JPM - JP Morgan

[Parsad]

JPM Was Secretly Downgraded By Regulators:

 

http://finance.yahoo.com/news/jpmorgan-secretly-downgraded-regulators-170006215.html;_ylt=AjCqm6YkNpoevBnHVHIdQEiiuYdG;_ylu=X3oDMTQ4MGlwMWl2BG1pdANDTkJDIFRvcCBTdG9yaWVzBHBrZwM3NzBlNjEzYy05ZDQwLTM5NDUtYmY0Ni1jYTZjNjI5MjllYTMEcG9zAzIEc2VjA01lZGlhQkxpc3RNaXhlZExQQ0FUZW1wBHZlcgNjNjRkNmFlMy05MTgwLTExZTItYjdmYi1jZTIzMDY1NTY4ZGQ-;_ylg=X3oDMTFpNzk0NjhtBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25z;_ylv=3

 

Cheers!

[fareastwarriors]

Fund Manager Says 'Whale' Trade Was a Bet .

 

Boaz Weinstein, a hedge-fund manager who traded opposite J.P. Morgan Chase Co.'s JPM -1.55%"London Whale," said a Senate report clearly indicates that the losing positions were "not a hedge, it was a bet."

 

Asked at a hedge-fund conference in New York Thursday about how he formulated his trading position, Mr. Weinstein, founder of Saba Capital Management L.P., told attendees: "There was one index sitting out there [that] looked like a real mispricing" and "didn't make sense."

 

It was an "easy and obvious trade to do," he said in a keynote talk at the Absolute Return Symposium, referring to the bank's outsize positions in an opaque corner of the credit markets that came to light last year.

 

J.P. Morgan declined to comment.

 

Regulators and lawmakers have been scrutinizing the bank's trading in derivatives indexes that tracked the health of corporate credit, which ultimately saddled J.P. Morgan with more than $6 billion of losses. Regulators have focused on whether the bank was hedging its risks or making big bets on the future cost to insure against defaults by companies in the indexes.

 

Senators at a hearing last week questioned J.P. Morgan executives about whether the bank would be allowed such trades if new rules and regulations were in place, including the Volcker rule, a part of the Dodd-Frank regulatory overhaul that aims to curb banks from placing bets in the markets with their own money.

 

The trades that hurt J.P. Morgan became a rallying cry for supporters of a stronger interpretation of the rule. J.P. Morgan proposed Friday to revamp the way it hedges its positions.

 

According to quarterly data from the Federal Reserve, J.P. Morgan sold $101.3 billion more long-dated derivatives insuring against defaults by investment-grade companies as of March 31, 2012 than it had purchased.

 

"It appears now that the notional [volume] was over $150 billion," Mr. Weinstein said. The Senate investigators said the volume was $157 billion.

 

Mr. Weinstein said regulators might want to "have a rule that any time anyone wants to make an investment…. greater than $10 billion, the boss has to sign off on it." He added that the J.P. Morgan bets he and others traded against were "probably the largest investment ever in an item" and significant because one entity was "the entire other side of the trade."

 

Asked why he didn't make as much money on the trade as some others on the winning side, Mr. Weinstein said he didn't want to put his whole fund into it. "We had quite a large trade on and the risk reward was fantastic. But we don't use leverage in that way."

 

Mr. Weinstein isn't a stranger to big gambles in the markets. Before he ran his hedge fund, he was known for running a group of traders at Deutsche Bank AG DBK.XE +0.80%that saddled the German bank with $1.8 billion in losses in 2008.

 

 

 

 

 

http://online.wsj.com/article/SB10001424127887324557804578374622233916856.html?mod=WSJ_hps_LEFTTopStories

[wknecht]

Was expecting the annual letter and report to be posted by now. Anyone know when this is coming?

[meiroy]

 

http://www.bloomberg.com/news/2013-04-10/dimon-sees-more-regulator-scrutiny-after-embarrassing-whale-loss.html

 

"“We must confess that this issue worries us,” Dimon wrote, adding that JPMorgan spends about $200 million on cyber defense and data safety. “This number will grow dramatically over the next three years.”"

 

So, 1. are these raising costs included in valuations and 2. surely this is applies to all banks and possibly other industries, so who is going to benefit from it?

[Liberty]

http://brooklyninvestor.blogspot.ca/2013/04/jpm-2012-annual-report.html

[Liberty]

http://www.reuters.com/article/2013/04/15/us-jpmorgan-madoff-idUSBRE93E11E20130415

 

Regulators plan to fault JPMorgan Chase & Co, which served as Bernie Madoff's main bank for two decades, for failing to conduct adequate due diligence and report suspicious activity, according to a person familiar with the matter.

 

The Office of the Comptroller of the Currency is expected to issue a cease-and-desist order against JPMorgan, which will require the largest U.S. bank to put an end to the alleged failures in its anti-money laundering practices.

[jay21]

A director just went on a buying spree:

 

http://www.dataroma.com/m/stock.php?sym=JPM

[Phaceliacapital]

Not just a director, son of Lester Crown, billionaire.

 

Interesting to note is that James is also on the board of General Dynamics, which is, in contrary to JPM, a respectable company.

