Doing Their Bit: JP Morgan’s Part in the Ukraine-Russia Conflict

It is just over a year since the war in Ukraine began, during which time JP Morgan has taken steps to assist Ukraine in these difficult times. As discussed below, help has been both financial and advisory, including a memorandum on further help when the war is over. This aid has taken place against a background where JP Morgan’s market performance has been seriously, and adversely, affected by war. 

Little has gone as planned since Vladimir Putin sent his tanks across the Ukrainian border on Thursday the 24^th of February 2022. Throughout 2021 and 2022, a Russian military build-up on Ukraine's border exacerbated tensions and damaged bilateral ties, eventually culminating to Moscow launching a full-scale invasion of the nation. Russia's blitzkrieg failed, and the fighting stalled for months until Ukraine launched effective counter-offensives. Though NATO cannot join Ukraine’s war against Russia, along with Allies they have provided Ukraine with unprecedented levels of support, assisting them in upholding their fundamental right to self-defence. Not only has Russia's invasion of Ukraine caused tragedy for Ukraine but it has roiled the global economy, causing energy and food price shocks, as well as global supply chain disruptions, which have fuelled skyrocketing inflation globally and forced the world's central banks to boost interest rates painfully. The OECD warned at the end of last year that the war will continue to cause serious headwinds for the global economy, “Persistent inflation, high energy prices, weak real household income growth, falling confidence and tighter financial conditions are all expected to curtail growth.” (Mathias Cormann, 2022). 

Jamie Dimon, CEO of JP Morgan, has made his stance on the war clear since it first erupted, calling on Joe Biden’s administration to take a stronger stance. In his widely read annual report, Dimon stated, “we need to make this a permanent, long-lasting stand for democratic ideals and against all forms of evil.” (Dimon, 2022). JP Morgan has taken a stand against the humanitarian situation in Ukraine, boosting their commitment initial employee commitment of $2 million to $5 million (Chase, 2023). This is supporting a variety of organisations that provide emergency food, shelter, and services to people in need. 

The war disruption of the global economy, which was still recuperating from the Covid-19 epidemic, has been a major setback for JP Morgan. The market turbulence unleashed by the war underpinned the $524 million loss they reported in April last year (Franklin, April 2022). As shown in the graph below, JP Morgan's stock price was affected by the break out of the war, as has the stock price of the majority of the world's global banks. All experienced comparable declines, but a year on and their share price has restored to “normal”. 

With the war setting off Europe’s largest refugee crisis since WWII, JP Morgan have been advising the Ukrainian Government on the laying the groundwork to rebuild the country economically. Ukraine's government reached an arrangement with JP Morgan in early February of this year. The agreement is to assist in advising the war-torn country on its economy and future reconstruction efforts. Yulia Svyrydenko, Ukraine’s Minister of Economic Development signed a memorandum of understanding with a group of executives from the US bank aimed at rebuilding and developing the country. JP Morgan bankers were on the ground in Kyiv and other towns, evading bombings and learning first-hand how the country's economy has been damaged by the war. Following a series of meetings with several ministries, they met with Zelensky personally, as seen in the below image. As they were present on the eve of the American football Super Bowl, the bankers also sent Zelensky a New England Patriots jersey with the number "91," to commemorate the year Ukraine earned independence from the old Soviet Union (Gasparino, 2023). Although it is unclear what role JP Morgan will play in supporting Ukraine in its redevelopment, “J.P. Morgan envisions itself as a capital markets advisor to the country, helping it raise money either through a large investment fund or a bank” (Business, 2023). 

Works Cited

Business, F., 2023. JP Morgan reaches agreement with Ukraine's Zelenskyy on rebuilding infrastructure. [Online] 
Available at: https://www.foxbusiness.com/business-leaders/jp-morgan-reach-agreement-ukraine-zelenskyy-rebuild-infrastructure-present-patriots-jersey

Chase, 2023. Chase. [Online] 
Available at: https://recovery.chase.com/an-update-on-our-response-to-the-humanitarian-crisis-in-ukraine

Dimon, J., 2022. Chairman & CEO Letter to Shareholders, New York: JP Morgan Chase & Co.

Franklin, J., April 2022. JPMorgan profits hit by Ukraine crisis and mounting US recession fears, New York: Financial Times.

Gasparino, C., 2023. JP Morgan reaches agreement with Ukraine’s Zelensky on rebuilding infrastructure. [Online] 
Available at: https://nypost.com/2023/02/12/jp-morgan-reaches-agreement-with-ukraines-zelensky-on-rebuilding-infrastructure/

Mathias Cormann, A. S. P., 2022. Launch of the OECD Economic Outlook 2022. La Muette, OECD.