Financial Biz Review: JPMorgan’s Loss Could Go VIRAL, Barclay’s Libor SCANDAL
Shares of JPMorgan (NYSE:JPM) tumble as speculation mounts that the now-famous trading loss might reach $9 billion, according to person briefed on the situation. The company moves faster than observers expect to divest its positions that are losing cash, as it now appears that Jamie Dimon was dramatically understating the situation when in May he warned that the loss could ‘double’ from the first-reported $2 billion, in the coming quarters. At the same time, JPM is downplaying the $9 billion prediction to Kate Kelly, saying that it will ultimately amount to between $4 billion and $6 billion. Earnings at scheduled for July 13th; is that on a Friday by any chance?
The United Kingdom is having a blockbuster banking scandal of its own, as several politicians there are demanding that Barclays’ (NYSE:BCS) Bob Diamond step down following that bank’s attempted Libor manipulation. One MP commented that “This is the most corrosive failure of moral behaviour I have seen in a major U.K. financial institution in my career”, and another remarked that, “If Barclays’ board had an inch of backbone between them they would sack him.”. While this was going on, the bank’s shares went over the cliff in London and New York, as the impact of Barclay’s admission that it rigged the world’s largest and important market filters through after 24 hours. And now, HSBC (NYSE:HBC), Lloyds (NYSE:LYG), and the Royal Bank of Scotland (NYSE:RBS) have come under inquiry into the same matter, says Chancellor Osborne to Parliament. Court documents in an unrelated case have surfaced that accuse the hedge fund Brevan Howard requesting that RBS alter Libor, and that the bank “received this request without objection”.
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