1 00:00:02,520 --> 00:00:07,320 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:07,800 --> 00:00:11,160 Speaker 2: Joining us now Daniel Pinzack, JP Morganschase President, Daniel, it's 3 00:00:11,160 --> 00:00:12,120 Speaker 2: got to say you, sir. 4 00:00:12,440 --> 00:00:14,000 Speaker 1: Thank you for inviting me. It's great. Do you hear? 5 00:00:14,080 --> 00:00:16,079 Speaker 2: Do you feel happy? Do you feel lighter now? You 6 00:00:16,120 --> 00:00:17,520 Speaker 2: know you're stepping down and retiring. 7 00:00:17,720 --> 00:00:19,800 Speaker 1: I do a bit. I've been in the company for 8 00:00:19,840 --> 00:00:24,079 Speaker 1: more than four years. I add my contribution to the 9 00:00:24,120 --> 00:00:26,480 Speaker 1: success of the company. The company is in an amazing 10 00:00:26,520 --> 00:00:29,080 Speaker 1: place at the moment. It is the right time to 11 00:00:29,160 --> 00:00:32,640 Speaker 1: embrace an next generation, to work with Jamie and prepare 12 00:00:32,680 --> 00:00:36,159 Speaker 1: the company for the future and his succession. So I 13 00:00:36,200 --> 00:00:39,760 Speaker 1: feel good about the opportunities company gave me my contribution. 14 00:00:40,159 --> 00:00:44,800 Speaker 1: I'm looking forward to a very violence life going forward. 15 00:00:45,040 --> 00:00:47,000 Speaker 3: You are living the life that we all aspired to. 16 00:00:47,600 --> 00:00:50,040 Speaker 3: Why now and what do you expect the next twelve 17 00:00:50,040 --> 00:00:50,839 Speaker 3: to eighteen months. 18 00:00:50,680 --> 00:00:53,080 Speaker 1: To look like? So it's very simple in the next 19 00:00:53,159 --> 00:00:54,920 Speaker 1: This has been planned for a long period of time, 20 00:00:56,440 --> 00:01:00,400 Speaker 1: and now is the time for me to try decision 21 00:01:00,400 --> 00:01:02,640 Speaker 1: in a very, very smooth way. This transition will go 22 00:01:02,680 --> 00:01:05,679 Speaker 1: over a couple of years. I will my job will 23 00:01:05,720 --> 00:01:11,759 Speaker 1: be to help the management team to continue advising Jamie 24 00:01:11,840 --> 00:01:14,440 Speaker 1: and the bard In issues that there is strategic and 25 00:01:14,480 --> 00:01:18,480 Speaker 1: important for JP Morgan and for the future of the company. 26 00:01:18,600 --> 00:01:20,960 Speaker 1: So it is a right time. It is the right 27 00:01:21,000 --> 00:01:25,120 Speaker 1: group that I helped Jamie to build up to. So 28 00:01:25,760 --> 00:01:28,160 Speaker 1: I think that I feel good about where the company 29 00:01:28,200 --> 00:01:29,080 Speaker 1: is and where I am Now. 30 00:01:29,200 --> 00:01:32,399 Speaker 3: You've finish JP Morgan and it's affiliate banks for four 31 00:01:32,800 --> 00:01:35,800 Speaker 3: decades a long time. You've been to a lot of devices. 32 00:01:35,880 --> 00:01:38,920 Speaker 3: You've seen a lot of different cycles of enthusiasm. How 33 00:01:39,040 --> 00:01:42,680 Speaker 3: enthusiastic is the optimism around the dealmaking and some of 34 00:01:42,680 --> 00:01:45,120 Speaker 3: the mergers and acquisitions that could come down the pike. 35 00:01:45,520 --> 00:01:48,880 Speaker 1: I think that is quite anhusiastic. It was twenty four 36 00:01:49,040 --> 00:01:51,560 Speaker 1: was a very good year too, so you think about them. 37 00:01:51,560 --> 00:01:54,240 Speaker 1: An AIL historical average of volumes around four trillion a 38 00:01:54,360 --> 00:01:59,120 Speaker 1: year in twenty