
$—
$1,968
$2,209
 $12
$—
$1,117
$1,129
             
Lending-related commitments by impairment methodology             
Asset-specific$—
$—
 $446
$446
 $—
 $—
 $252
$252
 $—
$—
$762
$762
 $—
$—
$465
$465
Formula-based53,591
645,880
 395,173
1,094,644
 50,630
 600,728
 397,064
1,048,422
 
Portfolio-based(d)
35,417
—
404,731
440,148
 30,827
—
403,302
434,129
Total lending-related commitments$53,591
$645,880
 $395,619
$1,095,090
 $50,630
 $600,728
 $397,316
$1,048,674
 $35,417
$—
$405,493
$440,910
 $30,827
$—
$403,767
$434,594


(a)Write-offsPrior to the adoption of CECL, write-offs of PCI loans arewere recorded against the allowance for loan losses when actual losses for a pool exceedexceeded estimated losses that were recorded as purchase accounting adjustments at the time of acquisition. A write-off of a PCI loan iswas recognized when the underlying loan iswas removed from a pool.
(b)Includes modified PCD loans and loans that have been modified or are reasonably expected to be modified in a TDR. Also includes risk-rated loans that have been placed on nonaccrual status and loans that have been modified in a TDR.
(c)for the wholesale portfolio segment. The asset-specific credit card allowance for loan losses is relatedloans modified, or reasonably expected to loans that have beenbe modified, in a TDR; such allowanceTDR is calculated based on the loans’ original contractual interest rates and does not consider any incremental penalty rates.
(c)The allowance for lending-related commitments is reported in accounts payable and other liabilities on the Consolidated balance sheets.
(d)At June 30, 2020 and 2019, lending-related commitments excluded $9.9 billion and $9.3 billion, respectively, for the consumer, excluding credit card portfolio segment; and $673.8 billion and $634.0 billion, respectively, for the credit card portfolio segment, which were not subject to the allowance for lending-related commitments.
(e)Excludes HTM securities, which had an allowance for credit losses of $23 million and a provision for credit losses of $13 million as of and for the six months ended June 30, 2020.
Discussion of current period changes
The increase in the allowance for loan losses and lending-related commitments was primarily driven by an increase in the provision for credit losses, reflecting the deterioration in and uncertainty around the future macroeconomic environment as a result of the impact of the COVID-19 pandemic. In the first quarter of 2020, management’s macroeconomic forecast included a decline in the U.S. real GDP of approximately 25% and an increase in the U.S. unemployment rate to above 10%, both in the second quarter, followed by a solid recovery in the second half of 2020. In the second quarter of 2020, based on the increased uncertainty around the duration and depth of the downturn and speed of economic recovery, the Firm’s central case reflected a more protracted downturn with a slower recovery of U.S. real GDP.
In the first and second quarters of 2020, the Firm’s central case assumptions reflected forecasted U.S. unemployment rates and cumulative changes in U.S. real GDP as follows:
 2020 2021
 4Q 2Q4Q
Central case assumptions    
     
U.S. unemployment rate(a)
    
1Q 20206.6 % 5.5 %4.6 %
2Q 202010.9
 9.0
7.7
     
U.S. real GDP - cumulative change from December 31, 2019    
1Q 2020(5.4) (2.3)0.3
2Q 2020(6.2) (4.0)(3.0)
(a)Reflects quarterly average of forecasted reported U.S. unemployment rate.
In the second quarter of 2020, the Firm placed significant weighting on its adverse scenarios, which incorporate more punitive macroeconomic factors than the central case assumptions above, resulting in weighted average U.S. unemployment rates remaining in double digits through the first half of 2021.
Subsequent changes to this forecast and related estimates will be reflected in the provision for credit losses in future periods.


Note 1314 – Variable interest entities
Refer to Note 1 of JPMorgan Chase’s 20182019 Form 10-K for a further description of JPMorgan Chase’s accounting policies regarding consolidation of VIEs.
The following table summarizes the most significant types of Firm-sponsored VIEs by business segment.
Line of BusinessTransaction TypeActivityForm 10-Q page reference
CCBCredit card securitization trustsSecuritization of originated credit card receivables139162
 Mortgage securitization trustsServicing and securitization of both originated and purchased residential mortgages139-141162-164
CIBMortgage and other securitization trustsSecuritization of both originated and purchased residential and commercial mortgages, and other consumer loans139-141162-164
 Multi-seller conduitsAssist clients in accessing the financial markets in a cost-efficient manner and structures transactions to meet investor needs141164
 Municipal bond vehiclesFinancing of municipal bond investments141164

The Firm also invests in and provides financing and other services to VIEs sponsored by third parties. Refer to pages 142–143165–166 of this Note for more information on the VIEs sponsored by third parties.
Significant Firm-sponsored VIEs
Credit card securitizations
Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed discussion of JPMorgan Chase’s involvement with credit card securitizations.
As a result of the Firm’s continuing involvement, the Firm is considered to be the primary beneficiary of its Firm-sponsored credit card securitization trusts, including its primary vehicle,trust, the Chase Issuance Trust. Refer to the table on page 142165 of this Note for further information on consolidated VIE assets and liabilities.
 
Firm-sponsored mortgage and other securitization trusts
The Firm securitizes (or has securitized) originated and purchased residential mortgages, commercial mortgages and other consumer loans primarily in its CCB and CIB businesses. Depending on the particular transaction, as well as the respective business involved, the Firm may act as the servicer of the loans and/or retain certain beneficial interests in the securitization trusts.
Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a detailed discussion of the Firm’s involvement with Firm-sponsored mortgage and other securitization trusts, as well as the accounting treatment relating to such trusts.


The following table presents the total unpaid principal amount of assets held in Firm-sponsored private-label securitization entities, including those in which the Firm has continuing involvement, and those that are consolidated by the Firm. Continuing involvement includes servicing the loans, holding senior interests or subordinated interests (including amounts required to be held pursuant to credit risk retention rules), recourse or guarantee arrangements, and derivative contracts. In certain instances, the Firm’s only continuing involvement is servicing the loans. The Firm’s maximum loss exposure from retained and purchased interests is the carrying value of these interests. Refer to Securitization activity on page 143166 of this Note for further information regarding the Firm’s cash flows associated with and interests retained in nonconsolidated VIEs, and pages 143–144166-167 of this Note for information on the Firm’s loan sales and securitization activity related to U.S. GSEs andgovernment agencies.
Principal amount outstanding 
JPMorgan Chase interest in securitized assets in nonconsolidated VIEs(c)(d)(e)
Principal amount outstanding 
JPMorgan Chase interest in securitized assets in nonconsolidated VIEs(c)(d)(e)
September 30, 2019 (in millions)Total assets held by securitization VIEsAssets
held in consolidated securitization VIEs		Assets held in nonconsolidated securitization VIEs with continuing involvement Trading assets Investment securitiesOther financial assetsTotal interests held by JPMorgan
Chase
June 30, 2020 (in millions)Total assets held by securitization VIEsAssets
held in consolidated securitization VIEs		Assets held in nonconsolidated securitization VIEs with continuing involvement Trading assets Investment securitiesOther financial assetsTotal interests held by JPMorgan
Chase
Securitization-related(a)
      
Residential mortgage:      
Prime/Alt-A and option ARMs$61,480
$2,966
$49,826
 $522
$728
$—
$1,250
$55,813
$2,359
$44,492
 $597
$1,031
$—
$1,628
Subprime15,156
—
14,085
 16
—
—
16
13,817
49
12,859
 9
—
—
9
Commercial and other(b)
101,624
—
86,302
 919
708
234
1,861
114,006
—
94,321
 918
1,952
279
3,149
Total$178,260
$2,966
$150,213
 $1,457
$1,436
$234
$3,127
$183,636
$2,408
$151,672
 $1,524
$2,983
$279
$4,786
Principal amount outstanding 
JPMorgan Chase interest in securitized assets in nonconsolidated VIEs(c)(d)(e)
Principal amount outstanding 
JPMorgan Chase interest in securitized assets in nonconsolidated VIEs(c)(d)(e)
December 31, 2018 (in millions)Total assets held by securitization VIEs
Assets
held in consolidated securitization VIEs
Assets held in nonconsolidated securitization VIEs with continuing involvement Trading assets Investment securitiesOther financial assets
Total interests held by
JPMorgan
Chase
December 31, 2019 (in millions)Total assets held by securitization VIEs
Assets
held in consolidated securitization VIEs
Assets held in nonconsolidated securitization VIEs with continuing involvement Trading assets Investment securitiesOther financial assets
Total interests held by
JPMorgan
Chase
Securitization-related(a)
      
Residential mortgage:      
Prime/Alt-A and option ARMs$63,350
$3,237
$50,679
 $623
$647
$—
$1,270
$60,348
$2,796
$48,734
 $535
$625
$—
$1,160
Subprime16,729
32
15,434
 53
—
—
53
14,661
—
13,490
 7
—
—
7
Commercial and other(b)
102,961
—
79,387
 783
801
210
1,794
111,903
—
80,878
 785
773
241
1,799
Total$183,040
$3,269
$145,500
 $1,459
$1,448
$210
$3,117
$186,912
$2,796
$143,102
 $1,327
$1,398
$241
$2,966
(a)Excludes U.S. GSEs and government agency securitizations and re-securitizations, which are not Firm-sponsored. Refer to pages 143–144166-167 of this Note for information on the Firm’s loan sales and securitization activity related to U.S. GSEs and government agencies.
(b)Consists of securities backed by commercial real estate loans and non-mortgage-related consumer receivables purchased from third parties.
(c)Excludes the following: retained servicing (refer to Note 1415 for a discussion of MSRs); securities retained from loan sales and securitization activity related to U.S. GSEs and government agencies; interest rate and foreign exchange derivatives primarily used to manage interest rate and foreign exchange risks of securitization entities (Refer(refer to Note 45 for further information on derivatives); senior and subordinated securities of $168$201 million and $69$16 million, respectively, at SeptemberJune 30, 2019,2020, and $87$106 million and $28$94 million, respectively, at December 31, 2018,2019, which the Firm purchased in connection with CIB’s secondary market-making activities.
(d)Includes interests held in re-securitization transactions.
(e)As of SeptemberJune 30, 2019,2020, and December 31, 2018, 67%2019, 76% and 60%63%, respectively, of the Firm’s retained securitization interests, which are predominantly carried at fair value and include amounts required to be held pursuant to credit risk retention rules, were risk-rated “A” or better, on an S&P-equivalent basis. The retained interests in prime residential mortgages consisted of $1.2$1.6 billion and $1.3$1.1 billion of investment-grade retained interests, and $55$62 million and $16$72 million of noninvestment-grade retained interests at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively. The retained interests in commercial and other securitizationssecuritization trusts consisted of $1.3$2.5 billion and $1.2 billion of investment-grade retained interests, at September 30, 2019 and December 31, 2018, and $567$650 million and $623$575 million of noninvestment-grade retained interests at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively.


Residential mortgage
The Firm securitizes residential mortgage loans originated by CCB, as well as residential mortgage loans purchased from third parties by either CCB or CIB. Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed description of the Firm’s involvement with residential mortgage securitizations. Refer to the table on page 142165 of this Note for more information on the consolidated residential mortgage securitizations, and the table on the previous page of this Note for further information on interests held in nonconsolidated residential mortgage securitizations.
Commercial mortgages and other consumer securitizations
CIB originates and securitizes commercial mortgage loans, and engages in underwriting and trading activities involving the securities issued by securitization trusts. Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed description of the Firm’s involvement with commercial mortgage and other consumer securitizations. Refer to the table on page 142165 of this Note for more information on the consolidated commercial mortgage securitizations, and the table on the previous page of this Note for further information on interests held in nonconsolidated securitizations.
Re-securitizations
Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed description of JPMorgan Chase’s participation in certain re-securitization transactions.
The following table presents the principal amount of securities transferred to re-securitization VIEs.
 Three months ended June 30, Six months ended June 30,
(in millions)2020
 2019
 2020
 2019
Transfers of securities to VIEs       
U.S. GSEs and government agencies$12,505
 $2,564
 $15,222
 $7,067

 Three months ended September 30, Nine months ended September 30,
(in millions)2019
 2018
 2019
 2018
Transfers of securities to VIEs       
U.S. GSEs and government agencies$5,377
 $2,540
 $12,444
 $11,321
The Firm did not transfer any private label securities to re-securitization VIEs during the three and six months ended June 30, 2020 and 2019, respectively, and retained interests in any such Firm-sponsored VIEs as of June 30, 2020 and December 31, 2019 were immaterial.
The following table presents information on nonconsolidated re-securitization VIEs.
 
Nonconsolidated
re-securitization VIEs
(in millions)June 30, 2020
 December 31, 2019
U.S. GSEs and government agencies   
Interest in VIEs$4,189
 $2,928

 
Nonconsolidated
re-securitization VIEs
(in millions)September 30, 2019
 December 31, 2018
Firm-sponsored private-label   
Assets held in VIEs with continuing involvement(a)
$21
 $118
Interest in VIEs—
 10
U.S. GSEs and government agencies   
Interest in VIEs2,097
 3,058
(a)Represents the principal amount and includes the notional amount of interest-only securities.
As of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, the Firm did not consolidate any U.S. GSE and government agency re-securitization VIEs or any Firm-sponsored private-label re-securitization VIEs.
 
Multi-seller conduits
Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed description of JPMorgan Chase’s principal involvement with Firm-administered multi-seller conduits.
In the normal course of business, JPMorgan Chase makes markets in and invests in commercial paper issued by the Firm-administered multi-seller conduits. The Firm held $12.6$11.5 billion and $20.1$16.3 billion of the commercial paper issued by the Firm-administered multi-seller conduits at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively, which have been eliminated in consolidation. The Firm’s investments reflect the Firm’s funding needs and capacity and were not driven by market illiquidity. Other than the amounts required to be held pursuant to credit risk retention rules, the Firm is not obligated under any agreement to purchase the commercial paper issued by the Firm-administered multi-seller conduits.
Deal-specific liquidity facilities, program-wide liquidity and credit enhancement provided by the Firm have been eliminated in consolidation. The Firm or the Firm-administered multi-seller conduits provide lending-related commitments to certain clients of the Firm-administered multi-seller conduits. The unfunded commitments were $8.5$8.6 billion and $8.0$8.9 billion at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, respectively, and are reported as off-balance sheet lending-related commitments in other unfunded commitments to extend credit. Refer to Note 2223 for more information on off-balance sheet lending-related commitments.
Municipal bond vehicles
Municipal bond vehicles or tender option bond (“TOB”) trusts allow institutions to finance their municipal bond investments at short-term rates. TOB transactions are known as customer TOB trusts and non-customer TOB trusts. Customer TOB trusts are sponsored by a third party, refer to pages 142–143165-166 of this Note for further information.
The Firm serves as sponsor for all non-customer TOB transactions. Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a more detailed description of JPMorgan Chase’s Municipal bond vehicles.




Consolidated VIE assets and liabilities
The following table presents information on assets and liabilities related to VIEs consolidated by the Firm as of SeptemberJune 30, 2019,2020, and December 31, 2018.2019.
Assets LiabilitiesAssets Liabilities
September 30, 2019 (in millions)Trading assetsLoans
Other(b) 
 Total
assets(c)
 
Beneficial interests in
VIE assets(d)
Other(e)
Total
liabilities
June 30, 2020 (in millions)Trading assetsLoans
Other(b) 
 Total
assets(c)
 
Beneficial interests in
VIE assets(d)
Other(e)
Total
liabilities
VIE program type      
Firm-sponsored credit card trusts$—
$27,377
$370
$27,747
 $6,457
$6
$6,463
$—
$12,208
$859
$13,067
 $5,790
$3
$5,793
Firm-administered multi-seller conduits3
22,708
334
23,045
 10,514
35
10,549
—
23,868
331
24,199
 12,666
30
12,696
Municipal bond vehicles1,280
—
3
1,283
 1,249
2
1,251
2,206
—
3
2,209
 2,126
1
2,127
Mortgage securitization entities(a)
70
2,937
58
3,065
 295
137
432
57
2,308
97
2,462
 245
118
363
Other108
—
209
317
 —
121
121
2
—
279
281
 1
91
92
Total$1,461
$53,022
$974
$55,457
 $18,515
$301
$18,816
$2,265
$38,384
$1,569
$42,218
 $20,828
$243
$21,071
      
Assets LiabilitiesAssets Liabilities
December 31, 2018 (in millions)Trading assetsLoans
Other(b) 
 Total
assets(c)
 
Beneficial interests in
VIE assets(d)
Other(e)
Total
liabilities
December 31, 2019 (in millions)Trading assetsLoans
Other(b) 
 Total
assets(c)
 
Beneficial interests in
VIE assets(d)
Other(e)
Total
liabilities
VIE program type      
Firm-sponsored credit card trusts$—
$31,760
$491
$32,251
 $13,404
$12
$13,416
$—
$14,986
$266
$15,252
 $6,461
$6
$6,467
Firm-administered multi-seller conduits—
24,411
300
24,711
 4,842
33
4,875
1
25,183
355
25,539
 9,223
36
9,259
Municipal bond vehicles1,779
—
4
1,783
 1,685
3
1,688
1,903
—
4
1,907
 1,881
3
1,884
Mortgage securitization entities(a)
53
3,285
40
3,378
 308
161
469
66
2,762
64
2,892
 276
130
406
Other134
—
178
312
 2
103
105
663
—
192
855
 —
272
272
Total$1,966
$59,456
$1,013
$62,435
 $20,241
$312
$20,553
$2,633
$42,931
$881
$46,445
 $17,841
$447
$18,288
(a)Includes residential and commercial mortgage securitizations.
(b)Includes assets classified as cash and other assets on the Consolidated balance sheets.
(c)The assets of the consolidated VIEs included in the program types above are used to settle the liabilities of those entities. The assets and liabilities include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation.
(d)The interest-bearing beneficial interest liabilities issued by consolidated VIEs are classified in the line item on the Consolidated balance sheets titled, “Beneficial interests issued by consolidated variable interest entities.” The holders of these beneficial interests generally do not have recourse to the general credit of JPMorgan Chase. Refer to noteNote 14 of JPMorgan Chase’s 20182019 Form 10-K for conduits program-wide credit enhancements. Included in beneficial interests in VIE assets are long-term beneficial interests of $6.8$6.0 billion and $13.7$6.7 billion at SeptemberJune 30, 2019,2020, and December 31, 2018.2019, respectively.
(e)Includes liabilities classified as accounts payable and other liabilities on the Consolidated balance sheets.
VIEs sponsored by third parties
The Firm enters into transactions with VIEs structured by other parties. These include, for example, acting as a derivative counterparty, liquidity provider, investor, underwriter, placement agent, remarketing agent, trustee or custodian. These transactions are conducted at arm’s-length, and individual credit decisions are based on the analysis of the specific VIE, taking into consideration the quality of the underlying assets. Where the Firm does not have the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, or a variable interest that could potentially be significant, the Firm generally does not consolidate the VIE, but it records and reports these positions on its Consolidated balance sheets in the same manner it would record and report positions in respect of any other third-party transaction.
Tax credit vehicles
The Firm holds investments in unconsolidated tax credit vehicles, which are limited partnerships and similar entities that construct, own and operate affordable housing, wind, solarenergy, and other alternative energy projects. These entities are primarily considered VIEs. A third party is typically the general partner or managing
 
general partner or managing member and has control over the significant activities of the tax credit vehicles, and accordingly the Firm does not consolidate tax credit vehicles. The Firm generally invests in these partnerships as a limited partner and earns a return primarily through the receipt of tax credits allocated to the projects. The maximum loss exposure, represented by equity investments and funding commitments, was $17.0$21.0 billion and $16.5$19.1 billion, of which $4.8$6.1 billion and $4.0$5.5 billion was unfunded at SeptemberJune 30, 20192020 and December 31, 2018,2019, respectively. In order to reduce the risk of loss, the Firm assesses each project and withholds varying amounts of its capital investment until the project qualifies for tax credits. Refer to Note 2425 of JPMorgan Chase’s 20182019 Form 10-K for further information on affordable housing tax credits. Refer to Note 2223 of this Form 10-Q for more information on off-balance sheet lending-related commitments.

Customer municipal bond vehicles (TOB trusts)
The Firm may provide various services to Customercustomer TOB trusts, including remarketing agent, liquidity or tender option provider. In certain Customercustomer TOB transactions, the

Firm, as liquidity provider, has entered into a reimbursement agreement with the Residual holder.
In those transactions, upon the termination of the vehicle, the Firm has recourse to the third-party Residual holders for any shortfall. The Firm does not have any intent to protect Residual holders from potential losses on any of the underlying municipal bonds. The Firm does not consolidate Customercustomer TOB trusts, since the Firm does not have the power to make decisions that significantly impact the economic performance of the municipal bond vehicle.
The Firm’s maximum exposure as a liquidity provider to Customercustomer TOB trusts at SeptemberJune 30, 20192020 and
December 31, 20182019 was $5.3$6.1 billion and $4.8$5.5 billion, respectively. The fair value of assets held by such VIEs at SeptemberJune 30, 20192020 and December 31, 2018,2019, was $8.6$9.7 billion and $7.7$8.6 billion, respectively. Refer to Note 2223 for more information on off-balance sheet lending-related commitments.
Loan securitizations
The Firm has securitized and sold a variety of loans, including residential mortgage, credit card, and commercial mortgage. Refer to Note 14 of JPMorgan Chase’s 20182019 Form 10-K for a further description of the Firm’s accounting policies regarding securitizations.
Securitization activity
The following table provides information related to the Firm’s securitization activities for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, related to assets held in Firm-sponsored securitization entities that were not consolidated by the Firm, and where sale accounting was achieved at the time of the securitization.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
2019 2018 2019 20182020 2019 2020 2019
(in millions)
Residential mortgage(e)
Commercial and other(f)
 
Residential mortgage(e)
Commercial and other(f)
 
Residential mortgage(e)
Commercial and other(f)
 
Residential mortgage(e)
Commercial and other(f)
Residential mortgage(d)
Commercial and other(e)
 
Residential mortgage(d)
Commercial and other(e)
 
Residential mortgage(d)
Commercial and other(e)
 
Residential mortgage(d)
Commercial and other(e)
Principal securitized$3,225
$1,477
 $1,513
$3,533
 $7,132
$4,215
 $5,972
$8,705
$534
$861
 $2,125
$1,974
 $3,598
$4,049
 $3,907
$2,738
All cash flows during the period(a):
       
All cash flows during the period:(a)
       
Proceeds received from loan sales as financial instruments(b)(c)
$3,327
$1,506
 $1,524
$3,558
 $7,337
$4,329
 $5,984
$8,745
$554
$912
 $2,188
$2,041
 $3,690
$4,185
 $4,010
$2,823
Servicing fees collected(d)
70
—
 80
1
 220
1
 240
1
49
—
 73
1
 111
—
 150
1
Cash flows received on interests115
34
 99
99
 314
183
 328
230
214
31
 114
98
 331
60
 199
149
(a)Excludes re-securitization transactions.
(b)Predominantly includes Level 2 assets.
(c)The carrying value of the loans accounted for at fair value approximated the proceeds received upon loan sale.
(d)The prior period amounts have been revised to conform with the current period presentation.
(e)Includes prime mortgages only. Excludes loan securitization activity related to U.S. GSEs and government agencies.
(f)(e)Includes commercial mortgage and other consumer loans.
Loans and excess MSRs sold to U.S. government-sponsored
enterprises and loans in securitization transactions pursuant to
Ginnie Mae guidelines
In addition to the amounts reported in the securitization activity tables above, the Firm, in the normal course of business, sells originated and purchased mortgage loans and certain originated excess MSRs on a nonrecourse basis, predominantly to U.S. GSEs. These loans and excess MSRs are sold primarily for the purpose of securitization by the U.S. GSEs, who provide certain guarantee provisions (e.g., credit enhancement of the loans). The Firm also sells loans into securitization transactions pursuant to Ginnie Mae guidelines; these loans are typically insured or guaranteed by another U.S. government agency. The Firm does not consolidate the securitization vehicles underlying these transactions as it is not the primary beneficiary. For a limited number of loan sales, the Firm is obligated to share
 
a portion of the credit risk associated with the sold loans with the purchaser. Refer to Note 2223 of this Form 10-Q, and Note 2728 of JPMorgan Chase’s 20182019 Form 10-K for additional information about the Firm’s loan sales- and securitization-related indemnifications. Refer to Note 1415 for additional information about the impact of the Firm’s sale of certain excess MSRs.


