JPM's Lake: Stock cheap and buybacks will add value

Leading off JPMorgan's (JPM -1.1%) investor day, CFO Marianne Lake makes the case (presentation slides, pg. 13) for buying the stock, noting the current price is a 20% discount "to theoretical value" in that it implies a 13% ROTCE vs. the bank's target of 15-16%. Given that analysis, management fees repurchasing shares even at significantly higher prices than today creates shareholder value.

Expenses are "a focus and opportunity for us," she says, guiding to total headcount in 2014 falling 5K, with headcount in Consumer and Community Banking falling 8K (pg. 22).

Earlier: Presentation confirms another 6K job cuts in mortgage banking.

Whither bank branches? Following Lake, CCB heads Gordon Smith and Doug Petno say the branch build concept may be over (presentation slides), but 40% of new credit cards and 55% of retail mortgages are originated in branches. Nevertheless, bank tellers (and total branch staff) become more of an endangered species, with the number of tellers falling to 2 per branch vs. 4 historically, and total branch staff expected to be 20% lower in 2015 than it was in 2011.

As for the weak mortgage market, it's expected to continue to deteriorate - off another 34% this year before flattening out in 2015.

Jamie Dimon's closing remarks and Q&A are scheduled for 2:30 ET.

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