JPMorgan Chase aims to raise $5 billion in common equity to fulfill a supervisory repayment condition that the largest bank holding companies redeeming TARP (Troubled Asset Relief Program) preferred capital demonstrate access to the equity capital markets. Even though the approval has not been granted yet, the company believes that upon completion of this capital raise, it will have satisfied the criteria for fully redeeming the TARP preferred capital and expects to do so before the end of June.
JPMorgan Chase plans to have Tier One Capital of approximately $118 billion or 9.3% and Tier One Common of approximately $93 billion or 7.3% at the end of the second quarter.
The company also expects to maintain its extremely strong capital ratios, even in the event of a more highly stressed environment over the next two years. JPMorgan Chase believes that redeeming the TARP preferred capital is in the best interests of the country and the company, and that these funds can be used by the Government for other critical purposes.
