JPMorgan Is No Match for Google in One Analyst’s Fintech Ranking

LAGOS (Capital Markets in Africa) – No banking titan is better prepared than JPMorgan Chase & Co. to roll out new financial technologies — but even its innovation pales alongside Silicon Valley’s, according to a report by Autonomous Research.

Big financial firms including Bank of America Corp., Barclays Plc, Wells Fargo & Co. and UBS Group AG are “soberingly behind actual tech companies” in showing they’re embracing advances that power fintech, the study found. Alphabet Inc.’s Google, Facebook Inc. and Amazon.com Inc. are all leagues ahead, at least under the methodology used for the ranking, which graded companies in areas including artificial intelligence, chatbots and blockchain.

The report, titled “Bankosaurus Innovation” (possibly not a compliment), isn’t meant to be “scary or discouraging,” according to its author, Lex Sokolin, global director of fintech strategy at Autonomous. Instead, it underscores how firms that have long ruled banking must adapt to head off potential challengers as new technologies remake the industry.

“Many financial services CEOs would do well to appreciate Jeff Bezos and Elon Musk and find ways to develop a long-term mission and core technology advantage for the next generation of clients, employees and shareholders,” Sokolin wrote. They shouldn’t focus on “merely financial performance,” he said.

The report is based on a survey of firms and other sources. The ranking that Silicon Valley dominated, dubbed the “Innovation Index,” was based on how often thousands of media reports this year linked companies to “themes” important to fintech — such as, say, an article showing JPMorgan is experimenting with blockchain.

The analysis was weighted to emphasize “what matters in technology today,” Sokolin wrote. A firm pursuing artificial intelligence, for example, would score higher than a rival belatedly trying cloud computing.

He illustrated the ranking with a black-and-white photo, comparing banks to a horse pulling an old-fashioned U.S. mail car.

JPMorgan, the largest U.S. lender, declined to comment. The grades are “an art and a science,” Sokolin wrote, inviting readers to dispute his data.

Source: Bloomberg Business News