JPMorgan Chase Wagering Big on Long-Term Boston Growth

March 15, 2019 - By Jim Morrison

Ribbon-Cutting: Chase Downtown Crossing, Boston

BOSTON–As the number of retail bank branches nationwide continues to diminish, JP Morgan Chase is betting heavily on Boston, with a plan to open 50 new retail branches in Greater Boston over the next few years.

It’s part of a nationwide expansion plan of 400 new branches, announced by CEO Jamie Dimon, in January of 2018. The company expects the new branches to complement and feed other lines of business already in place in more than a dozen markets.

The executive director of Chase multifamily lending in Boston, Dan Vasserman said he saw first-hand how the various business lines fed and supported each other when he worked in Chase’s commercial lending group in New York City - and he’s eager to replicate that model in Boston.

“When you have the full franchise of the firm available in the market, everything from retail, real estate lending, commercial banking and asset management, it gives our clients a comprehensive relationship with the bank,” Vasserman said. “The missing piece in Boston was retail banking. It also adds value to us by raising brand visibility.”

The sleek new branches offer a stark contrast to traditional retail branches. The highly-functional ATMs allow customers to pay their Chase mortgage and other loans as well. As a result, there are fewer tellers. Customers are met by a greeter as they enter. There’s a space to open a laptop and do some banking and small conference rooms. There are also residential mortgage lending officers, commercial lenders and asset management specialists on hand at all times.

Carolyn Evert, JP Morgan Chase vice president of Northeast regional communications said the ATMs can do most of what a teller can do - and more. “Obviously we have a banking associate there to support for the cash handling, but there is a lot you can do on your phone or tablet, too,” Evert said. “The majority of our clients do a lot of banking online and they don’t need to come to the branch as often. People do still come in at least four times a year, so we’ve scaled the branches to meet the customers’ needs.”

Vasserman acknowledged that the booming commercial and residential real estate runs in Greater Boston can’t go on forever. But he and Chase have great confidence in the fundamental soundness of the area. He said Chase is taking the long view.

“We’re not in the business of trying to time the cycle,” Vasserman said. “We want to be prepared to support our clients through the cycle so we’re not over-leveraging, We’re doing what we know how to do. And we’re supporting our clients, who for the most part have 20-30 years of experience and have been through multiple cycles. They know what they’re doing.”

As a testament, if historically high property values mean it doesn’t make sense for a client to buy, Vasserman said many of his clients are refinancing and taking a look at their existing portfolios - trying to reconfigure them to increase their value.

He says the high cost of residential real estate in Greater Boston is fueling demand for rentals, which benefits his commercial lending clients. Vasserman projects the continued influx of millennials into the Boston area will give the recovery a little more runway and he’s shaving days off his closing times to capitalize on it. “We’ve fully digitized our loan process and close 40 percent of our deals in under 30 day, which is well below the industry standard 45-60 days,” he relays. “That number is only going to go down. In the last few months, I’ve closed 4 deals in 21 days or less. The speed and efficiency in a competitive market really gives us an edge, especially in an acquisition.”

According to Chase Boston Lending Manager Rolando Lora, the residential mortgage underwriting team is responding to demand on their side in the same manner. The new ‘Chase My Home’ digital portal lets customers track their loan application through the underwriting process in real time - and they’re reducing their closing times as well. “We rolled out our Closing Guarantee on February 4th,” Lora explained. “Once a customer initiates the application and provides us all their documentation, they’re passing that baton to us … that gives us 21 calendar days to honor their contract or we’ll pay them $1,000.”

Evert said the response to the new Greater Boston branches has been strong to date. “People are waiting in line to open new accounts … we’re really grateful for the overwhelming response we’ve gotten from our customer base. We opened branches in Dedham and Downtown Crossing. We’ll open two more in Coolidge Corner [Brookline] and Watertown next month. Later [in the year] we’ll open Roxbury, Back Bay, Hingham and others.”

Vasserman sees Chase’s investment in Boston’s retail banking as a springboard for the company and the region’s continued growth. “No one would disagree that the Boston market is extremely strong based with the vibrant, diverse economies we have here. There are high barriers to entry for constructing new buildings. No one is making (available) more land. The properties that exist have to house this population here. It’s a strong market for us and our clients have been investing in these types of assets for generations … and we feel the same. We take a long-term view of the market. We want to be prepared for whatever comes next,” Vasserman expressed.