JPMorgan Chase & Co. (JPM) fell more than 6 percent in New York trading after the New York Times reported the lender’s losses from credit derivatives may eventually total as much as $9 billion, exceeding the firm’s initial estimate.
Chief Executive Officer Jamie Dimon said on May 10 the bank lost more than $2 billion on bets in credit markets taken by its chief investment office in London and that the loss could increase by as much as $1 billion this quarter. Dimon, 56, has said JPMorgan doesn’t want to “do anything stupid” by unwinding the trades too quickly, and he hopes that by the end of the year the holdings will no longer have a significant impact on results.
The firm’s losses have increased in recent weeks as JPMorgan sought to exit its holdings, the New York Times reported, citing unidentified former traders and executives at the bank. The company has already closed out more than half of its positions, the newspaper said.