three, it was around three point two 39 00:01:59,240 --> 00:02:02,040 Speaker 1: last year three five. We think that this year could 40 00:02:02,120 --> 00:02:05,360 Speaker 1: get to around four trillion, which is historical average. And 41 00:02:05,440 --> 00:02:08,880 Speaker 1: most important, we hope that the timing PARTICU in the 42 00:02:08,960 --> 00:02:12,359 Speaker 1: US to approve transaction is not as long. It's moved 43 00:02:12,400 --> 00:02:15,880 Speaker 1: from twelve six months in the bus to running teen months. 44 00:02:16,080 --> 00:02:19,000 Speaker 1: Hopefully we go back. It's not just to announce new 45 00:02:19,040 --> 00:02:22,280 Speaker 1: yeers also to close new There is an environment is 46 00:02:22,320 --> 00:02:24,360 Speaker 1: said for that. Let's talk about the environment. 47 00:02:24,480 --> 00:02:26,679 Speaker 2: Is it just a regulatory shift that we need or 48 00:02:26,720 --> 00:02:29,240 Speaker 2: do you find that four percent five percent interest rates 49 00:02:29,240 --> 00:02:30,440 Speaker 2: of how people back as well? 50 00:02:31,800 --> 00:02:34,760 Speaker 1: I think that if you think about the US economy 51 00:02:34,880 --> 00:02:38,120 Speaker 1: has grown very well in twenty four over three percent, 52 00:02:38,280 --> 00:02:42,280 Speaker 1: is likely to grow over two percent this year, So 53 00:02:42,480 --> 00:02:45,880 Speaker 1: the environment is good. I think that even that is 54 00:02:45,919 --> 00:02:49,480 Speaker 1: an economy that you don't see and balances that tell 55 00:02:49,520 --> 00:02:51,760 Speaker 1: you that is an economy that is about to go 56 00:02:51,880 --> 00:02:56,000 Speaker 1: into recession. This cycle could continue for a period of time. 57 00:02:56,080 --> 00:02:58,600 Speaker 1: There is plenty of monetization that needs to be done 58 00:02:58,919 --> 00:03:05,200 Speaker 1: in the sponsor space. There is essentially the evaluations in 59 00:03:05,240 --> 00:03:08,240 Speaker 1: the US that are much higher than any other places 60 00:03:08,760 --> 00:03:14,519 Speaker 1: is also incentivizing merging into US companies. So I think 61 00:03:14,520 --> 00:03:16,040 Speaker 1: that it would be a good environment. 62 00:03:16,360 --> 00:03:18,480 Speaker 2: Which way to one bank yesterday who suggested that maybe 63 00:03:18,520 --> 00:03:20,040 Speaker 2: these US companies could go on a bit of a 64 00:03:20,080 --> 00:03:23,240 Speaker 2: shopping spring in places like Europe where valuations were depressed. 65 00:03:23,639 --> 00:03:26,320 Speaker 2: You engaged in any active conversations right now in companies 66 00:03:26,360 --> 00:03:27,359 Speaker 2: looking to do those kind of things. 67 00:03:27,360 --> 00:03:30,400 Speaker 1: So we are always engaged with clients all over the world, 68 00:03:30,600 --> 00:03:34,600 Speaker 1: and there is a lot of optimission everywhere about what 69 00:03:34,960 --> 00:03:39,760 Speaker 1: the US could do. So therefore, yes, there is dialogue. 70 00:03:39,280 --> 00:03:42,000 Speaker 3: Everywhere, so everyone sounds very optimistic. And then you go 71 00:03:42,080 --> 00:03:44,520 Speaker 3: to some of these for as in the evening and 72 00:03:44,600 --> 00:03:47,320 Speaker 3: people say there's a lot of enthusiasm, what actually will 73 00:03:47,360 --> 00:03:50,680 Speaker 3: get done, we're less clear on, just simply because there 74 00:03:50,760 --> 00:03:53,920 Speaker 3: is that question mark to John's point about benchmark rates, 75 00:03:53,960 --> 00:03:56,440 Speaker 3: about the fact that the economy isn't slowing down so much, 76 00:03:56,480 --> 00:03:58,800 Speaker 3: so why would they go any lower? And what happens 77 00:03:58,840 --> 00:03:59,600 Speaker 3: if they go higher? 