Dimon Says JPMorgan ‘Let People Down’ on Faulty Credit Trades
Source: Bloomberg
JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon said his traders didn’t understand the risk they were taking with bets on credit derivatives and hurt the bank.
“This portfolio morphed into something that, rather than protect the firm, created new and potentially larger risks,” Dimon said in prepared remarks ahead of his appearance tomorrow before the Senate Banking Committee. “We have let a lot of people down, and we are sorry for it.”
Lawmakers plan to question Dimon at hearings this week and next about the bank’s losses after he initially called April news reports about the trades “a complete tempest in a teapot.” Shares of the bank, the biggest in the U.S., have dropped 17 percent since Dimon disclosed the mounting losses May 10, lopping about $26.5 billion from the firm’s market value.
Dimon, who’s also set to face the House Financial Services Committee on June 19, finds himself in the middle of a renewed debate about whether curbs on trading by deposit-taking banks are being tightened enough after mortgage bets pushed the financial system to the brink of collapse four years ago.
Read more: http://www.bloomberg.com/news/2012-06-12/dimon-says-jpmorgan-let-people-down-on-faulty-credit-trades.html
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