cannabis firms that have a “direct nexus to marijuana-related activities” and are not listed on the Nasdaq, the New York Stock Exchange or the Toronto Stock Exchange.
Under the new policy, JPMorgan will no longer permit new purchases or short positions in such “plant-touching” cannabis business stocks beginning on November 8.
Steve Hawkins, CEO of the U.S.
“JPMorgan’s new policy is regressive and at odds with the majority of Americans, who want legal, regulated cannabis.
Both the Nasdaq and the New York Stock Exchange allow some cannabis companies, including Canadian firms that do not sell marijuana products in the United States, to list their securities.
Luis Merchan, CEO of Colombian cannabis cultivator and exporter Flora Growth, says that the change from JPMorgan does not apply to his company, which debuted on the Nasdaq with a May 2021 IPO.
They point to pending cannabis reform legislation such as the Secure and Fair Enforcement Banking Act as the best chance of ending restrictive policies like the one disclosed to JPMorgan’s prime brokerage clients this week.
“I suspect that many financial institutions would welcome the opportunity to work with cannabis, but we can’t expect broad banking access or participation without banking reform,” says Paxhia.