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Introduction
JPMorgan Chase (NYSE:JPM) is the largest “too big to fail” bank in the United States. Recently, I’ve been a bit cautious about the bank’s common shares, but I’ve been a fan of their preferred securities
JPMorgan Chase's Newest 6% Bond Appears Better Than CDs Or Treasuries
Summary
- JPMorgan Chase's new 6% coupon bond offers a compelling yield, outpacing both its preferred shares and typical A-rated corporate bonds.
- Despite recent declines in net interest income, JPMorgan's strong loan and deposit growth, plus conservative loan-to-deposit ratios, reinforce its financial stability.
- Rising external borrowing poses some risk, but robust credit loss coverage and the bank's 'too big to fail' status mitigate major concerns for bondholders.
- With equity market risks elevated, I recommend this bond as a safe, attractive fixed income alternative, especially at par pricing during the IPO.
About My Writing: I am currently focused on income investing through either common shares, preferred shares, or bonds. I will occasionally break away and write about the economy at large or a special situation involving a company I've been researching in. I target two articles per week for publication on Monday and Tuesday.About My Background: Bachelors in history/political science, Masters in Business Administration with a specialization in Finance and Economics. I enjoy numbers. I have been investing since 2000. Professionally, I am the CEO of an independent living retirement community in Illinois.
Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
I have bid for the bond mentioned in this article.
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