78 00:03:59,640 --> 00:04:04,040 Speaker 1: Still? Because of that and deficit, I tell you how 79 00:04:04,080 --> 00:04:06,520 Speaker 1: I think about it. When you think about the US economy, 80 00:04:06,640 --> 00:04:08,920 Speaker 1: isn't a good place here, not a balance is. Consumer 81 00:04:09,360 --> 00:04:11,840 Speaker 1: is in a good place, the corporate sector is in 82 00:04:11,840 --> 00:04:15,120 Speaker 1: a good place. Inflation hasn't yet got to the levels 83 00:04:15,160 --> 00:04:18,000 Speaker 1: that it should be, and the deficit is high. And 84 00:04:18,040 --> 00:04:23,200 Speaker 1: then you have policies coming from immigration, policies, started physical 85 00:04:23,520 --> 00:04:28,719 Speaker 1: the policies and others. So at the end, this government 86 00:04:29,120 --> 00:04:33,480 Speaker 1: is about growth. So therefore I hope they will balance 87 00:04:33,720 --> 00:04:37,800 Speaker 1: the implementation of those policies in a way that it 88 00:04:37,839 --> 00:04:41,760 Speaker 1: doesn't either overhit the economy or trigger a recessions so 89 00:04:42,160 --> 00:04:45,000 Speaker 1: I think that the hope is because of that, because 90 00:04:45,040 --> 00:04:49,000 Speaker 1: the economy is in a good place, and certain things 91 00:04:49,279 --> 00:04:52,600 Speaker 1: like rational revelation, I don't like to talk about the revelation. 92 00:04:53,040 --> 00:04:56,560 Speaker 1: Rational revelation in our sector, in any other sector could 93 00:04:56,600 --> 00:05:01,039 Speaker 1: be good for growth, but if things go too far, 94 00:05:01,279 --> 00:05:03,800 Speaker 1: then the fact will have may have to hydrate and 95 00:05:04,400 --> 00:05:06,520 Speaker 1: deal with inflation. Hopefully it doesn't happen. 96 00:05:06,839 --> 00:05:09,360 Speaker 3: I guess what I'm getting at. Some people are asking 97 00:05:09,680 --> 00:05:13,200 Speaker 3: what potentially to rail this optimism? Is there anything that 98 00:05:13,279 --> 00:05:16,600 Speaker 3: you could see derailing this optimism this year at a 99 00:05:16,640 --> 00:05:19,359 Speaker 3: time when people are basically counting on this sort of 100 00:05:19,800 --> 00:05:23,360 Speaker 3: rational regulation or some of the other growth measures. 101 00:05:23,360 --> 00:05:25,680 Speaker 1: It's an extent, is what I said. Like inflation could 102 00:05:25,720 --> 00:05:29,279 Speaker 1: be that economy goes a bit too fast and doesn't 103 00:05:29,320 --> 00:05:34,120 Speaker 1: allow inflation to come down. That geopolitical space is still 104 00:05:35,600 --> 00:05:38,680 Speaker 1: in a challenging place, though there is some signs of 105 00:05:39,360 --> 00:05:44,480 Speaker 1: potential improvement there. And at the end, is like any 106 00:05:44,480 --> 00:05:46,880 Speaker 1: other policy, you can do the right amount, you can 107 00:05:46,960 --> 00:05:49,960 Speaker 1: do too much, too little. Hopefully the right amount, the 108 00:05:50,040 --> 00:05:52,880 Speaker 1: right amount is done in a way that doesn't really 109 00:05:53,240 --> 00:05:57,120 Speaker 1: derail An economy that is not ready for a recession 110 00:05:57,440 --> 00:05:59,880 Speaker 1: is an economy that is ready to continue to go 111 00:06:00,320 --> 00:06:01,480 Speaker 1: at a decent pace. 112 00:06:01,720 --> 00:06:04,839 Speaker 2: Daniel, A lot's changed in your banking career, tremendous amount, 113 00:06:04,920 --> 00:06:07,159 Speaker 2: and now a bunch of alternative asset managers are looking 114 00:06:07,160 --> 00:06:09,719 Speaker 2: for the activity that traditionally was on a bank balance sheet. 