The following table summarizes the activities related to loans sold to the U.S. GSEs, and loans in securitization transactions pursuant to Ginnie Mae guidelines.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
2018
 201920182020
2019
 20202019
Carrying value of loans sold$35,556
$11,968
 $73,873
$28,804
$17,447
$23,138
 $42,382
$38,317
Proceeds received from loan sales as cash3
1
 73
1
13
2
 22
70
Proceeds from loan sales as securities(a)(b)
35,512
11,713
 73,172
28,291
17,274
22,823
 41,937
37,660
Total proceeds received from loan sales(c)
$35,515
$11,714
 $73,245
$28,292
$17,287
$22,825
 $41,959
$37,730
Gains on loan sales(d)(e)
$342
$9
 $495
$32
Gains/(losses) on loan sales(d)(e)
$2
$104
 $6
$153
(a)Includes securities from U.S. GSEs and Ginnie Mae that are generally sold shortly after receipt or retained as part of the Firm’s Investmentinvestment securities portfolio.
(b)Included in level 2 assets.
(c)Excludes the value of MSRs retained upon the sale of loans.
(d)GainsGains/(losses) on loan sales include the value of MSRs.
(e)The carrying value of the loans accounted for at fair value approximated the proceeds received upon loan sale.
Options to repurchase delinquent loans
In addition to the Firm’s obligation to repurchase certain loans due to material breaches of representations and warranties as discussed in Note 22,23, the Firm also has the option to repurchase delinquent loans that it services for
Ginnie Mae loan pools, as well as for other U.S. government
agencies under certain arrangements. The Firm typically elects to repurchase delinquent loans from Ginnie Mae loan pools as it continues to service them and/or manage the foreclosure process in accordance with the applicable requirements, and such loans continue to be insured or guaranteed. When the Firm’s repurchase option becomes exercisable, such loans must be reported on the Consolidated balance sheets as a loan with a corresponding liability. Refer to Note 1112 for additional information.
The following table presents loans the Firm repurchased or had an option to repurchase, real estate owned, and foreclosed government-guaranteed residential mortgage loans recognized on the Firm’s Consolidated balance sheets as of SeptemberJune 30, 20192020 and December 31, 2018.2019. Substantially all of these loans and real estate are insured or guaranteed by U.S. government agencies.
(in millions)Sep 30,
2019
Dec 31,
2018
Jun 30,
2020
Dec 31,
2019
Loans repurchased or option to repurchase(a)
$4,761
$7,021
$1,523
$2,941
Real estate owned50
75
13
41
Foreclosed government-guaranteed residential mortgage loans(b)
241
361
92
198
(a)Predominantly all of these amounts relate to loans that have been repurchased from Ginnie Mae loan pools.
(b)Relates to voluntary repurchases of loans, which are included in accrued interest and accounts receivable.

Loan delinquencies and liquidation losses
The table below includes information about components of and delinquencies related to nonconsolidated securitized financial assets held in Firm-sponsored private-label securitization entities, in which the Firm has continuing involvement and delinquencies as of SeptemberJune 30, 2019,2020, and December 31, 2018.2019.
    
Net liquidation losses(a)
    Net liquidation losses
Securitized assets 90 days past due Three months ended September 30, Nine months ended September 30,Securitized assets 90 days past due Three months ended June 30, Six months ended June 30,
(in millions)Sep 30,
2019
Dec 31,
2018
 Sep 30,
2019
Dec 31,
2018
 2019
2018
 2019
2018
Jun 30,
2020
Dec 31,
2019
 Jun 30,
2020
Dec 31,
2019
 2020
2019
 2020
2019
Securitized loans              
Residential mortgage:              
Prime / Alt-A & option ARMs$49,826
$50,679
 $2,679
$3,354
 $146
$182
 $474
$453
$44,492
$48,734
 $2,725
$2,449
 $76
$171
 $175
$328
Subprime14,085
15,434
 1,962
2,478
 145
155
 456
(307)12,859
13,490
 1,766
1,813
 49
167
 135
311
Commercial and other86,302
79,387
 153
225
 118
71
 283
119
94,321
80,878
 401
187
 1
24
 11
165
Total loans securitized$150,213
$145,500
 $4,794
$6,057
 $409
$408
 $1,213
$265
$151,672
$143,102
 $4,892
$4,449
 $126
$362
 $321
$804

(a)Includes liquidation gains as a result of private label mortgage settlement payments during the first quarter of 2018, which were reflected as asset recoveries by trustees.



Note 1415 – Goodwill and Mortgage servicing rights
Refer to Note 15 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the accounting policies related to goodwill and mortgage servicing rights.
Goodwill
The following table presents goodwill attributed to the business segments.
(in millions)September 30,
2019
December 31,
2018
June 30,
2020
December 31,
2019
Consumer & Community Banking(a)$31,038
$30,984
$30,082
$30,082
Corporate & Investment Bank(a)6,941
6,770
7,889
7,901
Commercial Banking2,982
2,860
2,985
2,982
Asset & Wealth Management6,857
6,857
6,855
6,858
Total goodwill$47,818
$47,471
$47,811
$47,823

(a)In the first quarter of 2020, the Merchant Services business was realigned from CCB to CIB, including the associated Goodwill of $959 million. Prior-period amounts have been revised to conform with the current presentation.
The following table presents changes in the carrying amount of goodwill.
Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions)2019
 2018
 2019
 2018
2020
 2019
 2020
 2019
Balance at beginning
of period
$47,477
 $47,488
 $47,471
 $47,507
$47,800
 $47,474
 $47,823
 $47,471
Changes during the period from:              
Business combinations(a)
348
 —
 348
 —
Other(b)
(7) (5) (1) (24)
Balance at September 30,$47,818
 $47,483
 $47,818
 $47,483
Other(a)
11
 3
 (12) 6
Balance at June 30,$47,811
 $47,477
 $47,811
 $47,477
(a)For the three and nine months periods ended September 30, 2019, represents goodwill associated with the July 24, 2019 acquisition of InstaMed. This goodwill was allocated to CIB, CB and CCB.
(b)Primarily relates to foreign currency adjustments.
 
Goodwill impairment testing
Effective January 1, 2020, the Firm adopted new accounting guidance related to goodwill impairment testing. The adoption of the guidance requires recognition of an impairment loss when the estimated fair value of a reporting unit falls below its carrying value. It eliminated the requirement that an impairment loss be recognized only if the estimated implied fair value of the goodwill is below its carrying value. Refer to Impairment testing on pages 252–253Note 15 of JPMorgan Chase’s 20182019 Form 10-K for a further descriptiondiscussion of the Firm’s goodwill impairment testing, including the primary method used to estimate the fair value of the reporting units and the assumptions used in the goodwill impairment test.
The Firm reviewed current economic conditions, estimated market cost of equity, as well as actual and projections of business performanceGoodwill is tested for all its businesses. Based upon such reviews, the Firm concluded that the goodwill allocated to its reporting units was not impaired as of September 30, 2019 or December 31, 2018, nor was goodwill written off due to impairment during the nine months ended September 30, 2019fourth quarter of each fiscal year, or 2018.more often if events or circumstances, such as adverse changes in the business climate, indicate that there may be an impairment.  
DeclinesUnanticipated declines in business performance, increases in credit losses, increases in capital requirements, as well as deterioration in economic or market conditions, adverse regulatory or legislative changes or increases in the estimated market cost of equity, could cause the estimated fair values of the Firm’s reporting units or their associated goodwill to decline in the future, which could result in a material impairment charge to earnings in a future period related to some portion of the associated goodwill.
As of June 30, 2020, the Firm reviewed current economic conditions, including the potential impacts of the COVID-19 pandemic on business performance, estimated market cost of equity, and also reviewed actuals and projections of business performance for all its reporting units. The Firm has concluded that the goodwill allocated to its reporting units was 0t impaired as of June 30, 2020, or December 31, 2019, nor was goodwill written off due to impairment during the six months ended June 30, 2020 or 2019.


Mortgage servicing rights
MSRs represent the fair value of expected future cash flows for performing servicing activities for others. The fair value considers estimated future servicing fees and ancillary revenue, offset by estimated costs to service the loans, and generally declines over time as net servicing cash flows are received, effectively amortizing the MSR asset against contractual servicing and ancillary fee income. MSRs are either purchased from third parties or recognized upon sale or securitization of mortgage loans if servicing is retained. Refer to Notes 2 and 15 of JPMorgan Chase’s 20182019 Form 10-K for a further description of the MSR asset, interest rate risk management, and the valuation of MSRs.
The following table summarizes MSR activity for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
As of or for the three months
ended September 30,		As of or for the nine months
ended September 30,		As of or for the three months
ended June 30,		 As of or for the six months
ended June 30,
(in millions, except where otherwise noted)2019
2018
2019
 2018
2020
2019
 2020
2019
 
Fair value at beginning of period$5,093
$6,241
$6,130
 $6,030
$3,267
$5,957
  $4,699
$6,130
 
MSR activity:       
Originations of MSRs390
278
1,146
 611
164
424
 435
756
 
Purchase of MSRs(2)13
104
 159
5
2
 7
106
 
Disposition of MSRs(a)
(359)(2)(687) (401)2
(217) (73)(328) 
Net additions/(dispositions)29
289
563
 369
171
209
 369
534
 
       
Changes due to collection/realization of expected cash flows(256)(195)(702) (542)(247)(247) (495)(446) 
       
Changes in valuation due to inputs and assumptions:       
Changes due to market interest rates and other(b)
(433)150
(1,274) 635
(144)(540) (1,514)(841) 
Changes in valuation due to other inputs and assumptions:       
Projected cash flows (e.g., cost to service)17
14
(333)
(e) 
14
3
(350)
(e) 
 2
(350)
(e) 
Discount rates—
—
153
 24
—
153
 —
153
 
Prepayment model changes and other(c)
(31)(66)(118) (97)30
(89)  19
(87) 
Total changes in valuation due to other inputs and assumptions(14)(52)(298) (59)33
(286)  21
(284) 
Total changes in valuation due to inputs and assumptions(447)98
(1,572) 576
(111)(826) (1,493)(1,125) 
Fair value at September 30,$4,419
$6,433
$4,419
 $6,433
Fair value at June 30$3,080
$5,093
 $3,080
$5,093
 
       
Change in unrealized gains/(losses) included in income related to MSRs held at September 30,$(447)$98
$(1,572) $576
Changes in unrealized gains/(losses) included in income related to MSRs held at June 30$(111)$(826) $(1,493)$(1,125) 
Contractual service fees, late fees and other ancillary fees included in income397
428
1,254
 1,339
329
437
  693
857
 
Third-party mortgage loans serviced at September 30, (in billions)537
528
537
 528
Servicer advances, net of an allowance for uncollectible amounts, at September 30, (in billions)(d)
2.0
3.1
2.0
 3.1
Third-party mortgage loans serviced at June 30 (in billions)483
527
 483
527
 
Servicer advances, net of an allowance for uncollectible amounts, at June 30 (in billions)(d)
1.7
2.2
  1.7
2.2
 
(a)Includes excess MSRs transferred to agency-sponsored trusts in exchange for stripped mortgage backed securities (“SMBS”). In each transaction, a portion of the SMBS was acquired by third parties at the transaction date; the Firm acquired the remaining balance of those SMBS as trading securities.
(b)Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments.
(c)Represents changes in prepayments other than those attributable to changes in market interest rates.
(d)Represents amounts the Firm pays as the servicer (e.g., scheduled principal and interest, taxes and insurance), which will generally be reimbursed within a short period of time after the advance from future cash flows from the trust or the underlying loans. The Firm’s credit risk associated with these servicer advances is minimal because reimbursement of the advances is typically senior to all cash payments to investors. In addition, the Firm maintains the right to stop payment to investors if the collateral is insufficient to cover the advance. However, certain of these servicer advances may not be recoverable if they were not made in accordance with applicable rules and agreements.
(e)The decrease in projected cash flows was largely related to default servicing assumption updates.


The following table presents the components of mortgage fees and related income (including the impact of MSR risk management activities) for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
 Three months ended September 30, Nine months ended September 30,Three months ended June 30, Six months ended June 30,
(in millions) 2019
 2018
 2019
 2018
2020
2019
 2020
2019
CCB mortgage fees and related income        
        
Net production revenue $738
 $108
 $1,291
 $296
$742
$353
 $1,061
$553
           
Net mortgage servicing revenue:           
Operating revenue:           
Loan servicing revenue 351
 435
 1,172
 1,389
343
417
 682
821
Changes in MSR asset fair value due to collection/realization of expected cash flows (256) (195) (702) (542)(247)(247) (495)(446)
Total operating revenue 95
 240
 470
 847
96
170
 187
375
Risk management:           
Changes in MSR asset fair value due to market interest rates and other(a)
 (433) 150
 (1,274) 636
(144)(540) (1,514)(841)
Other changes in MSR asset fair value due to other inputs and assumptions
in model(b)
 (14) (52) (298) (59)33
(286) 21
(284)
Change in derivative fair value and other 500
 (186) 1,372
 (671)
Changes in derivative fair value and other190
582
 1,482
872
Total risk management 53
 (88) (200) (94)79
(244) (11)(253)
Total net mortgage servicing revenue 148
 152
 270
 753
175
(74) 176
122
        
Total CCB mortgage fees and related income 886
 260
 1,561
 1,049
        
All other 1
 2
 1
 2
Mortgage fees and related income $887
 $262
 $1,562
 $1,051
$917
$279
 $1,237
$675
(a)Represents both the impact of changes in estimated future prepayments due to changes in market interest rates, and the difference between actual and expected prepayments.
(b)Represents the aggregate impact of changes in model inputs and assumptions such as projected cash flows (e.g., cost to service), discount rates and changes in prepayments other than those attributable to changes in market interest rates (e.g., changes in prepayments due to changes in home prices).
The table below outlines the key economic assumptions used to determine the fair value of the Firm’s MSRs at SeptemberJune 30, 2019,2020, and December 31, 2018,2019, and outlines hypothetical sensitivities of those fair values to immediate adverse changes in those assumptions, as defined below.
(in millions, except rates)(in millions, except rates)Sep 30,
2019
 Dec 31,
2018
(in millions, except rates)Jun 30,
2020
 Dec 31,
2019
Weighted-average prepayment speed assumption (constant prepayment rate)Weighted-average prepayment speed assumption (constant prepayment rate)13.81% 8.78%Weighted-average prepayment speed assumption (constant prepayment rate)19.08% 11.67%
Impact on fair value of 10% adverse changeImpact on fair value of 10% adverse change$(206) $(205)Impact on fair value of 10% adverse change$(207) $(200)
Impact on fair value of 20% adverse changeImpact on fair value of 20% adverse change(393) (397)Impact on fair value of 20% adverse change(391) (384)
Weighted-average option adjusted spread(b)(a)
Weighted-average option adjusted spread(b)(a)
8.26% 7.87%
Weighted-average option adjusted spread(b)(a)
9.10% 7.93%
Impact on fair value of a 100 basis point adverse changeImpact on fair value of a 100 basis point adverse change$(150) $(235)Impact on fair value of a 100 basis point adverse change$(100) $(169)
Impact on fair value of a 200 basis point adverse changeImpact on fair value of a 200 basis point adverse change(289) (452)Impact on fair value of a 200 basis point adverse change(193) (326)

(a)Includes the impact of operational risk and regulatory capital.
(b)The prior period amount has been revised to conform with the current period presentation.
 
Changes in fair value based on variations in assumptions generally cannot be easily extrapolated, because the relationship of the change in the assumptions to the change in fair value are often highly interrelated and may not be linear. In this table, the effect that a change in a particular assumption may have on the fair value is calculated without changing any other assumption. In reality, changes in one factor may result in changes in another, which would either magnify or counteract the impact of the initial change.


Note 1516 – Deposits
Refer to Note 17 of JPMorgan Chase’s 20182019 Form 10-K for further information on deposits.
At SeptemberJune 30, 2019,2020, and December 31, 2018, 2019, noninterest-bearing and interest-bearing deposits were as follows.
(in millions)September 30,
2019
 December 31, 2018
June 30,
2020
 December 31, 2019
U.S. offices      
Noninterest-bearing (included $23,225 and $17,204 at fair value)(a)(b)
$393,522
 $386,709
Interest-bearing (included $2,523 and $2,487 at fair value)(a)(b)
844,137
 813,881
Noninterest-bearing (included $15,512 and $22,637 at fair value)(a)
$529,729
 $395,667
Interest-bearing (included $2,808 and $2,534 at fair value)(a)
1,061,093
 876,156
Total deposits in U.S. offices1,237,659
 1,200,590
1,590,822
 1,271,823
Non-U.S. offices      
Noninterest-bearing (included $2,289 and $2,367 at fair value)(a)(b)
21,455
 21,459
Interest-bearing (included $1,318 and $1,159 at fair value)(a)(b)
266,147
 248,617
Noninterest-bearing (included $1,673 and $1,980 at fair value)(a)
22,752
 20,087
Interest-bearing (included $1,519 and $1,438 at fair value)(a)
317,455
 270,521
Total deposits in non-U.S. offices287,602
 270,076
340,207
 290,608
Total deposits$1,525,261
 $1,470,666
$1,931,029
 $1,562,431
(a)Includes structured notes classified as deposits for which the fair value option has been elected. Refer to Note 3 of JPMorgan Chase’s 2018 Form 10-K for a further discussion.information.
(b)In the second quarter of 2019, the Firm reclassified balances related to certain structured notes from interest-bearing to noninterest-bearing deposits as the associated returns are recorded in principal transactions revenue and not in net interest income. This change was applied retrospectively and, accordingly, prior period amounts were revised to conform with the current presentation.


 
Note 1617 – Leases
Lease commitments
Effective January 1,Refer to Note 18 of JPMorgan Chase’s 2019 the Firm adopted new guidance that requires lessees to recognizeForm 10-K for a further discussion on the Consolidated balance sheets all leases with lease terms greater than twelve months as a lease liability with a corresponding right-of-use (“ROU”) asset. Accordingly, the Firm recognized operating lease liabilities and ROU assets of $8.2 billion and $8.1 billion, respectively. The adoption of the new lease guidance did not have a material impact on the Firm’s Consolidated statements of income. The change in accounting due to the adoption of the new lease guidance did not result in a material change to the future net minimum rental payments/receivables or to the net rental expense when compared to December 31, 2018.leases.
Firm as lessee
At SeptemberJune 30, 2019,2020, JPMorgan Chase and its subsidiaries were obligated under a number of noncancelablenoncancellable leases, predominantly operating leases for premises and equipment used primarily for business purposes. These leases generally have terms of 20 years or less, determined based on the contractual maturity of the lease, and include periods covered by options to extend or terminate the lease when the Firm is reasonably certain that it will exercise those options. None of these lease agreements impose restrictions on the Firm’s ability to pay dividends, engage in debt or equity financing transactions or enter into further lease agreements. Certain of these leases contain escalation clauses that will increase rental payments based on maintenance, utility and tax increases, which are non-lease components. The Firm elected not to separate lease and non-lease components of a contract for its real estate leases. As such, real estate lease payments represent payments on both lease and non-lease components.
Operating lease liabilities and ROU assets are recognized at the lease commencement date based on the present value of the future minimum lease payments over the lease term. The future lease payments are discounted at a rate that represents the Firm’s collateralized borrowing rate for financing instruments of a similar term and are included in accounts payable and other liabilities. The operating lease ROU asset, included in premises and equipment, also includes any lease prepayments made, plus initial direct costs incurred, less any lease incentives received. Rental expense associated with operating leases is recognized on a straight-line basis over the lease term, and generally included in occupancy expense in the Consolidated statements of income.

