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JPMorgan Pulls Back on Some Types of Higher-Risk Consumer Loans

  • Consumer chief Smith points to subprime auto, near-prime cards
  • Talk of downturn could be self-fulfilling prophecy, Smith says

JPMorgan Chase & Co. has been pulling back from some higher-risk pockets of the consumer credit market, concerned about how those types of borrowers will hold up in an economic downturn.

The bank has been avoiding subprime auto finance and cut back on long-duration car loans, according to Gordon Smith, chief executive officer of JPMorgan’s consumer-banking unit. The company also made “small changes” in the segment of the credit-card market known as near-prime about 12 to 18 months ago, Smith said.