Why could the Federal Reserve's published results differ from JPMorgan's?

The Federal Reserve runs its own stress tests using its own models and methodologies, which differ from the Firm's. As a result, the Fed's published figures may vary from those in this disclosure, and JPMorgan states it may not be able to explain those differences.

What does this disclosure mean for dividends and share buybacks?

This report does not include the 2024 Stress Capital Buffer requirement. That figure, to be published by the Federal Reserve by August 31, 2024, is the regulatory input that will most directly determine capital distribution capacity, so investors should watch for it.

What is driving the projected losses under the stress scenario?

Provisions for credit losses of $83.4B and trading and counterparty losses of $21.2B are the largest drivers. Within loan losses, credit cards ($21.8B) and commercial & industrial loans ($20.1B) account for the biggest shares of the $61.0B total projected loan losses.

Is this disclosure considered filed under the Securities Exchange Act?

No. The results are furnished under Item 7.01 (Regulation FD), so the information is not deemed 'filed' for purposes of Section 18 of the Exchange Act and is not incorporated by reference into Securities Act registration statements.

JPMORGAN CHASE & CO 8-K: Regulation FD

01—Abstract

Summary

Summary of the 8-K filed June 28, 2024. Cited figures are marked; the original filing is the authoritative source.

On June 28, 2024, JPMorgan Chase & Co. furnished (under Item 7.01, Regulation FD) the results of its company-run 2024 Dodd-Frank Act Stress Test (DFAST), covering JPMorgan Chase & Co. and JPMorgan Chase Bank, N.A. over a nine-quarter projection window (1Q24 through 1Q26) under the Federal Reserve's Supervisory Severely Adverse Scenario.

The scenario assumes a severe global recession with U.S. real GDP falling 8.5%, unemployment peaking at 10.0%, and the stock market index falling 55%. Under these hypothetical conditions, the Firm's projected Basel III Standardized CET1 ratio declines from 15.0% at 4Q23 to a minimum-period level of 12.3% at 1Q26 (the reported 'minimum' stressed CET1 ratio is 13.4% at the end point, per the filing's table), with total risk-based capital at 15.6% and the supplementary leverage ratio at 5.2%, all well above regulatory minimums. Cumulative pre-provision net revenue of $73.3 billion^a is more than offset by $61.0 billion in projected loan losses (credit cards are the largest loss driver at $21.8 billion) and $21.2 billion in trading and counterparty losses, producing a projected nine-quarter pre-tax net loss of $34.6 billion.

For investors, the disclosure reinforces the Firm's capital resilience: the results show the bank would remain comfortably capitalized above minimum requirements even under extreme stress. The filing explicitly states these are hypothetical estimates, not management forecasts, and that the Federal Reserve's own results may differ. The Stress Capital Buffer (SCB) requirement, which will ultimately determine capital distribution constraints, has not yet been published and is expected from the Federal Reserve by August 31, 2024.

JPMorgan Chase Bank, N.A. shows similar resilience, with a stressed CET1 ratio of 13.8% at its projected minimum and a pre-tax net loss of $20.8 billion^b over the period. The disclosure is informational in nature and does not involve any transaction, financing, or change in corporate guidance. Investors should view the results as a regulatory-driven stress benchmark rather than a earnings or capital-return signal, with the forthcoming SCB announcement being the more direct driver of dividend and buyback capacity.

02—Key points

Key Highlights

Stressed CET1 ratio falls from 15.0% (4Q23 actual) to a projected minimum of 12.3% (per the stressed-ratio table) under the Supervisory Severely Adverse Scenario, well above the 4.5% regulatory minimum.
Nine-quarter projected pre-provision net revenue of $73.3B is outweighed by $83.4B in provisions for credit losses, $21.2B in trading and counterparty losses, and $3.1B in other losses, resulting in a projected pre-tax net loss of $34.6B.
Projected total loan losses of $61.0B (4.9% portfolio loss rate), led by credit cards ($21.8B) and commercial & industrial ($20.1B).
Total risk-based capital ratio projected at 15.6% and supplementary leverage ratio at 5.2% at 1Q26, both comfortably above regulatory minimums.
JPMorgan Chase Bank, N.A. projects a stressed CET1 ratio of 13.8% at its minimum point, with a nine-quarter pre-tax net loss of $20.8B.
Risk-weighted assets are projected to rise modestly from $1,672B to $1,687B over the stress horizon.
The 2024 Stress Capital Buffer (SCB) has not yet been published; the Federal Reserve is expected to release it by August 31, 2024, which will directly inform capital distribution capacity.

03—Questions

Frequently Asked Questions

Do these stress test results represent JPMorgan's forecast of actual losses or capital?
No. The filing explicitly states the results are hypothetical estimates under the Federal Reserve's Supervisory Severely Adverse Scenario and do not represent management's forecasts of gains, losses, PPNR, capital, RWA, or capital ratios.
Why could the Federal Reserve's published results differ from JPMorgan's?
The Federal Reserve runs its own stress tests using its own models and methodologies, which differ from the Firm's. As a result, the Fed's published figures may vary from those in this disclosure, and JPMorgan states it may not be able to explain those differences.
What does this disclosure mean for dividends and share buybacks?
This report does not include the 2024 Stress Capital Buffer requirement. That figure, to be published by the Federal Reserve by August 31, 2024, is the regulatory input that will most directly determine capital distribution capacity, so investors should watch for it.
What is driving the projected losses under the stress scenario?
Provisions for credit losses of $83.4B and trading and counterparty losses of $21.2B are the largest drivers. Within loan losses, credit cards ($21.8B) and commercial & industrial loans ($20.1B) account for the biggest shares of the $61.0B total projected loan losses.
Is this disclosure considered filed under the Securities Exchange Act?
No. The results are furnished under Item 7.01 (Regulation FD), so the information is not deemed 'filed' for purposes of Section 18 of the Exchange Act and is not incorporated by reference into Securities Act registration statements.

04—Continue

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