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JPMorgan CEO says $2-billion trading loss not 'life threatening'

Chief executive Jamie Dimon admits JPMorgan Chase was 'sloppy' and 'stupid,' and worries the trading loss could empower regulators to further restrict risky trades by large banks.

May 13, 2012|By Noam N. Levey, Washington Bureau
  • A pedestrian passes JP Morgan Chase & Co. headquarters in New York on Friday.
A pedestrian passes JP Morgan Chase & Co. headquarters in New York on… ( Peter Foley / Bloomberg )

WASHINGTON — JPMorgan Chase CEO Jamie Dimon acknowledged Sunday that his company's $2-billion trading loss could empower government regulators seeking to place tighter controls on risky trades by large banks.

"This is a very unfortunate and inopportune time to have had this kind of mistake," Dimon said in an interview on NBC's "Meet the Press" with David Gregory.

But the head of America's largest bank brushed aside the suggestion that the loss underscored the persistent risk posed by mismanagement at large banks more than three years after a financial crisis that forced billions of dollars in taxpayer bailouts.

"This is not a risk that is life threatening to JPMorgan. This is a stupid thing that … we should never have done. But we are still going to earn a lot of money this quarter. So it isn't like the company is jeopardized," he said.

Dimon, a widely respected executive credited with guiding his company skillfully through the financial crisis while others faltered or failed, has been unusually contrite since disclosing the loss by traders in an overseas subsidiary. But he said Sunday he did not know whether the bank broke any laws or accounting rules.

"We know we were sloppy. We know we were stupid. We know there was bad judgment," he said. As for violations of rules or law, "we don't know if any of that is true yet."

Because of his reputation for having managed his bank well, Dimon has had greater credibility than many other Wall Street figures in the debates over financial regulations. "The price" that the bank will pay for its trading loss will be "that they'll lose their battle to weaken the rules," Sen. Carl Levin (D-Mich.) told Gregory.

Dimon, however, repeated his warning that Democrats have been trying to regulate too much. In general, Dimon, a Democrat, said he has become increasingly troubled by a lot of what Democrats in Washington have been doing.

"I have gotten disturbed at … some of the Democrats' anti-business behavior, the sentiment, the attacks on work ethic and successful people. I think it's very counter-productive," said Dimon, who added that he now describes himself as "barely Democrat."

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