The following tables providetable provides information related to the Firm’s operating leases:
As of September 30,
(in millions, except where otherwise noted)
 
2019
Right-of-use assets$8,160
Lease liabilities8,425
  
Weighted average remaining lease term (in years)8.7
Weighted average discount rate3.73%
  
Supplemental cash flow information 
Cash paid for amounts included in the measurement of lease liabilities - operating cash flows$1,177
Supplemental non-cash information 
Right-of-use assets obtained in exchange for operating lease obligations$990
  


(in millions)
Three months ended September 30, 2019Nine months ended September 30, 2019
Rental expense  
Gross rental expense$517
$1,537
Sublease rental income(49)(137)
Net rental expense$468
$1,400
(in millions)June 30, 2020December 31, 2019
Right-of-use assets$8,166
$8,190
Lease liabilities8,426
8,505

The following table presents future payments under operating leases as of SeptemberFirm’s net rental expense was $475 million and $464 million for the three months ended June 30, 2019:
Year ended December 31, (in millions) 
2019 (excluding nine months ended September 30, 2019)$394
20201,569
20211,394
20221,198
20231,027
After 20234,442
Total future minimum lease payments10,024
Less: Imputed interest(1,599)
Total$8,425

In addition to the table above, as of September 30, 2019, the Firm had additional future operating lease commitments of $1.3 billion that were signed but had not yet commenced. These operating leases will commence between2020 and 2019, and 2022 with lease terms up to 25 years.$949 million and $932 million for the six months ended June 30, 2020 and 2019.
Firm as lessor
The Firm provides auto and equipment lease financing to its customers through lease arrangements with lease terms that may contain renewal, termination and/or purchase options. Generally, the Firm’s lease financings are generally operating leases. These assetsleases and are recognizedincluded in other assets on the Firm’s Consolidated balance sheets and are depreciated on a straight-line basis over the lease term to reduce the asset to its estimated residual value. Depreciation expense is included in technology, communications and equipment
expense in the Consolidated statements of income. The Firm’s lease income is generally recognized on a straight-line basis over the lease term and is included in other income in the Consolidated statements of income.sheets.
On a periodic basis, the Firm assesses leased assets for impairment, and if the carrying amount of the leased asset exceeds the undiscounted cash flows from the lease payments and the estimated residual value upon disposition of the leased asset, an impairment loss is recognized.
The risk of loss on auto and equipment leased assets relating to the residual value of the leased assets is monitored through projections of the asset residual values at lease origination and periodic review of residual values, and is mitigated through arrangements with certain manufacturers or lessees. 
The following table presents the carrying value of assets subject to leases reported on the Consolidated balance sheets:
(in millions) September 30, 2019December 31, 2018
Carrying value of assets subject to operating leases, net of accumulated depreciation $22,953
$21,428
Accumulated depreciation 5,848
5,303

The following table presents the Firm’s operating lease income, included within other income, and the related depreciation expense, included within technology, communications and equipment expense, on the Consolidated statements of income:
 Three months ended September 30,Nine months ended September 30, Three months ended June 30,Six months
ended June 30,

(in millions)
 2019
2018
2019
2018
 2020
2019
2020
2019
Operating lease income $1,384
$1,157
$4,027
$3,316
 $1,413
$1,327
$2,810
$2,643
Depreciation expense 1,053
901
3,038
2,564
 1,084
988
2,224
1,985

The following table presents future receipts under operating leases as of September 30, 2019:
Year ended December 31, (in millions) 
2019 (excluding nine months ended September 30, 2019)$1,121
20203,785
20212,303
2022660
202374
After 2023137
Total future minimum lease payments$8,080



Note 1718 - Preferred stock
Refer to Note 2021 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion on preferred stock.
The following is a summary of JPMorgan Chase’s non-cumulative preferred stock outstanding as of SeptemberJune 30, 20192020 and December 31, 2018,2019, and the quarterly dividend declarations for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
 Shares
Carrying value
 (in millions)
 Contractual rate in effect at June 30, 2020Earliest redemption dateFloating annualized rate of three-month LIBOR/Term SOFR plus:
Dividend declared
per share
 
 June 30, 2020December 31, 2019June 30, 2020December 31, 2019Issue dateThree months ended June 30,Six months ended June 30, 
 2020201920202019 
Fixed-rate:             
Series P—
—
$—
$—
2/5/2013—%3/1/2018NA$—$136.25$—$272.50 
Series T—
—
—
—
1/30/2014—
3/1/2019NA———167.50 
Series W—
—
—
—
6/23/2014—
9/1/2019NA—157.50—315.00 
Series Y—
143,000
—
1,430
2/12/2015—
3/1/2020NA—153.13153.13306.26 
Series AA142,500
142,500
1,425
1,425
6/4/20156.100
9/1/2020NA152.50152.50305.00305.00 
Series BB115,000
115,000
1,150
1,150
7/29/20156.150
9/1/2020NA153.75153.75307.50307.50 
Series DD169,625
169,625
1,696
1,696
9/21/20185.750
12/1/2023NA143.75143.75287.50287.50 
Series EE185,000
185,000
1,850
1,850
1/24/20196.000
3/1/2024NA150.00211.67300.00211.67 
Series GG90,000
90,000
900
900
11/7/20194.750
12/1/2024NA118.75NA269.17NA 
Fixed-to-floating-rate:             
Series I293,375
293,375
$2,934
$2,934
4/23/2008LIBOR + 3.47%
4/30/2018LIBOR + 3.47%$106.93$153.00$239.37$308.51 
Series Q150,000
150,000
1,500
1,500
4/23/20135.150
5/1/2023LIBOR + 3.25128.75128.75257.50257.50 
Series R150,000
150,000
1,500
1,500
7/29/20136.000
8/1/2023LIBOR + 3.30150.00150.00300.00300.00 
Series S200,000
200,000
2,000
2,000
1/22/20146.750
2/1/2024LIBOR + 3.78168.75168.75337.50337.50 
Series U100,000
100,000
1,000
1,000
3/10/20146.125
4/30/2024LIBOR + 3.33153.13153.13306.25306.25 
Series V250,000
250,000
2,500
2,500
6/9/2014LIBOR + 3.32
7/1/2019LIBOR + 3.32120.16125.00250.89250.00
(a) 
Series X160,000
160,000
1,600
1,600
9/23/20146.100
10/1/2024LIBOR + 3.33152.50152.50305.00305.00 
Series Z200,000
200,000
2,000
2,000
4/21/2015LIBOR + 3.80
5/1/2020LIBOR + 3.80117.15132.50249.65265.00
(b) 
Series CC125,750
125,750
1,258
1,258
10/20/20174.625
11/1/2022LIBOR + 2.58115.63115.63231.25231.25 
Series FF225,000
225,000
2,250
2,250
7/31/20195.000
8/1/2024SOFR + 3.38125.00NA250.00NA 
Series HH300,000
—
3,000
—
1/23/20204.600
2/1/2025SOFR + 3.125115.00NA240.22NA 
Series II150,000
—
1,500
—
2/24/20204.000
4/1/2025SOFR + 2.745141.11NA141.11NA
(c) 
Total preferred stock3,006,250
2,699,250
$30,063
$26,993
         
 Shares
Carrying value
 (in millions)
 Contractual rate in effect at September 30, 2019
Earliest redemption date(b)
Floating annualized rate of three-month LIBOR/Term SOFR plus:
Dividend declared per share(c)
 
 
September 30, 2019(a)
December 31, 2018(a)
September 30, 2019December 31, 2018Issue dateThree months ended September 30,Nine months ended September 30, 
 2019201820192018 
Fixed-rate:             
Series P90,000
90,000
$900
$900
2/5/20135.450%3/1/2018NA$136.25
$136.25$408.75
$408.75 
Series T—
92,500
—
925
1/30/2014—
3/1/2019NANA167.50167.50502.50 
Series W—
88,000
—
880
6/23/2014—
9/1/2019NANA157.50472.50472.50 
Series Y143,000
143,000
1,430
1,430
2/12/20156.125
3/1/2020NA153.13
153.13459.39459.39 
Series AA142,500
142,500
1,425
1,425
6/4/20156.100
9/1/2020NA152.50
152.50457.50457.50 
Series BB115,000
115,000
1,150
1,150
7/29/20156.150
9/1/2020NA153.75
153.75461.25461.25 
Series DD169,625
169,625
1,696
1,696
9/21/20185.750
12/1/2023NA143.75
NA431.25NA 
Series EE185,000
—
1,850
—
1/24/20196.000
3/1/2024NA150.00
NA361.67NA 
              
Fixed-to-floating-rate:             
Series I430,375
430,375
$4,304
$4,304
4/23/2008LIBOR + 3.47%
4/30/2018LIBOR + 3.47%$146.58
$148.45$455.09
$493.29
(d) 
Series Q150,000
150,000
1,500
1,500
4/23/20135.150
5/1/2023LIBOR + 3.25128.75
128.75386.25386.25 
Series R150,000
150,000
1,500
1,500
7/29/20136.000
8/1/2023LIBOR + 3.30150.00
150.00450.00450.00 
Series S200,000
200,000
2,000
2,000
1/22/20146.750
2/1/2024LIBOR + 3.78168.75
168.75506.25506.25 
Series U100,000
100,000
1,000
1,000
3/10/20146.125
4/30/2024LIBOR + 3.33153.13
153.13459.38459.38 
Series V250,000
250,000
2,500
2,500
6/9/2014LIBOR + 3.32%
7/1/2019LIBOR + 3.32144.11
125.00394.11375.00
(e) 
Series X160,000
160,000
1,600
1,600
9/23/20146.100
10/1/2024LIBOR + 3.33152.50
152.50457.50457.50 
Series Z200,000
200,000
2,000
2,000
4/21/20155.300
5/1/2020LIBOR + 3.80132.50
132.50397.50397.50 
Series CC125,750
125,750
1,258
1,258
10/20/20174.625
11/1/2022LIBOR + 2.58115.63
115.63346.88346.88 
Series FF225,000
—
2,250
—
7/31/20195.000
8/1/2024SOFR + 3.38126.39
NA126.39NA
(f) 
Total preferred stock2,836,250
2,606,750
$28,363
$26,068
         

(a)Represented by depositary shares.
(b)Fixed-to-floating rate notes convert to a floating rate at the earliest redemption date.
(c)Dividends are declared quarterly. Dividends are payable quarterly on fixed-rate preferred stock. Dividends are payable semiannually on fixed-to-floating-rate preferred stock while at a fixed rate, and payable quarterly after converting to a floating rate.
(d)Prior to April 30, 2018, the dividend rate was fixed at 7.90%.
(e)Prior to July 1, 2019, the dividend rate was fixed at 5%.
(f)(b)Prior to May 1, 2020, the dividend rate was fixed at 5.3%.
(c)Dividends in the amount of $126.39$141.11 per share were declared on September 9, 2019May 15, 2020 and include dividends from the original issue date of July 31, 2019February 24, 2020 through October 31, 2019.June 30, 2020.

Each series of preferred stock has a liquidation value and redemption price per share of $10,000, plus accrued but unpaid dividends. The aggregate liquidation value was $30.5 billion at June 30, 2020.
Redemptions
On October 31, 2019,March 1, 2020, the Firm announced and priced an offeringredeemed all $1.43 billion of depositary shares representing $900 million of 4.75% non-cumulativeits 6.125% preferred stock, Series GG. This issuance is expected to close on November 7, 2019. Y.
On NovemberDecember 1, 2019, the Firm announced that it will redeemredeemed all $900 million of its 5.45% non-cumulative preferred stock, Series P on December 1, 2019.P.
On October 30, 2019, the Firm redeemed $1.37 billion of its Series I fixed-to-floating rate non-cumulative perpetual preferred stock.stock, Series I.
On September 1, 2019, the Firm redeemed all $880 million of its 6.3% non-cumulative preferred stock, series W.
On July 31, 2019, the Firm issued $2.25 billion of fixed-to-floating rate non-cumulative6.30% preferred stock, Series FF.W.
On January 24, 2019, the Firm issued $1.85 billion of 6.00% non-cumulative preferred stock, Series EE, and on March 1, 2019, the Firm redeemed all $925 million of its 6.70% non-cumulative preferred stock, Series T.



Note 1819 – Earnings per share
Refer to Note 2223 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the computation of basic and diluted earnings per share (“EPS”). The following table presents the calculation of basic and diluted EPS for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018.2019.
(in millions, except per share amounts)Three months ended
September 30,		 Nine months ended
September 30,		Three months ended
June 30,		 Six months ended
June 30,
2019
2018
 2019
2018
2020
2019
 2020
2019
Basic earnings per share      
Net income$9,080
$8,380
 $27,911
$25,408
$4,687
$9,652
 $7,552
$18,831
Less: Preferred stock dividends423
379
 1,201
1,167
401
404
 822
778
Net income applicable to common equity8,657
8,001
 26,710
24,241
4,286
9,248
 6,730
18,053
Less: Dividends and undistributed earnings allocated to participating securities51
53
 159
174
21
56
 32
108
Net income applicable to common stockholders$8,606
$7,948
 $26,551
$24,067
$4,265
$9,192
 $6,698
$17,945
      
Total weighted-average basic shares
outstanding
3,198.5
3,376.1
 3,248.7
3,416.5
3,076.3
3,250.6
 3,086.1
3,274.3
Net income per share$2.69
$2.35
 $8.17
$7.04
$1.39
$2.83
 $2.17
$5.48
      
Diluted earnings per share      
Net income applicable to common stockholders$8,606
$7,948
 $26,551
$24,067
$4,265
$9,192
 $6,698
$17,945
Total weighted-average basic shares
outstanding
3,198.5
3,376.1
 3,248.7
3,416.5
3,076.3
3,250.6
 3,086.1
3,274.3
Add: Employee stock options, SARs, warrants and unvested PSUs8.7
18.2
 9.3
19.7
Add: Dilutive impact of SARs and employee stock options, unvested PSUs and nondividend-earning RSUs4.7
9.1
 4.7
9.6
Total weighted-average diluted shares outstanding3,207.2
3,394.3
 3,258.0
3,436.2
3,081.0
3,259.7
 3,090.8
3,283.9
Net income per share$2.68
$2.34
 $8.15
$7.00
$1.38
$2.82
 $2.17
$5.46



Note 1920 – Accumulated other comprehensive income/(loss)
AOCI includes the after-tax change in unrealized gains and losses on investment securities, foreign currency translation adjustments (including the impact of related derivatives), fair value changes of excluded components on fair value hedges, cash flow hedging activities, net loss and prior service costs/(credit) related to the Firm’s defined benefit pension and OPEB plans, and on fair value option-elected liabilities arising from changes in the Firm’s own credit risk (DVA).
 As of or for the three months ended
September 30, 2019
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit
pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at July 1, 2019 $3,709
   $(652)  $(73) $126
   $(2,231)  $235
  $1,114
 
 Net change 479
   (165)  (1) 195
   46
  132
  686
 
 Balance at September 30, 2019 $4,188
   $(817)  $(74) $321
   $(2,185)  $367
  $1,800
 
                        
 As of or for the three months ended
September 30, 2018
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at July 1, 2018 $1,599
   $(632)  (162) $(147)   $(1,876)  $80
  $(1,138) 
 Net change (819)   (31)  34
 (88)   19
  (402)  (1,287) 
 Balance at September 30, 2018 $780
   $(663)  $(128) $(235)   $(1,857)  $(322)  $(2,425) 
                        
 As of or for the nine months ended
September 30, 2019
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit
pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at January 1, 2019 $1,202
   $(727)  $(161) $(109)   $(2,308)  $596
  $(1,507) 
 Net change 2,986
   (90)  87
 430
   123
  (229)  3,307
 
 Balance at September 30, 2019 $4,188
   $(817)  $(74) $321
   $(2,185)  $367
  $1,800
 
                        
 As of or for the nine months ended
September 30, 2018
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at January 1, 2018 $2,164
   $(470)  $—
 $76
   $(1,521)  $(368)  $(119) 
 
Cumulative effect of changes in accounting principles(a)
 896
   (277)  $(54) 16
   (414)  (79)  88
 
 Net change (2,280)   84
  (74) (327)   78
  125
  (2,394) 
 Balance at September 30, 2018 $780
   $(663)  $(128) $(235)   $(1,857)  $(322)  $(2,425) 
 As of or for the three months ended
June 30, 2020
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit
pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at April 1, 2020 $5,176
   $(1,037)  $(43) $2,528
   $(1,311)  $2,105
  $7,418
 
 Net change 2,744
   142
  16
 234
   (7)  (1,758)  1,371
 
 Balance at June 30, 2020 $7,920
(a) 

  $(895)  $(27) $2,762
   $(1,318)  $347
  $8,789
 
                        
 As of or for the three months ended
June 30, 2019
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at April 1, 2019 $2,616
   $(751)  (159) $29
   $(2,272)  $(21)  $(558) 
 Net change 1,093
   99
  86
 97
   41
  256
  1,672
 
 Balance at June 30, 2019 $3,709
   $(652)  $(73) $126
   $(2,231)  $235
  $1,114
 
                        
 As of or for the six months ended
June 30, 2020
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit
pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at January 1, 2020 $4,057
   $(707)  $(131) $63
   $(1,344)  $(369)  $1,569
 
 Net change 3,863
   (188)  104
 2,699
   26
  716
  7,220
 
 Balance at June 30, 2020 $7,920
(a) 

  $(895)  $(27) $2,762
   $(1,318)  $347
  $8,789
 
                        
 As of or for the six months ended
June 30, 2019
(in millions)		Unrealized
gains/(losses)
on investment securities		 Translation adjustments, net of hedges Fair value hedgesCash flow hedges Defined benefit pension and
OPEB plans		DVA on fair value option elected liabilitiesAccumulated other comprehensive income/(loss)
 
 Balance at January 1, 2019 $1,202
   $(727)  $(161) $(109)   $(2,308)  $596
  $(1,507) 
 Net change 2,507
   75
  88
 235
   77
  (361)  2,621
 
 Balance at June 30, 2019 $3,709
   $(652)  $(73) $126
   $(2,231)  $235
  $1,114
 

(a)Represents the adjustmentIncludes after-tax net unamortized unrealized gains of $703 million related to AOCI as a result of the accounting standards adopted in the first quarter of 2018, referAFS securities that have been transferred to Note 1 of JPMorgan Chase’s 2018 Form 10-K.HTM.





The following table presents the pre-tax and after-tax changes in the components of OCI.
2019 20182020 2019
Three months ended September 30,
(in millions)		Pre-tax Tax effect After-tax Pre-tax Tax effect After-tax
Three months ended June 30,
(in millions)		Pre-tax Tax effect After-tax Pre-tax Tax effect After-tax
Unrealized gains/(losses) on investment securities:                      
Net unrealized gains/(losses) arising during the period$708
 $(169) $539
 $(1,117) $262
 $(855)$3,642
 $(878) $2,764
 $1,491
 $(365) $1,126
Reclassification adjustment for realized (gains)/losses included in net income(a)
(78) 18
 (60) 46
 (10) 36
(26) 6
 (20) (44) 11
 (33)
Net change630
 (151) 479
 (1,071) 252
 (819)3,616
 (872) 2,744
 1,447
 (354) 1,093
Translation adjustments:           
Translation adjustments(b):
           
Translation(861) 40
 (821) (314) 45
 (269)405
 46
 451
 123
 72
 195
Hedges866
 (210) 656
 311
 (73) 238
(405) 96
 (309) (128) 32
 (96)
Net change5
 (170) (165) (3) (28) (31)—
 142
 142
 (5) 104
 99
Fair value hedges, net change(b):
(1) —
 (1) 45
 (11) 34
Fair value hedges, net change(c):
21
 (5) 16
 112
 (26) 86
Cash flow hedges:                      
Net unrealized gains/(losses) arising during the period222
 (55) 167
 (122) 27
 (95)402
 (97) 305
 101
 (24) 77
Reclassification adjustment for realized (gains)/losses included in net income(c)
37
 (9) 28
 9
 (2) 7
Reclassification adjustment for realized (gains)/losses included in net income(d)
(93) 22
 (71) 26
 (6) 20
Net change259
 (64) 195
 (113) 25
 (88)309
 (75) 234
 127
 (30) 97
Defined benefit pension and OPEB plans:                      
Net gain/(loss) arising during the period—
 —
 —
 —
 —
 —
—
 —
 —
 (1) —
 (1)
Reclassification adjustments included in net income(d):
           
Reclassification adjustments included in net income(e):
           
Amortization of net loss42
 (10) 32
 26
 (6) 20
3
 (1) 2
 41
 (7) 34
Amortization of prior service cost/(credit)—
 —
 —
 (7) 2
 (5)1
 (2) (1) 1
 (1) —
Foreign exchange and other18
 (4) 14
 7
 (3) 4
(8) —
 (8) 9
 (1) 8
Net change60
 (14) 46
 26
 (7) 19
(4) (3) (7) 50
 (9) 41
DVA on fair value option elected liabilities, net change:173
 (41) 132
 (527) 125
 (402)(2,314) 556
 (1,758) 338
 (82) 256
Total other comprehensive income/(loss)$1,126
 $(440) $686
 $(1,643) $356
 $(1,287)$1,628
 $(257) $1,371
 $2,069
 $(397) $1,672
                      
2019 20182020 2019
Nine months ended September 30,
(in millions)		Pre-tax Tax effect After-tax Pre-tax Tax effect After-tax
Six months ended June 30,
(in millions)		Pre-tax Tax effect After-tax Pre-tax Tax effect After-tax
Unrealized gains/(losses) on investment securities:                      
Net unrealized gains/(losses) arising during the period$4,074
 $(985) $3,089
 $(3,351) $787
 $(2,564)$5,351
 $(1,291) $4,060
 $3,366
 $(816) $2,550
Reclassification adjustment for realized (gains)/losses included in net income(a)
(135) 32
 (103) 371
 (87) 284
(259) 62
 (197) (57) 14
 (43)
Net change3,939
 (953) 2,986
 (2,980) 700
 (2,280)5,092
 (1,229) 3,863
 3,309
 (802) 2,507
Translation adjustments(e):
           
Translation adjustments(b):
           
Translation(697) 76
 (621) (981) 188
 (793)(1,187) 101
 (1,086) 164
 36
 200
Hedges700
 (169) 531
 1,149
 (272) 877
1,184
 (286) 898
 (166) 41
 (125)
Net change3
 (93) (90) 168
 (84) 84
(3) (185) (188) (2) 77
 75
Fair value hedges, net change(b):
114
 (27) 87
 (96) 22
 (74)
Fair value hedges, net change(c):
136
 (32) 104
 115
 (27) 88
Cash flow hedges:                      
Net unrealized gains/(losses) arising during the period464
 (112) 352
 (365) 85
 (280)3,653
 (877) 2,776
 242
 (57) 185
Reclassification adjustment for realized (gains)/losses included in net income(c)
102
 (24) 78
 (62) 15
 (47)
Reclassification adjustment for realized (gains)/losses included in net income(d)
(101) 24
 (77) 65
 (15) 50
Net change566
 (136) 430
 (427) 100
 (327)3,552
 (853) 2,699
 307
 (72) 235
Defined benefit pension and OPEB plans:                      
Net gain/(loss) arising during the period2
 (2) —
 25
 (6) 19
9
 (2) 7
 2
 (2) —
Reclassification adjustments included in net income(d):
           
Reclassification adjustments included in net income(e):
           
Amortization of net loss125
 (26) 99
 78
 (18) 60
7
 (2) 5
 83
 (16) 67
Amortization of prior service cost/(credit)2
 (1) 1
 (19) 5
 (14)2
 (2) —
 2
 (1) 1
Settlement (gain)/loss

—
 —
 —
 —
 —
 —
Foreign exchange and other19
 4
 23
 19
 (6) 13
23
 (9) 14
 1
 8
 9
Net change148
 (25) 123
 103
 (25) 78
41
 (15) 26
 88
 (11) 77
DVA on fair value option elected liabilities, net change:$(296) $67
 $(229) $163
 $(38) $125
$941
 $(225) $716
 $(469) $108
 $(361)
Total other comprehensive income/(loss)$4,474
 $(1,167) $3,307
 $(3,069) $675
 $(2,394)$9,759
 $(2,539) $7,220
 $3,348
 $(727) $2,621
(a)The pre-tax amount is reported in Investment securities gains/(losses)gains in the Consolidated statements of income.
(b)Reclassifications of pre-tax realized gains/(losses) on translation adjustments and related hedges are reported in other income/expense in the Consolidated statements of income. The amounts were 0t material for the three and six months ended June 30, 2020. During the three and six months ended June 30, 2019, the Firm reclassified net pre-tax gains of $6 million to other income and $1 million to other expense, respectively. These amounts, which related to the liquidation of certain legal entities, are comprised of $5 million related to net investment hedge gains and $2 million related to cumulative translation adjustments.
(c)Represents changes in fair value of cross-currency swaps attributable to changes in cross-currency basis spreads, which are excluded from the assessment of hedge effectiveness and recorded in other comprehensive income. The initial cost of cross-currency basis spreads is recognized in earnings as part of the accrual of interest on the cross currency swap.
(c)(d)The pre-tax amounts are predominantlyprimarily recorded in noninterest revenue, net interest income and compensation expense in the Consolidated statements of income.
(d)(e)The pre-tax amount is reported in other expense in the Consolidated statements of income.
(e)Reclassifications of pre-tax realized gains/(losses) on translation adjustments and related hedges are reported in other income/expense in the Consolidated statements of income. During the nine months ended September 30, 2019, the Firm reclassified net pre-tax gains of $6 million to other income and $1 million to other expense, respectively. These amounts, which related to the liquidation of certain legal entities, are comprised of $5 million related to net investment hedge gains and $2 million related to cumulative translation adjustments. During the nine months ended September 30, 2018, the Firm reclassified a net pre-tax loss of $174 million to other expense related to the liquidation of a legal entity, $23 million related to net investment hedge losses and $151 million related to cumulative translation adjustments.

