Concentrations of credit risk arise when a number of clients, counterparties or customers are engaged in similar business activities or activities in the same geographic region, or when they have similar economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic conditions.

JPMorgan Chase regularly monitors various segments of its credit portfolios to assess potential credit risk concentrations and to obtain additional collateral when deemed necessary and permitted under the Firm’s agreements. Senior management is significantly involved in the credit approval and review process, and risk levels are adjusted as needed to reflect the Firm’s risk appetite.

In the Firm’s consumer portfolio, concentrations are managed primarily by product and by U.S. geographic region, with a key focus on trends and concentrations at the portfolio level, where potential credit risk concentrations can be remedied through changes in underwriting policies and portfolio guidelines. Refer to Note 12 for additional information on the geographic composition of the Firm’s consumer loan portfolios. In the wholesale portfolio, credit risk concentrations are evaluated primarily by industry and monitored regularly on both an aggregate portfolio level and on an individual client or counterparty basis.

The Firm’s wholesale exposure is managed through loan syndications and participations, loan sales, securitizations, credit derivatives, master netting agreements, collateral and other risk-reduction techniques. Refer to Note 12 for additional information on loans.

The Firm does not believe that its exposure to any particular loan product or industry segment (e.g., real estate), or its exposure to residential real estate loans with high LTV ratios, results in a significant concentration of credit risk.

Terms of loan products and collateral coverage are included in the Firm’s assessment when extending credit and establishing its allowance for loan losses.

The table below presents both on–balance sheet and off–balance sheet consumer and wholesale credit exposure by the Firm’s three credit portfolio segments as of December 31, 2020 and 2019. The wholesale industry of risk category is generally based on the client or counterparty’s primary business activity.

In conjunction with the adoption of CECL, the Firm reclassified risk-rated loans and lending-related commitments from the consumer, excluding credit card portfolio segment to the wholesale portfolio segment, to align with the methodology applied when determining the allowance. Prior-period amounts have been revised to conform with the current presentation. Refer to Note 1 for further information.


	2020									2019
	Credit exposure(h)(i)		On-balance sheet					Off-balance sheet(i)(k)		Credit exposure(h)(i)		On-balance sheet				Off-balance sheet(i)(k)
December 31, (in millions)			Loans(i)			Derivatives						Loans(i)		Derivatives
Consumer, excluding credit card	$	375,898	$	318,579	(j)	$	—	$	57,319	$	357,986	$	317,817	$	—	$	40,169
Credit card(a)	802,722		144,216			—		658,506		819,644		168,924		—		650,720
Total consumer-related(a)	1,178,620		462,795			—		715,825		1,177,630		486,741		—		690,889
Wholesale-related(b)
Real Estate	148,498		118,299			1,385		28,814		150,919		117,709		619		32,591
Individuals and Individual Entities(c)	122,870		109,746			1,750		11,374		105,027		94,616		694		9,717
Consumer & Retail	108,437		39,013			2,802		66,622		106,986		36,985		1,424		68,577
Technology, Media & Telecommunications	72,150		14,687			4,252		53,211		60,033		15,322		2,766		41,945
Asset Managers	66,573		31,059			9,277		26,237		54,304		24,008		7,160		23,136
Industrials	66,470		21,143			1,851		43,476		62,483		22,063		878		39,542
Healthcare	60,118		19,405			3,252		37,461		50,824		17,607		2,078		31,139
Banks & Finance Cos	54,032		31,004			8,044		14,984		50,786		31,191		5,165		14,430
Automotive	43,331		17,128			5,995		20,208		35,118		18,844		368		15,906
Oil & Gas	39,159		11,267			1,643		26,249		41,641		13,101		852		27,688
State & Municipal Govt(d)	38,286		18,054			2,347		17,885		30,095		13,271		2,000		14,824
Utilities	30,124		4,874			3,340		21,910		34,843		5,157		2,573		27,113
Chemicals & Plastics	17,176		4,884			856		11,436		17,499		4,864		459		12,176
Central Govt	17,025		3,396			12,313		1,316		14,865		2,840		10,477		1,548
Transportation	16,232		6,566			1,495		8,171		14,497		5,253		715		8,529
Metals & Mining	15,542		4,854			882		9,806		15,586		5,364		402		9,820
Insurance	13,141		1,042			2,527		9,572		12,348		1,356		2,282		8,710
Securities Firms	8,048		469			4,838		2,741		7,381		757		4,507		2,117
Financial Markets Infrastructure	6,515		19			3,757		2,739		4,121		13		2,482		1,626
All other(e)	100,713		58,038			7,024		35,651		79,598		51,357		1,865		26,376
Subtotal	1,044,440		514,947			79,630		449,863		948,954		481,678		49,766		417,510
Loans held-for-sale and loans at fair value	35,111		35,111			—		—		29,201		29,201		—		—
Receivables from customers(f)	47,710		—			—		—		33,706		—		—		—
Total wholesale-related	1,127,261		550,058			79,630		449,863		1,011,861		510,879		49,766		417,510
Total exposure(g)(h)	$	2,305,881	$	1,012,853		$	79,630	$	1,165,688	$	2,189,491	$	997,620	$	49,766	$	1,108,399

(a)Also includes commercial card lending-related commitments primarily in CB and CIB.

(b)The industry rankings presented in the table as of December 31, 2019, are based on the industry rankings of the corresponding exposures at December 31, 2020, not actual rankings of such exposures at December 31, 2019.

(c)Individuals and Individual Entities predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts.

(d)In addition to the credit risk exposure to states and municipal governments (both U.S. and non-U.S.) at December 31, 2020 and 2019, noted above, the Firm held: $7.2 billion and $6.5 billion, respectively, of trading assets; $20.4 billion and $29.8 billion, respectively, of AFS securities; and $12.8 billion and $4.8 billion, respectively, of HTM securities, issued by U.S. state and municipal governments. Refer to Note 2 and Note 10 for further information.

(e)All other includes: SPEs and Private education and civic organizations, representing approximately 92% and 8%, respectively, at December 31, 2020 and 90% and 10%, respectively, at December 31, 2019 . Refer to Note 14 for more information on exposures to SPEs.

(f)Receivables from customers reflect held-for-investment margin loans to brokerage clients in CIB, CCB and AWM that are collateralized by assets maintained in the clients’ brokerage accounts (e.g., cash on deposit, liquid and readily marketable debt or equity securities). Because of this collateralization, no allowance for credit losses is generally held against these receivables. To manage its credit risk the Firm establishes margin requirements and monitors the required margin levels on an ongoing basis, and requires clients to deposit additional cash or other collateral, or to reduce positions, when appropriate. These receivables are reported within accrued interest and accounts receivable on the Firm’s Consolidated balance sheets.

(g)Excludes cash placed with banks of $516.9 billion and $254.0 billion, at December 31, 2020 and 2019, respectively, which is predominantly placed with various central banks, primarily Federal Reserve Banks.

(h)Credit exposure is net of risk participations and excludes the benefit of credit derivatives used in credit portfolio management activities held against derivative receivables or loans and liquid securities and other cash collateral held against derivative receivables.

(i)In the third quarter of 2020, the Firm reclassified certain fair value option elected lending-related positions from trading assets to loans, which resulted in a corresponding reclassification of certain off-balance sheet commitments. Prior-period amounts have been revised to conform with the current presentation.

(j)At December 31, 2020, included $19.2 billion of loans in Business Banking under the PPP. PPP loans are guaranteed by the SBA. Other than in certain limited circumstances, the Firm typically does not recognize charge-offs, classify as nonaccrual nor record an allowance for loan losses on these loans.

(k)Represents lending-related financial instruments.