JP Morgan exec steps down following bank’s $2 billion loss

Diane Alter – Fourth Estate Cooperative Reporter

New York, NY, United States (4E) – Following JP Morgan Chase’s admitted $ 2 billion blunder, the bank’s chief investment officer has stepped down.

The bank behemoth announced Monday that Ina Drew resigned following the bank’s $ 2 billion loss caused by a trade involving derivatives that was intended to hedge the bank’s risk. Instead, the company’s stock spiraled downward and sent shock waves through global markets.

The botched trade, which CEO Jamie Dimon called “sloppy and stupid,” gives lawmakers and advocates fresh ammunition to persuade regulators to implement tighter restraints on a bank’s in-house, or proprietary, trading activities.

According to JP Morgan, Drew “has made the decision to retire.” Matt Zames, co-head of Global Fixed Income, will step in to replace her.

The wayward trade has tarnished Dimon’s once-stellar reputation and image. JP Morgan emerged during and after the 2008 financial crisis in better shape than most of its peers.

Dimon told NBC’s Meet the Press that “In hindsight, we took on too much risk. We know we were sloppy. We know we were stupid. We know there was bad judgment. We’ve had audit, legal, risk, compliance, some of our best people looking at all of that.”

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