Note 2021 – Restricted cash and other restricted
assets
Refer to Note 2526 of JPMorgan Chase’s 20182019 Form 10-K for a detailed discussion of the Firm’s restricted cash and other restricted assets.
Certain of the Firm’s cash and other assets are restricted as to withdrawal or usage. These restrictions are imposed by various regulatory authorities based on the particular activities of the Firm’s subsidiaries.
The Firm is also subject to rules and regulations established by other U.S. and non U.S. regulators. As part of its compliance with the respective regulatory requirements, the Firm’s broker-dealer activities are subject to certain restrictions on cash and other assets.
The following table presents the components of the Firm’s restricted cash:
(in billions)September 30,
2019
December 31, 2018
June 30,
2020
December 31, 2019
Cash reserves – Federal Reserve Banks(a)$26.7
$22.1
$—
$26.6
Segregated for the benefit of securities and futures brokerage customers16.8
14.6
Segregated for the benefit of securities and cleared derivative customers20.5
16.0
Cash reserves at non-U.S. central banks and held for other general purposes3.6
4.1
4.7
3.9
Total restricted cash(a)(b)
$47.1
$40.8
$25.2
$46.5
(a)Effective March 26, 2020, the Federal Reserve temporarily eliminated reserve requirements for depository institutions.
(b)Comprises $45.9$23.9 billion and $39.6$45.3 billion in deposits with banks, as of September 30, 2019 and December 31, 2018, respectively,$1.3 billion and $1.2 billion in cash and due from banks as of September 30, 2019 and December 31, 2018, on the Consolidated balance sheets.sheet as of June 30, 2020 and December 31, 2019, respectively.
Also, as of SeptemberJune 30, 20192020 and December 31, 2018,2019, the Firm had the following other restricted assets:
Cash and securities pledged with clearing organizations for the benefit of customers of $23.6$35.7 billion and $20.6$24.7 billion, respectively.
Securities with a fair value of $13.1$5.7 billion and $9.7$8.8 billion, respectively, were also restricted in relation to customer activity.


 
Note 2122 – Regulatory capital
Refer to Note 2627 of JPMorgan Chase’s 20182019 Form 10-K for a detailed discussion on regulatory capital.
The Federal Reserve establishes capital requirements, including well-capitalized standards, for the consolidated financial holding company. The Office of the Comptroller of the Currency (“OCC”) establishes similar minimum capital requirements and standards for the Firm’s insured depository institutions (“IDI”), includingprincipal IDI subsidiary, JPMorgan Chase Bank, N.A.
Effective January 1, 2019, the capital adequacy of the Firm and JPMorgan Chase Bank, N.A. is evaluated against the fully phased-in measures under Basel III and represents the lower of the Standardized or Advanced approaches. During 2018, the required capital measures were subject to the transitional rules and as of December 31, 2018 were the same on a fully phased-in and on a transitional basis.
Under the risk-based capital and leverage-based guidelines of the Federal Reserve, JPMorgan Chase is required to maintain minimum ratios for CET1 capital, Tier 1 capital, Total capital, Tier 1 leverage and the SLR. Failure to meet these minimum requirements could cause the Federal Reserve to take action. IDI subsidiaries are also subject to these capital requirements by their respective primary regulators.
The following table representspresents the minimum and well-capitalized ratios to which the Firm and its IDI subsidiaries were subject as of SeptemberJune 30, 2020 and December 31, 2019.
Minimum capital ratios Well-capitalized ratiosMinimum capital ratios Well-capitalized ratios
BHC(a)(e)(f)

IDI(b)(e)(f)

 
BHC(c) 
IDI(d)

BHC(a)(e)
IDI(b)(e)
 
BHC(c) 
IDI(d)

Capital ratios     
CET110.5%7.0% N/A6.5%
Tier 112.0
8.5
 6.08.0
Total14.0
10.5
 10.010.0
CET1 capital10.57.0 N/A6.5%
Tier 1 capital12.08.5 6.08.0
Total capital14.010.5 10.010.0
Tier 1 leverage4.0
4.0
 N/A5.0
4.0 N/A5.0
SLR5.0
6.0
 N/A6.0
5.06.0 N/A6.0
Note: The table above is as defined by the regulations issued by the Federal Reserve, OCC and FDIC and to which the Firm and its IDI subsidiaries are subject.
(a)
Represents the minimum capital ratios applicable to the Firm under Basel III. The CET1, Tier 1 and Total capital minimum capital ratio includesratios include a capital conservation buffer requirement of 2.5% and GSIB surcharge of 3.5% as calculated under Method 2.
(b)
Represents requirements for JPMorgan Chase’s IDI subsidiaries. The CET1, Tier 1 and Total capital minimum capital ratio includesratios include a capital conservation buffer requirement of 2.5% that is applicable to the IDI subsidiaries. The IDI subsidiaries are not subject to the GSIB surcharge.
(c)
Represents requirements for bank holding companies pursuant to regulations issued by the Federal Reserve.
(d)
Represents requirements for IDI subsidiaries pursuant to regulations issued under the FDIC Improvement Act.
(e)For the period ended December 31, 2018, the CET1, Tier 1, Total and Tier 1 leverage minimum capital ratios applicable to the Firm were 9.0%, 10.5%, 12.5%, and 4.0% and the CET1, Tier 1, Total and Tier 1 leverage minimum capital ratios applicable to the Firm’s IDI subsidiaries were 6.375%, 7.875%, 9.875%, and 4.0%, respectively.
(f)
Represents minimum SLR requirement of 3.0%, as well as supplementary leverage buffersbuffer requirements of 2.0% and 3.0% for BHC and IDI, respectively.
Current Expected Credit Losses
As disclosed in the Firm’s 2019 Form 10-K, the Firm initially elected to phase-in the January 1, 2020 (“day 1”) CECL adoption impact to retained earnings of $2.7 billion to CET1 capital, at 25% per year in each of 2020 to 2023. As part of their response to the impact of the COVID-19 pandemic, on March 31, 2020, the federal banking agencies issued an interim final rule that provided the option to delay the effects of CECL on regulatory capital for two years, followed by a three-year transition period.
The interim final rule provides a uniform approach for estimating the effects of CECL compared to the legacy


incurred loss model during the first two years of the transition period (the “day 2” transition amount), whereby the Firm may exclude from CET1 capital 25% of the change in the allowance for credit losses (excluding allowances on PCD loans). The cumulative day 2 transition amount as at December 31, 2021 that is not recognized in CET1 capital as well as the $2.7 billion day 1 impact, will be phased into CET1 capital at 25% per year beginning January 1, 2022. The Firm has elected to apply the CECL capital transition provisions, and accordingly, for the period ended June 30, 2020, the capital metrics of the Firm
exclude $6.5 billion, which is the $2.7 billion day 1 impact to retained earnings and 25% of the $15.7 billion increase in the allowance for credit losses (excluding allowances on PCD loans).
The impacts of the CECL capital transition provisions on Tier 2 capital, adjusted average assets, and total leverage exposure have also been incorporated into the Firm’s capital metrics. Refer to Note 1 for further information on the CECL accounting guidance.
The following tables present the risk-based and leverage-based capital metrics for JPMorgan Chase and JPMorgan Chase Bank, N.A. under both the Basel III Standardized and Basel III Advanced Approaches. As of SeptemberJune 30, 20192020, the capital metrics are presented applying the CECL capital transition provisions. As of June 30, 2020 and December 31, 2018,2019, JPMorgan Chase and JPMorgan Chase Bank, N.A. were well-capitalized and met all capital requirements to which each was subject.

June 30, 2020
(in millions, except ratios)		Basel III Standardized Basel III Advanced
JPMorgan
Chase & Co.(d)
JPMorgan
Chase Bank, N.A.(d)
 
JPMorgan
Chase & Co.(d)
JPMorgan
Chase Bank, N.A.(d)
Risk-based capital metrics:(a)
     
CET1 capital$190,867
$217,100
 $190,867
$217,100
Tier 1 capital220,674
217,107
 220,674
217,107
Total capital256,667
234,631
 244,112
222,473
Risk-weighted assets1,541,365
1,458,534
 1,450,587
1,310,057
CET1 capital ratio12.4%14.9% 13.2%16.6%
Tier 1 capital ratio14.3
14.9
 15.2
16.6
Total capital ratio16.7
16.1
 16.8
17.0
Leverage-based capital metrics:     
Adjusted average assets(b)
$3,176,729
$2,757,510
 $3,176,729
$2,757,510
Tier 1 leverage ratio6.9%7.9% 6.9%7.9%
Total leverage exposure(c)
NA
NA
 $3,228,424
$3,418,625
SLR(c)
NA
NA
 6.8%6.4%
September 30, 2019
(in millions, except ratios)		Basel III Standardized Fully Phased-In Basel III Advanced Fully Phased-In
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
 
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Regulatory capital     
CET1 capital$188,151
$205,347
 $188,151
$205,347
Tier 1 capital214,831
205,347
 214,831
205,347
Total capital243,500
223,038
 233,203
212,919
      
Assets     
Risk-weighted1,527,762
1,445,648
 1,435,693
1,302,749
Adjusted average(a)
2,717,852
2,339,858
 2,717,852
2,339,858
      
Capital ratios(b)
     
CET112.3%14.2% 13.1%15.8%
Tier 114.1
14.2
 15.0
15.8
Total15.9
15.4
 16.2
16.3
Tier 1 leverage(c)
7.9
8.8
 7.9
8.8
December 31, 2018
(in millions, except ratios)		Basel III Standardized Transitional Basel III Advanced Transitional
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.(d)
 
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.(d)
Regulatory capital     
CET1 capital$183,474
$211,671
 $183,474
$211,671
Tier 1 capital209,093
211,671
 209,093
211,671
Total capital237,511
229,952
 227,435
220,025
      
Assets     
Risk-weighted1,528,916
1,446,529
 1,421,205
1,283,146
Adjusted average(a)
2,589,887
2,250,480
 2,589,887
2,250,480
      
Capital ratios(b)
     
CET112.0%14.6% 12.9%16.5%
Tier 113.7
14.6
 14.7
16.5
Total15.5
15.9
 16.0
17.1
Tier 1 leverage(c)
8.1
9.4
 8.1
9.4
December 31, 2019
(in millions, except ratios)		Basel III Standardized Basel III Advanced
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
 
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
Risk-based capital metrics:(a)
     
CET1 capital$187,753
$206,848
 $187,753
$206,848
Tier 1 capital214,432
206,851
 214,432
206,851
Total capital242,589
224,390
 232,112
214,091
Risk-weighted assets1,515,869
1,457,689
 1,397,878
1,269,991
CET1 capital ratio12.4%14.2% 13.4%16.3%
Tier 1 capital ratio14.1
14.2
 15.3
16.3
Total capital ratio16.0
15.4
 16.6
16.9
Leverage-based capital metrics:     
Adjusted average assets(b)
$2,730,239
$2,353,432
 $2,730,239
$2,353,432
Tier 1 leverage ratio7.9%8.8% 7.9%8.8%
Total leverage exposureNA
NA
 $3,423,431
$3,044,509
SLRNA
NA
 6.3%6.8%
(a)The capital adequacy of the Firm and JPMorgan Chase Bank, N.A. is evaluated against the lower of the two ratios as calculated under Basel III approaches (Standardized or Advanced).
(b)
Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio, includes total quarterly average assets adjusted for on-balance sheet assets that are subject to deduction from Tier 1 capital, predominantly goodwill and other intangible assets.
(b)(c)
For eachAs of June 30, 2020, JPMorgan Chase’s total leverage exposure for purposes of calculating the risk-based capital ratios,SLR, excludes on-balance sheet amounts of U.S. Treasury securities and deposits at Federal Reserve Banks, as provided by the capital adequacyinterim final rule issued by the Federal Reserve on April 1, 2020. On June 1, 2020, the Federal Reserve, OCC and FDIC issued an interim final rule that provides IDI subsidiaries with an option to apply this temporary exclusion subject to certain restrictions. As of the Firm andJune 30, 2020, JPMorgan Chase Bank, N.A. is evaluated against the lower of the two ratios as calculated under Basel III approaches (Standardized or Advanced).
(c)
The Tier 1 leverage ratio ishas not a risk-based measure of capital.elected to apply this exclusion.
(d)On May 18, 2019, Chase Bank USA, N.A. merged with
As of June 30, 2020, the capital metrics for the Firm reflect the exclusion of assets purchased from money market mutual fund clients pursuant to nonrecourse advances provided under the MMLF. Additionally, loans originated under the PPP, in the Firm and into JPMorgan Chase Bank, N.A., with JPMorgan Chase Bank, N.A as the surviving entity. The December 31, 2018 amounts reported for JPMorgan Chase Bank, N.A. retrospectively reflect the impact of the merger.

 September 30, 2019 December 31, 2018
 Basel III Advanced Fully Phased-In Basel III Advanced Fully Phased-In
(in millions, except ratios)
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.
 
JPMorgan
Chase & Co.
JPMorgan
Chase Bank, N.A.(a)
Total leverage exposure$3,404,535
$3,007,280
 $3,269,988
$2,915,541
SLR6.3%6.8% 6.4%7.3%
receive a zero percent risk weight.
(a)On May 18, 2019, Chase Bank USA, N.A. merged with and into JPMorgan Chase Bank, N.A., with JPMorgan Chase Bank, N.A as the surviving entity. The December 31, 2018 amounts reported for JPMorgan Chase Bank, N.A. retrospectively reflect the impact of the merger.

Note 2223 – Off–balance sheet lending-related
financial instruments, guarantees, and other
commitments
JPMorgan Chase provides lending-related financial instruments (e.g., commitments and guarantees) to address the financing needs of its customers and clients. The contractual amount of these financial instruments represents the maximum possible credit risk to the Firm should the customer or client draw upon the commitment or the Firm be required to fulfill its obligation under the guarantee, and should the customer or client subsequently fail to perform according to the terms of the contract. Most of these commitments and guarantees arehave historically been refinanced, extended, cancelled, or expireexpired without being drawn or a default occurring. As a result, the total contractual amount of these instruments is not, in the Firm’s view, representative of its expected future credit exposure or funding requirements. Refer to Note 2728 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion of lending-related commitments and guarantees, and the Firm’s related accounting policies.
To provide for probable expectedcredit losses inherent in wholesale and certain consumer lending-related commitments, an allowance for credit losses on lending-related commitments is maintained. Refer to Note 12 13 for further information regarding the allowance for credit losses on lending-related commitments.commitments, including the impact of the Firm’s adoption of the CECL accounting guidance on January 1, 2020.
The following table summarizes the contractual amounts and carrying values of off-balance sheet lending-related financial instruments, guarantees and other commitments at September June 30, 2019,2020, and December 31, 2018. 2019. The amounts in the table below for credit card, and home equity and certain scored business banking lending-related commitments represent the total available credit for these products. The Firm has not experienced, and does not anticipate, that all available lines of credit for these products will be utilized at the same time. The Firm can reduce or cancel credit card and certain scored business banking lines of credit by providing the borrower notice or, in some cases as permitted by law, without notice. In addition, the Firm typically closes credit card lines when the borrower is 60 days or more past due. The Firm may reduce or close HELOCs when there are significant decreases in the value of the underlying property, or when there has been a demonstrable decline in the creditworthiness of the borrower.


In conjunction with the adoption of CECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Refer to Note 1 for further information.
Off–balance sheet lending-related financial instruments, guarantees and other commitmentsOff–balance sheet lending-related financial instruments, guarantees and other commitments
Off–balance sheet lending-related financial instruments, guarantees and other commitments

Contractual amount
Carrying value(g)
Contractual amount
Carrying value(i)

September 30, 2019
Dec 31,
2018

Sep 30,
2019
Dec 31,
2018
June 30, 2020Dec 31,
2019

Jun 30,
2020
Dec 31,
2019
By remaining maturity
(in millions)		Expires in 1 year or lessExpires after
1 year through
3 years		Expires after
3 years through
5 years		Expires after 5 yearsTotal
Total

Expires in 1 year or lessExpires after
1 year through
3 years		Expires after
3 years through
5 years		Expires after 5 yearsTotal

Lending-related        
Consumer, excluding credit card:        
Home equity$597
$1,156
$2,353
$17,077
$21,183
 $20,901
 $12
$12
Residential mortgage(a)
10,904
—
—
12
10,916
 5,481
 —
—
Auto8,062
1,238
118
49
9,467
 8,011
 2
2
Consumer & Business Banking10,324
643
106
952
12,025
 11,673
 19
19
Residential real estate(a)
$15,055
$1,310
$3,173
$15,864
$35,402
$30,217
 $241
$12
Auto and other9,146
1
27
772
9,946
9,952
 —
—
Total consumer, excluding credit card29,887
3,037
2,577
18,090
53,591
 46,066
 33
33
24,201
1,311
3,200
16,636
45,348
40,169
 241
12
Credit card645,880
—
—
—
645,880
 605,379
 —
—
Total consumer(b)
675,767
3,037
2,577
18,090
699,471
 651,445
 33
33
Credit card(b)
673,836
—
—
—
673,836
650,720
 —
—
Total consumer(b)(c)
698,037
1,311
3,200
16,636
719,184
690,889
 241
12
Wholesale:        
Other unfunded commitments to extend credit(c)
55,258
128,911
161,963
11,200
357,332
 351,490
 912
852
Standby letters of credit and other financial guarantees(c)
16,373
10,525
5,349
1,842
34,089
 33,498
 605
521
Other letters of credit(c)
3,853
305
40
—
4,198
 2,825
 5
3
Total wholesale(b)
75,484
139,741
167,352
13,042
395,619
 387,813
 1,522
1,376
Other unfunded commitments to extend credit(d)
88,390
138,354
132,361
11,879
370,984
376,107
 1,920
959
Standby letters of credit and other financial guarantees(d)
16,116
10,173
4,028
1,625
31,942
34,242
 482
618
Other letters of credit(d)
2,466
82
19
—
2,567
2,961
 17
4
Total wholesale(c)
106,972
148,609
136,408
13,504
405,493
413,310
 2,419
1,581
Total lending-related$751,251
$142,778
$169,929
$31,132
$1,095,090
 $1,039,258
 $1,555
$1,409
$805,009
$149,920
$139,608
$30,140
$1,124,677
$1,104,199
 $2,660
$1,593
Other guarantees and commitments        
Securities lending indemnification agreements and guarantees(d)
$214,338
$—
$—
$—
$214,338
 $186,077
 $—
$—
Securities lending indemnification agreements and guarantees(e)
$218,273
$—
$—
$—
$218,273
$204,827
 $—
$—
Derivatives qualifying as guarantees1,772
196
12,081
40,369
54,418
 55,271
 231
367
859
62
11,469
40,354
52,744
53,089
 388
159
Unsettled resale and securities borrowed agreements122,946
1,125
66
—
124,137
 102,008
 —
—
148,288
1,234
—
—
149,522
117,951
 4
—
Unsettled repurchase and securities loaned agreements120,679
670
—
—
121,349
 57,732
 —
—
112,424
562
—
—
112,986
73,351
 (1)—
Loan sale and securitization-related indemnifications:        
Mortgage repurchase liabilityNA
NA
NA
NA
NA
 NA
 61
89
NA
NA
NA
NA
NA
NA
 85
59
Loans sold with recourseNA
NA
NA
NA
1,001
 1,019
 27
30
NA
NA
NA
NA
904
944
 24
27
Exchange & clearing house guarantees and commitments(e)
161,580
—
—
—
161,580
 58,960
 —
—
Other guarantees and commitments(f)
4,098
590
260
2,832
7,780
 8,183
 (89)(73)
Exchange & clearing house guarantees and commitments(f)
97,750
—
—
—
97,750
206,432
 —
—
Other guarantees and commitments(g)
5,640
3,716
286
3,201
12,843
10,534
(h) 
(81)(73)
(a)Includes certain commitments to purchase loans from correspondents.
(b)Also includes commercial card lending-related commitments primarily in CB and CIB.
(c)Predominantly all consumer and wholesale lending-related commitments are in the U.S.
(c)(d)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, reflected the contractual amount net of risk participations totaling $198$66 million and $282$76 million, respectively, for other unfunded commitments to extend credit; $9.7$9.0 billion and $10.4$9.8 billion, respectively, for standby letters of credit and other financial guarantees; and $705$290 million and $385$546 million, respectively, for other letters of credit. In regulatory filings with the Federal Reserve these commitments are shown gross of risk participations.
(d)(e)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, collateral held by the Firm in support of securities lending indemnification agreements was $226.5$229.6 billion and $195.6$216.2 billion, respectively. Securities lending collateral primarily consists of cash, G7 government securities, and securities issued by U.S. GSEs and government agencies.
(e)(f)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, includes guarantees to the Fixed Income Clearing Corporation under the sponsored member repo program and commitments and guarantees associated with the Firm’s membership in certain clearing houses.
(f)(g)At SeptemberJune 30, 2019,2020, and December 31, 2018,2019, primarily includes letters of credit hedged by derivative transactions and managed on a market risk basis, and unfunded commitments related to institutional lending. Additionally, includes unfunded commitments predominantly related to certain tax-oriented equity investments.
(g)(h)Prior-period amounts have been revised to conform with the current presentation.
(i)For lending-related products, the carrying value represents the allowance for lending-related commitments and the guarantee liability; for derivative-related products, and lending-related commitments for which the fair value option was elected, the carrying value represents the fair value. At June 30, 2020, includes net markdowns on held-for-sale positions related to unfunded commitments in the bridge financing portfolio.



Other unfunded commitments to extend credit
Other unfunded commitments to extend credit generally consist of commitments for working capital and general corporate purposes, extensions of credit to support commercial paper facilities and bond financings in the event that those obligations cannot be remarketed to new investors, as well as committed liquidity facilities to clearing organizations. The Firm also issues commitments under multipurpose facilities which could be drawn upon in several forms, including the issuance of a standby letter of credit.
 
