JPMorgan Chase Stock Repurchase Plan On Hold

NEW YORK (AP) — JPMorgan Chase CEO Jamie Dimon says the bank is suspending plans to buy back its own stock.

Dimon said Monday the bank will continue to pay a dividend despite the $2 billion trading loss disclosed on May 10.

"It's an embarrassment, it's a black mark," Dimon said of the trading loss. He also said the bank's balance sheet was "barely nicked" by the loss.

Speaking at a conference Monday organized by Deutsche Bank, Dimon said JPMorgan is preparing for new international regulations that force banks to hold more capital to prepare for economic downturns. JPMorgan's was scheduled to buy back $15 billion shares through the end of the first quarter of 2013.

JPMorgan's stock was 1.7 percent at $32.91 in morning trading.

Dimon's announcement is an about-face from earlier statements. At a meeting with investors in February, Dimon had said buying back stock helps the company meet regulatory requirements quicker.

"I don't mind the low stock price," Dimon had said then. The bank had bought a lot of stock back in 2011 at $36.

Usually, the bank buys back the shares it issues for employee stock-based incentive awards.

Here are nine other big bank disasters:

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• JPMorgan Chase Loses $2 Billion

  On May 10th, the U.S.'s largest bank JPMorgan Chase announced one of its London trading desks had lost <a href="http://www.huffingtonpost.com/2012/05/10/jpmorgan-chase-london-whale_n_1507662.html?ref=business" target="_hplink">$2 billion on bad bets on credit derivatives</a>.

• UBS Trader Loses $2 Billion

  Kweku Adoboli, a trader for Swiss bank UBS, lost <a href="http://www.huffingtonpost.com/2011/09/15/ubs-traders_n_963715.html" target="_hplink">$2 billion on unauthorized trades in September 2011</a>.

• MF Global Collapse

  Brokerage firm <a href="http://www.huffingtonpost.com/2011/10/31/mf-global-to-file-for-bankruptcy_n_1066902.html" target="_hplink">MF Global filed for Chapter 11 bankruptcy</a> in October 2011 after a failed $6 billion bet on European debt.

• Rogue Societe General Trader Loses $6 Billion

  Hailed as "history's biggest rogue trading scandal" at the time, French trader Jerome Kerviel was convicted in October 2010 of <a href="http://www.huffingtonpost.com/2010/10/05/jerome-kerviel-rogue-fren_n_750464.html" target="_hplink">losing French bank Societe General around $6 billion</a> due to unauthorized trades.

• Bear Sterns Bought By JPMorgan Chase

  After a run on investment bank Bear Sterns nearly caused its collapse in 2007, JPMorgan bought the firm for $2 a share the following March, <a href="http://www.businessweek.com/bwdaily/dnflash/content/mar2008/db20080316_356646.htm" target="_hplink">Businessweek</a> reports.

• AIG Largest Single Bailout

  Insurance company AIG became the recipient of the <a href="http://www.huffingtonpost.com/2012/05/08/aig-bailout-realize-15-billion-profit-taxpaers-gao_n_1498645.html" target="_hplink">largest ever government bailout for a single corporation</a> when a $182 billion rescue package saved it from a liquidity crisis following a <a href="http://www.huffingtonpost.com/2012/05/08/aig-bailout-realize-15-billion-profit-taxpaers-gao_n_1498645.html" target="_hplink">downgrade of its credit rating</a> in 2008.

• Washington Mutual Bankruptcy

  One of the biggest players in retail banking and mortgages during the housing crisis, Washington Mutual filed for Chapter 11 in September 2008, after sustaining losses on billions of dollars worth of mortgage and home loans, <a href="http://www.cnbc.com/id/46793926/WaMu_Emerges_From_Bankruptcy_Protection" target="_hplink">CNBC</a> reports.

• Citigroup Bailout

  Citigroup came to the brink of collapse after it reported losses around $10 billion in 2007, in part due to failed mortgage investments, <a href="http://money.cnn.com/2008/01/15/news/companies/citigroup_earnings/index.htm" target="_hplink">CNNMoney</a> reported. To keep the bank afloat the government issued <a href="http://www.huffingtonpost.com/2008/11/23/feds-consider-plan-to-res_n_145856.html" target="_hplink">a $20 billion bailout in November of that year</a>.

• Merill Lynch Shocks Investors With Big Loss

  After projecting a $4.5 billion loss during the third quarter of 2007, Merrill Lynch shocked investors by reporting a $7.9 billion deficit from trading mortgage-backed securities and other structured products, <a href="http://money.cnn.com/magazines/fortune/fortune_archive/2007/11/26/101232838/" target="_hplink">according to CNNMoney</a>.

• Barings Bank Collapse

  One time star trader Nick Leeson was responsible for sinking British bank Barings after losing $1 billion when an an earthquake struck Kobe, Japan in 1995, causing his investments in the Nikkei to fail as the Japanese stock exchange crashed, <a href="http://www.time.com/time/specials/packages/article/0,28804,1937349_1937350_1937488,00.html" target="_hplink">TIME reported</a>.

Comments

[marinade]

04:45 PM on 05/21/2012

Lloyd Blankfein must be happy to be off the hotseat.

