Regulatory Capital

12 Months Ended

Dec. 31, 2015

Banking and Thrift [Abstract]

Regulatory Capital

Regulatory capital

The Federal Reserve establishes capital requirements, including well-capitalized standards, for the consolidated financial holding company. The OCC establishes similar capital requirements and standards for the Firm’s national banks, including JPMorgan Chase Bank, N.A. and Chase Bank USA, N.A.

Basel III capital rules, for large and internationally active U.S. bank holding companies and banks, including the Firm and its insured depository institution (“IDI”) subsidiaries, revised, among other things, the definition of capital and introduced a new common equity tier 1 capital (“CET1 capital”) requirement. Basel III presents two comprehensive methodologies for calculating risk-weighted assets (“RWA”), a general (Standardized) approach, which replaced Basel I RWA effective January 1, 2015 (“Basel III Standardized”) and an advanced approach, which replaced Basel II RWA (“Basel III Advanced”); and sets out minimum capital ratios and overall capital adequacy standards. Certain of the requirements of Basel III are subject to phase-in periods that began on January 1, 2014 and continue through the end of 2018 (“transitional period”).

There are three categories of risk-based capital under the Basel III Transitional rules: CET1 capital, as well as Tier 1 capital and Tier 2 capital. CET1 capital predominantly includes common stockholders’ equity (including capital for AOCI related to debt and equity securities classified as AFS as well as for defined benefit pension and OPEB plans), less certain deductions for goodwill, MSRs and deferred tax assets that arise from NOL and tax credit carryforwards. Tier 1 capital predominantly consists of CET1 capital as well as perpetual preferred stock. Tier 2 capital includes long-term debt qualifying as Tier 2 and qualifying allowance for credit losses. Total capital is Tier 1 capital plus Tier 2 capital.

The following tables present the regulatory capital, assets and risk-based capital ratios for JPMorgan Chase and its significant national bank subsidiaries under both Basel III Standardized Transitional and Basel III Advanced Transitional at December 31, 2015 and 2014.

	JPMorgan Chase & Co.(f)
	Basel III Standardized Transitional						Basel III Advanced Transitional
(in millions, except ratios)	Dec 31, 2015			Dec 31, 2014			Dec 31, 2015			Dec 31, 2014
Regulatory capital
CET1 capital	$	175,398		$	164,426		$	175,398		$	164,426
Tier 1 capital(a)	200,482			186,263			200,482			186,263
Total capital	234,413			221,117			224,616			210,576
Assets
Risk-weighted(b)	1,465,262			1,472,602			1,485,336			1,608,240
Adjusted average(c)	2,361,177			2,464,915			2,361,177			2,464,915
Capital ratios(d)
CET1	12.0		%	11.2		%	11.8		%	10.2		%
Tier 1(a)	13.7			12.6			13.5			11.6
Total	16.0			15.0			15.1			13.1
Tier 1 leverage(e)	8.5			7.6			8.5			7.6

	JPMorgan Chase Bank, N.A.(f)
	Basel III Standardized Transitional						Basel III Advanced Transitional
(in millions, except ratios)	Dec 31, 2015			Dec 31, 2014			Dec 31, 2015			Dec 31, 2014
Regulatory capital
CET1 capital	$	168,857		$	156,567		$	168,857		$	156,567
Tier 1 capital(a)	169,222			156,891			169,222			156,891
Total capital	183,262			173,322			176,423			166,326
Assets
Risk-weighted(b)	1,264,056			1,230,358			1,249,607			1,330,175
Adjusted average(c)	1,913,448			1,968,131			1,913,448			1,968,131
Capital ratios(d)
CET1	13.4		%	12.7		%	13.5		%	11.8		%
Tier 1(a)	13.4			12.8			13.5			11.8
Total	14.5			14.1			14.1			12.5
Tier 1 leverage(e)	8.8			8.0			8.8			8.0

