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Key takeaways
- JPMorgan Chase has launched a 10-year, $1.5 trillion initiative to strengthen sectors deemed vital to U.S. security and resiliency.
- The bank will invest up to $10 billion in selected companies to help increase their growth, innovation and strategic industrialization.
- CEO Jamie Dimon said the United States relies heavily on others for critical minerals, products and manufacturing, and needs to “act now” to address these challenges.
JPMorgan Chase announced plans to pump $1.5 trillion over ten years into industries deemed vital to US national interests.
Under the program, called the Security and Resilience Initiative, the bank said it “will make direct equity and venture capital investments of up to $10 billion to help selected companies primarily in the United States boost their growth, stimulate innovation and accelerate strategic manufacturing,” according to a press release issued Monday.
Why is this important?
News of JPMorgan’s plans comes as major technology companies and the US government announce investments in critical industries to ensure the United States does not need to rely on producers in other countries. Many American companies that received these investments recently saw their stock prices rise.
The plan will focus on four main areas: supply chain and manufacturing; Defense and space. Energy independence and flexibility. Frontier and strategic technologies. Additionally, JPMorgan has divided those groups into 27 subgroups “ranging from shipbuilding and nuclear energy to nanomaterials and critical defense components.”
JPMorgan said that to advance the initiative, it will hire more bankers, investment professionals and other experts, as well as “create an external advisory board of experienced leaders from the public and private sectors to help guide the long-term strategy.”
CEO Jamie Dimon said the country had become too reliant on elsewhere to supply critical minerals, products and manufacturing. “Our security depends on the strength and resilience of the American economy,” Dimon said. “We need to act now.”
Shares of JPMorgan, which is scheduled to report third-quarter earnings on Tuesday, rose 2% in recent trading, tracking a broader upward move in US stocks. The stock has risen 28% since the beginning of the year.
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