London Whale

  • News

    JPMorgan Isn’t Ready To Let Bruno Iksil Go

    You can take your said to be leavings and stick them where the sun don’t shine for all Jamie Dimon cares!

    Bruno Iksil, the London-based JPMorgan Chase & Co trader known as the “whale” believed to have been involved in the company’s $2 billion loss in derivatives, is still employed by JPMorgan, a spokeswoman for the bank said on Wednesday. Kristin Lemkau responded to a report on the New York Times website saying that Iksil is leaving the company. “He is still employed,” Lemkau said.

    JPMorgan still employs “whale” trader [Reuters]
    ‘London Whale’ Said to Be Leaving JPMorgan [Dealbook]

    / May 16, 2012 at 3:01 PM
  • News

    Trading Against Your Clients Works Best When You Lose Money

    This is sort of a strange footnote to the London Whale: one of the hedge […]

    / May 16, 2012 at 12:32 PM
  • News

    New JPMorgan CIO Doesn’t Get Out Of Bed For Less Than A Great Depression-Level Financial Catastrophe

    Earlier today, it was announced that Matt Zames had been named JPMorgan’s new Chief Investment Officer, to replace Ina Drew, the woman who supervised the trader responsible for the firm’s whale of a loss and was dismissed over the weekend. Previously, Zames served as the firm’s head of fixed income and while he may be happy to be seen by senior management as a guy capable of putting out at a fire, based on his experience, is probably at least a little bit underwhelmed by the task.

    From Kate Kelly’s Street Fighters:

    Matt Zames had been down this road before. He had started his career at Long-Term Capital Management in the winter of 1994, shortly after college. There he witnessed firsthand what could happen when a bunch of shortsighted executives didn’t manage their risk properly…By the time he reached the sixth floor it was after midnight. His team was huddled with a group of Bear managers in one of the conference rooms. Zames had one question for the Bear team: How much cash and collateral did it have on hand?…Zames shook his head. “This isn’t going to be necessary,” he told them. “This whole thing is fucked.”

    Guy had a front-row seat for LTCM and Bear’s implosion and now he’s being asked to do what, exactly? Clean up a minor mess at a *solvent* bank? It’s almost a little insulting, actually. Call him when you’ve got SOMETHING REAL.

    JPMorgan Says Ina Drew to Retire, Replaced by Zames as CIO [Bloomberg]

    / May 14, 2012 at 12:25 PM
  • News

    Fitch Has Something To Say About Fudgie

    “Manageable” but “raises questions.”

    Fitch Ratings has downgraded JPMorgan Chase & Co.’s (JPM) Long-term Issuer Default Rating (IDR) to ‘A+’ from ‘AA-‘ and its Short-term IDR to ‘F1′ from ‘F1+’. Fitch has placed all parent and subsidiary long-term ratings on Rating Watch Negative. Fitch has also downgraded JPM’s viability rating (VR) to ‘a+’ from ‘aa-‘ and placed it on Rating Watch Negative. In addition, Fitch affirmed JPM’s ‘1’ support rating and ‘A’ support rating floor. The rating actions follow JPM’s disclosure yesterday of a $2 billion trading loss on its synthetic credit positions in its Chief Investment Office (CIO). The positions were intended to hedge JPM’s overall credit exposure, particularly during periods of credit stress.

    Fitch views the size of loss as manageable. That said, the magnitude of the loss and ongoing nature of these positions implies a lack of liquidity. It also raises questions regarding JPM’s risk appetite, risk management framework, practices and oversight; all key credit factors. Fitch believes the potential reputational risk and risk governance issues raised at JPM are no longer consistent with an ‘AA-‘ rating.

    Fitch Cuts JPMorgan Ratings [Reuters]

    / May 11, 2012 at 4:50 PM
  • News

    JPMorgan Chief Risk Officer: “I want to reiterate the critical role that we play at J.P. Morgan Chase”

    In case that was unclear. Also, no more “surprises” like you know what again, please.

    / May 11, 2012 at 2:59 PM
  • News

    Senator From Vermont Finally Weighs In On JPMorgan Situation

    BURLINGTON, Vt., May 11 – U.S. Sen. Bernie Sanders (I-Vt.) issued the following statement today […]

    / May 11, 2012 at 12:45 PM
  • News

    Whale Sushi On The Menu At JPMorgan Executive Lunchroom For Next Few Months

    Jamie Dimon just did a conference call in which he mentioned something called the “Dimon […]

    / May 10, 2012 at 6:21 PM
  • News

    More Voldemort v. Volcker

    I for one am pleased that the London Whale cannot stay out of the news […]

    / Apr 18, 2012 at 3:27 PM
  • News

    You Say “Voldemort” Like That’s A Bad Thing

    Do you think that Bruno Iksil, when he woke up in Paris on Friday looking forward to trading from home in his black jeans, expected to become an international celebrity? The evidence suggests not. You may remember Iksil – possibly under other names like “Voldemort” or “the London Whale™” as the JPMorgan chief investment office trader who has sold protection on $100bn of notional of a CDX investment grade index to … hedge … JPMorgan’s massive short position in credit … or … something?* Anyway a lot of people are mad at him because that’s just too much protection to sell on that index and so they are complaining to Bloomberg and the Journal about how he is manipulating the market and also taking huge proprietary risks with JPMorgan capital that should obvs be regulated out of existence.

    This is weird in a lot of ways but one of them is that you can distill a lot of the Volcker-Rule complaints into “my God, you’re telling me that JPMorgan is exposed to $100bn of credit risk on investment-grade debt issued by a diverse mix of 121 U.S. companies!?” No! JPMorgan is exposed to something like $750bn of credit risk on debt issued by a diverse mix of companies. Some of it’s non-US. Some of it’s not even investment grade. And that’s just in its loan book.** Is writing $100bn of protection on the CDX.IG.NA.9 a terrible risk to take with investor and depositor and government-backstop money? Well, define “terrible risk.” It’s certainly less risky than operating the rest of JPMorgan.***

    / Apr 9, 2012 at 4:58 PM