Jamie Dimon blames $2bn loss on management chain failure
JPMORGAN Chase chief executive Jamie Dimon used his much anticipated appearance before lawmakers to apologise for the bank’s multi-billion dollar trading loss but made clear he will still criticise how Washington tries to curb Wall Street.
The Senate Banking Committee scheduled the hearing to grill Dimon on how a hedging strategy in a seemingly low-risk London office morphed into a complex bet that has produced at least $2bn (£1.28bn) in losses.
Asked if he had approved the trading strategy, Dimon said, “No. I was aware of it, but I did not approve it.”
Dimon told the committee that people throughout his management chain of command had failed. “You can blame it on anyone in that chain,” he said.
He told senators the trades started as a genuine hedge that would make the firm a lot of money if a credit crisis hit. “What it morphed into, I will not try to defend,” he added.
But Dimon said Washington must not overreact to JPMorgan’s trading loss and tighten new rules so much that it hurts financial markets.
Dimon, confident and amiable through most of yesterday’s hearing, appeared angry only briefly in an exchange with a senator over whether JPMorgan needed taxpayer assistance during the 2007-2009 financial crisis.
Shares of JPMorgan, the largest US bank by assets, rose 1.6 per cent.
Arance was a success for Dimon as he revealed few new details about the trading losses, struck a contrite tone when needed, and punched back when provoked.