JPMorgan executive Ina Drew steps down after $2bn loss

  • Published
JP Morgan offices
Image caption,
Shares in JPMorgan have fallen since the trading loss was announced

JPMorgan Chase says its chief investment officer is to leave after a $2bn (£1.2bn) trading blunder.

The Wall Street firm said Ina Drew, who oversaw the London-based division responsible for the trading mistake, will leave after more than 30 years.

Matt Zames, the bank's co-chief of global fixed income in its investment bank, will take over from Ms Drew.

On Sunday, JPMorgan boss Jamie Dimon said he was "dead wrong" to dismiss concerns about trading at the bank.

Further resignations

Following a testing week for the bank, President Barack Obama in a US TV interview took the opportunity to cite the trading loss as an example as to why he pushed laws to curb the power of big banks.

Media caption,

Obama: A less profitable bank could be making these same bets

"JPMorgan is one of the best managed banks there is. Jamie Dimon, the head of it, is one of the smartest bankers we got and they still lost $2bn and counting," Mr Obama said.

"It's going to be investigated, but this is why we passed Wall Street reform."

It had been reported on Monday that Ms Drew, one of JPMorgan's best-paid executives, had offered her resignation several times following disclosure of the losses last Thursday.

However, in a statement issued in New York, Mr Dimon said: "Ina Drew has been a great partner over her many years with our firm. Despite our recent losses in the CIO, Ina's vast contributions to our company should not be overshadowed by these events."

"It's important to remember that our company is very strong and well capitalised. We maintain our fortress balance sheet and capital strength to withstand setbacks like this."

JPMorgan's shares opened down a further 3% after falling almost 10% on Friday following news of the trading blunder. Mr Dimon had previously dismissed growing speculation that the bank was facing losses.

Speaking on NBC's Meet the Press on Sunday, Mr Dimon said: "We made a terrible, egregious mistake. There's almost no excuse for it."

He said he did not know the full extent of the problem in April, when he described the concerns as a "tempest in a teapot".

The losses were made at a small trading unit in London. Reports suggest that Achilles Macris, head of the unit, and Javier Martin-Artajo, a member of the desk, could also resign.

They also suggest the position of trader Bruno Michel Iksil, nicknamed the London Whale, will come under scrutiny.

The trading loss was revealed in a regulatory filing, and will dent the company's profits, although it still expects to make about $4bn this quarter.

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