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JPMorgan Bank Announces Massive Surprise Loss

Business News

0  Updated at 6:48 pm, May 10th, 2012 By:
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STAN HONDA/AFP/Getty Images(NEW YORK) — JPMorgan, in an unexpected announcement, said it saw $2 billion in trading losses in the last six weeks, and may yet see more.

“We have egg on our face,” Jamie Dimon, the massive bank’s CEO, said on a conference call.  “We deserve any criticism we get.”

JPMorgan’s stock was trading about six percent lower in after-hours trading and could very well drag down markets on Friday.

In recent weeks, the financial papers, particularly The Wall Street Journal, have been reporting on how the “London whale,” a trader or traders at JPMorgan’s London operations, has been distorting credit markets with big bets.

Now, apparently, those big bets mean a big hole for JPMorgan.

It is “striking how management and company downplayed the actions of this unit” before coming clean with the losses Thursday, said Todd Hagerman, a senior banking analyst with Sterne Agee.

JPMorgan, one of the largest banks in the world, has $1.4 trillion in assets under management. That figure is equivalent to the gross domestic product of Spain, a country whose financial predicament is worrying global markets right now — though nobody is saying JPMorgan is in danger of going under because of the newly announced loss.

Copyright 2012 ABC News Radio