http://www.nydailynews.com/news/national/jpmorgan-chase-execs-resign-wake-bank-2-billion-trading-loss-article-1.1077456
Three JPMorgan Chase execs to resign in wake of epic $2 billion trading loss
Ina Drew, one of Wall Street's most powerful women, among those stepping down
Comments (109)
By Helen Kennedy / NEW YORK DAILY NEWS
Published: Sunday, May 13, 2012, 6:25 PM
Updated: Monday, May 14, 2012, 12:42 PM
JPMorgan Chase executive Ina R. Drew earned $15.5 million in 2011. She resigned over the bank's $2 billion trading loss announced last week.
One of the most powerful women on Wall Street was ousted Sunday as heads began to roll at JPMorgan Chase in the wake of its staggering $2 billion trading loss.
Ina Drew, JPMorgan’s chief investment officer and one of Wall Street’s few senior female bankers, resigned and two other executives were booted.
Drew, a close associate of bank President Jamie Dimon, ran the risk-management division that was responsible for the enormous losses revealed on Thursday.
A longtime star at the bank, she made $15.5 million last year and was listed at No. 8 on Fortune’s 2011 list of highest-paid businesswomen.
The Wall Street Journal said the other two ousted execs were Achilles Macris, who ran the London-based desk that placed the trades, and Managing Director Javier Martin-Artajo.
It also reported that Bruno Michel Iksil, the French-born financier nicknamed “Voldemort” and “the London Whale” who was directly responsible for the trades, would probably join the hit list.
One of the highest-paid bankers in London, Iksil earned the monicker of Harry Potter’s nemesis for his outsized, aggressive trades and the power he wielded in the market. In his personal profile on the Bloomberg trading platform, he brags of “walking over water.”
Dimon, who had dismissed concerns about the $2 billion in losses over six weeks as a “tempest in a teapot,” was uncharacteristically contrite on Sunday.
“We made a terrible, egregious mistake that there is almost no excuse for,” he said on NBC’s “Meet the Press.”
The $2 billion in losses came from trading in credit default swaps — the same type of market bet that caused so much global havoc in 2008 — in an effort to insure against risk from the turmoil in Europe.
“Hedging should make your bank less risky. In this particular case, we made a terrible mistake,” Dimon said.
He admitted that JPMorgan’s errors had given the Obama administration new ammunition in the battle for more bank regulation to avoid another credit crisis.
“This is a very unfortunate and inopportune time to have had this kind of mistake,” he said.
Drew, 55, oversaw an office that handled $360 billion in trades. She has repeatedly offered to step down since the scale of the loss became apparent in late April, said executives at the bank.
Dimon did not accept Drew’s resignation until Sunday — after disclosure of the losses sent JPMorgan’s market value plunging 9% and dragged down other financial stocks, sparking fears of a new investor panic.
A publicity-shy mother of two married to a New Jersey dentist, Drew joined Chemical Bank in 1982 and rose steadily through the company’s mergers with Manufacturers Hanover, JP Morgan and Chase into the behemoth of today.
She has been described in rare media profiles as “scary smart” and relishing the risks in trading.
Back in 1993, Crain’s New York named her one of 40 executives under age 40 to watch. The article’s now-unfortunate lead sentence: “Ina R. Drew loves crises.”
She declined comment through a bank spokeswoman.
Dimon stressed on NBC that JPMorgan, America’s largest bank with $2.27 trillion in assets, is “very strong.”
He said that even with the loss, the bank should make around $4 billion in profit this quarter.
Rep. Barney Frank (D-Mass.) told ABC’s “This Week” on Sunday that he hopes tougher regulations on banks — like the Volcker rule, which would prevent banks from making speculative bets with their own money and would limit the amount they can place in high-risk investments like hedge funds — would prevent such losses in the future.
A version of the rule goes into effect this summer. “I hope that the final rule will prevent this,” said Frank, an author of the Dodd-Frank financial reform bill. “The Volcker Rule is still being formulated.”
JPMorgan emerged relatively unscathed from the 2008 financial crisis, and many credited Dimon’s refusal to trade in subprime mortgages.