Standby letters of credit and other financial guarantees
Standby letters of credit and other financial guarantees are conditional lending commitments issued by the Firm to guarantee the performance of a client or customer to a third party under certain arrangements, such as commercial paper facilities, bond financings, acquisition financings, trade and similar transactions.
The following table summarizes the contractual amount and carrying value of standby letters of credit and other financial guarantees and other letters of credit arrangements as of SeptemberJune 30, 2019,2020, and December 31, 2018.2019.
Standby letters of credit, other financial guarantees and other letters of credit
September 30, 2019 December 31, 2018June 30, 2020 December 31, 2019
(in millions)Standby letters of
credit and other financial guarantees		 
Other letters
of credit
 Standby letters of
credit and other financial guarantees		 
Other letters
of credit
Standby letters of
credit and other financial guarantees		 
Other letters
of credit
 Standby letters of
credit and other financial guarantees		 
Other letters
of credit
Investment-grade(a)
$27,131
 $3,249
 $26,420
 $2,079
$23,952
 $1,837
 $26,880
 $2,137
Noninvestment-grade(a)
6,958
 949
 7,078
 746
7,990
 730
 7,362
 824
Total contractual amount$34,089
 $4,198
 $33,498
 $2,825
$31,942
 $2,567
 $34,242
 $2,961
              
Allowance for lending-related commitments$215
 $5
 $167
 $3
$126
 $17
 $216
 $4
Guarantee liability390
 —
 354
 —
356
 —
 402
 —
Total carrying value$605
 $5
 $521
 $3
$482
 $17
 $618
 $4
              
Commitments with collateral$17,690
 $877
 $17,400
 $583
$17,194
 $411
 $17,853
 $728
(a)The ratings scale is based on the Firm’s internal ratings which generally correspondrisk ratings. Refer to ratings as defined by S&P and Moody’s.Note 12 for further information on internal risk ratings.
Derivatives qualifying as guarantees
The Firm transacts in certain derivative contracts that have the characteristics of a guarantee under U.S. GAAP. Refer to Note 2728 of JPMorgan Chase’s 20182019 Form 10-K for further information on these derivatives.
The following table summarizes the derivatives qualifying as guarantees as of September June 30, 2019,2020, and December 31, 2018.2019.
(in millions)September 30, 2019
 December 31, 2018
June 30, 2020
 December 31, 2019
Notional amounts      
Derivative guarantees$54,418
 $55,271
$52,744
 $53,089
Stable value contracts with contractually limited exposure28,886
 28,637
28,874
 28,877
Maximum exposure of stable value contracts with contractually limited exposure2,960
 2,963
2,970
 2,967
      
Fair value      
Derivative payables231
 367
388
 159
Derivative receivables—
 —


In addition to derivative contracts that meet the characteristics of a guarantee, the Firm is both a purchaser and seller of credit protection in the credit derivatives market. Refer to Note 45 for a further discussion of credit derivatives.
Merchant charge-backs
Under the rules of payment networks, the Firm, in its role as a merchant acquirer, retains a contingent liability for disputed processed credit and debit card transactions that result in a charge-back to the merchant. If a dispute is resolved in the cardholder’s favor, Merchant Services will (through the cardholder’s issuing bank) credit or refund the amount to the cardholder and will charge back the transaction to the merchant. If Merchant Services is unable to collect the amount from the merchant, Merchant Services will bear the loss for the amount credited or refunded to the cardholder. Merchant Services mitigates this risk by withholding future settlements, retaining cash reserve accounts or obtaining other collateral. In addition, Merchant Services recognizes a valuation allowance that covers the payment or performance risk to the Firm related to charge-backs. The carrying value of the valuation allowance was $20 million and $11 million at June 30, 2020 and December 31, 2019, respectively.

Loan sales- and securitization-related indemnifications
In connection with the Firm’s mortgage loan sale and securitization activities with GSEs the Firm has made representations and warranties that the loans sold meet certain requirements, and that may require the Firm to repurchase mortgage loans and/or indemnify the loan purchaser if such representations and warranties are breached by the Firm. Further, although the Firm’s securitizations are predominantly nonrecourse, the Firm does provide recourse servicing in certain limited cases where it agrees to share credit risk with the owner of the mortgage loans. Refer to Note 2728 of JPMorgan Chase’s 20182019 Form 10-K for additional information.
The liability related to repurchase demands associated with private label securitizations is separately evaluated by the Firm in establishing its litigation reserves. Refer to Note 2425 of this Form 10-Q and Note 2930 of JPMorgan Chase’s 20182019 Form 10-K for additional information regarding litigation.

Sponsored member repo program
In 2018 the Firm commenced the sponsored member repo program, wherein theThe Firm acts as a sponsoring member to clear eligible overnight resale and repurchase agreements through the Government Securities Division of the Fixed Income Clearing Corporation (“FICC”) on behalf of clients that become sponsored members under the FICC’s rules. The Firm also guarantees to the FICC the prompt and full payment and performance of its sponsored member clients’ respective obligations under the FICC’s rules. The Firm minimizes its liability under these overnight guarantees by obtaining a security interest in the cash or high-quality securities collateral that the clients place with the clearing house therefore the Firm expects the risk of loss to be remote. The Firm’s maximum possible exposure, without taking into consideration the associated collateral, is included in the Exchange & clearing house guarantees and commitments line on page 157.179. Refer to Note 11 of JPMorgan Chase’s 20182019 Form 10-K for additional information on credit risk mitigation practices on resale agreements and the types of collateral pledged under repurchase agreements.
Guarantees of subsidiaries
The Parent Company has guaranteed certain long-term debt and structured notes of its subsidiaries, including JPMorgan Chase Financial Company LLC (“JPMFC”), a 100%-owned finance subsidiary. All securities issued by JPMFC are fully and unconditionally guaranteed by the Parent Company. These guarantees, which rank on a parity with the Firm’s unsecured and unsubordinated indebtedness, are not included in the table on page 157179 of this Note. Refer to Note 1920 of JPMorgan Chase’s 20182019 Form 10-K for additional information.


 
Note 2324 – Pledged assets and collateral
Refer to Note 2829 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the Firm’s pledged assets and collateral.
Pledged assets
The Firm may pledgepledges financial assets that it owns to maintain potential borrowing capacity at discount windows with Federal Reserve banks, various other central banks and FHLBs. Additionally, pledgedthe Firm pledges assets are used for other purposes, including to collateralize repurchase and other securities financing agreements, to cover short sales and to collateralize derivative contracts and deposits. Certain of these pledged assets may be sold or repledged or otherwise used by the secured parties and are parenthetically identified on the Consolidated balance sheets as assets pledged.
The following table presents the Firm’s pledged assets.
(in billions)September 30, 2019
 December 31, 2018
Assets that may be sold or repledged or otherwise used by secured parties$154.2
 $104.0
Assets that may not be sold or repledged or otherwise used by secured parties94.5
 83.7
Assets pledged at Federal Reserve banks and FHLBs487.1
 475.3
Total assets pledged$735.8
 $663.0

Total
(in billions)June 30, 2020
 December 31, 2019
Assets that may be sold or repledged or otherwise used by secured parties$189.7
 $125.2
Assets that may not be sold or repledged or otherwise used by secured parties108.6
 80.2
Assets pledged at Federal Reserve banks and FHLBs(a)
479.6
 478.9
Total pledged assets$777.9
 $684.3
(a)Includes assets pledged to the Federal Reserve under the MMLF and the Federal Reserve’s open market operations.
Total pledged assets do not include assets of consolidated VIEs; these assets are used to settle the liabilities of those entities. Refer to Note 1314 for additional information on assets and liabilities of consolidated VIEs. Refer to Note 1011 for additional information on the Firm’s securities financing activities. Refer to Note 1920 of JPMorgan Chase’s 20182019 Form 10-K for additional information on the Firm’s long-term debt.
Collateral
The Firm accepts financial assets as collateral that it is permitted to sell or repledge, deliver or otherwise use. This collateral is generally obtained under resale and other securities financing agreements, prime brokerage-related held-for-investment customer receivables and derivative contracts. Collateral is generally used under repurchase and other securities financing agreements, to cover short sales and to collateralize derivative contracts and deposits.
The following table presents the fair value of collateral accepted.
(in billions)September 30, 2019
 December 31, 2018
Collateral permitted to be sold or repledged, delivered, or otherwise used$1,264.1
 $1,245.3
Collateral sold, repledged, delivered or otherwise used1,017.3
 998.3


(in billions)June 30, 2020
 December 31, 2019
Collateral permitted to be sold or repledged, delivered, or otherwise used$1,282.3
 $1,282.5
Collateral sold, repledged, delivered or otherwise used(a)
985.3
 1,000.5


(a)Includes collateral repledged to the Federal Reserve under the Federal Reserve’s open market operations.

Note 2425 – Litigation
Contingencies
As of SeptemberJune 30, 2019,2020, the Firm and its subsidiaries and affiliates are defendants, putative defendants or respondents in numerous legal proceedings, including private, civil litigations and regulatory/government investigations. The litigations range from individual actions involving a single plaintiff to class action lawsuits with potentially millions of class members. Investigations involve both formal and informal proceedings, by both governmental agencies and self-regulatory organizations. These legal proceedings are at varying stages of adjudication, arbitration or investigation, and involve each of the Firm’s lines of business and several geographies and a wide variety of claims (including common law tort and contract claims and statutory antitrust, securities and consumer protection claims), some of which present novel legal theories.
The Firm believes the estimate of the aggregate range of reasonably possible losses, in excess of reserves established, for its legal proceedings is from $0 to approximately $1.3$1.7 billion at SeptemberJune 30, 2019.2020. This estimated aggregate range of reasonably possible losses was based upon information available as of that date for those proceedings in which the Firm believes that an estimate of reasonably possible loss can be made. For certain matters, the Firm does not believe that such an estimate can be made, as of that date. The Firm’s estimate of the aggregate range of reasonably possible losses involves significant judgment, given:
the number, variety and varying stages of the proceedings, including the fact that many are in preliminary stages,
the existence in many such proceedings of multiple defendants, including the Firm, whose share of liability (if any) has yet to be determined,
the numerous yet-unresolved issues in many of the proceedings, including issues regarding class certification and the scope of many of the claims, and
the attendant uncertainty of the various potential outcomes of such proceedings, including where the Firm has made assumptions concerning future rulings by the court or other adjudicator, or about the behavior or incentives of adverse parties or regulatory authorities, and those assumptions prove to be incorrect.
In addition, the outcome of a particular proceeding may be a result which the Firm did not take into account in its estimate because the Firm had deemed the likelihood of that outcome to be remote. Accordingly, the Firm’s estimate of the aggregate range of reasonably possible losses will change from time to time, and actual losses may vary significantly.
 
Set forth below are descriptions of the Firm’s material legal proceedings.
Amrapali. India’s Enforcement Directorate (“ED”) is investigating JPMorgan India Private Limited in connection with investments made in 2010 and 2012 by 2 offshore funds formerly managed by JPMorgan Chase entities into residential housing projects developed by the Amrapali Group (“Amrapali”). In 2017, numerous creditors filed civil claims against Amrapali including petitions brought by home buyers relating to delays in delivering or failure to deliver residential units. The home buyers’ petitions have been overseen by the Supreme Court of India since 2017 pursuant to its jurisdiction over public interest litigation. In July 2019, the Supreme Court of India issued an order making preliminary findings that Amrapali and other parties, including unspecified JPMorgan Chase entities and the offshore funds that had invested in the projects, violated certain currency control and money laundering provisions, and ordering the ED to conduct a further inquiry under India’s Prevention of Money Laundering Act (“PMLA”) and Foreign Exchange Management Act (“FEMA”). In May 2020, the Enforcement Directorate issued a provisional attachment order as part of the criminal PMLA proceedings freezing approximately $25 million held by JPMorgan India Private Limited. In June 2020, the funds were transferred to an account held by the Supreme Court of India. A separate civil proceeding relating to alleged FEMA violations is ongoing. The Firm is responding to and cooperating with the investigation.    
Federal Republic of Nigeria Litigation. JPMorgan Chase Bank, N.A. operated an escrow and depository account for the Federal Government of Nigeria (“FGN”) and two major international oil companies. The account held approximately $1.1 billion in connection with a dispute among the clients over rights to an oil field. Following the settlement of the dispute, JPMorgan Chase Bank, N.A. paid out the monies in the account in 2011 and 2013 in accordance with directions received from its clients. In November 2017, the Federal Republic of Nigeria (“FRN”) commenced a claim in the English High Court for approximately $875 million in payments made out of the accounts. The FRN, claiming to be the same entity as the FGN, alleges that the payments were instructed as part of a complex fraud not involving JPMorgan Chase Bank, N.A., but that JPMorgan Chase Bank, N.A. was or should have been on notice that the payments may be fraudulent. JPMorgan Chase Bank, N.A. applied for summary judgment and was unsuccessful. The claim is ongoing and no trial date has been set.
Foreign Exchange Investigations and Litigation. The Firm previously reported settlements with certain government authorities relating to its foreign exchange (“FX”) sales and trading activities and controls related to those activities. FX-related investigations and inquiries by government authorities, including competition authorities, are ongoing, and the Firm is cooperating with and working to resolveAmong those matters. Inresolutions, in May 2015, the Firm pleaded

guilty to a single violation of federal antitrust law. In January 2017, the Firm was sentenced, with judgment entered thereafter and a term of probation ending in January 2020. The term of probation has concluded, with the Firm remaining in good standing throughout the probation period. The Department of Labor has granted the Firm a five-year exemption of disqualification that allows the Firm and its affiliates to continue to rely on the Qualified Professional Asset Manager exemption under the Employee Retirement Income Security Act (“ERISA”) until January 2023. The Firm will need to reapply in due course for a further exemption to cover the remainder of the ten-year disqualification period. In addition, the Firm has paid fines totaling approximately $265 million in connection with the settlement of FX-related investigations conducted by the European Commission and the SwissA South Africa Competition Commission which were announced in May 2019matter is the remaining FX-related governmental inquiry, and June 2019, respectively. Separately, in February 2017is currently pending before the South Africa Competition Commission referred its FX investigation of the Firm and other banks to the South Africa Competition Tribunal, which is conducting civil proceedings concerning that matter.Tribunal.
In August 2018, the United States District Court for the Southern District of New York granted final approval to the Firm’s settlement of a consolidated class action brought by U.S.-based plaintiffs, which principally alleged violations of

federal antitrust laws based on an alleged conspiracy to manipulate foreign exchange rates and also sought damages on behalf of persons who transacted in FX futures and options on futures. Certain members of the settlement class filed requests to the Court to be excluded from the class, and certain of them filed a complaint against the Firm and a number of other foreign exchange dealers in November 2018 (the “opt-out action”). The 2 FX-related2018. A number of these actions brought by participants or beneficiaries of qualified ERISA plansremain pending. Further, putative class actions have been dismissed. Putative class actionsfiled against the Firm and a number of other foreign exchange dealers on behalf of certain consumers who purchased foreign currencies at allegedly inflated rates (the “consumer action”) and purported indirect purchasers of FX instruments (the “indirect purchaser action”)instruments; these actions also remain pending in the District Court. In 2020, the Firm and 11 other defendants agreed to settle the class action filed by purported indirect purchasers for a total of $10 million. That settlement remains subject to court approval. In addition, some FX relatedFX-related individual and putative class actions based on similar alleged underlying conduct have been filed outside the U.S., including in the U.K., Israel and Australia, which are based on similar alleged underlying conduct.Australia.
Interchange Litigation. GA grouproups of merchants and retail associations filed a series of class action complaints alleging that Visa and Mastercard, as well as certain banks, conspired to set the price of credit and debit card interchange fees and enacted respectiverelated rules in violation of antitrust laws. TheIn 2012, the parties initially settled the cases for a cash payment, a temporary reduction of credit card interchange, and modifications to certain credit card network rules. In December 2013, the District Court granted final approval of the settlement.
A number of merchants appealed the settlement to the United States Court of Appeals for the Second Circuit, which, in June 2016, vacated the District Court’s certification of the class action and reversed2017, after the approval of that settlement was reversed on appeal, the class settlement. In March 2017, the U.S. Supreme Court declined petitions seeking review of the decision of the Court of Appeals. The case was remanded to the United States District Court for the Eastern District of New York for further proceedings consistent with the appellate decision.
The original class action was divided into 2 separate actions, one seeking primarily monetary relief and the other seeking primarily injunctive relief. In September 2018, the
parties to the class action seeking monetary relief finalized an agreement which amends and supersedes the prior settlement agreement, and the plaintiffs filed a motion seeking preliminary approval of the modified settlement.agreement. Pursuant to this settlement, the defendants have collectively contributed an additional $900 million to the approximately $5.3 billion previously held in escrow from the original settlement. In JanuaryDecember 2019, the amended agreement was preliminarily approved by the District Court,Court. Certain merchants appealed the District Court’s approval order, and formal noticethose appeals are pending. Based on the percentage of merchants that opted out of the amended class settlement, $700 million has been completedreturned to the defendants from the settlementescrow in accordance with the District Court’s order. A fairness hearing is scheduled before the District Court in November 2019.settlement agreement. The class action seeking primarily injunctive relief continues separately.
In addition, certain merchants have filed individual actions raising similar allegations against Visa and Mastercard, as well as against the Firm and other banks, and some of those actions are proceeding.remain pending.
LIBOR and Other Benchmark Rate Investigations and Litigation. JPMorgan Chase has received subpoenas and requests for documents and, in some cases, interviews,responded to inquiries from federal and statevarious governmental agencies and entities including the U.S. Commodity Futures Trading Commission and various state attorneys general, as well as the European Commission (“EC”), the Swiss Competition Commission (“ComCo”) and other regulatory authorities and banking associations around the world relating primarily to the process by which interest rates were submitted to the British Bankers Association (“BBA”) in connection with the setting of the BBA’sAssociation’s London Interbank Offered Rate (“LIBOR”) for various currencies principally in 2007 and 2008. Some of the inquiries also relate to similar processes by which information on rates was submitted to the European Banking Federation (“EBF”) in connection with the setting of the EBF’sFederation’s Euro Interbank Offered Rate (“EURIBOR”). The Firm continues to cooperate with these investigations to the extent that they are ongoing. ComCo’sSwiss Competition Commission’s investigation relating to EURIBOR, to which the Firm and other banks are subject, continues. In December 2016, the ECEuropean Commission issued a decision against the Firm and other banks finding an infringement of European antitrust rules relating to EURIBOR. The Firm has filed an appeal of that decision with the European General Court, and that appeal is pending.
In addition, the Firm has been named as a defendant along with other banks in a series of individual and putative class actions related to benchmarks, including U.S. dollar LIBOR during the period that it was administered by the BBA and, in a separate consolidated putative class action, during the period that it was administered by ICE Benchmark Administration. These actions have been filed, or consolidated for pre-trial purposes, in the United States District Court for the Southern District of New York. In these actions, plaintiffs make varying allegations that in various periods, starting in 2000 or later, defendants either individually or collectively manipulated various benchmark rates by submitting rates that were artificially low or high. Plaintiffs allege that they transacted in loans, derivatives or other financial instruments whose values are affected by changes in these rates and assert a variety of claims including antitrust claims seeking treble damages. These actions are in various stages of litigation.
In actions related to U.S. dollar LIBOR during the period that it was administered by the BBA, the Firm has resolved certain of these actions, and others are in various stages of litigation. The District Court dismissed certain claims, including antitrust claims brought by some plaintiffs whom the District Court found did not have standing to assert such claims, and permitted certain claims to proceed, including

antitrust, Commodity Exchange Act, Section 10(b) of the Securities Exchange Act and common law claims. The plaintiffs whose antitrust claims were dismissed for lack of standing have filed an appeal. The District Court granted class certification of antitrust claims related to bonds and interest rate swaps sold directly by the defendants and denied class certification motions filed by other plaintiffs. The Firm has agreed to settleIn the consolidated putative class

action related to the time period that U.S. dollar LIBOR was administered by ICE Benchmark Administration, the District Court granted defendants’ motion to dismiss plaintiffs’ complaint, and the plaintiffs have appealed. The Firm’s settlements of putative class actions related to Swiss franc LIBOR, the Singapore Interbank Offered Rate and the Singapore Swap Offer Rate and(“SIBOR”), the Australian Bank Bill Swap Reference Rate, as well asand certain of the putative class actions related to U.S. dollar LIBOR. TheLIBOR remain subject to court approval. In the class actions related to SIBOR and Swiss franc LIBOR, the District Court declined to grant preliminary approval to the settlement involving the Singapore Interbank Offered Rate and the Singapore Swap Offer Rate and instead dismissed the litigation after concludingconcluded that the plaintiffCourt lacked standing. Plaintiff’s appealsubject matter jurisdiction, and plaintiffs’ appeals of the District Court’s decision isthose decisions are pending. The remaining settlements are all subject to further documentation and court approval.
Metals and U.S. Treasuries Investigations and Litigation.Litigation and Related Inquiries. Various authorities, including the Department of Justice’s Criminal Division, are conducting investigations relating to trading practices in the metals markets and related conduct. The Firm also is responding to and cooperatingrelated requests concerning similar trading-practices issues in markets for other financial instruments, such as U.S. Treasuries. The Firm continues to cooperate with these investigations and is currently engaged in discussions with various regulators about resolving their respective investigations. There is no assurance that such discussions will result in settlements. Several putative class action complaints have been filed in the United States District Court for the Southern District of New York against the Firm and certain former employees, alleging a precious metals futures and options price manipulation scheme in violation of the Commodity Exchange Act. Some of the complaints also allege unjust enrichment and deceptive acts or practices under the General Business Law of the State of New York. The Court consolidated these putative class actions in February 2019.2019, and the consolidated action is stayed through May 2021. In addition, several putative class actions have been filed in the United States District Courts for the Northern District of Illinois and Southern District of New York against the Firm, alleging manipulation of U.S. Treasuries futures and options, and bringing claims under the Commodity Exchange Act. Some of the complaints also allege unjust enrichment. A motion is pending before the United States Judicial Panel on Multidistrict Litigation to transfer and consolidate or coordinate the actions. The Firm is also a defendant in a consolidated action filed in the United States District Court for the Southern District of New York alleging monopolization of silver futures in violation of the Sherman Act.
Wendel. Since 2012, the French criminal authorities have been investigating a series of transactions entered into by senior managers of Wendel Investissement (“Wendel”) during the period from 2004 through 2007 to restructure their shareholdings in Wendel. JPMorgan Chase Bank, N.A., Paris branch provided financing for the transactions to a number of managers of Wendel in 2007. JPMorgan Chase has cooperated with the investigation. The investigating judges issued an ordonnance de renvoi in November 2016, referring JPMorgan Chase Bank, N.A. to the French tribunal correctionnel for alleged complicity in tax fraud. No date for trial has been set by the court. In January 2018, the Paris Court of Appeal issued a decision cancelling the mise en examen of JPMorgan Chase Bank, N.A. In September 2018, theThe Court of Cassation, France’s highest court, ruled in September 2018 that a mise en examen is a prerequisite for an ordonnance de renvoi and remandedin January 2020 ordered the case to the Courtannulment of Appeal. In June 2019, the Court of Appeal declined to annul the ordonnance de renvoi referring JPMorgan Chase Bank, N.A. to the French tribunal correctionnelcorrectionnel., and the Firm has reapplied to the Court of Cassation for a determination as to whether the Court of Appeal’s decision is consistent with the Court of Cassation’s September 2018 ruling. Any further actions in the criminal proceedings are stayed pending the outcome of that application. In addition, a number of the managers have commenced civil proceedings against JPMorgan Chase Bank, N.A. The claims are separate, involve
different allegations and are at various stages of proceedings.
* * *
In addition to the various legal proceedings discussed above, JPMorgan Chase and its subsidiaries are named as defendants or are otherwise involved in a substantial number of other legal proceedings. The Firm believes it has meritorious defenses to the claims asserted against it in its currently outstanding legal proceedings and it intends to defend itself vigorously. Additional legal proceedings may be initiated from time to time in the future.
The Firm has established reserves for several hundred of its currently outstanding legal proceedings. In accordance with the provisions of U.S. GAAP for contingencies, the Firm accrues for a litigation-related liability when it is probable that such a liability has been incurred and the amount of the loss can be reasonably estimated. The Firm evaluates its outstanding legal proceedings each quarter to assess its litigation reserves, and makes adjustments in such reserves, upwardsupward or downward, as appropriate, based on management’s best judgment after consultation with counsel. The Firm’s legal expense/(benefit) was $10$118 million and $20$69 million for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and $(2)$315 million and $90$(12) million for the ninesix months ended SeptemberJune 30, 20192020 and 2018, respectively.2019. There is no assurance that the Firm’s litigation reserves will not need to be adjusted in the future.
In view of the inherent difficulty of predicting the outcome of legal proceedings, particularly where the claimants seek very large or indeterminate damages, or where the matters present novel legal theories, involve a large number of parties or are in early stages of discovery, the Firm cannot state with confidence what will be the eventual outcomes of the currently pending matters, the timing of their ultimate resolution or the eventual losses, fines, penalties or consequences related to those matters. JPMorgan Chase

believes, based upon its current knowledge and after consultation with counsel, consideration of the material legal proceedings described above and after taking into account its current litigation reserves and its estimated aggregate range of possible losses, that the other legal proceedings currently pending against it should not have a material adverse effect on the Firm’s consolidated financial condition. The Firm notes, however, that in light of the uncertainties involved in such proceedings, there is no assurance that the ultimate resolution of these matters will not significantly exceed the reserves it has currently accrued or that a matter will not have material reputational consequences. As a result, the outcome of a particular matter may be material to JPMorgan Chase’s operating results for a particular period, depending on, among other factors, the size of the loss or liability imposed and the level of JPMorgan Chase’s income for that period.



