Monday, July 16

JPMorgan's trading loss could hit $9 billion — report

JPMorgan's trading loss could hit $9 billion — report

Yuri Gripas / REUTERS

JPMorgan Chase's CEO Jamie Dimon testifies before lawmakers.

The loss from JP Morgan’s botched trade could total as much as $9 billion, far higher than the original estimates of the shortfall, according to a report in The New York Times.

JP Morgan’s CEO Jamie Dimon estimated in May that the bank’s losses from the trade, which came as a result of a bad bet on credit derivatives, would be $2 billion, and might double within the next few quarters.

The Times’ story cites an internal report that JPMorgan made in April that showed the losses could reach $8 billion to $9 billion, in a worst-case scenario. But the newspaper also noted that because JPMorgan has already been unwinding its positions, some expect that the losses will not be more than $6 billion to $7 billion.

The newspaper also said the bank’s exit from its money-losing trade is happening faster than many expected. JP Morgan had previously said it hoped to clear its position by early next year, the Times said.

Dimon has appeared before lawmakers on Capitol Hill in recent weeks to explain the origin of the multibillion-dollar trading loss.

Lawmakers peppered him with questions about regulation and risky practices at the bank, but did not press him to give an update on the estimated trading loss.

Reuters contributed to this report.

CNBC's Kate Kelly reports that JPMorgan's trading loss is likely to be less than $9 billion.

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