JPMorgan boss to testify to Congress twice in June

WASHINGTON, United States of America – JPMorgan Chase’s embattled chief executive Jamie Dimon will be hauled before US lawmakers twice in June to explain the bank’s recent huge trading losses, congressional officials said Thursday, May 31.

The US Senate Banking Committee said it postponed an appearance by Dimon from June 7 to June 13 to accommodate the schedules of both parties, while a House of Representatives panel has invited him to appear six days later.

Dimon “has accepted Chairman (Tim) Johnson’s request to testify before the Senate Banking Committee on Wednesday, June 13th at 10:00 am,” committee spokesman Sean Oblack said in a statement.

JPMorgan confirmed the postponement but did not provide a reason for the delay.

Congress, regulators and JPMorgan Chase staff are looking at the actions that led to more than $2 billion in derivatives trading losses, and earlier this month Johnson vowed to “get to the bottom of the massive trading loss.”

The hearing is likely to be highly politically charged, a proxy for the battle between Democrats and Republicans over Wall Street reform.

“Wall Street continues to need better risk management, vigorous oversight and unyielding enforcement,” Johnson, a Democrat, said in an earlier statement.

“I expect Mr. Dimon to come prepared.”

‘Stupid’

The under-fire executive has also been invited to testify at the House Financial Services Committee chaired by Republican Spencer Bachus.

“The chairman has scheduled that hearing for June 19,” a committee spokeswoman said.

Dimon, who has seen the bank’s share price tumble in the wake of the announcement, has admitted that the trading scheme was “stupid” but downplayed the losses, insisting the company was “still going to earn a lot of money this quarter.”

The scheme, which originally aimed to hedge risks, appears to have evolved into a big, aggressive and complex bet on the direction of the economy that went spectacularly wrong.

The White House and members of Congress have stepped up pressure for tighter regulation of the banks, including a broad ban on the speculative proprietary trade that has hurt many of them in the derivatives markets. – Agence France-Presse