The Banking Sector: J.P.Morgan vs Bank of America

The Banking Sector: J.P.Morgan vs Bank of America

By Name: Sowmyasree

Student ID: NIS22582070






The banking sector, sometimes referred to as the financial or banking industry, is the area of the financial services sector that focuses mostly on financial institutions and banks. It comprises an extensive array of organisations engaged in offering diverse financial services, such as receiving deposits, granting loans, and assisting with financial transactions. By providing necessary services and enabling the movement of credit and money, the banking industry is an integral part of the financial system as a whole and contributes significantly to the economy






Bank of America

Amadeo Giannini established the Bank of Italy in San Francisco in 1904.

Transformed into Bank of America and was a major contributor to the expansion of the American West.

Provides a broad range of financial services, such as wealth management, asset management, retail banking, commercial banking, and investment banking.

A participant in mergers and acquisitions, including the 1998 purchase of NationsBank.

Offers online and mobile banking services, embracing innovation and technology in the banking industry.

Revenue: $94.95 billion in 2022

J.P. Morgan

John Pierpont Morgan established it in the 1800s.

Founded in 1871 under the name J.P. Morgan & Co.played a significant part in the union of American steel and railroad sectors.

Formed JPMorgan Chase & Co. in 2000 by merging with Chase Manhattan Corporation.

Offers investment banking, retail banking, asset management, and banking services.

Operates internationally and is well-established in the US and other nations.

The current chairman and CEO is Jamie Dimon, a well-known person in the banking sector.

Revenue: $128.7billion in 2022





EXTERNAL ANALYSIS (PESTLE and Porter’s 5 Forces)

PESTLE Analysis

Porter’s 5 Forces



The political environment is highly regulated where passenger are favoured over the airlines – passenger safety comes first (e.g. there are several policies about protecting passengers more than the industry

T: The industry is characterised by deregulation – more competition amongst airlines  meaning passengers will go for the cheapest fares with more amenities



T: The economic recession made both economy and premium traveling to decline

T: Under pressure to cope with increasing fuel prices  difficult to generate profits, resulted in increased bankruptcies and struggled with increasing labour demands



O: People are getting more demanding in terms of services – there needs are changing but they are travelling more

T: Automation is a factor affecting the industry as people are using platforms such as Skype for video calls/online conference instead of travelling



T: Latest intense competition in the airline industry – to survive in the tough environment latest technology must be adapted by airlines  failing to be tech-savvy results in loss of clients

O: Technology means aircrafts are lighter (making efficient aircrafts) and gain profits through offering safety and enhanced services (e.g. in-flight entertainment)



T: There are regulations where airlines are required to offer safe travel along with high-quality services. The laws are getting stricter which is becoming challenging for the airlines. This has increased costs for airlines to maintain certain levels of services and standards

T: Labour regulations (working hours right to strike)



T: Increased pollution

O: There are test flights that are beginning to use bio-fuels

O: airlines are developing CSR programs to address this issue







Government policies and financial laws have an effect on the functioning of both institutions.






Changes in the economy, both positive and negative, can have an impact on the demand for financial services and investment activity.






O: People getting more demanding in terms of services but are travelling more






Both banks need to change with the times, particularly in the area of online banking.






Both banks must adhere to financial laws and regulations, and modifications to these policies may have an impact on how they do business.



Ecological (Environmental)



Climate change and sustainability are becoming more and more significant factors in bank operations and investment decisions.



The financial sector may be impacted by shifts in governmental direction and policy.



Interest rate fluctuations have an impact on borrowing costs as well as banks’ profitability.



T: Automation affecting the industry




Threat of New Entrants (Moderate)



In the banking sector, suppliers usually refer to depositors and borrowers. Due to the size and diversity of their customer bases at both banks, these groups’ individual bargaining power is diminished.



Bargaining Power of Buyers (Moderate)



Threat of Substitutes (Low)



Bargaining Power of Suppliers (Low)



It is challenging for new players to enter the banking sector due to high capital requirements and regulatory obstacles. Prominent establishments such as J.P. Morgan and Bank of America possess a competitive edge.



Although individual consumers have some options when choosing a bank, switching can be expensive, particularly for institutions and businesses.



Traditional banking services have few alternatives. Established banks like J.P. Morgan and Bank of America have adjusted to effectively compete despite the introduction of new alternatives by fintech innovations.



Competition Rivalry (High)



Established banks compete fiercely with one another, particularly in financial hubs like Wall Street. This rivalry encourages innovation and may exert pressure on service and price.



More investment in marketing



Skilled labour: airlines focus on retaining the best-talented professionals




Value Chain

VRIO Framework

Resources/ Capabilities Valuable Rare Inimitable Organised
1. Commercial Banking
2. Wealth Management
3. Corporate Functions
4. Technology Innovation
Bank of America
1. Market Presence
2. Asset Management
3. Technology Investments
4. Extensive Product Range
J.P.Morgan Bank of America
Primary Activities
Inbound Logistics Efficient fund management, asset allocation, risk assessment Strong asset management and risk assessment
Operations Financial services, trading, wealth management, and investment banking Trading, asset management, investment banking, and retail and commercial banking.
Outbound Logistics Providing clients with financial services and products Extensive availability of financial services.
Marketing and Sales Robust brand with a global reach. A large consumer base and a powerful brand.
Services Exceptional client support and customized financial plans. wide range of products and a customer-focused approach.
Support Activities
Firm Infrastructure Firmly established international office network. A solid presence throughout the United States
Human Resource Management Draws the best financial talent. Draws elite personnel to the banking sector
Technology Development Makes investments in innovative financial technologies. Makes technological and digital banking investments.
Procurement Safe access to resources and capital The availability of financial resources.





Outbound Logistics: Emirates Sky Cargo




Ways of Responding

Sustainable Finance

J.P: Offering goods and services to promote social and environmental objectives, J.P. Morgan is engaged in sustainable financing. This covers impact investment, green bonds, and funding for renewable energy initiatives.

BA: In order to assist green initiatives and enterprises, the bank provides sustainable financing products and services, such as green bonds and loans.

Towards Community

J.P: The JPMorgan Chase Foundation

BA: The Bank of America Charitable Foundation

Critical Success Factors


Financial Performance and stability


Risk Management

Operational efficiency


Bank of America

Diversified portfolio

Digital Transformation

Global Market








References (n.d.). J.P. Morgan | Official Website. [online] Available at:


Bank of America. (n.d.). Bank of America – Banking, Credit Cards, Loans and Merrill Investing. [online] Available at:


Porter, M.E. (1985). Competitive Advantage : Creating and Sustaining Superior Performance. Riverside: Free Press, pp.11–15.


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Weber, J. and Wasieleski, D.M. (2018). Corporate Social Responsibility. Bingley: Emerald Publishing Limited.


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