Note 2526 – Business segments
The Firm is managed on a line of businessan LOB basis. There are 4 major reportable business segments - Consumer & Community Banking, Corporate & Investment Bank, Commercial Banking and Asset & Wealth Management. In addition, there is a Corporate segment. The business segments are determined based on the products and services provided, or the type of customer served, and they reflect the manner in which financial information is currently evaluated by the Firm’s Operating Committee. Segment results are presented on a managed basis. Refer to Segment results below, and Note 3132 of JPMorgan Chase’s 20182019 Form 10-K for a further discussion concerning JPMorgan Chase’s business segments.
Segment results
The following tables provide a summary of the Firm’s segment results as of or for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, on a managed basis. The Firm’s definition of managed basis starts with the
reported U.S. GAAP results and includes certain reclassifications to present total net revenue for the Firm (and each of the reportable business segments) on an FTE basis. Accordingly, revenue from investments that receive tax credits and tax-exempt securities is presented in the managed results on a basis comparable to taxable investments and securities. Refer to Note 3132 of JPMorgan Chase’s 20182019 Form 10-K for additional information on the Firm’s managed basis.
Business segment capital allocation
The amount of capital assigned to each business is referred to as equity. On at least an annual basis,Periodically, the assumptions and methodologies used into allocate capital allocation are assessed and as a result, the capital allocated to lines of businessthe LOBs may change. Refer to Line of business equity on page 9190 of JPMorgan Chase’s 20182019 Form 10-K for additional information on business segment capital allocation.
Business segment changes
In the first quarter of 2020, the Firm began reporting a Wholesale Payments business unit within CIB following a realignment of the Firm’s wholesale payments businesses. The Wholesale Payments business comprises:
Merchant Services, which was realigned from CCB to CIB
Treasury Services and Trade Finance in CIB. Trade Finance was previously reported in Lending in CIB.
In connection with the alignment of Wholesale Payments, the assets, liabilities and headcount associated with the Merchant Services business were realigned to CIB from CCB, and the revenue and expenses of the Merchant Services business is reported across CCB, CIB and CB based primarily on client relationships. Prior periods have been revised to reflect this realignment and revised allocation methodology.
Segment results and reconciliation(a)
Segment results and reconciliation(a)
Segment results and reconciliation(a)
As of or for the three months ended September 30,
(in millions, except ratios)		Consumer &
Community Banking		 Corporate &
Investment Bank		 Commercial Banking Asset & Wealth Management
2019
2018
 2019
2018
 2019
2018
 2019
2018
As of or for the three months ended June 30,
(in millions, except ratios)
Consumer &
Community Banking(b)
 Corporate &
Investment Bank		 Commercial Banking Asset & Wealth Management
2020
2019
 2020
2019
 2020
2019
 2020
2019
Noninterest revenue$5,095
$4,176
 $7,182
$6,505
 $599
$576
 $2,713
$2,680
$4,116
$4,104
 $12,273
$7,660
 $815
$623
 $2,720
$2,683
Net interest income9,164
9,114
 2,156
2,300
 1,608
1,695
 855
879
8,101
9,380
 4,079
2,171
 1,577
1,662
 890
876
Total net revenue14,259
13,290
 9,338
8,805
 2,207
2,271
 3,568
3,559
12,217
13,484
 16,352
9,831
 2,392
2,285
 3,610
3,559
Provision for credit losses1,311
980
 92
(42) 67
(15) 44
23
5,828
1,120
 1,987
—
 2,431
29
 223
2
Noninterest expense7,290
6,982
 5,348
5,175
 881
853
 2,622
2,585
6,626
6,836
 6,764
5,661
 899
931
 2,506
2,596
Income before income tax expense5,658
5,328
 3,898
3,672
 1,259
1,433
 902
951
Income tax expense1,385
1,242
 1,089
1,046
 322
344
 234
227
Net income$4,273
$4,086
 $2,809
$2,626
 $937
$1,089
 $668
$724
Income/(loss) before income tax expense/(benefit)(237)5,528
 7,601
4,170
 (938)1,325
 881
961
Income tax expense/(benefit)(61)1,371
 2,137
1,224
 (247)323
 223
242
Net income/(loss)$(176)$4,157
 $5,464
$2,946
 $(691)$1,002
 $658
$719
Average equity$52,000
$51,000
 $80,000
$70,000
 $22,000
$20,000
 $10,500
$9,000
$52,000
$52,000
 $80,000
$80,000
 $22,000
$22,000
 $10,500
$10,500
Total assets532,487
560,432
 1,023,132
928,148
 222,483
217,194
 174,226
166,716
492,251
536,758
 1,080,761
976,430
 234,934
220,712
 183,189
172,149
ROE32%31% 13%14% 16%21% 24%31%(2)%31% 27%14% (14)%17% 24%27%
Overhead ratio51
53
 57
59
 40
38
 73
73
54
51
 41
58
 38
41
 69
73
As of or for the three months ended September 30,
(in millions, except ratios)		Corporate 
Reconciling Items(a)
 Total
2019
2018
 2019
2018
 2019
2018
As of or for the three months ended June 30,
(in millions, except ratios)		Corporate 
Reconciling Items(a)
 
Total(b)
2020
2019
 2020
2019
 2020
2019
Noninterest revenue$120
$(177) $(596)$(408) $15,113
$13,352
$(67)$(125) $(730)$(596) $19,127
$14,349
Net interest income572
74
 (127)(154) 14,228
13,908
(687)447
 (107)(138) 13,853
14,398
Total net revenue692
(103) (723)(562) 29,341
27,260
(754)322
 (837)(734) 32,980
28,747
Provision for credit losses—
2
 —
—
 1,514
948
4
(2) —
—
 10,473
1,149
Noninterest expense281
28
 —
—
 16,422
15,623
147
232
 —
—
 16,942
16,256
Income/(loss) before income tax expense/(benefit)411
(133) (723)(562) 11,405
10,689
(905)92
 (837)(734) 5,565
11,342
Income tax expense/(benefit)18
12
 (723)(562) 2,325
2,309
(337)(736) (837)(734) 878
1,690
Net income/(loss)$393
$(145) $—
$—
 $9,080
$8,380
$(568)$828
 $—
$—
 $4,687
$9,652
Average equity$71,113
$80,439
 $—
$—
 $235,613
$230,439
$69,908
$68,526
 $—
$—
 $234,408
$233,026
Total assets812,333
742,693
 NA
NA
 2,764,661
2,615,183
1,221,980
821,330
 NA
NA
 3,213,115
2,727,379
ROENM
NM
 NM
NM
 15%14%NM
NM
 NM
NM
 7%16%
Overhead ratioNM
NM
 NM
NM
 56
57
NM
NM
 NM
NM
 51
57

(a)Segment managed results reflect revenue on an FTE basis with the corresponding income tax impact recorded within income tax expense/(benefit). These adjustments are eliminated in reconciling items to arrive at the Firm’s reported U.S. GAAP results.
(b)In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.









Segment results and reconciliation(a)
Segment results and reconciliation(a)
Segment results and reconciliation(a)
As of or for the nine months ended September 30,
(in millions, except ratios)		Consumer &
Community Banking		 Corporate &
Investment Bank		 Commercial Banking Asset & Wealth Management
2019
2018
 2019
2018
 2019
2018
 2019
2018
As of or for the six months ended June 30,
(in millions, except ratios)
Consumer &
Community Banking(b)
 Corporate &
Investment Bank		 Commercial Banking Asset & Wealth Management
2020
2019
 2020
2019
 2020
2019
 2020
2019
Noninterest revenue$13,868
$12,063
 $22,328
$21,954
 $1,806
$1,758
 $7,989
$7,997
$8,075
$8,142
 $19,114
$15,496
 $1,436
$1,356
 $5,429
$5,276
Net interest income27,975
26,321
 6,499
7,257
 4,950
4,995
 2,627
2,640
17,254
18,785
 7,186
4,369
 3,134
3,342
 1,787
1,772
Total net revenue41,843
38,384
 28,827
29,211
 6,756
6,753
 10,616
10,637
25,329
26,927
 26,300
19,865
 4,570
4,698
 7,216
7,048
Provision for credit losses3,745
3,405
 179
(142) 186
23
 48
40
11,600
2,434
 3,388
87
 3,441
119
 317
4
Noninterest expense21,663
20,770
 16,288
16,237
 2,618
2,541
 7,865
7,732
13,728
13,759
 12,660
11,290
 1,887
1,869
 5,165
5,243
Income before income tax expense16,435
14,209
 12,360
13,116
 3,952
4,189
 2,703
2,865
Income tax expense4,025
3,385
 3,365
3,318
 966
988
 655
616
Net income$12,410
$10,824
 $8,995
$9,798
 $2,986
$3,201
 $2,048
$2,249
Income/(loss) before income tax expense/(benefit)1
10,734
 10,252
8,488
 (758)2,710
 1,734
1,801
Income tax expense/(benefit)(14)2,630
 2,800
2,282
 (214)648
 412
421
Net income/(loss)$15
$8,104
 $7,452
$6,206
 $(544)$2,062
 $1,322
$1,380
Average equity$52,000
$51,000
 $80,000
$70,000
 $22,000
$20,000
 $10,500
$9,000
$52,000
$52,000
 $80,000
$80,000
 $22,000
$22,000
 $10,500
$10,500
Total assets532,487
560,432
 1,023,132
928,148
 222,483
217,194
 174,226
166,716
492,251
536,758
 1,080,761
976,430
 234,934
220,712
 183,189
172,149
Return on equity31%27% 14%18% 17%20% 25%32%(1)%31% 18%15% (6)%18% 24%26%
Overhead ratio52
54
 57
56
 39
38
 74
73
54
51
 48
57
 41
40
 72
74
As of or for the nine months ended September 30,
(in millions, except ratios)		Corporate 
Reconciling Items(a)
 Total
2019
2018
 2019
2018
 2019
2018
As of or for the six months ended June 30,
(in millions, except ratios)		Corporate 
Reconciling Items(a)
 
Total(b)
2020
2019
 2020
2019
 2020
2019
Noninterest revenue$3
$(220) $(1,777)$(1,337) $44,217
$42,215
$264
$(117) $(1,438)$(1,181) $32,880
$28,972
Net interest income1,436
(35) (408)(473) 43,079
40,705
(852)864
 (217)(281) 28,292
28,851
Total net revenue1,439
(255) (2,185)(1,810) 87,296
82,920
(588)747
 (1,655)(1,462) 61,172
57,823
Provision for credit losses—
(3) —
—
 4,158
3,323
12
—
 —
—
 18,758
2,644
Noninterest expense724
394
 —
—
 49,158
47,674
293
443
 —
—
 33,733
32,604
Income/(loss) before income tax expense/(benefit)715
(646) (2,185)(1,810) 33,980
31,923
(893)304
 (1,655)(1,462) 8,681
22,575
Income tax expense/(benefit)(757)18
 (2,185)(1,810) 6,069
6,515
(200)(775) (1,655)(1,462) 1,129
3,744
Net income/(loss)$1,472
$(664) $—
$—
 $27,911
$25,408
$(693)$1,079
 $—
$—
 $7,552
$18,831
Average equity$68,417
$78,995
 $—
$—
 $232,917
$228,995
$69,969
$67,047
 $—
$—
 $234,469
$231,547
Total assets812,333
742,693
 NA
NA
 2,764,661
2,615,183
1,221,980
821,330
 NA
NA
 3,213,115
2,727,379
Return on equityNM
NM
 NM
NM
 15%14%NM
NM
 NM
NM
 6%16%
Overhead ratioNM
NM
 NM
NM
 56
57
NM
NM
 NM
NM
 55
56
(a)Segment managed results reflect revenue on an FTE basis with the corresponding income tax impact recorded within income tax expense/(benefit). These adjustments are eliminated in reconciling items to arrive at the Firm’s reported U.S. GAAP results.
(b)In the second quarter of 2020, the Firm reclassified certain spend-based credit card reward costs from marketing expense to be a reduction of card income, with no effect on net income. Prior-period amounts have been revised to conform with the current presentation.






pwclogobwaa10.jpg
Report of Independent Registered Public Accounting Firm


To the Board of Directors and Shareholders of JPMorgan Chase & Co.:
Results of Review of Interim Financial Statements
We have reviewed the accompanying consolidated balance sheet of JPMorgan Chase & Co. and its subsidiaries (the “Firm”) as of SeptemberJune 30, 2019,2020, and the related consolidated statements of income, comprehensive income, and changes in stockholders’ equity for the three-month and nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 20182019 and the consolidated statements of cash flows for the nine-monthsix-month periods ended SeptemberJune 30, 20192020 and 2018,2019, including the related notes (collectively referred to as the “interim financial statements”). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.
We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of the Firm as of December 31, 2018,2019, and the related consolidated statements of income, comprehensive income, changes in stockholders’ equity and of cash flows for the year then ended (not presented herein), and in our report dated February 26, 2019,25, 2020, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet information as of December 31, 2018,2019, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

 
Basis for Review Results
These interim financial statements are the responsibility of the Firm’s management. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Firm in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our review in accordance with the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
pwcsig2020.jpg
November 4, 2019August 3, 2020
























PricewaterhouseCoopers LLP, 300 Madison Avenue, New York, NY 10017

JPMorgan Chase & Co.Consolidated average balance sheets, interest and rates (unaudited)(Taxable-equivalent interest and rates; in millions, except rates)
      
Three months ended September 30, 2019 Three months ended September 30, 2018Three months ended June 30, 2020 Three months ended June 30, 2019
Average
balance
Interest(g)
 Rate
(annualized)		 Average
balance
Interest(g)
 Rate
(annualized)		Average
balance
Interest(f)
 Rate
(annualized)		 Average
balance
Interest(f)
 Rate
(annualized)
Assets            
Deposits with banks$267,578
$898
 1.33% $408,595
$1,585
 1.54 $477,895
$70
 0.06 % $289,838
$1,132
 1.57 
Federal funds sold and securities purchased under resale agreements276,721
1,542
 2.21
 208,439
952
 1.81 244,306
601
 0.99
 288,781
1,676
 2.33 
Securities borrowed(a)
139,939
434
 1.23
 117,057
248

0.84 141,328
(175) (0.50)
(g) 
 126,157
467

1.48 
Trading assets – debt instruments(a)
339,198
2,671
 3.12
 241,074
2,170
 3.57 380,442
2,363
 2.50
 351,716
2,927
 3.34 
Taxable securities308,619
2,132
 2.74
 187,942
1,402
 2.96 466,324
2,154
 1.86
 244,814
1,875
 3.07 
Nontaxable securities(b)(a)
34,515
396
 4.55
 42,045
490
 4.62 33,930
373
 4.42
 36,418
422
 4.65 
Total investment securities343,134
2,528
 2.92
(h) 
 229,987
1,892
 3.26
(h) 
500,254
2,527
 2.03
(h) 
 281,232
2,297
 3.28
(h) 
Loans947,280
12,623
 5.29
 951,724
12,250
 5.11 997,558
10,655
 4.30
 954,854
12,770
 5.36 
All other interest-earning assets(c)(b)
51,304
552
 4.27
 46,429
496
 4.23 78,072
178
 0.92
 46,516
472
 4.07 
Total interest-earning assets(a)
2,365,154
21,248
 3.56
 2,203,305
19,593
 3.53 2,819,855
16,219
 2.31
 2,339,094
21,741
 3.73 
Allowance for loan losses(13,142)    (13,207)  (23,287)    (13,428)  
Cash and due from banks20,375
    21,101
  22,169
    20,651
  
Trading assets – equity and other instruments(a)
113,980
    119,915
  99,115
    120,545
  
Trading assets – derivative receivables57,062
    62,075
  79,298
    52,659
  
Goodwill, MSRs and other intangible assets
53,125
    54,652
  51,785
    54,144
  
All other noninterest-earning assets168,498
    151,780
  180,333
    165,390
  
Total assets$2,765,052
    $2,599,621
  $3,229,268
    $2,739,055
  
Liabilities            
Interest-bearing deposits(a)
$1,123,452
$2,409
 0.85% $1,041,896
$1,621
 0.62 $1,375,213
$349
 0.10 % $1,104,051
$2,413
 0.88 
Federal funds purchased and securities loaned or sold under repurchase agreements239,698
1,241
 2.05
 184,377
827
 1.78 276,815
131
 0.19
 227,313
1,226
 2.16 
Short-term borrowings(d)(c)
44,814
261
 2.31
 52,779
288
 2.17 45,297
124
 1.11
 58,262
363
 2.49 
Trading liabilities – debt and all other interest-bearing
liabilities(f)(e)
183,369
660
 1.43
 176,795
617
 1.39 207,322
(43) (0.08)
(g) 
 191,655
762
 1.60 
Beneficial interests issued by consolidated VIEs21,123
134
 2.53
 19,921
122
 2.41 20,331
59
 1.15
 26,713
175
 2.63 
Long-term debt(a)
248,985
2,188
 3.49
 241,878
2,056
 3.37 269,336
1,639
 2.45
 246,053
2,266
 3.69 
Total interest-bearing liabilities(a)
1,861,441
6,893
 1.47
 1,717,646
5,531
 1.28 2,194,314
2,259
 0.41
 1,854,047
7,205
 1.56 
Noninterest-bearing deposits(a)
407,428
    410,966
  515,304
    408,243
  
Trading liabilities – equity and other instruments(f)(e)
31,310
    36,605
  33,797
    30,170
  
Trading liabilities – derivative payables45,987
    44,810
  63,178
    40,233
  
All other liabilities, including the allowance for lending-related commitments(a)
155,032
    132,903
  158,204
    146,343
  
Total liabilities2,501,198
    2,342,930
  2,964,797
    2,479,036
  
Stockholders’ equity            
Preferred stock28,241
    26,252
  30,063
    26,993
  
Common stockholders’ equity235,613
    230,439
  234,408
    233,026
  
Total stockholders’ equity263,854
    256,691
  264,471
    260,019
  
Total liabilities and stockholders’ equity$2,765,052
    $2,599,621
  $3,229,268
    $2,739,055
  
Interest rate spread(a)
  2.09%   2.25   1.90 %   2.17 
Net interest income and net yield on interest-earning assets(a)
 $14,355
 2.41
  $14,062
 2.53  $13,960
 1.99
  $14,536
 2.49 
(a)In the second quarter of 2019, the Firm implemented certain presentation changes that impacted interest income and interest expense, but had no effect on net interest income. These changes were made to align the accounting treatment between the balance sheet and the related interest income or expense, primarily by offsetting interest income and expense for certain prime brokerage-related held-for-investment customer receivables and payables that are currently presented as a single margin account on the balance sheet. In addition, the Firm reclassified balances related to certain instruments and structured notes from interest-earning/bearing to noninterest-earning/bearing assets and liabilities as the associated returns are recorded in principal transactions revenue and not in net interest income. These changes were applied retrospectively and, accordingly, prior period amounts were revised to conform with the current presentation.
(b)Represents securities which are tax-exempt for U.S. federal income tax purposes.
(c)(b)Includes prime brokerage-related held-for-investment customer receivables, which are classified in accrued interest and accounts receivable, and all other interest-earning assets, which are classified in other assets on the Consolidated Balance Sheets.
(d)(c)Includes commercial paper.
(e)(d)OtherAll other interest-bearing liabilities include prime brokerage-related customer payables.
(f)(e)The combined balance of trading liabilities – debt and equity instruments were $102.3was $108.9 billion and $106.4$111.0 billion for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.
(g)(f)Interest includes the effect of certain related hedging derivatives. Taxable-equivalent amounts are used where applicable.
(g)Negative interest income and yield are related to the impact of current interest rates combined with the fees paid on client-driven securities borrowed balances. The negative interest expense related to prime brokerage customer payables is recognized in interest expense and reported within trading liabilities - debt and all other interest-bearing liabilities.
(h)The annualized rate for securities based on amortized cost was 2.97%2.07% and 3.29%3.32% for the three months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and does not give effect to changes in fair value that are reflected in AOCI.


