- America's biggest bank by assets, JPMorgan Chase, reported fourth-quarter earnings on Tuesday.
- CFO Jeremy Barnum discussed how reduced interest rates could impact the company's card business.
- Slashing card interest rates could create harm for "the people who need it the most," Barnum said.
JPMorgan Chase's chief financial officer outlined the impact of a rate cut on its credit card business on Tuesday, warning that such a move could have detrimental effects on the bank's lending business.
"It's a very competitive business, but we wouldn't be in it if it weren't a good business for us. And in a world where price controls make it no longer a good business, that would present a significant challenge," Jeremy Barnum, the CFO, told analysts and shareholders during the company's fourth-quarter earnings call.
"Clearly beyond that, you know, the way we actually respond would have a lot to do with the details. And I just don't think we have enough information at this point," Barnum added, saying a dramatic shift in lenders' card interest rates could lead to negative consequences for consumers — "especially the people who need it the most."
On Friday, President Donald Trump said in a Truth Social post that he would call for a 10% cap on credit card interest for one year, starting on January 20. Lawmakers from both parties have criticized card interest rates, which have sat around 20% in recent years, according to Bloomberg.
Congress would typically need to approve such a cap, which would eat into banks' profits.
The bank's cards business is central to its retail-focused offerings. Debit and credit card sales volume rose 7% from a year earlier, with card services sales totaling about $360 billion for the quarter, according to its earnings presentation.
Revenue in the consumer and community banking division climbed 6% year over year to $19.4 billion, which JPMorgan said was driven in part by higher net interest income from card services as revolving balances grew.
Now, JPMorgan is in the process of taking over the Apple card from Goldman Sachs, which previously supported the tech giant's credit card offering. The transition, JPMorgan has said, is expected to take up to two years to complete.
