C Citigroup Inc

In its latest round of cost cuts, J.P. Morgan Chase & Co. is picking BlackBerrys.

The nation's largest bank by assets is hoping to save tens of millions of dollars by eliminating support for the BlackBerry wireless devices next year and mandating that some employees pay for their own devices, BlackBerry or otherwise, according to people close to the bank.

The move is part of a broader effort at big U.S. banks to keep costs low, especially as interest rates set by the Federal Reserve remain stuck near zero. Higher rates generally bring fatter profits for banks' lending businesses. The lack of rising rates—along with sluggish trading revenue—means bank executives must tighten the belts some more to keep profits growing.

J.P. Morgan, led by Chairman and CEO James Dimon, will shed new light on its expenses Tuesday afternoon, when it is set to disclose its third-quarter results. Even though analysts polled by Thomson Reuters estimate revenue fell 2% during the quarter, earnings per share are expected to edge higher thanks in part to cost discipline.

For the year, J.P. Morgan's operating expenses are expected to fall about 6% to $57.67 billion, according to estimates from Nomura Holdings Inc. analysts.

The bank's cost-cutting efforts have gotten a tailwind from a drop in legal expenses; those peaked for most big banks in 2013 and 2014, as J.P. Morgan and many of its peers signed large regulatory settlements with the Justice Department over alleged misdeeds during the financial crisis.

Banks are now looking to trim expenses elsewhere and raising new questions about costs they didn't think about as closely before: "Should we look at whether or not we're having too many large meetings?" U.S. Bancorp Chief Executive Richard Davis asked at an investor conference last month. "Should we take more time to get rid of the paper in the company?"

At the same conference, Bank of America Corp. Chairman and CEO Brian Moynihan said his firm would manage expenses on "a very, very careful basis in a low-growth environment." In May, Mr. Moynihan said that if the trading environment didn't improve, he would look to cut expenses further in that unit.

In the most recently reported quarter, three of the four largest U.S. banks by assets cut noninterest or operating costs from the year-earlier period. The metric fell 25% at Bank of America, 30% at Citigroup Inc. and 6% at J.P. Morgan.

J.P. Morgan has taken a number of other cost-cutting steps: It reduced the number of hotels it will approve for business trips, leaving some employees seeking manager approval to stay at five-star hotels such as the St. Regis in New York or Claridge's in London, according to the people familiar with the bank.

Some parts of the bank are also testing "ratio seating," in which employees essentially share desks with others who work at different shifts or those working across multiple office locations, the people close to the bank said.

"Cutting wasteful expenses frees up resources" for J.P. Morgan to continue investing elsewhere, said bank spokesman Joe Evangelisti.

With the bank's device-policy changes, employees won't be able to access certain J.P. Morgan email on a BlackBerry. Those who wish to keep a BlackBerry will need to pay for their own data plans.

More bank employees also will need to begin paying for their smartphones, whether it is a BlackBerry or other device.

Outside of J.P. Morgan, other firms and government agencies have dropped BlackBerry as the devices have been ceding ground to iPhones and other smartphones. A spokeswoman for BlackBerry Ltd. said in a statement that the company's clients include the largest banks and all G-7 governments.

J.P. Morgan's overall cost-cutting push is expected to shave hundreds of millions of dollars in annual savings but the bank hasn't disclosed a specific estimate. Earlier this year, the bank detailed plans to reduce the number of tellers; The Wall Street Journal reported the bank planned to cut at least 2% of its current workforce by next year.

In the past two years, the bank also redoubled efforts to cut costs with moves ranging from relocating employees to less-expensive office space to shutting off employee voice mail.

Peter Rudegeair contributed to this article.

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(END) Dow Jones Newswires

October 12, 2015 19:05 ET (23:05 GMT)

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