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Regulatory Capital
 6 Months Ended
Jun. 30, 2017
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 Office of the Comptroller of the Currency (“OCC”) establishes similar minimum capital requirements and standards for the Firm’s national banks, including JPMorgan Chase Bank, N.A. and Chase Bank USA, N.A.
Capital rules under Basel III establish minimum capital ratios and overall capital adequacy standards for large and internationally active U.S. bank holding companies and banks, including the Firm and its IDI subsidiaries. Basel III sets forth two comprehensive approaches for calculating RWA: a standardized approach (“Basel III Standardized”), and an advanced approach (“Basel III Advanced”). 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, 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 risk-based and leverage-based capital metrics for JPMorgan Chase and its significant national bank subsidiaries under both the Basel III Standardized Transitional and Basel III Advanced Transitional approaches at June 30, 2017, and December 31, 2016.
 
JPMorgan Chase & Co.
 
Basel III Standardized Transitional
 
Basel III Advanced Transitional
(in millions,
  except ratios)
Jun 30,
2017

 
Dec 31,
2016

 
Jun 30,
2017

 
Dec 31,
2016

Regulatory capital
 
 
 
 
 
 
 
CET1 capital
$
186,942

 
$
182,967

 
$
186,942

 
$
182,967

Tier 1 capital(a)
212,353

 
208,112

 
212,353

 
208,112

Total capital
243,061

 
239,553

 
233,345

 
228,592

 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
Risk-weighted
1,478,816

 
1,464,981

 
1,459,196

 
1,476,915

Adjusted
average(b)
2,512,120

 
2,484,631

 
2,512,120

 
2,484,631

 
 
 
 
 
 
 
 
Capital ratios(c)
 
 
 
 
 
 
 
CET1
12.6
%
 
12.5
%
 
12.8
%
 
12.4
%
Tier 1(a)
14.4

 
14.2

 
14.6

 
14.1

Total
16.4

 
16.4

 
16.0

 
15.5

Tier 1 leverage(d)
8.5

 
8.4

 
8.5

 
8.4

 
JPMorgan Chase Bank, N.A.
 
Basel III Standardized Transitional
 
Basel III Advanced Transitional
(in millions,
  except ratios)
Jun 30,
2017

 
Dec 31,
2016

 
Jun 30,
2017

 
Dec 31,
2016

Regulatory capital
 
 
 
 
 
 
 
CET1 capital
$
184,141

 
$
179,319

 
$
184,141

 
$
179,319

Tier 1 capital(a)
184,141

 
179,341

 
184,141

 
179,341

Total capital
195,851

 
191,662

 
189,381

 
184,637

 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
Risk-weighted
1,304,939

 
1,293,203

 
1,245,670

 
1,262,613

Adjusted
average(b)
2,107,302

 
2,088,851

 
2,107,302

 
2,088,851

 
 
 
 
 
 
 
 
Capital ratios(c)
 
 
 
 
 
 
 
CET1
14.1
%
 
13.9
%
 
14.8
%
 
14.2
%
Tier 1(a)
14.1

 
13.9

 
14.8

 
14.2

Total
15.0

 
14.8

 
15.2

 
14.6

Tier 1 leverage(d)
8.7

 
8.6

 
8.7

 
8.6

 
Chase Bank USA, N.A.
 
Basel III Standardized Transitional
 
Basel III Advanced Transitional
(in millions,
 except ratios)
Jun 30,
2017

 
Dec 31,
2016

 
Jun 30,
2017

 
Dec 31,
2016

Regulatory capital
 
 
 
 
 
 
 
CET1 capital
$
19,647

 
$
16,784

 
$
19,647

 
$
16,784

Tier 1 capital(a)
19,647

 
16,784

 
19,647

 
16,784

Total capital
25,684

 
22,862

 
24,297

 
21,434

 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
Risk-weighted
109,002

 
112,297

 
194,110

 
186,378

Adjusted
average(b)
122,880

 
120,304

 
122,880

 
120,304

 
 
 
 
 
 
 
 
Capital ratios(c)
 
 
 
 
 
 
 
CET1
18.0
%
 
14.9
%
 
10.1
%
 
9.0
%
Tier 1(a)
18.0

 
14.9

 
10.1

 
9.0

Total
23.6

 
20.4

 
12.5

 
11.5

Tier 1 leverage(d)
16.0

 
14.0

 
16.0

 
14.0

(a)
Includes the deduction associated with the permissible holdings of covered funds (as defined by the Volcker Rule) acquired after December 31, 2013. The deduction was not material as of June 30, 2017 and December 31, 2016.
(b)
Adjusted average assets, for purposes of calculating the Tier 1 leverage ratio, includes total quarterly average assets adjusted for unrealized gains/(losses) on AFS securities, less deductions for goodwill and other intangible assets, defined benefit pension plan assets, and deferred tax assets related to NOL and tax credit carryforwards.
(c)
For each of the risk-based capital ratios, the capital adequacy of the Firm and its national bank subsidiaries is evaluated against the lower of the two ratios as calculated under Basel III approaches (Standardized or Advanced) as required by the Collins Amendment of the Dodd-Frank Act (the “Collins Floor”).
(d)
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.

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 RWA, as well as a minimum leverage ratio (which is 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. National 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 June 30, 2017.
 
Minimum capital ratios
 
Well-capitalized ratios
 
BHC(a)(e)

IDI(b)(e)

 
BHC(c) 

IDI(d)

Capital ratios
 
 
 
 
 
CET1
7.50
%
5.75
%
 
—
%
6.5
%
Tier 1
9.00

7.25

 
6.0

8.0

Total
11.00

9.25

 
10.0

10.0

Tier 1 leverage
4.0

4.0

 
—

5.0

Note: The table above is 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.
(a)
Represents the Transitional minimum capital ratios applicable to the Firm under Basel III at June 30, 2017. At June 30, 2017, the CET1 minimum capital ratio includes 1.25% resulting from the phase in of the Firm’s 2.5% capital conservation buffer and 1.75%, resulting from the phase in of the Firm’s 3.5% GSIB surcharge.
(b)
Represents requirements for JPMorgan Chase’s banking subsidiaries. The CET1 minimum capital ratio includes 1.25% resulting from the phase in of the 2.5% capital conservation buffer that is applicable to the banking subsidiaries. The banking subsidiaries are not subject to the GSIB surcharge.
(c)
Represents requirements for bank holding companies pursuant to regulations issued by the Federal Reserve.
(d)
Represents requirements for bank subsidiaries pursuant to regulations issued under the FDIC Improvement Act.
(e) For the period ended December 31, 2016 the CET1, Tier 1, Total and Tier 1 leverage minimum capital ratios applicable to the Firm were 6.25%, 7.75%, 9.75% and 4.0% and the CET1, Tier 1, Total and Tier 1 leverage minimum capital ratios applicable to the Firm’s banking subsidiaries were 5.125%, 6.625%, 8.625% and 4.0% respectively.
As of June 30, 2017, and December 31, 2016, JPMorgan Chase and all of its banking subsidiaries were well-capitalized and met all capital requirements to which each was subject.