The JPMorgan trading loss has gone up to as much as $9 billion. Initial estimates in May were only at $2 billion.
The Times reports, “The red ink has been mounting in recent weeks, as the bank has been unwinding its positions, according to interviews with current and former traders and executives at the bank.”
During Congressional hearings last week, JPMorgan’s chief executive, Jaime Dimon, announced he expected the second quarter to be “solidly profitable”—despite suffering the huge losses. According to Wall Street analysts JPMorgan is expected to make 84 cents a share or $3.2 billion in net income—including trading losses.
From the Washington Post JPMorgan stocks closed down 2.4%. JPMorgan traded at $41 before the loss and now it is closing as low as $31.
According to Business Memo an international investigation on trading activities for big banks continue—banks under investigation include HSBC, RBS, Lloyds, Citigroup and JPMorgan Chase. Regulators are also looking into how the Libor and Euro Interbank Offered Rates are set.
Rating firms have downgraded several big banking firms such as Moody’s, Citigroup, Goldman Sachs and Bank of America—which could indicate growing risk from the weak economy and tougher regulation.
European leaders are in Brussels to discuss a series of proposals on how to boost the economy.
As for JPMorgan, the company is expected to present its second quarter reports July 13.