In a highly anticipated investor conference call today, JPMorgan announced the 'highest legal trading losses in history' on its QT earnings. During the call the bank answered questions on why the star of its Chief investment Office (CIO), Bruno Iksil, lost the bank $5.8bn in bad hedging bets. They also revealed the systematic failure in its units risk management procedures, models and monitoring.
The US bank said the executives responsible had been dismissed without severance pay and the bank would be clawing back two years of their pay. When it first announced the loss in May, it said it had lost at least $2bn.They also confirmed there was evidence that some traders may have been trying to hide their losses.
However despite those losses from its chief investment office, the bank reported three-month net profit of $4.96bn, down 8.7% from the same period last year. And JPMorgan's shares opened up 3% in New York.
Chief executive Jamie Dimon said he had closed the division of the bank responsible for the losses and moved the remainder of the trading position to its investment banking division.
Written and Presented by Ann Salter