JPMorgan Chase & Co. JPM Moat

Key data

The moat

A bank's moat is the right-hand side of its balance sheet. JPMorgan holds the operating accounts of a large share of American businesses and households, and those balances sit there because the payroll runs through them, the cards settle into them, and the treasury system is wired to them. They are not chasing a rate.

That produces funding cheaper than any competitor without the same relationships can obtain, and cheap funding is the only durable advantage in a business where the product is money and everyone sells the same one.

What it produces is a cost of deposits that falls while the balances grow.

Widening or narrowing

Both halves moved the right way at once.

Deposits rose $218B, or 8.7%, over five quarters. Over the same period the annualised cost of those deposits fell 19 basis points from its peak, and the absolute dollars of interest paid fell despite the larger balance.

The turn came in the March 2026 quarter, when deposits jumped $117B and interest expense fell $716M in the same three months. Taking in more money and paying less for it in a single quarter is the specific outcome a deposit franchise exists to produce.

Total revenue grew from $177.6B to $182.4B between 2024 and 2025, up 2.8%, which is the pedestrian number sitting on top of a very strong funding position. The franchise is in the funding, not in the growth rate.

The overrated case. The falling deposit cost is not solely a franchise result. The policy rate is the largest single input to what any bank pays, and a general decline in short-term rates lowers deposit costs across the industry at the same time. Separating the franchise effect from the rate effect requires comparing against peers on the same measure, which is not done here. The direction is right and the share of it that belongs to the franchise is not established by these figures.

The moat is widening on the evidence shown, with that caveat attached.

On profit pool, JPMorgan takes the spread between what it pays a depositor and what it earns lending or investing that money, on $2.7 trillion. A thin slice on an enormous base, which is why the base matters more than the slice, and why the cost of the base is the only number worth watching.