JPMorgan Chase & Co.Consolidated average balance sheets, interest and rates (unaudited)(Taxable-equivalent interest and rates; in millions, except rates)
      
Nine months ended September 30, 2019 Nine months ended September 30, 2018 Six months ended June 30, 2020 Six months ended June 30, 2019
Average
balance
Interest(g)
 Rate
(annualized)		 Average
balance
Interest(g)
 Rate
(annualized)		Average
balance
Interest(f)
 Rate
(annualized)		 Average
balance
Interest(f)
 Rate
(annualized)
Assets              
Deposits with banks$282,483
$3,200
 1.51% $419,392
$4,449
 1.42 $378,821
$639
 0.34 % $290,058
$2,302
 1.60% 
Federal funds sold and securities purchased under resale agreements284,616
4,865
 2.29
 203,969
2,490
 1.63 248,856
1,696
 1.37
 288,631
3,323
 2.32
 
Securities borrowed(a)
129,915
1,298
 1.34
 113,112
549
 0.65 138,728
(23) (0.03)
(g) 
 124,820
864
 1.40
 
Trading assets – debt instruments(a)
337,879
8,380
 3.32
 240,404
6,415
 3.57 363,676
4,835
 2.67
 337,209
5,709
 3.41
 
Taxable securities258,406
5,712
 2.96
 190,970
4,098
 2.87 427,270
4,387
 2.06
 232,880
3,580
 3.10
 
Nontaxable securities(b)(a)
36,490
1,271
 4.66
 42,911
1,494
 4.65 33,621
738
 4.41
 37,496
875
 4.71
 
Total investment securities294,896
6,983
 3.17
(h) 
 233,881
5,592
 3.20
(h) 
460,891
5,125
 2.24
(h) 
 270,376
4,455
 3.32
(h) 
Loans956,641
38,313
 5.35
 939,408
35,047
 4.99 980,189
22,621
 4.64
 961,400
25,690
 5.39
 
All other interest-earning assets(c)(b)
48,193
1,482
 4.11
 48,743
1,430
 3.92 71,633
597
 1.68
 46,611
930
 4.03
 
Total interest-earning assets(a)
2,334,623
64,521
 3.69
 2,198,909
55,972
 3.40 2,642,794
35,490
 2.70
 2,319,105
43,273
 3.76
 
Allowance for loan losses(13,366)    (13,303)  (20,322)    (13,480)    
Cash and due from banks20,824
    21,771
  21,918
    21,052
    
Trading assets – equity and other instruments(a)
114,394
    124,048
  106,797
    114,605
    
Trading assets – derivative receivables54,098
    61,188
  72,803
    52,591
    
Goodwill, MSRs and other intangible assets
53,853
    54,656
  52,238
    54,222
    
All other noninterest-earning assets165,475
    152,325
  183,522
    163,940
    
Total assets$2,729,901
    $2,599,594
  $3,059,750
    $2,712,035
    
Liabilities              
Interest-bearing deposits(a)
$1,102,751
$7,010
 0.85% $1,039,646
$4,021
 0.52 $1,295,884
$1,924
 0.30 % $1,092,228
$4,601
 0.85% 
Federal funds purchased and securities loaned or sold under repurchase agreements225,471
3,577
 2.12
 190,832
2,164
 1.52 260,368
918
 0.71
 218,240
2,336
 2.16
 
Short-term borrowings(d)(c)
56,635
1,051
 2.48
 51,349
757
 1.97 41,292
275
 1.34
 62,643
790
 2.54
 
Trading liabilities – debt and all other interest-bearing liabilities(f)(e)
186,167
2,141
 1.54
 176,104
1,674
 1.27 200,138
329
 0.33
(g) 
 187,590
1,481
 1.59
 
Beneficial interests issued by consolidated VIEs23,549
459
 2.61
 21,449
366
 2.28 19,189
149
 1.56
 24,782
325
 2.64
 
Long-term debt(a)
247,782
6,796
 3.67
 244,307
5,812
 3.18 256,666
3,386
 2.65
 247,171
4,608
 3.76
 
Total interest-bearing liabilities(a)
1,842,355
21,034
 1.53
 1,723,687
14,794
 1.15 2,073,537
6,981
 0.68
 1,832,654
14,141
 1.56
 
Noninterest-bearing deposits(a)
405,075
    413,501
  467,467
    403,880
    
Trading liabilities – equity and other instruments(f)(e)
32,059
    33,607
  32,259
    32,440
    
Trading liabilities – derivative payables41,952
    42,919
  59,084
    39,902
    
All other liabilities, including the allowance for lending-related commitments(a)
148,086
    130,755
  163,200
    144,553
    
Total liabilities2,469,527
    2,344,469
  2,795,547
    2,453,429
    
Stockholders’ equity              
Preferred stock27,457
    26,130
  29,734
    27,059
    
Common stockholders’ equity232,917
    228,995
  234,469
    231,547
    
Total stockholders’ equity260,374
    255,125
  264,203
    258,606
    
Total liabilities and stockholders’ equity$2,729,901
    $2,599,594
  $3,059,750
    $2,712,035
    
Interest rate spread(a)
  2.16%   2.25   2.02 %   2.20% 
Net interest income and net yield on interest-earning assets(a)
 $43,487
 2.49
  $41,178
 2.50  $28,509
 2.17
  $29,132
 2.53
 
(a)
In the second quarter of 2019, the Firm implemented certain presentation changes that impacted interest income and interest expense, but had no effect on net interest income. These changes were made to align the accounting treatment between the balance sheet and the related interest income or expense, primarily by offsetting interest income and expense for certain prime brokerage-related held-for-investment customer receivables and payables that are currently presented as a single margin account on the balance sheet. In addition, the Firm reclassified balances related to certain instruments and structured notes from interest-earning/bearing to noninterest-earning/bearing assets and liabilities as the associated returns are recorded in principal transactions revenue and not in net interest income. These changes were applied retrospectively and, accordingly, prior period amounts were revised to conform with the current presentation.
(b)Represents securities which are tax-exempt for U.S. federal income tax purposes.
(c)(b)Includes prime brokerage-related held-for-investment customer receivables, which are classified in accrued interest and accounts receivable, and all other interest-earning assets, which are classified in other assets on the Consolidated Balance Sheets.
(d)(c)Includes commercial paper.
(e)(d)Other interest-bearing liabilities include prime brokerage-related customer payables.
(f)(e)The combined balance of trading liabilities – debt and equity instruments were $106.8$105.0 billion and $105.1$109.0 billion for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively.
(g)(f)Interest includes the effect of certain related hedging derivatives. Taxable-equivalent amounts are used where applicable.
(g)Negative interest income and yield are related to the impact of current interest rates combined with the fees paid on client-driven securities borrowed balances. The negative interest expense related to prime brokerage customer payables is recognized in interest expense and reported within trading liabilities - debt and all other liabilities.
(h)The annualized rate for securities based on amortized cost was 3.20%2.27% and 3.23%3.36% and for the ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, respectively, and does not give effect to changes in fair value that are reflected in AOCI.

GLOSSARY OF TERMS AND ACRONYMS
20182019 Form 10-K: Annual report on Form 10-K for year ended December 31, 2018,2019, filed with the U.S. Securities and Exchange Commission.
ABS: Asset-backed securities
Active foreclosures: Loans referred to foreclosure where formal foreclosure proceedings are ongoing. Includes both judicial and non-judicial states.
AFS: Available-for-sale
Allowance for loan losses to total retained loans: represents period-end allowance for loan losses divided by retained loans.
Amortized cost: Amount at which a financing receivable or investment is originated or acquired, adjusted for accretion or amortization of premium, discount, and net deferred fees or costs, collection of cash, charge-offs, foreign exchange, and fair value hedge accounting adjustments. For AFS securities, amortized cost is also reduced by any impairment losses recognized in earnings. Amortized cost is not reduced by the allowance for credit losses, except where explicitly presented net.
AOCI: Accumulated other comprehensive income/(loss)
ARM(s): Adjustable rate mortgage(s)
AUC: “Assets under custody”: Represents assets held directly or indirectly on behalf of clients under safekeeping, custody and servicing arrangements.
Auto loan and lease origination volume: Dollar amount of auto loans and leases originated.
AWM: Asset & Wealth Management
Beneficial interests issued by consolidated VIEs: represents the interest of third-party holders of debt, equity securities, or other obligations, issued by VIEs that JPMorgan Chase consolidates.
Benefit obligation: refers to the projected benefit obligation for pension plans and the accumulated postretirement benefit obligation for OPEB plans.
BHC: Bank holding company
Bridge Financing Portfolio: A portfolio of held-for-sale unfunded loan commitments and funded loans. The unfunded commitments include both short-term bridge loan commitments that will ultimately be replaced by longer term financing as well as term loan commitments. The funded loans include term loans and funded revolver facilities.
CB: Commercial Banking
CBB: Consumer & Business Banking
CCAR: Comprehensive Capital Analysis and Review
CCB: Consumer & Community Banking
CDS: Credit default swaps
CECL: Current Expected Credit Losses
CEO: Chief Executive Officer
CET1 Capital:capital: Common equity Tier 1 Capitalcapital
CFTC: Commodity Futures Trading Commission
CFO: Chief Financial Officer
Chase Bank USA, N.A.: Chase Bank USA, National Association
CIB: Corporate & Investment Bank
CIO: Chief Investment Office
Client assets: Represent assets under management as well as custody, brokerage, administration and deposit accounts.
Client deposits and other third-party liabilities: Deposits, as well as deposits that are swept to on-balance sheet liabilities (e.g., commercial paper, federal funds purchased and securities loaned or sold under repurchase agreements) as part of client cash management programs.
CLTV: Combined loan-to-value
Collateral-dependent: A loan is considered to be collateral-dependent when repayment of the loan is expected to be provided solely bysubstantially through the underlying operation or sale of thecollateral rather than by cash flows fromwhen the borrower’s operations, income or other resources.borrower is experiencing financial difficulty, including when foreclosure is deemed probable based on borrower delinquency.
Commercial Card: provides a wide range of payment services to corporate and public sector clients worldwide through the commercial card products. Services include procurement, corporate travel and entertainment, expense
management services, and business-to-business payment solutions.
Core loans: CPFFrepresents loans central to the Firm’s ongoing businesses; core loans excludes loans classified as trading assets, runoff portfolios, discontinued portfolios and portfolios the Firm has an intent to exit.: Commercial Paper Funding Facility
Credit derivatives: Financial instruments whose value is derived from the credit risk associated with the debt of a third-party issuer (the reference entity) which allow one party (the protection purchaser) to transfer that risk to another party (the protection seller). Upon the occurrence of a credit event by the reference entity, which may include, among other events, the bankruptcy or failure to pay its obligations, or certain restructurings of the debt of the reference entity, neither party has recourse to the reference entity. The protection purchaser has recourse to the protection seller for the difference between the face value of the CDS contract and the fair value at the time of settling the credit derivative contract. The determination as to whether a credit event has occurred is generally made by the relevant International Swaps and Derivatives Association (“ISDA”) Determinations Committee.
Criticized: Criticized loans, lending-related commitments and derivative receivables that are classified as special mention, substandard and doubtful categories for regulatory purposes and are generally consistent with a rating of CCC+/Caa1 and below, as defined by S&P and Moody’s.
CRO: Chief Risk Officer
CVA: Credit valuation adjustment
DVA: Debit valuation adjustment
EC: European Commission
Eligible LTD: Long-term debt satisfying certain eligibility criteria

Embedded derivatives: are implicit or explicit terms or features of a financial instrument that affect some or all of the cash flows or the value of the instrument in a manner similar to a derivative. An instrument containing such terms or features is referred to as a “hybrid.” The component of the hybrid that is the non-derivative instrument is referred to as the “host.” For example, callable debt is a hybrid instrument that contains a plain vanilla debt instrument (i.e., the host) and an embedded option that allows the issuer to redeem the debt issue at a specified date for a specified amount (i.e., the embedded derivative). However, a floating rate instrument is not a hybrid composed of a fixed-rate instrument and an interest rate swap.
ERISA: Employee Retirement Income Security Act of 1974
EPS: Earnings per share
Exchange-traded derivatives: Derivative contracts that are executed on an exchange and settled via a central clearing house.
Expense categories:
Volume- and revenue-related expenses generally correlate with changes in the related business/transaction volume or revenue. Examples of volume- and revenue-related expenses include commissions and incentive compensation, depreciation expense related to operating lease assets, and brokerage expense related to equities trading transaction volume.
Investments include expenses associated with supporting medium- to longer-term strategic plans of the Firm. Examples of investments include initiatives in technology (including related compensation), marketing, and compensation for new bankers and client advisors.
Structural expenses are those associated with the day-to-day cost of running the bank and are expenses not covered by the above two categories. Examples of structural expenses include employee salaries and benefits, as well as noncompensation costs such as real estate and all other expenses.
EU: European Union
Fannie Mae: Federal National Mortgage Association
FASB: Financial Accounting Standards Board

FCA: Financial Conduct Authority
FDIC: Federal Deposit Insurance Corporation
Federal Reserve: The Board of the Governors of the Federal Reserve System
FFIEC: Federal Financial Institutions Examination Council
FHA: Federal Housing Administration
FHLB: Federal Home Loan Bank
FICO score: A measure of consumer credit risk based on information in consumer credit reports produced by Fair Isaac Corporation. Because certain aged data is excluded from credit reports based on rules in the Fair Credit Reporting Act, FICO scores may not reflect all historical information about a consumer.
Firm: JPMorgan Chase & Co.
Follow-on offering: An issuance of shares following a company's IPO.
Forward points: represents the interest rate differential between two currencies, which is either added to or subtracted from the current exchange rate (i.e., “spot rate”) to determine the forward exchange rate.
FRBB: Federal Reserve Bank of Boston
FRBNY: Federal Reserve Bank of New York
Freddie Mac: Federal Home Loan Mortgage Corporation
Free-standing derivatives: is a derivative contract entered into either separate and apart from any of the Firm’s other financial instruments or equity transactions. Or, in conjunction with some other transaction and is legally detachable and separately exercisable.
FTE: Fully taxable-equivalent
FVA: Funding valuation adjustment
FX: Foreign exchange
G7: “Group of Seven nations”: Countries in the G7 are Canada, France, Germany, Italy, Japan, the U.K. and the U.S.
G7 government securities: Securities issued by the government of one of the G7 nations.
Ginnie Mae: Government National Mortgage Association
GSIB: Global systemically important banks
HELOAN: Home equity loan
HELOC: Home equity line of credit
Home equity – senior lien: represents loans and commitments where JPMorgan Chase holds the first security interest on the property.
Home equity – junior lien: represents loans and commitments where JPMorgan Chase holds a security interest that is subordinate in rank to other liens.
HQLA: High-quality liquid assets
HTM: Held-to-maturity
IBOR: Interbank Offered Rate
IDI: Insured depository institutions
IHC: JPMorgan Chase Holdings LLC, an intermediate holding company
Impaired loan:Impaired loans are loans measured at amortized cost, for which it is probable that the Firm will be unable to collect all amounts due, including principal and interest, according to the contractual terms of the agreement. Impaired loans include the following:
All wholesale nonaccrual loans
All TDRs (both wholesale and consumer), including ones that have returned to accrual status
IPO: Initial public offering
Investment-grade: An indication of credit quality based on JPMorgan Chase’s internal risk assessment system. “Investment grade” generally represents a risk profile similar to a rating of a “BBB-”/“Baa3” or better, as defined by independent rating agencies.
IR: Interest rate
ISDA: International Swaps and Derivatives Association
JPMorgan Chase: JPMorgan Chase & Co.
JPMorgan Chase Bank, N.A.: JPMorgan Chase Bank, National Association
J.P. Morgan Securities: J.P. Morgan Securities LLC
LCR: Liquidity coverage ratio
LGD: Loss given default
LIBOR: London Interbank Offered Rate

LLC: Limited Liability Company
LOB: Line of business
Loss emergence period: represents the time period between the date at which the loss is estimated to have been incurred and the ultimate realization of that loss.
LTV: “Loan-to-value ratio”: For residential real estate loans, the relationship, expressed as a percentage, between the principal amount of a loan and the appraised value of the collateral (i.e., residential real estate) securing the loan.
Origination date LTV ratio
The LTV ratio at the origination date of the loan. Origination date LTV ratios are calculated based on the actual appraised values of collateral (i.e., loan-level data) at the origination date.
Current estimated LTV ratio
An estimate of the LTV as of a certain date. The current estimated LTV ratios are calculated using estimated collateral values derived from a nationally recognized home price index measured at the metropolitan statistical area (“MSA”) level. These MSA-level home price indices consist of actual data to the extent available and forecasted data where actual data is not available. As a result, the estimated collateral values used to calculate these ratios do not represent actual appraised loan-level collateral values; as such, the resulting LTV ratios are necessarily imprecise and should therefore be viewed as estimates.
Combined LTV ratio
The LTV ratio considering all available lien positions, as well as unused lines, related to the property. Combined LTV ratios are used for junior lien home equity products.
Managed basis: A non-GAAP presentation of Firmwide financial results that includes reclassifications to present revenue on a fully taxable-equivalent basis. Management also uses this financial measure at the segment level, because it believes this provides information to enable investors to understand the underlying operational performance and trends of the particular business segment

and facilitates a comparison of the business segment with the performance of competitors.
Master netting agreement: A single agreement with a counterparty that permits multiple transactions governed by that agreement to be terminated or accelerated and settled through a single payment in a single currency in the event of a default (e.g., bankruptcy, failure to make a required payment or securities transfer or deliver collateral or margin when due).
Measurement alternative: Measures equity securities without readily determinable fair values at cost less impairment (if any), plus or minus observable price changes from an identical or similar investment of the same issuer.
Merchant Services: offers merchants payment processing capabilities, fraud and risk management, data and analytics, and other payments services. Through Merchant Services, merchants of all sizes can accept payments via credit and debit cards and payments in multiple currencies.
MEV: Macroeconomic variable
MBS: Mortgage-backed securities
MD&A: Management’s discussion and analysis
MMLF: Money Market Mutual Fund Liquidity Facility
MMMF: Money market mutual funds
Moody’s: Moody’s Investor Services
Mortgage product types:
Alt-A
Alt-A loans are generally higher in credit quality than subprime loans but have characteristics that would disqualify the borrower from a traditional prime loan. Alt-A lending characteristics may include one or more of the following: (i) limited documentation; (ii) a high CLTV ratio; (iii) loans secured by non-owner occupied properties; or (iv) a debt-to-income ratio above normal limits. A substantial proportion of the Firm’s Alt-A loans are those where a borrower does not provide complete documentation of his or her assets or the amount or source of his or her income.
Option ARMs
The option ARM real estate loan product is an adjustable-rate mortgage loan that provides the borrower with the option each month to make a fully amortizing, interest-only or minimum payment. The minimum payment on an option ARM loan is based on the interest rate charged during the introductory period. This introductory rate is usually significantly below the fully indexed rate. The fully indexed rate is calculated using an index rate plus a margin. Once the introductory period ends, the contractual interest rate charged on the loan increases to the fully indexed rate and adjusts monthly to reflect movements in the index. The minimum payment is typically insufficient to cover interest accrued in the prior month, and any unpaid interest is deferred and added to the principal balance of the loan. Option ARM loans are subject to payment recast, which converts the loan to a variable-rate fully amortizing loan upon meeting specified loan balance and anniversary date triggers.
Prime
Prime mortgage loans are made to borrowers with good credit records who meet specific underwriting requirements, including prescriptive requirements related to income and overall debt levels. New prime mortgage borrowers provide full documentation and generally have reliable payment histories.
Subprime
Subprime loans are loans that, prior to mid-2008, were offered to certain customers with one or more high risk
characteristics, including but not limited to: (i) unreliable or poor payment histories; (ii) a high LTV ratio of greater than 80% (without borrower-paid mortgage insurance); (iii) a high debt-to-income ratio; (iv) an occupancy type for the loan is other than the borrower’s primary residence; or (v) a history of delinquencies or late payments on the loan.
MSA: Metropolitan statistical areas
MSR: Mortgage servicing rights
NA: Data is not applicable or available for the period presented.
NAV: Net Asset Value
Net Capital Rule: Rule 15c3-1 under the Securities Exchange Act of 1934.

Net charge-off/(recovery) rate: represents net charge-offs/(recoveries) (annualized) divided by average retained loans for the reporting period.
Net interchange income includes the following components:
•
Interchange income: Fees earned by credit and debit card issuers on sales transactions.
•
Rewards costs: The cost to the Firm for points earned by cardholders enrolled in credit card rewards programs.programs generally tied to sales transactions.
•
Partner payments: Payments to co-brand credit card partners based on the cost of loyalty program rewards earned by cardholders on credit card transactions.
Net yield on interest-earning assets: The average rate for interest-earning assets less the average rate paid for all sources of funds.
NM: Not meaningful
Nonaccrual loans: Loans for which interest income is not recognized on an accrual basis. Loans (other than credit card loans and certain consumer loans insured by U.S. government agencies) are placed on nonaccrual status when full payment of principal and interest is not expected, regardless of delinquency status, or when principal and interest has been in default for a period of 90 days or more unless the loan is both well-secured and in the process of collection. Collateral-dependent loans are typically maintained on nonaccrual status.
Nonperforming assets: Nonperforming assets include nonaccrual loans, nonperforming derivatives and certain assets acquired in loan satisfactions, predominantly real estate owned and other commercial and personal property.
OCC: Office of the Comptroller of the Currency
OCI: Other comprehensive income/(loss)
OPEB: Other postretirement employee benefit
OTC: “Over-the-counter derivatives”: Derivative contracts that are negotiated, executed and settled bilaterally between two derivative counterparties, where one or both counterparties is a derivatives dealer.
OTC cleared: “Over-the-counter cleared derivatives”: Derivative contracts that are negotiated and executed bilaterally, but subsequently settled via a central clearing house, such that each derivative counterparty is only exposed to the default of that clearing house.
OTTI: Other-than-temporary impairment

Overhead ratio: Noninterest expense as a percentage of total net revenue.
Parent Company: JPMorgan Chase & Co.
Participating securities: represents unvested share-based compensation awards containing nonforfeitable rights to dividends or dividend equivalents (collectively, “dividends”), which are included in the earnings per share calculation using the two-class method. JPMorgan Chase grants restricted stock and RSUs to certain employees under its share-based compensation programs, which entitle the recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to the dividends paid to
holders of common stock. These unvested awards meet the definition of participating securities. Under the two-class method, all earnings (distributed and undistributed) are allocated to each class of common stock and participating securities, based on their respective rights to receive dividends.
PCD: “Purchased credit deteriorated” assets represent acquired financial assets that as of the date of acquisition have experienced a more-than-insignificant deterioration in credit quality since origination, as determined by the Firm.
PCI: “Purchased credit-impaired” loans representsrepresented certain loans that were acquired and deemed to be credit-impaired on the acquisition date in accordance with thedate. The superseded FASB guidance of the FASB. The guidance allowsallowed purchasers to aggregate credit-impaired loans acquired in the same fiscal quarter into one or more pools, provided that the loans havehad common risk characteristics (e.g., product type, LTV ratios, FICO scores, past due status, geographic location). A pool iswas then accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows.
PD: Probability of default
PDCF: Primary Dealer Credit Facility
Phishing: a type of social engineering cyberattack received through email or online messages.
PPP: Paycheck Protection Program
PRA: Prudential Regulation Authority
Pre-provision profit/(loss): represents total net revenue less noninterest expense. The Firm believes that this financial measure is useful in assessing the ability of a lending institution to generate income in excess of its provision for credit losses.
Principal transactions revenue: Principal transactions revenue is driven by many factors, including the bid-offer spread, which is the difference between the price at which the Firm is willing to buy a financial or other instrument and the price at which the Firm is willing to sell that instrument. It also consists of realized (as a result of closing out or termination of transactions, or interim cash payments) and unrealized (as a result of changes in valuation) gains and losses on financial and other instruments (including those accounted for under the fair value option) primarily used in client-driven market-making activities and on private equity investments. In connection with its client-driven market-making activities, the Firm transacts in debt and equity instruments, derivatives and commodities (including physical commodities inventories and financial instruments that reference commodities). Principal transactions revenue also includes certain realized and unrealized gains and losses related to hedge accounting and specified risk-management activities, including: (a) certain derivatives designated in qualifying hedge accounting relationships (primarily fair value hedges of commodity and foreign exchange risk), (b) certain derivatives used for specific risk management purposes, primarily to mitigate credit risk and foreign exchange risk, and (c) other derivatives.
PSU(s): Performance share units
Receivables from customers: primarily represents prime brokerage-related held-for-investment customer receivables from brokerage customers that are collateralized through assets maintained in the clients’ brokerage accounts, as such no allowance is held against these receivables. These receivables are reported within accrued interest and accounts receivable on the Firm’s Consolidated balance sheets.
Regulatory VaR: Daily aggregated VaR calculated in accordance with regulatory rules.

