JPMORGAN CHASE & CO

Consolidated balance sheets analysis

The following is a discussion of the significant changes between September 30, 2024 and December 31, 2023. Refer to pages 155–158 for a discussion of the Critical Accounting Estimates Used by the Firm that affect the Consolidated Balance Sheets.

Cash and due from banks and deposits with banks decreased driven by Markets activities in CIB, and cash deployment, including in investment securities, in Treasury and CIO.

Federal funds sold and securities purchased under resale agreements increased driven by Markets, reflecting higher client-driven market-making activities and higher demand for securities to cover short positions, as well as when compared with seasonally lower levels at year-end.

Securities borrowed increased driven by Markets, reflecting higher demand for securities to cover short positions, and higher client-driven activities.

Refer to Note 10 for additional information on securities purchased under resale agreements and securities borrowed.

Trading assets increased due to higher levels of equity and debt instruments in Markets related to client-driven market-making activities, as well as when compared with seasonally lower levels at year-end; and to a lesser extent, an increase in short-term cash deployment in Treasury and CIO. Refer to Notes 2 and 4 for additional information.

Investment securities increased due to:

•higher available-for-sale ("AFS") securities, reflecting net purchases, primarily U.S. Treasuries and non-U.S. government debt securities, partially offset by maturities and paydowns, and

•lower HTM securities primarily driven by maturities and paydowns.

Refer to Corporate segment results on pages 40-42, Investment Portfolio Risk Management onpage 76, and Notes 2 and 9 for additional information.

Loans increased, reflecting:

•higher wholesale loans in CIB,

•higher securities-based lending in AWM, and

•higher loans in Card Services driven bygrowth in new accounts and continued normalization of revolving balances,

•a decline in Home Lending as paydowns and loan sales outpaced originations.

Theallowance for loan losses increased, reflecting a net addition to the allowance for loan losses of $1.5 billion inconsumer, primarily in Card Services, due to loan growth, reflecting higher revolving balances, including the seasoning of newer vintages, and changes in certain macroeconomic variables, partially offset by a net reduction in Home Lending in the first quarter of 2024.

Thewholesale allowance was flat as the net addition, including net downgrade activity, primarily in Real Estate, and the impact of incorporating the First Republic portfolio into the Firm’s modeled credit loss estimates in the second quarter of 2024, was offset by a net reduction, primarily due to the impact of changes in the loan portfolio and changes in certain macroeconomic variables.

There was also a $168 million net addition to the allowance for lending-related commitments recognized in other liabilities on the Consolidated balance sheets.

Refer to Consolidated Results of Operations and Credit and Investment Risk Management on pages 9–14 and pages 58-76, respectively, Critical Accounting Estimates Used by the Firm on pages 84-86, and Notes 2, 3, 11 and 12 for additional information on loans and the total allowance for credit losses.

Accrued interest and accounts receivable increased primarily driven by higher client activities in Markets.

Refer to Note 14 for additional information ongoodwill, MSRs and other intangible assets.

Other assets increased and included higher cash collateral placed with central counterparties ("CCP") in Markets, and the impact of the adoption of updates to the Accounting for Investments in Tax Credit Structures guidance on January 1, 2024.

Deposits increased, reflecting the net impact of:

•an increase in CIB due to net inflows in Payments and Securities Services, partially offset by net maturities of structured notes in Markets,

•an increase in AWM driven by new and existing product offerings,

•a decline in CCB in existing accounts primarily due to increased customer spending and migration into higher-yielding investments, largely offset by new accounts.

Federal funds purchased and securities loaned or sold under repurchase agreements increased driven by Markets, reflecting higher client-driven market-making activities and higher secured financing of trading assets, as well as when compared with seasonally lower levels at year-end.

Short-term borrowings increased primarily driven by higher net issuance of structured notes due to client demand in Markets.

Refer to Liquidity Risk Management on pages 50-57 for additional information on deposits, federal funds purchased and securities loaned or sold under repurchase agreements, and short-term borrowings; and Notes 2 and 15 for deposits; and Note 10 for federal funds purchased and securities loaned or sold under repurchase agreements.

Trading liabilities increased due to client-driven market-making activities primarily in Fixed Income Markets, which resulted in higher levels of short positions in debt instruments, as well as when compared with seasonally lower levels at year-end. Refer to Notes 2 and 4 for additional information.

Accounts payable and other liabilities increased predominantly due to higher client activities in Markets, and the impact of the adoption of updates to the Accounting for Investments in Tax Credit Structures guidance on January 1, 2024.

Beneficial interests issued by consolidated VIEs increased driven by the issuance of credit card securitizations in Treasury and CIO.

Refer to Liquidity Risk Management on pages 50-57 and Notes 13 and 22 for additional information, specifically Firm-sponsored VIEs and loan securitization trusts.

Long-term debt increased, primarily driven by:

•net issuances of structured notes in CIB due to client demand, and

•net issuances of long-term debt, partially offset by lower FHLB advances in Treasury and CIO.

Refer to Liquidity Risk Management on pages 50-57; and Note 26 for additional information on the First Republic acquisition.

Stockholders’ equity increased reflecting net income and lower unrealized losses in AOCI, predominantly driven by the impact of lower interest rates on the AFS portfolio and cash flow hedges in Treasury and CIO, largely offset by the impact of capital actions, including repurchases of common shares, common and preferred stock dividend payments and net redemption of preferred stock. Refer to Consolidated statements of changes in stockholders’ equity onpage 92, Capital Actions on page 48, and Note 19 for additional information.

Consolidated cash flows analysis

The following is a discussion of cash flow activities during the nine months ended September 30, 2024 and 2023.

Operating activities

•In 2024, cash used resulted from higher trading assets, higher securities borrowed, higher accrued interest and accounts receivable, and net originations and purchases of loans held-for-sale, partially offset by higher trading liabilities and higher accounts payable and other liabilities.

•In 2023, cash used resulted from higher trading assets and lower accounts payable and other liabilities, partially offset by lower other assets and higher trading liabilities.

Investing activities

•In 2024, cash used resulted from higher securities purchased under resale agreements, net purchases of investment securities and net originations of loans.

•In 2023, cash used resulted from higher securities purchased under resale agreements, higher net loan originations, and net cash used in the First Republic acquisition, predominantly offset by proceeds from paydowns and maturities of investment securities and from sales and securitizations of loans held-for-investment.

Financing activities

•In 2024, cash provided reflected higher securities loaned or sold under repurchase agreements, higher deposits, and net proceeds from long-and short-term borrowings, partially offset by net redemption of preferred stock.

•In 2023, cash provided reflected higher securities loaned or sold under repurchase agreements and higher beneficial interests issued by consolidated VIEs, largely offset by net outflows in deposits, which included the impact of the repayment of the deposits provided to First Republic Bank by the consortium of large U.S. banks that the Firm assumed as part of the First Republic acquisition.

•For both periods, cash was used for repurchases of common stock and cash dividends on common and preferred stock.

Refer to Consolidated Balance Sheets Analysis on pages 15–16, Capital Risk Management on pages 44-49, and Liquidity Risk Management on pages 50-57, and the Consolidated Statements of Cash Flows on page 93 of this Form 10-Q, and pages 102–109 of JPMorgan Chase’s 2023 Form 10-K for a further discussion of the activities affecting the Firm’s cash flows.