[Hubris]

I don't see what people dislike about JPM. Jamie Dimon is fantastic considering he has had an extremely challenging job of restructuring such a huge bank with so many different franchises and STILL has greatly grown and compounded tangible book value. All of this during one of the most turbulent times for the banking industry. Short of the TARP funds shoved down their throats I have no idea how much more we can expect. Unless people have forgotten it was Dimon's risk management and discipline that saved them from a huge hit on subprime. Jamie Dimon is one hell of a jockey and at P/E of ~8.8 what's not to like? Clearly I understand many might find BofA attractive however if you do actually look at Chase's credit card business which rivals AXP and their commercial banking both are direct results of Dimon's management. Both segments have performed spectacularly well. I think people are underestimating Jamie over a couple of incidents (London whale and Mike Mayo).

 

 

[Hubris]

Doing some JPM due diligence. I found the following to be interesting:

 

1- Jamie Dimon's annual letter to shareholders. (He writes it himself.)

 

http://files.shareholder.com/downloads/ONE/2404084338x0x652198/c54d05da-1acb-4cca-ab7a-9b80f9465199/JPMC_2012_AR_CEOletter.pdf

 

The focus on Tangible Common equity and returns on that. The other focus is one RWA and returns on those. The comparability of JPM, BAC and Wells isn't so simple because JPM has foreign exposure and foreign regulations that it must comply with.

 

One of the things about so many banks consolidating over the years is the creation of Goodwill which has not been all value-added goodwill. Therefore Jamie has only been responsible for the merger of Bank One and JP Morgan Chase and the acquisitions of Bear Sterns and Washington Mutual.

 

I think WaMu was certainly a stroke of genius at a moment of crisis. So his capital allocating decisions have been quite sound and he has taken advantage of the current environment. (Note: I recently read the outsiders and Jamie seems to fit the iconoclast bill. So I might be slightly biased to his leadership skills.)

 

2- Watching his interview at CFR:

 

 

 

3- I happen to think that has actually happened in Chase Retail Banking:

 

http://www.jdpower.com/content/press-release/K8ZBMfE/2013-u-s-retail-banking-satisfaction-study.htm

[fareastwarriors]

http://dealbook.nytimes.com/2013/04/29/another-executive-leaves-jpmorgan-raising-questions-as-vote-nears/?ref=business

 

Another Executive Leaves JPMorgan, Raising Questions as Vote Nears

 

 

 

 

news or just noise?

 

[PlanMaestro]

http://dealbook.nytimes.com/2013/05/02/jpmorgan-caught-in-swirl-of-regulatory-woes/

[PlanMaestro]

http://dealbook.nytimes.com/2013/05/03/scrutiny-falls-on-a-pioneer-at-jpmorgan/

[fareastwarriors]

http://www.bloomberg.com/news/2013-05-03/buffett-supports-dimon-s-dual-roles-100-at-jpmorgan.html

 

Buffett Supports Dimon’s Dual Roles 100% at JPMorgan

 

[fareastwarriors]

Amid Vote, Dimon Has Considered Departure

 

 

http://online.wsj.com/article/SB10001424127887324744104578475203412316878.html?mod=WSJ_hp_LEFTWhatsNewsCollection

[txlaw]

So how many of you guys own the warrants?  I own warrants, but I will sell if Jamie Dimon leaves.

[jay21]

So how many of you guys own the warrants?  I own warrants, but I will sell if Jamie Dimon leaves.

 

If he leaves, I think it will be a buying opportunity (also hope he would go to BRK after!)

[treasurehunt]

So how many of you guys own the warrants?  I own warrants, but I will sell if Jamie Dimon leaves.

 

I own both the warrants and the stock. Don't think I will hold these long term if Dimon quits.

[txlaw]

So how many of you guys own the warrants?  I own warrants, but I will sell if Jamie Dimon leaves.

 

If he leaves, I think it will be a buying opportunity (also hope he would go to BRK after!)

 

If he leaves, I would just redeploy the capital that is freed up into BAC.

[PlanMaestro]

http://www.efinancialnews.com/story/2013-05-17/jamie-dimon-napoleon-bonaparte-comment

http://epicureandealmaker.blogspot.mx/2013/05/mr-indispensable.html

http://blogs.reuters.com/felix-salmon/2013/05/17/jamie-dimon-needs-a-boss/

[PLynchJr]

So...Dimon stays as CEO & Chairman.  Stock is sitting right around book value and a 10 year high.  Anyone selling yet?

[fareastwarriors]

http://www.bloomberg.com/news/2013-06-03/whale-of-a-trade-revealed-at-biggest-u-s-bank-with-best-control.html

 

 

Whale of a Trade Revealed at Biggest U.S. Bank With Best Control

[fareastwarriors]

http://www.bloomberg.com/news/2013-06-05/jpmorgan-s-alabama-debacle-set-to-cost-bank-1-5-billion.html

 

 

JPMorgan’s Alabama Debacle Set to Cost Bank $1.5 Billion

[fareastwarriors]

Dimon Sees ‘Scary’ World as Interest Rates Return to Normal

 

http://www.bloomberg.com/news/2013-06-06/dimon-predicts-volatility-as-global-liquidity-returns-to-normal.html

[Hubris]

Anyone got insights how warrants will adjust to spin-offs?

 

JPM is spinning off the private equity business.