[jistinnkees]

03:58 PM on 05/21/2012

2 billion loss embarrassing? 16 trillion in debt...stupid?

[Tom95134]

02:51 PM on 05/21/2012

The balance sheet may have been "barely nicked" by the loss but the loss in value by shareholders has been significant.

And there is something else that is fishy here. If the balance sheet hasn't been affected that badly then why are they worried about meeting stricter international bank capital rules? Something smells and I suspect we haven't hear the last shoe to drop.

[daveat1910]

02:25 PM on 05/21/2012

An embarassment- sounds like a jerk that did not lose his own money and doesn't care about someone else's. A place to never deal with for any reason.

[Gmasters]

02:18 PM on 05/21/2012

Time to update the Loss amount in the headline.
Isn't it closer to $5 Billion now?

[holycowbatman]

02:10 PM on 05/21/2012

Going to work with my zipper undone is embarassing.

Calling my wife by my dog's name is embarassing.

Falling asleep on the train and missing my stop is embarassing.

Not having the $1.50 when you get to the toll booth is embarssing.

Losing 2-3 billion dollars that may include up to 20 billion in lost interest...that is malfeasance.

[Jen Celli]

02:28 PM on 05/21/2012

Well done.

[jistinnkees]

03:56 PM on 05/21/2012

Perfect

[Scott Fishel]

02:02 PM on 05/21/2012

Time to follow China's teaching for financial criminals: bullet to the brain and charge the family for the cost.

[conscioushope]

02:01 PM on 05/21/2012

....not a "black mark".....rather 2 billion red marks of deficit.

[holycowbatman]

02:12 PM on 05/21/2012

And is there anyone who believes that is simply a loss of equity for the company and that the costs will be passed along to investors and employees? I anticipate JPM layoffs in the coming months.

[conscioushope]

06:03 PM on 05/21/2012

holycow!
I'm with you!

[thisoldbroad]

01:58 PM on 05/21/2012

Somewhere, somehow, somebody is missing almost $5 billion from their retirement / investment funds. Either this is real $ or it's monopoly $.. which is it?

If it is real $ then the arrogance of Dimons & Romney to try & pass this off as nothing important is breathtaking!

If it's monopoly $, then there's no need for FDIC insurance against loss & certainly no need to worry about propping them back up with tax $'s when they yell FIRE!

Someone please tell me if this now $5 billion is real $ & whose $ it is.. Thank you.

[headhuntnyc]

02:03 PM on 05/21/2012

Your request is so simple, so sincere, and so right. And yet you will never get an answer to it. None of us will. F&F

[holycowbatman]

02:15 PM on 05/21/2012

Actually, it is like not real, but virtual money that they use to make more virtual money, and once they do, they extract it as real money in the form of bonuses and payouts.

It doesn't become real money on the negative end until they have to pay out dividends and such; at which point they use magical math to move money around to minimize the appearance of mismanagement. If they really do experience losses that must negatively be shown to the public...it usually manifests as layoffs first, then decreased payouts.

And the blame never goes to the leadership....it's the markets...always the markets...

[tonybillbob]

02:52 PM on 05/21/2012

Is that the old "I'll gladly pay you Tuesday for a hamburger today" scam that J Wellington Wimpy used to run in the Popeye comics?

[ahl76]

01:56 PM on 05/21/2012

WOW...and they want LESS regulation...Throw the CEO out. Glad this is being investigated. This CEO has lost between 6-7 billion accouring to the most recent report.

[Nosybear]

01:56 PM on 05/21/2012

Two billion is an embarrassment? How much would it take to become a shame? Or even a crime?

[OldTulsan]

09:30 PM on 05/21/2012

Bankers are immune to criminal prosecution, even for laundering billions of dollars of Mexican drug money.

[headhuntnyc]

01:53 PM on 05/21/2012

If $2Bn is an embarrassment then what will the adjective be when it is revealed that is much more than that. They don't know what the final number is and won't for awhile. Could be much higher.

No one understands these trades. Not even the "businessman" and "finance guru" (gag) that is Romney. Krugman took him apart this morning and deservedly so. Romney is such a shallow vehicle for the GOP. There is no intellectual depth there at all (for further proof see: Chicago Tribune oped on Afghanistan and NATO . . . an exercise in how to fill space and say NOTHING WHATSOEVER). None. How can anyone vote for him and trust that he could navigate the US in a state of calm much less a storm.

[cadawa]

01:50 PM on 05/21/2012

It's not an 'embarrassment', it's a crime. http://www.huffingtonpost.com/rj-eskow/jamie-dimons-jpmorgan-cha_b_1515185.html
Only embarrassing if you are prosecuted. No chance of that happening. http://www.opednews.com/articles/Wall-Street-Has-No-Worries-by-Arlen-Grossman-120510-154.html

[PALEOLOGOS DRAGASH]

01:47 PM on 05/21/2012

Wall street finds embezzlement embarrassing?

Gosh...those fast-approaching pitchforks seem to have had a profound educational and moral impact on our cute little banksters.

With a little, ahem...enhanced...interrogation, they might conceivably even remember where they stashed the "lost" money.

[Annespeaks]

01:46 PM on 05/21/2012

Changing the rules as you go along - the new mantra of Wall Street.