THE CHASE RETAIL FRANCHISE

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T H E   C H A S E   R E T A I L 
 F R A N C H I S E
S E P T E M B E R   1 0    2 0 0 3

• Lehman Brothers
• 2003 Financial Services Conference
• Donald H. Layton Vice Chairman

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• This presentation contains statements that are
  forward-looking within the meaning of the Private
  Securities Litigation Reform Act of 1995. Such
  statements are based upon the current beliefs and
  expectations of JPMorgan Chases management and
  are subject to significant risks and
  uncertainties. These risks and uncertainties
  could cause our results to differ materially from
  those set forth in such forward looking
  statements. Such risks and uncertainties are
  described in our Quarterly Reports on Form 10-Q
  for the quarters ended June 30 2003 and March
  31 2003 and in the 2002 Annual Report on Form
  10-K filed with the Securities and Exchange
  Commission and available at the Securities and
  Exchange Commissions Internet site
  (http//www.sec.gov) to which reference is
  hereby made.

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Key messages

• We have a major retail leadership franchise
• centered in National Consumer Credit
• 2002 was our performance breakout year
• continuing strongly in 2003
• Well positioned for long-term success
• with room for growth through the cycle

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The Chase retail franchise
1H 2003 Net Income1.6 billion
1H 2003 Revenue7.7 billion
Middle Market11
Middle Market9
RegionalBranch Banking5
RegionalBranch Banking17
National ConsumerCredit74
National ConsumerCredit84

• National Consumer Credit Home finance credit
  card auto finance
• Regional Branch Banking Consumer and small
  business
• Middle Market Commercial clients 10mm to 1bn
  in sales

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The only leader in all 3 major national credit
businesses!
National Consumer Credit (market share)
Source Visa MasterCard Discover Nilson 2Q
2003 Est
Source Polk June 2003 YTD
Source Inside Mortgage Finance 2Q 2003
Source Inside Mortgage Finance 2Q 2003
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A historic leader in the geographies as well
Branch-supported banking (market share)
Source Claritas 2Q 2003 Total deposit share
Source Claritas 2Q 2003 Total deposit share
Source Validata Study 2Q 2003 Primary
relationship share
Source Validata Study 2Q 2003 Primary
relationship share
Source SRBI Inc. 2003 Interim Study Primary
relationship share
Source Barlow Research Associates 2003 Study
Primary relationship share
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A long-term tradition of good returns...
ChaseROE
12
Net income 1.2 1.3 1.3 1.6 1.5 1.5
billions
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...now producing great returns and great growth...
Chase
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...which are leading the industry!
Comparable segments
1
1
1
1
1 Citigroup North America Cards Consumer
Finance Citibanking North America and Consumer
Assets. Wells Fargo Community Banking and Wells
Fargo Financial. Morgan Stanley Individual
Investor Group and Credit Services. Bank of
America Consumer Commercial Banking. Merrill
Lynch Global Private Client 2 Wells Fargo net
income growth excludes impact of 2Q01
impairment/special charges of 1.1 billion after
tax mainly related to private equity Revenue
growth is shown on a reported basis not adjusted
down for this charge as it is not reported on a
pre-tax basis 3 Merrill Lynch income is pre-tax
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Chase Home Finance
Business summary

• Execution
• Record operating results Aggressively
  reducing origination cost Maintained service
  quality standards Strategic shift to
  direct-to-consumer
• Risk Management
• Market riskexcellent results Credit
  riskconservative
• Growth
• Direct channelsbroker phone web etc.
  Prime home equity

Growth Home Equity (bn)
Growth Production (bn)
Financials (mm)
(15)
Outstandings
143
137
24
25
9
(16)
2.4
2.6
2.7
Share
6.0
7.3
6.2
Share
7.3
8.8
7.8
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Chase Credit Card
Business summary

• Execution Completing the rejuvenation
• Growth in market share Growth in account
  acquisition Successful Providian acquisition
  Strong collections and servicing Productivity
  more to come
• Risk Management
• Credit riskprime focus proven through cycle
  Low prime testing
• Growth
• Portfolio acquisition Co-brands Business
  cards Rewards cards e Cross-sell

Execution Providian
Growth Outstandings (bn)
Financials (mm)
Net Charge-offs
23
312
12
Chase platform
7
9.4
3
7.1
7.4
7.1
8.0
Share
6.7
6.9
7.9
16/30/03 versus 6/30/02 rate 26 without
Providian portfolio
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Chase Auto Finance
Business summary

• Execution
• Best-in-class business! Customer segment
  emphasisdealers mega-dealers manufacturers
• Risk Management
• Superb track recordcredit (prime) Lease
  residuals
• Growth
• Market leaderrevenues and profits increase
  Dramatic share gain Potential in related
  businesses

Growth Origination Volume (bn)
Lease of Origination Volume
Financials (mm)
25
32
36
67
21
2.7
2.6
6.8
Share
4.2
5.7
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Chase Regional Banking
Business summary

• Rejuvenation underway
• Substantially new management Salesmajor
  transformation Opening branches again
• Segmentation strategy
• Small Businessbest-in-class Mass
  affluentnew offering Retail mass consumer
  sharper focus
• Growth
• Rebounding market share Investment revenue
  via mass affluent Cross-sell with credit
  products

Growth Deposits (bn)
Rejuvenation Texas share
Financials (mm)
Total Deposit Share
Industry CAGR 4-6
CAGR 8
4.7
3.8
Source FDIC and Federal Reserve 2003 studies
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Chase Middle Market
Business summary

• Execution
• Industry leaderNY/Metro Texas Strong
  non-credit revenues Productivity improvement
  opportunity
• Risk Management
• Credit riskstrong track record
• Growth
• National up-tier expansion Diversify revenues

Financials (mm)
Sources of revenues
Successful risk management
Net charge-offs
1Net charge-offs for 7 largest U.S. commercial
banks.
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Profitability High returns across the board
1H 2003Return on internally allocated equity
12
79
80
16
Demonstrated high quality risk management
Credit card
Auto
Excludes Providian
2001
2002
2003
2001
2002
2003
FICO FICO 17
... including MSRs

• Hedging outsourced to IBs Global Treasury Q1
  2002 providing competitive advantage
• Conservative MSR valuation philosophyvalidated
  by independent survey
• Excellent net results in volatile markets

PL ( millions)
104
125
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Executionraising the bar for growth

• Examples
• Corporate Development Dept.
• Chief Marketing Officer
• Formally organized cross-sell e.g.
• Best-in-bank Six Sigma/productivity program
• e Turnaround

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Our strategic growth viewsfor Chase
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Key messages

• We have a major retail leadership franchise
• centered in National Consumer Credit
• 2002 was our performance breakout year
• continuing strongly in 2003
• Well positioned for long-term success
• with room for growth through the cycle

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Questions answers

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S E P T E M B E R   1 0    2 0 0 3
T H E   C H A S E   R E T A I L 
 F R A N C H I S E

• Lehman Brothers
• 2003 Financial Services Conference
• Donald H. Layton Vice Chairman