115 00:06:10,080 --> 00:06:11,599 Speaker 1: Can you walk us through as. 116 00:06:11,440 --> 00:06:14,440 Speaker 2: You depart, how different banking might look in the years 117 00:06:14,440 --> 00:06:16,560 Speaker 2: ahead compared to when you first started. 118 00:06:17,240 --> 00:06:21,039 Speaker 1: Well, it's very different. I think that is in a 119 00:06:21,080 --> 00:06:24,480 Speaker 1: better place, with more scale, better quality of service, is 120 00:06:24,520 --> 00:06:27,479 Speaker 1: a very quality of products, and a safer industry that 121 00:06:27,680 --> 00:06:30,120 Speaker 1: probably has ever been. I think that if you are 122 00:06:30,160 --> 00:06:35,240 Speaker 1: referring to private credit, I think that banks we've been 123 00:06:35,279 --> 00:06:37,760 Speaker 1: lending for two hundred years and private credit is no 124 00:06:37,839 --> 00:06:40,880 Speaker 1: more than a normal loan. So I think that we 125 00:06:40,960 --> 00:06:43,359 Speaker 1: feel very good and where we are in order to 126 00:06:43,400 --> 00:06:47,640 Speaker 1: compete in that space. And at the end, so what 127 00:06:47,760 --> 00:06:49,919 Speaker 1: is how we're rejected to be able to provide the 128 00:06:49,960 --> 00:06:53,200 Speaker 1: best possible service to a client? So, therefore, what is 129 00:06:53,240 --> 00:06:55,680 Speaker 1: it is in a certain transaction, you will be able 130 00:06:55,720 --> 00:06:59,440 Speaker 1: to offer a syndicative facility or you will be to 131 00:06:59,480 --> 00:07:03,520 Speaker 1: offer that a lending facility. Both markets will tend to 132 00:07:03,560 --> 00:07:06,599 Speaker 1: converge some way or the other, and we are in 133 00:07:06,600 --> 00:07:09,960 Speaker 1: an amazing position to compete because we do have relationship 134 00:07:10,000 --> 00:07:12,600 Speaker 1: with all those clients and we offer them not just 135 00:07:12,680 --> 00:07:16,920 Speaker 1: the loan, We offer them a bunch of activities. 136 00:07:17,040 --> 00:07:19,560 Speaker 2: We saw a relationship developed between Mark Row and Apollo 137 00:07:19,720 --> 00:07:22,480 Speaker 2: and Jane Fraser's City announced the end of last year. 138 00:07:22,720 --> 00:07:24,680 Speaker 2: Are you exploring similar partnerships. 139 00:07:25,120 --> 00:07:28,160 Speaker 1: We have plenty of partnerships, several where we have go 140 00:07:28,280 --> 00:07:33,120 Speaker 1: landing facilities with rather as the managers, and that they 141 00:07:33,240 --> 00:07:36,920 Speaker 1: want to participate in the origination. The issue for all 142 00:07:36,960 --> 00:07:40,120 Speaker 1: these funds at the moment is that they are getting 143 00:07:40,120 --> 00:07:42,400 Speaker 1: a huge amount of influence and they may not be 144 00:07:42,520 --> 00:07:45,720 Speaker 1: enough accests to deploy. So therefore, to have a partnership 145 00:07:45,760 --> 00:07:48,480 Speaker 1: with someone like us, a city or any other to 146 00:07:48,600 --> 00:07:52,200 Speaker 1: be able to participate in the origination of these banks 147 00:07:52,560 --> 00:07:54,880 Speaker 1: is a good thing. We are doing the same, not 148 00:07:55,560 --> 00:07:57,720 Speaker 1: just with one, with as many as we can. 149 00:07:57,960 --> 00:08:00,360 Speaker 3: That kind of dynamic gets people worried. Not to be 150 00:08:00,400 --> 00:08:01,760 Speaker 3: negative Nelly here, but you know. 151 00:08:02,000 --> 00:08:04,520 Speaker 1: Going to worries going forward. 