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JPMorgan Slips on Report Trading Loss Widened to $9 Billion
JPMorgan Chase & Co. (JPM) fell almost 5 percent in European trading after the New York Times (NYT) reported the lender’s losses from credit derivatives may total as much as $9 billion, exceeding the firm’s initial estimate.
The shares fell to $35 as of 12:06 p.m. in Frankfurt trading from their $36.78 close in New York yesterday.
JPMorgan Chief Executive Officer Jamie Dimon said on May 10 the bank lost more than $2 billion on bets in credit markets taken by its chief investment office in London and that the loss could increase by as much as $1 billion this quarter. Dimon, 56, has said JPMorgan is in no rush to unwind the trades, even if adverse market moves produce bigger losses in the short term.
The firm’s losses have increased in recent weeks as JPMorgan sought to exit its holdings, the New York Times reported today, citing unidentified former traders and executives at the bank. The company has already closed out more than half of its positions, the newspaper said.
“We are now in the realms of speculation in terms of the sheer scale,” said Christopher Wheeler, a London-based analyst at Mediobanca SpA, who has a ‘neutral’ recommendation on JPMorgan. “The final loss will be offset by a number of items including a debt-valuation adjustment gain and gains on the sale of some of their treasury securities. However, the larger the number, the more difficult it is to reduce the impact.”
Patrick Burton, a spokesman for JPMorgan in London declined to comment on the New York times story.
To contact the reporter on this story: Ambereen Choudhury in London at [email protected]
Bankers kanina always understate their expected losses ! Cheebye kias !
JPMorgan Chase & Co. (JPM) fell almost 5 percent in European trading after the New York Times (NYT) reported the lender’s losses from credit derivatives may total as much as $9 billion, exceeding the firm’s initial estimate.
The shares fell to $35 as of 12:06 p.m. in Frankfurt trading from their $36.78 close in New York yesterday.
JPMorgan Chief Executive Officer Jamie Dimon said on May 10 the bank lost more than $2 billion on bets in credit markets taken by its chief investment office in London and that the loss could increase by as much as $1 billion this quarter. Dimon, 56, has said JPMorgan is in no rush to unwind the trades, even if adverse market moves produce bigger losses in the short term.
The firm’s losses have increased in recent weeks as JPMorgan sought to exit its holdings, the New York Times reported today, citing unidentified former traders and executives at the bank. The company has already closed out more than half of its positions, the newspaper said.
“We are now in the realms of speculation in terms of the sheer scale,” said Christopher Wheeler, a London-based analyst at Mediobanca SpA, who has a ‘neutral’ recommendation on JPMorgan. “The final loss will be offset by a number of items including a debt-valuation adjustment gain and gains on the sale of some of their treasury securities. However, the larger the number, the more difficult it is to reduce the impact.”
Patrick Burton, a spokesman for JPMorgan in London declined to comment on the New York times story.
To contact the reporter on this story: Ambereen Choudhury in London at [email protected]
Bankers kanina always understate their expected losses ! Cheebye kias !