REO: Real estate owned
Reported basis: Financial statements prepared under U.S. GAAP, which excludes the impact of taxable-equivalent adjustments.
Retained loans: Loans that are held-for-investment (i.e. excludes loans held-for-sale and loans at fair value).
Revenue wallet: Total fee revenue based on estimates of investment banking fees generated across the industry (i.e., the revenue wallet) from investment banking transactions in M&A, equity and debt underwriting, and loan syndications. Source: Dealogic, a third-party provider of investment banking competitive analysis and volume based league tables for the above noted industry products.
RHS: Rural Housing Service of the U.S. Department of Agriculture
ROE: Return on equity
ROTCE: Return on tangible common equity
ROU assets: Right-of-use assets
RSU(s): Restricted stock units
RWA: “Risk-weighted assets”: Basel III establishes two comprehensive approaches for calculating RWA (a Standardized approach and an Advanced approach) which include capital requirements for credit risk, market risk, and in the case of Basel III Advanced, also operational risk. Key differences in the calculation of credit risk RWA between the Standardized and Advanced approaches are that for Basel III Advanced, credit risk RWA is based on risk-sensitive approaches which largely rely on the use of internal credit models and parameters, whereas for Basel III Standardized, credit risk RWA is generally based on supervisory risk-weightings which vary primarily by counterparty type and asset class. Market risk RWA is calculated on a generally consistent basis between Basel III Standardized and Basel III Advanced.
Scored portfolio:portfolios: The scored portfolioConsumer loan portfolios that predominantly includesinclude residential real estate loans, credit card loans, auto loans to individuals and certain auto andsmall business banking loans where credit loss estimates are based on statistical analysis of credit losses over discrete periods of time. The statistical analysis uses portfolio modeling, credit scoring and decision-support tools.loans.
S&P: Standard and Poors
SAR(s): Stock appreciation rights
SCB:Stress capital buffer
SEC: U.S. Securities and Exchange Commission
Seed capital: Initial JPMorgan capital invested in products,

such as mutual funds, with the intention of ensuring the fund is of sufficient size to represent a viable offering to clients, enabling pricing of its shares, and allowing the manager to develop a track record. After these goals are achieved, the intent is to remove the Firm’s capital from the investment.
Shelf Deals: Shelf offerings are SEC provisions that allow issuers to register for new securities without selling the entire issuance at once. Since these issuances are filed with the SEC but are not yet priced in the market, they are not included in the league tables until the actual securities are issued.
Single-name: Single reference-entities
SLR: Supplementary leverage ratio
SMBS: Stripped mortgage-backed securities
SMCCF: Secondary Market Corporate Credit Facility
SOFR: Secured Overnight Financing Rate
SPEs: Special purpose entities
SPV: Special purpose vehicle
Structural interest rate risk: represents interest rate risk of the non-trading assets and liabilities of the Firm.
Structured notes: Structured notes are financial instruments whose cash flows are linked to the movement in one or more indexes, interest rates, foreign exchange rates, commodities prices, prepayment rates, or other market variables. The notes typically contain embedded (but not separable or detachable) derivatives. Contractual cash flows for principal, interest, or both can vary in amount and timing throughout the life of the note based on non-traditional indexes or non-traditional uses of traditional interest rates or indexes.
Suspended foreclosures: Loans referred to foreclosure where formal foreclosure proceedings have started but are currently on hold, which could be due to bankruptcy or loss mitigation. Includes both judicial and non-judicial states.
TALF: Term Asset-Backed Securities Loan Facility
Taxable-equivalent basis: In presenting managed results, the total net revenue for each of the business segments and the Firm is presented on a tax-equivalent basis. Accordingly, revenue from investments that receive tax credits and tax-exempt securities is presented in the managed results on a basis comparable to taxable investments and securities; the corresponding income tax impact related to tax-exempt items is recorded within income tax expense.
TBVPS: Tangible book value per share
TCE: Tangible common equity
TDR: “Troubled debt restructuring” is deemed to occur when the Firm modifies the original terms of a loan agreement by granting a concession to a borrower that is experiencing financial difficulty. Loans with short-term and other insignificant modifications that are not considered concessions are not TDRs.
TLAC: Total Loss Absorbing Capacity
U.K.: United Kingdom
Unaudited: Financial statements and information that have not been subjected to auditing procedures sufficient to permit an independent certified public accountant to express an opinion.
U.S.: United States of America
U.S. government agencies: U.S. government agencies include, but are not limited to, agencies such as Ginnie Mae and FHA, and do not include Fannie Mae and Freddie Mac which are U.S. government-sponsored enterprises (“U.S. GSEs”). In general, obligations of U.S. government agencies are fully and explicitly guaranteed as to the timely payment of principal and interest by the full faith and credit of the U.S. government in the event of a default.

U.S. GAAP: Accounting principles generally accepted in the United States of America.
U.S. GSE(s): “U.S. government-sponsored enterprises” are quasi-governmental, privately-held entities established or chartered by the U.S. government to serve public purposes as specified by the U.S. Congress to improve the flow of credit to specific sectors of the economy and provide certain essential services to the public. U.S. GSEs include Fannie Mae and Freddie Mac, but do not include Ginnie Mae or FHA. U.S. GSE obligations are not explicitly guaranteed as to the timely payment of principal and interest by the full faith and credit of the U.S. government.
U.S. Treasury: U.S. Department of the Treasury
VA: U.S. Department of Veterans Affairs
VaR: “Value-at-risk” is a measure of the dollar amount of potential loss from adverse market moves in an ordinary market environment.
VIEs: Variable interest entities
Warehouse loans: consist of prime mortgages originated with the intent to sell that are accounted for at fair value and classified as trading assets.

LINE OF BUSINESS METRICS
CONSUMER & COMMUNITY BANKING (“CCB”)
Debit and credit card sales volume: Dollar amount of cardmember purchases, net of returns.
Deposit margin/deposit spread: representsRepresents net interest income expressed as a percentage of average deposits.
Home Lending Production and Home Lending Servicing revenue comprises the following:
Net mortgage servicing revenue: Includes
operating revenue earned from servicing third-party
mortgage loans, which is recognized over the period in
which the service is provided,provided; changes in the fair value of
MSRs, MSRs; the impact of risk management activities
associated with MSRsMSRs; and gains and losses on securitization of excess mortgage servicing. Net mortgage servicing revenue also includes gains and losses on sales and lower of cost or fair value adjustments of certain repurchased loans insured by U.S. government agencies.
Net production revenue: Includes fees and income
recognized as earned on mortgage loans originated with the
intent to sell;sell, and the impact of risk management activities
associated with the mortgage pipeline and warehouse
loans; and changes in the fair value of any residual interests
held from mortgage securitizations. loans. Net production revenue
also includes gains and losses on sales and lower of cost or fair value adjustments on mortgage loans held-for-sale (excluding certain repurchased loans insured by U.S. government agencies) held-for-sale, and changes in the fair value on mortgage loans originated with the intent to sell andof financial instruments measured at fair value under the fair value option.
Mortgage origination channels comprise the following:
Retail: Borrowers who buy or refinance a home through direct contact with a mortgage banker employed by the Firm using a branch office, the Internet or by phone. Borrowers are frequently referred to a mortgage banker by a banker in a Chase branch, real estate brokers, home builders or other third parties.
Correspondent: Banks, thrifts, other mortgage banks and other financial institutions that sell closed loans to the Firm.
Card Services: includes the Credit Card and Merchant Services businesses.
Credit Card: is a business that primarily issues credit cards to consumers and small businesses.
Merchant Services: is a business that primarily processes transactions for merchants.
Net revenue rate: represents Credit Card Services net revenue (annualized) expressed as a percentage of average loans for the period.
Auto loan and lease origination volume: Dollar amount of auto loans and leases originated.
 
CORPORATE & INVESTMENT BANK (“CIB”)
Definition of selected CIB revenue:
Investment Banking: incorporates all revenue associated with investment banking activities, and is reported net of investment banking revenue shared with other lines of business.LOBs.
Treasury Services: Wholesale Paymentsoffers a broad range of products and services that enable clients to manage payments and receipts, as well as invest and manage funds. Products include U.S. dollar and multi-currency clearing, ACH, lockbox, disbursement and reconciliation services, check deposits, and currency-related services. includes the following:
•
Treasury Services: offers a broad range of products and services that enable clients to manage payments and receipts, as well as invest and manage funds. Products include U.S. dollar and multi-currency clearing, automated clearing house, lockbox, disbursement and reconciliation services, check deposits, and currency-related services;
•
Merchant Services: primarily processes transactions for merchants; and
•
Trade Finance: which includes loans tied directly to goods crossing borders, export/import loans, commercial letters of credit, standby letters of credit, and supply chain finance.
Lending: includes net interest income, fees, gains or losses on loan sale activity, gains or losses on securities received as part of a loan restructuring, and the risk management results related to the credit portfolio. Lending also includes Trade Finance, which includes loans tied directly to goods crossing borders, export/import loans, commercial letters of credit, standby letters of credit, and supply chain finance.
Fixed Income Markets: primarily includes revenue related to market-making across global fixed income markets, including foreign exchange, interest rate, credit and commodities markets.
Equity Markets: primarily includes revenue related to market-making across global equity products, including cash instruments, derivatives, convertibles and prime brokerage.
Securities Services: primarily includes custody, fund accounting and administration, and securities lending products sold principally to asset managers, insurance companies and public and private investment funds. Also includes collateral management and depositary receipts businesses which provide collateral management products, and depositary bank services for American and global depositary receipt programs.
Description of certain business metrics:
Assets under custody (“AUC”): represents activities associated with the safekeeping and servicing of assets on which Securities Services earns fees.
Investment banking fees: represents advisory, equity underwriting, bond underwriting and loan syndication fees.


COMMERCIAL BANKING (“CB”)
Commercial Banking provides comprehensive financial solutions, including lending, treasury services,wholesale payments, investment banking and asset management products across three primary client segments: Middle Market Banking, Corporate Client Banking and Commercial Real Estate Banking. Other includes amounts not aligned with a primary client segment.
Middle Market Banking: covers small business and midsized corporations,companies, local governments and nonprofit clients.
Corporate Client Banking: covers large corporations.
Commercial Real Estate Banking: covers investors, developers, and owners of multifamily, office, retail, industrial and affordable housing properties.
CB product revenue comprises the following:
Lending: includes a variety of financing alternatives, which are primarily provided on a secured basis; collateral includes receivables, inventory, equipment, real estate or other assets. Products include term loans, revolving lines of credit, bridge financing, asset-based structures, leases, and standby letters of credit.
Treasury services:Wholesale payments: includes revenue from a broad range of products and services that enable CB clients to manage payments and receipts, as well as invest and manage funds.
Investment banking: includes revenue from a range of products providing CB clients with sophisticated capital-raising alternatives, as well as balance sheet and risk management tools through advisory, equity underwriting, and loan syndications. Revenue from fixed income and equity market products used by CB clients is also included.
Other: product revenue primarily includes tax-equivalent adjustments generated from Community Development Banking activity and certain income derived from principal transactions.
 
ASSET & WEALTH MANAGEMENT (“AWM”)
Assets under management (“AUM”): represent assets managed by AWM on behalf of its Private Banking, Institutional and Retail clients.
Client assets: represent assets under management, as well as custody, brokerage, administration and deposit accounts.
Multi-asset: Any fund or account that allocates assets under management to more than one asset class.
Alternative assets: The following types of assets constitute alternative investments – hedge funds, currency, real estate, private equity and other investment funds designed to focus on nontraditional strategies.
AWM’s lines of business consist of the following:
Asset Management: provides comprehensive global investment services - including asset management, pension analytics, asset-liability management and active risk-budgeting strategies.
Wealth Management: offers investment advice and wealth management, including investment management, capital markets and risk management, tax and estate planning, banking, lending and specialty-wealth advisory services.
AWM’s client segments consist of the following:
Private Banking: clients include high- and ultra-high-net-worth individuals, families, money managers, business owners and small corporations worldwide.
Institutional: clients include both corporate and public institutions, endowments, foundations, nonprofit organizations and governments worldwide.
Retail: clients include financial intermediaries and individual investors.
Asset Management has two high-level measures of its overall fund performance:
Percentage of mutual fund assets under management in funds rated 4- or 5-star: Mutual fund rating services rank funds based on their risk-adjusted performance over various periods. A 5-star rating is the best rating and represents the top 10% of industry-wide ranked funds.
A 4-star rating represents the next 22.5% of industry-wide ranked funds. A 3-star rating represents the next 35% of industry-wide ranked funds. A 2-star rating represents the next 22.5% of industry-wide ranked funds. A 1-star rating is the worst rating and represents the bottom 10% of industry-wide ranked funds. The “overall Morningstar rating” is derived from a weighted average of the performance associated with a fund’s three-, five- and ten-year (if applicable) Morningstar Rating metrics. For U.S. domiciled funds, separate star ratings are given at the individual share class level. The Nomura “star rating” is based on three-year risk-adjusted performance only. Funds with fewer than three years of history are not rated and


hence excluded from this analysis. All ratings, the assigned peer categories and the asset values used to derive this analysis are sourced from these fund rating providers. The data providers re-denominate the asset values into U.S. dollars. This % of AUM is based on star ratings at the share class level for U.S. domiciled funds, and at a “primary share class” level to represent the star rating of all other funds except for Japan where Nomura provides ratings at the fund level. The “primary share class”, as defined by Morningstar, denotes the share class recommended as being the best proxy for the portfolio and in most cases will be the most retail version (based upon annual management charge, minimum investment, currency and other factors). The performance data could have been different if all funds/accounts would have been included. Past performance is not indicative of future results.
 
Percentage of mutual fund assets under management in funds ranked in the 1st or 2nd quartile (one, three, and five years): All quartile rankings, the assigned peer categories and the asset values used to derive this analysis are sourced from the fund ranking providers. Quartile rankings are done on the net-of-fee absolute return of each fund. The data providers re-denominate the asset values into U.S. dollars. This % of AUM is based on fund performance and associated peer rankings at the share class level for U.S. domiciled funds, at a “primary share class” level to represent the quartile ranking of the U.K., Luxembourg and Hong Kong funds and at the fund level for all other funds. The “primary share class”, as defined by Morningstar, denotes the share class recommended as being the best proxy for the portfolio and in most cases will be the most retail version (based upon annual management charge, minimum investment, currency and other factors). Where peer group rankings given for a fund are in more than one “primary share class” territory both rankings are included to reflect local market competitiveness (applies to “Offshore Territories” and “HK SFC Authorized” funds only). The performance data could have been different if all funds/accounts would have been included. Past performance is not indicative of future results.


Item 3.    Quantitative and Qualitative Disclosures About Market Risk.
Refer to the Market Risk Management section of Management’s discussion and analysis and pages 124–131119–126 of JPMorgan Chase’s 20182019 Form 10-K for a discussion of the quantitative and qualitative disclosures about market risk.
Item 4.    Controls and Procedures.
As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of the Firm’s management, including its Chairman and Chief Executive Officer and its Chief Financial Officer, of the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934). Based on that evaluation, the Chairman and Chief Executive Officer and the Chief Financial Officer concluded that these disclosure controls and procedures were effective. Refer to Exhibits 31.1 and 31.2 for the Certification statements issuedCertifications furnished by the Chairman and Chief Executive Officer and Chief Financial Officer.Officer, respectively.
The Firm is committed to maintaining high standards of internal control over financial reporting. Nevertheless, because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, in a firm as large and complex as JPMorgan Chase, lapses or deficiencies in internal controls domay occur from time to time, and there can be no assurance that any such deficiencies will not result in significant deficiencies or material weaknesses in internal controlscontrol in the future.future and collateral consequences therefrom. Refer to “Management’s report on internal control over financial reporting” on page 148142 of JPMorgan Chase’s 20182019 Form 10-K for further information. There was no change in the Firm’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) that occurred during the three months ended SeptemberJune 30, 2019,2020, that has materially affected, or is reasonably likely to materially affect, the Firm’s internal control over financial reporting.


 
Part II – Other Information
Item 1. Legal Proceedings.
Refer to the discussion of the Firm’s material legal proceedings in Note 2425 of this Form 10-Q for information that updates the disclosures set forth under Part I, Item 3: Legal Proceedings, in JPMorgan Chase’s 20182019 Form 10-K.
Item 1A. Risk Factors.
Refer toThe following discussion supplements the discussion of risk
factors affecting the Firm as set forth in Part I, Item 1A:
Risk Factors on pages 7–6–28 of JPMorgan Chase’s 20182019 Form 10-K and Forward-Looking Statements on page 79 of this Form 10-Q for a10-K. The discussion of certain risk factors, affectingas so supplemented, sets forth the material risk factors that could affect JPMorgan Chase’s financial condition and operations. Readers should not consider any descriptions of such factors to be a complete set of all potential risks that could affect the Firm.
The COVID-19 pandemic has caused and is causing significant harm to the global economy and our businesses.
On March 11, 2020, the World Health Organization declared the outbreak of a strain of novel coronavirus disease, COVID-19, a global pandemic. The COVID-19 pandemic and governmental responses to the pandemic have had, and continue to have, a severe impact on global economic conditions, including:
significant disruption and volatility in the financial markets
disruption of global supply chains
closures of many businesses, leading to loss of revenues and increased unemployment, and
the institution of social distancing and sheltering-in-place requirements in the U.S. and other countries.
If the pandemic is prolonged, or other diseases emerge that give rise to similar effects, the adverse impact on the global economy could deepen.
The continuation of the adverse economic conditions caused by the pandemic can be expected to have a significant adverse effect on JPMorgan Chase’s businesses and results of operations, including:
significantly reduced demand for products and services from JPMorgan Chase’s clients and customers
possible recognition of credit losses and increases in the allowance for credit losses, especially if businesses remain closed, unemployment continues to rise and clients and customers draw on their lines of credit or seek additional loans to help finance their businesses
possible material impacts on the value of securities, derivatives and other financial instruments which JPMorgan Chase owns or in which it makes markets due to market fluctuations
possible downgrades in JPMorgan Chase’s credit ratings

possible constraints on liquidity and capital, whether due to increases in risk-weighted assets related to supporting client activities or to regulatory actions, and
the possibility that significant portions of JPMorgan Chase’s workforce are unable to work effectively, including because of illness, quarantines, sheltering-in-place arrangements, government actions or other restrictions in connection with the pandemic.
The extent to which the COVID-19 pandemic negatively affects JPMorgan Chase’s businesses, results of operations and financial condition, as well as its regulatory capital and liquidity ratios, will depend on future developments that are highly uncertain and cannot be predicted, including the scope and duration of the pandemic and actions taken by governmental authorities and other third parties in response to the pandemic. In addition, JPMorgan Chase’s participation directly or on behalf of customers and clients in U.S. government programs designed to support individuals, households and businesses impacted by the economic disruptions caused by the COVID-19 pandemic could be criticized and subject JPMorgan Chase to increased governmental and regulatory scrutiny, negative publicity or
increased exposure to litigation, which could increase its operational, legal and compliance costs and damage its reputation. To the extent the COVID-19 pandemic adversely affects JPMorgan Chase’s business, results of operations and financial condition, it may also have the effect of heightening many of the other risks described in Risk Factors in the 2019 Form 10-K.
Supervision and regulation
Refer to the Supervision and regulation section on pages 1–6 of JPMorgan Chase’s 20182019 Form 10-K for information on Supervision and Regulation.
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds.
The Firm did not have any unregistered sale of equity securities during the three months ended SeptemberJune 30, 2019.2020.
Repurchases under the common equity repurchase program
Refer to Capital Risk Management on pages 45–4949-54 of this Form 10-Q and pages 85-9485-92 of JPMorgan Chase’s 20182019 Form 10-K for information regarding repurchases under the Firm’s common equity repurchase program.

SharesOn March 15, 2020, in response to the COVID-19 pandemic, the Firm temporarily suspended through the second quarter of 2020 repurchases of its common equity, and as such, there were no shares repurchased on a settlement-date basis, pursuant to the common equity repurchase program during the ninethree months ended SeptemberJune 30, 2019, were as follows.2020. In June 2020, the Federal Reserve directed all large bank holding companies, including the Firm, to discontinue net share repurchases, at least through the end of the third quarter of 2020.
Nine months ended September 30, 2019Total shares of common stock repurchased 
Average price paid per share of common stock(a)
 
Aggregate repurchases
of common equity
 (in millions)(a)
 
Dollar value of remaining authorized repurchase
(in millions)(a)
 
First quarter49,534,646
 $102.78
 $5,091
 $5,290
 
Second quarter47,434,255
 109.83
 5,210
 80
(b) 
July16,285,176
 114.39
 1,863
 27,537
 
August29,005,310
 108.78
 3,155
 24,382
 
September16,720,914
 115.53
 1,931
 22,451
(c) 
Third quarter62,011,400
 112.07
 6,949
 22,451
(c) 
Year-to-date158,980,301
 $108.51
 $17,250
 $22,451
(c) 
Three months ended June 30, 2020Total shares of common stock repurchased 
Average price paid per share of common stock(a)
 
Aggregate repurchases
of common equity
 (in millions)(a)
 
Dollar value of remaining authorized repurchase
(in millions)(a)(b)
 
April—
 —
 —
 9,183
 
May—
 —
 —
 9,183
 
June—
 —
 —
 9,183
(c) 
Second quarter—
 —
 —
 9,183
(c) 
Year-to-date50,003,062
 127.92
 6,397
 9,183
(c) 
(a)Excludes commissions cost.
(b)The $80 million unused portion under the prior Board authorization was canceled when the $29.4 billion repurchase program was authorized by the Board of Directors on June 27, 2019.
(c)Represents the amount remaining under the $29.4 billion repurchase program.
(c)The $9.2 billion unused portion under the prior Board authorization expired on June 30, 2020.
Item 3.    Defaults Upon Senior Securities.
None.
Item 4.    Mine Safety Disclosures.
Not applicable.
Item 5.    Other Information.
None.
 



Item 6.    Exhibits.
Exhibit No. Description of Exhibit
10.1
Employee Stock Purchase Plan of JPMorgan Chase & Co., as amended and restated effective as of January 1, 2019.(a)
   
15 
Letter re: Unaudited Interim Financial Information. (a)
   
31.1 
Certification. (a)
   
31.2 
Certification. (a)
   
32 
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (b)
   
101.INS 
The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.(c)
101.SCH 
XBRL Taxonomy Extension Schema Document.(a)
101.CAL 
XBRL Taxonomy Extension Calculation Linkbase Document.(a)
101.DEF 
XBRL Taxonomy Extension Definition Linkbase Document.(a)
101.LAB 
XBRL Taxonomy Extension Label Linkbase Document.(a)
101.PRE 
XBRL Taxonomy Extension Presentation Linkbase Document.(a)
104 Cover Page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101).
(a)Filed herewith.
(b)Furnished herewith. This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.
(c)Pursuant to Rule 405 of Regulation S-T, includes the following financial information included in the Firm’s Quarterly Report on Form 10-Q for the quarterly period ended SeptemberJune 30, 2019,2020, formatted in XBRL (eXtensible Business Reporting Language) interactive data files: (i) the Consolidated statements of income (unaudited) for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, (ii) the Consolidated statements of comprehensive income (unaudited) for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, (iii) the Consolidated balance sheets (unaudited) as of SeptemberJune 30, 2019,2020, and December 31, 2018,2019, (iv) the Consolidated statements of changes in stockholders’ equity (unaudited) for the three and ninesix months ended SeptemberJune 30, 20192020 and 2018,2019, (v) the Consolidated statements of cash flows (unaudited) for the ninethree and six months ended SeptemberJune 30, 20192020 and 2018,2019, and (vi) the Notes to Consolidated Financial Statements (unaudited).

SIGNATURE



Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
JPMorgan Chase & Co.
(Registrant)


By:/s/ Nicole Giles
 Nicole Giles
 Managing Director and Firmwide Controller
 (Principal Accounting Officer)


Date:November 4, 2019August 3, 2020






INDEX TO EXHIBITS



Exhibit No. Description of Exhibit
10.1
Employee Stock Purchase Plan of JPMorgan Chase & Co., as amended and restated effective as of January 1, 2019.
   
15 
Letter re: Unaudited Interim Financial Information.
   
31.1 
Certification.
   
31.2 
Certification.
   
32 
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.†
   
101.INS The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
101.SCH XBRL Taxonomy Extension Schema Document.
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB XBRL Taxonomy Extension Label Linkbase Document.
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document.
104 Cover Page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101).
   
† This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.



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