152 00:08:05,800 --> 00:08:08,840 Speaker 4: I realized, Okay, I realized that I'm sounding pretty negative, 153 00:08:08,920 --> 00:08:11,480 Speaker 4: but I'm wondering, given how much the flows have come 154 00:08:11,520 --> 00:08:14,600 Speaker 4: in to the private credit sphere and how they've been 155 00:08:14,600 --> 00:08:16,120 Speaker 4: searching for ways to be deployed. 156 00:08:16,640 --> 00:08:20,320 Speaker 3: Is there anything that makes you nervous within this ecosystem 157 00:08:20,360 --> 00:08:21,320 Speaker 3: that's grown up very. 158 00:08:21,200 --> 00:08:24,960 Speaker 1: Quickly at the moment Now, I think that when you 159 00:08:25,000 --> 00:08:29,160 Speaker 1: look at these funds, they don't have too much leverage. 160 00:08:29,200 --> 00:08:33,840 Speaker 1: Their leverage one one and have times. So from that 161 00:08:33,960 --> 00:08:37,040 Speaker 1: point of view, particularly in the more in the bigger 162 00:08:37,080 --> 00:08:40,640 Speaker 1: space bigger loans, not so much. The only thing that 163 00:08:41,000 --> 00:08:43,880 Speaker 1: made me post and think about it is there it's 164 00:08:43,920 --> 00:08:47,520 Speaker 1: a lot of direct lending going into small business. There 165 00:08:47,600 --> 00:08:51,000 Speaker 1: is a lot of lending going into the smaller side 166 00:08:51,000 --> 00:08:54,959 Speaker 1: of middle markets. And this industry in the current form 167 00:08:55,400 --> 00:09:00,000 Speaker 1: hasn't been tested through a down turn cycle because when 168 00:09:00,160 --> 00:09:02,680 Speaker 1: COVID happen, it was al subsidized by the by the 169 00:09:02,720 --> 00:09:06,319 Speaker 1: different governments. So how these fans are going to behave 170 00:09:06,679 --> 00:09:09,800 Speaker 1: in a downturn with small business is something that you 171 00:09:10,280 --> 00:09:12,160 Speaker 1: want to be concerned about. It you want to keep 172 00:09:12,200 --> 00:09:14,520 Speaker 1: an eye on. But I don't think that there is 173 00:09:14,559 --> 00:09:18,120 Speaker 1: a systemic reissue in this space in the short term. 174 00:09:18,400 --> 00:09:20,520 Speaker 1: The components are not there for that to happen. 175 00:09:20,679 --> 00:09:22,600 Speaker 2: Daniel find a question, how's the golf game? 176 00:09:23,840 --> 00:09:27,439 Speaker 1: It's okay, It's been the terror rage what's awfully what's 177 00:09:27,440 --> 00:09:30,480 Speaker 1: the handicap? Now he has gone from five to eight. 178 00:09:31,040 --> 00:09:33,559 Speaker 1: Hopefully I go back and do it now. 179 00:09:33,960 --> 00:09:37,120 Speaker 2: You appreciate your time, sir, Congratulations on a fantastic career, 180 00:09:37,240 --> 00:09:39,079 Speaker 2: Thank you, thank you, and looking for the come in 181 00:09:39,120 --> 00:09:39,840 Speaker 2: the next twelve months with. 182 00:09:39,880 --> 00:09:41,160 Speaker 1: Each say absolutely thank you. 183 00:09:41,200 --> 00:09:44,200 Speaker 2: Sir. Daniel Pins are there? The President of JP Morgan Shacks.