JPMorgan Chase shares fall on shock $2bn trading loss
Shares in JPMorgan Chase fell almost 7% in after hours trading on Wall Street on Thursday after it revealed a surprise $2bn derivatives trading loss by a London trader.
In a call with analysts, chief executive Jamie Dimon said the loss on its proprietary trading desk was linked to reports about a trader, nicknamed the ‘London Whale’, who reportedly amassed an outsized position hedge funds were betting against, the Telegraph reports.
The Wall Street Journal last month reported hedge funds were making bets in the market credit default swaps to try to take advantage of trades done by a French-born, London-based trader named Bruno Michel Iksil who worked out of the Chief Investment Office (CIO) arm of the bank.
Dimon blamed the losses on “errors, sloppiness and bad judgement” and warned they “could get worse”. “It puts egg on our face and we deserve any criticism we get,” he added.
Dimon refused to disclose any details about the trades the bank had put on, but said that its focus now is on on “maximising the economic value of these positions. We have got staying power and we are willing to use it.”
Shares in JPMorgan Chase were 6.73% lower in after hours trading.
This article was first published on Investment Week