J.P. Morgan Chase: More Money More Problems

Here we go again... TOO BIG TO FAIL extraordinaire, JPMorgan Chase disclosed that a trading group had suffered “significant” losses in a portfolio of credit investments, with the chief executive, Jamie Dimon, estimating losses at $2 billion. Mr. Dimon blamed “errors, sloppiness and bad judgment” for the loss.  The trading group, called the Chief Investment Office, makes trades to balance the bank’s assets and liabilities.
Within a week of the disclosure, the losses surged, surpassing the bank’s initial $2 billion estimate by at least $1 billion, according to people with knowledge of the losses. The losses gained momentum as hedge funds and other investors took advantage of JPMorgan’s distress, fueling faster deterioration in the underlying credit market positions held by the bank.

The overall health of the bank remains strong, even with the additional losses, and JPMorgan has been able to increase its stock dividend faster than its rivals because of stronger earnings and a more solid capital buffer.

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