Business, Economics and Jobs

JPMorgan trading loss could reach $9BN


JPMorgan Chase CEO Jamie Dimon testifies during a US House Financial Services Committee hearing on Capitol Hill in Washington, DC, on June 19, 2012, about the investment bank's trading loss.

JP Morgan Chase & Co’s loss from a bungled trade could be as much as $9 billion – more than four times the amount flagged by chief executive Jamie Dimon back in May, the New York Times reported today.

Red ink from the bet on credit derivatives has been building as the investment bank unwinds its trading positions, the newspaper said, citing an internal report made in April.

The newspaper relied on information from current and former traders and executives at the bank.

Shares in JPMorgan were down more than four percent in afternoon trade on the New York Stock Exchange as investors digested the implications of the report, Reuters reported. They dropped more than six percent in early trading, Bloomberg said.

The bank’s shares have fallen more than 12 percent since Dimon revealed the hefty loss on May 10, which claimed the scalps of a number of senior executives and triggered separate investigations by the Securities and Exchange Commission and Federal Bureau of Investigation.

It also renewed calls in Washington for tighter monitoring of financial institutions.

At the time, Dimon warned the shortfall could widen by another “billion or more.”

JPMorgan will release its second quarter results on July 13 and investors expect the silver-haired CEO, who survived a vote of no confidence at the bank’s annual general meeting held days after he dropped the bombshell, to provide a more “complete report” on the situation inside the bank, Reuters said.

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