	Chase Bank USA, N.A.(f)
	Basel III Standardized Transitional						Basel III Advanced Transitional
(in millions, except ratios)	Dec 31, 2015			Dec 31, 2014			Dec 31, 2015			Dec 31, 2014
Regulatory capital
CET1 capital	$	15,419		$	14,556		$	15,419		$	14,556
Tier 1 capital(a)	15,419			14,556			15,419			14,556
Total capital	21,418			20,517			20,069			19,206
Assets
Risk-weighted(b)	105,807			103,468			181,775			157,565
Adjusted average(c)	134,152			128,111			134,152			128,111
Capital ratios(d)
CET1	14.6		%	14.1		%	8.5		%	9.2		%
Tier 1(a)	14.6			14.1			8.5			9.2
Total	20.2			19.8			11.0			12.2
Tier 1 leverage(e)	11.5			11.4			11.5			11.4

(a) At December 31, 2015, trust preferred securities included in Basel III Tier 1 capital were $992 million and $420 million for JPMorgan Chase andJPMorgan Chase Bank, N.A., respectively. At December 31, 2015 Chase Bank USA, N.A. had no trust preferred securities.

(b) Effective January 1, 2015, the Basel III Standardized RWA is calculated under the Basel III definition of the Standardized approach. Prior periods were based on Basel I (inclusive of Basel 2.5).

(c) Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio, includes total quarterly average assets adjusted for unrealized gains/(losses) on securities, less deductions for goodwill and other intangible assets, defined benefit pension plan assets, and deferred tax assets related to net operating loss carryforwards.

(d) For each of the risk-based capital ratios, the capital adequacy of the Firm and its national bank subsidiaries are evaluated against the Basel III approach, Standardized or Advanced, resulting in the lower ratio (the “Collins Floor”), as required by the Collins Amendment of the Dodd-Frank Act.

(e) The Tier 1 leverage ratio is not a risk-based measure of capital. This ratio is calculated by dividing Tier 1 capital by adjusted average assets.

(f) Asset and capital amounts for JPMorgan Chase’s banking subsidiaries reflect intercompany transactions; whereas the respective amounts for JPMorgan Chase reflect the elimination of intercompany transactions.

Note: Rating agencies allow measures of capital to be adjusted upward for deferred tax liabilities, which have resulted from both non-taxable business combinations and from tax-deductible goodwill. The Firm had deferred tax liabilities resulting from non-taxable business combinations of $105 million and $130 million at December 31, 2015, and 2014, respectively; and deferred tax liabilities resulting from tax-deductible goodwill of $3.0 billion and $2.7 billion at December 31, 2015, and 2014, respectively.

Under the risk-based capital guidelines of the Federal Reserve, JPMorgan Chase is required to maintain minimum ratios of CET1, Tier 1 and Total capital to risk-weighted assets, as well as minimum leverage ratios (which are defined as Tier 1 capital divided by adjusted quarterly average assets). Failure to meet these minimum requirements could cause the Federal Reserve to take action. Bank subsidiaries also are subject to these capital requirements by their respective primary regulators. The following table presents the minimum ratios to which the Firm and its national bank subsidiaries are subject as of December 31, 2015.

	Minimum capital ratios(a)		Well-capitalized ratios
			BHC(b)		IDI(c)
Capital ratios
CET1	4.5	%	—	%	6.5	%
Tier 1	6.0		6.0		8.0
Total	8.0		10.0		10.0
Tier 1 leverage	4.0		—		5.0

(a) As defined by the regulations issued by the Federal Reserve, OCC and FDIC and to which the Firm and its national bank subsidiaries are subject.

(b) Represents requirements for bank holding companies pursuant to regulations issued by the Federal Reserve.

(c) Represents requirements for bank subsidiaries pursuant to regulations issued under the FDIC Improvement Act.

As of December 31, 2015 and 2014, JPMorgan Chase and all of its banking subsidiaries were well-capitalized and met all capital requirements to which each was subject.