Dimon is not considered in trouble, but he may face tough questions about his 2011 $23 million pay package at Tuesday’s annual shareholder meeting.
Three JPMorgan Chase execs to resign in wake of epic $2 billion trading loss
Ina Drew, one of Wall Street's most powerful women, among those stepping down
Comments (109)
By Helen Kennedy / NEW YORK DAILY NEWS
Published: Sunday, May 13, 2012, 6:25 PM
Updated: Monday, May 14, 2012, 12:42 PM
JPMorgan Chase executive Ina R. Drew earned $15.5 million in 2011. She resigned over the bank's $2 billion trading loss announced last week.
One of the most powerful women on Wall Street was ousted Sunday as heads began to roll at JPMorgan Chase in the wake of its staggering $2 billion trading loss.
Ina Drew, JPMorgan’s chief investment officer and one of Wall Street’s few senior female bankers, resigned and two other executives were booted.
Drew, a close associate of bank President Jamie Dimon, ran the risk-management division that was responsible for the enormous losses revealed on Thursday.
A longtime star at the bank, she made $15.5 million last year and was listed at No. 8 on Fortune’s 2011 list of highest-paid businesswomen.
The Wall Street Journal said the other two ousted execs were Achilles Macris, who ran the London-based desk that placed the trades, and Managing Director Javier Martin-Artajo.
It also reported that Bruno Michel Iksil, the French-born financier nicknamed “Voldemort” and “the London Whale” who was directly responsible for the trades, would probably join the hit list.
One of the highest-paid bankers in London, Iksil earned the monicker of Harry Potter’s nemesis for his outsized, aggressive trades and the power he wielded in the market. In his personal profile on the Bloomberg trading platform, he brags of “walking over water.”
Dimon, who had dismissed concerns about the $2 billion in losses over six weeks as a “tempest in a teapot,” was uncharacteristically contrite on Sunday.
“We made a terrible, egregious mistake that there is almost no excuse for,” he said on NBC’s “Meet the Press.”
The $2 billion in losses came from trading in credit default swaps — the same type of market bet that caused so much global havoc in 2008 — in an effort to insure against risk from the turmoil in Europe.
“Hedging should make your bank less risky. In this particular case, we made a terrible mistake,” Dimon said.
He admitted that JPMorgan’s errors had given the Obama administration new ammunition in the battle for more bank regulation to avoid another credit crisis.
“This is a very unfortunate and inopportune time to have had this kind of mistake,” he said.
Drew, 55, oversaw an office that handled $360 billion in trades. She has repeatedly offered to step down since the scale of the loss became apparent in late April, said executives at the bank.
Dimon did not accept Drew’s resignation until Sunday — after disclosure of the losses sent JPMorgan’s market value plunging 9% and dragged down other financial stocks, sparking fears of a new investor panic.
A publicity-shy mother of two married to a New Jersey dentist, Drew joined Chemical Bank in 1982 and rose steadily through the company’s mergers with Manufacturers Hanover, JP Morgan and Chase into the behemoth of today.
She has been described in rare media profiles as “scary smart” and relishing the risks in trading.
Back in 1993, Crain’s New York named her one of 40 executives under age 40 to watch. The article’s now-unfortunate lead sentence: “Ina R. Drew loves crises.”
She declined comment through a bank spokeswoman.
Dimon stressed on NBC that JPMorgan, America’s largest bank with $2.27 trillion in assets, is “very strong.”
He said that even with the loss, the bank should make around $4 billion in profit this quarter.
Rep. Barney Frank (D-Mass.) told ABC’s “This Week” on Sunday that he hopes tougher regulations on banks — like the Volcker rule, which would prevent banks from making speculative bets with their own money and would limit the amount they can place in high-risk investments like hedge funds — would prevent such losses in the future.
A version of the rule goes into effect this summer. “I hope that the final rule will prevent this,” said Frank, an author of the Dodd-Frank financial reform bill. “The Volcker Rule is still being formulated.”
JPMorgan emerged relatively unscathed from the 2008 financial crisis, and many credited Dimon’s refusal to trade in subprime mortgages.
Dimon is not considered in trouble, but he may face tough questions about his 2011 $23 million pay package at Tuesday’s annual shareholder meeting.