In a hastily called conference call, JP Morgan (NYSE: JPM) CEO Jamie Dimon explained that one of the bank’s divisions would have an $800 million trading loss based on a bad investments in synthetic securities. Neither the loss nor the call was expected, and some investors sold in a panic and took other banks shares down.
On the call, Dimon said the bank had taken $2 billion in losses in the past six weeks and faces another potential $1 billion drop.
According to a WSJ transcript of the call, Dimon said:
J.P. Morgan is now forecasting an $800 million loss in the corporate segment in the second quarter.
And, he described the problem as “Flawed, complex, poorly reviewed, poorly executed and poorly monitored.”
Shares are at $38.35 after hours.
Douglas A. McIntyre