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Best ChaseSux Sites
My Favorite ChaseSux Sites: Chase Home Finance Sucks - a daily blog that focuses on Chase Home Finance, Modifications, Govt. Agencies and an overall emphasis on Chase Bank in general. Chase Sucks - an overall emphasis on Chase Bank with regards to Home Financing, Modificaitons & Credit Cards. Loan Safe - an overall emphasis on Bank Loans in general with a lot of individual loan and modification horror stories. This particular link focuses on Chase Bank. Loan Safe - another loan safe link that focuses on class action lawsuits. You Walk Away - Focuses on walking away from a bad Bank Loan and Strategic Default. Walking Away Paper ...
Lawsuits & Attorneys
LAWSUITS ACROSS THIS COUNTRY A site that will send your complaint to a lawyer for review. Send Your Complaint to a Lawyer for Review Lawsuit – Urban Justice Center - JP MORGAN CHASE ILLEGALLY DENYING HOMEOWNERS FORECLOSURE RELIEF. NYC Homeowners Sue Chase for Unexplained Delays & Denials of Permanent Modifications under Federal Program, Including after Months of ‘Trial Payments’ URBAN JUSTICE CENTER SITECase Documents UJC_Chase press release_FINAL Final Chase Complaint Case20100504132936429 The following case information brought to you by Justia Lawsuit - A North Carolina case where the plaintiff, a family, is suing the defendant, Chase Home Finance LLC. FULL STORY The ...
The following article is brought to you by Nathaniel Espino at BusinessWeek.Com.
JPMorgan Chase & Co. (JPM) (JPM)’s loss from derivatives trading may widen to $5 billion, the Wall Street Journal reported.
Chief Executive Officer Jamie Dimon personally approved the strategy that led to the trades, without monitoring how they were executed, the newspaper said, citing people familiar with the matter that it didn’t identify. His failure to closely regulate that activity caused resentment among executives whose departments face tighter oversight, according to the Journal.
JPMorgan last week announced a $2 billion trading loss on synthetic credit products, or derivatives tied to credit performance. Dimon said the transactions, intended to manage risk, were “egregious” failures by the bank’s chief investment office. JPMorgan has said the amount could increase by $1 billion or more as it winds down the positions.
Joseph Evangelisti, a spokesman for New York-based JPMorgan, declined to comment on the $5 billion estimate.
JPMorgan fell 0.5 percent to $33.77 by 10 a.m. in German trading, after closing at $33.93 in New York yesterday, down 4.3 percent.
The largest U.S. lender by assets didn’t have a treasurer during the five months when the trades took place, the Journal reported in a separate article.
JPMorgan’s chief investment office oversees about $360 billion, or the difference between deposits and what the bank lends. Matt Zames, who was appointed to lead the division after the loss was reported, shook up leadership and announced a “renewed focus” on hedging risks.
Regulatory Overhaul
The loss has prompted the Federal Reserve Bank of New York to examine how banks in its district are managing cash after receiving a flood of deposits since the credit crisis, according to a person familiar with the matter. Dimon, 56, has agreed to testify before a Senate committee that’s debating whether to tighten rules on trading by U.S. lenders.
JPMorgan and regulators face pressure to explain the loss as lawmakers haggle over rules for the Dodd-Frank regulatory overhaul enacted two years ago.
The U.S. Justice Department and the Federal Bureau of Investigation in New York have begun a criminal probe of the trading loss, a person familiar with the matter has said. The inquiry is in its most preliminary stage, the person said.
The company was trying to reposition a portfolio of corporate credit derivatives and used a trading strategy that was “flawed, complex, poorly conceived, poorly vetted and poorly executed,” Dimon told shareholders this week at the bank’s annual meeting in Tampa, Florida.(CHASEHOMEFINANCESUX RESPONSE: And All Of This Poorly Approved And Poorly Led By You Jamie!)
The following article is brought to you by AmericanBanker.Com.
NEW YORK — Investors have drained almost $26 billion in market capitalization from JPMorgan Chase & Co. (JPM) since the bank announced a surprise $2 billion trading loss a week ago — and most of it likely has left the bank sector altogether.
E. Keith Wirtz, the president and chief investment officer of Fifth Third Asset Management, said the money leaving banks is “is either going away from stocks, or they are going into categories like staples, utilities, health care, those more defensive sectors.” Utilities and health-care stocks are roughly flat over the last five trading days, and consumer discretionary fell considerably less than financials. Biotechnology stocks are up.
Bank stocks have struggled to find a firm footing after the financial meltdown. But the sector has been among the best performing this year. JPMorgan was part of the rally, in part because it was among the first to restore its dividend, with an increase last year and another one earlier this year.
Its “premature” dividend hike “added fuel to the fire” of financial stocks, wrote Andrew Wilkinson, the chief economic strategist of Miller Tabak & Co. LLC, in a research note Thursday. “Financials outperformed discretionary stocks by 7% during the rally. All that has been given back as the rally turned to dust.”
JPMorgan, along with Wells Fargo & Co. (WFC) and U.S. Bancorp (USB), has long been the go-to stock for fund managers who want to invest comfortably in bank stocks.
All three had come through the financial crisis in strong shape, their risk management held, their top executives are well regarded, and their growth prospects are promising.
But shares of Wells Fargo and U.S. Bancorp, though not down nearly as much, seemed to absorb little of the money that left with the more than 15% decline of JPMorgan’s stock. Shares closed at $33.93 Thursday, off 4.31% or $1.53. Shares are down $6.81 in five days.
Investors put their money elsewhere rather than buying shares in another bank, no matter how stable the bank appears.
The lack of investor interest in shifting funds from JPMorgan to Wells Fargo and U.S. Bancorp is in part because most bank stock investors own those stocks already.
“They own all three. JPMorgan, Wells Fargo, U.S. Bancorp, those are the three big pillars” of the banking industry, said Byron Brand Snider, president pf West Oak Capital LLC, a JPMorgan shareholder. And “when you take a step beyond those names, then you have worries about balance sheets that aren’t as big and strong.
“If I were to lose confidence in owning a name like JPMorgan, it probably would be money flowing out of the sector,” he said. He has held on to his JPMorgan shares.
But other investors, particularly generalist fund managers selling JPMorgan “are pulling their money out” of the banking sector, said Brian Bertonazzi, the head of sales and trading at Sandler O’Neill + Partners LP. Thomas Michaud, the chief executive of KBW Inc., an investment bank specializing on the financial services industry, said, “Investors see what happens…and move on.”
JPMorgan’s reputation took a massive hit when the bank disclosed that it lost about $2 billion already this quarter on trades to hedge the bank’s credit risk. The full extent of the damage from the flawed hedging strategy won’t be known until the trades are unwound, which could take until the end of the year, Chief Executive James Dimon told investors last week.
Michaud said JPMorgan’s issues shouldn’t tarnish the entire industry, but they do in part because JPMorgan is such a big part of major bank indexes and the big drop is pulling down the sector’s perceived performance, regardless of how risky the individual banks are.
That adds to concerns that banks in general are too leveraged and, given the slow economic recovery and uncertainty about how regulatory changes will impact banks’ profitability, overall not a good investment.
Still, some analysts and investors believe sellers of JPMorgan stock are overreacting. Jill Cuniff, the president of Edge Asset Management, said her firm underweights banks, particularly the large banks.
“We don’t own Citigroup (C), we don’t own Bank of America (BAC), we are not confident in their business models,” she said. Wells Fargo and JPMorgan, however, were exceptions, and “we still feel confident” in JPMorgan.
For Wirtz, the JPMorgan dip is “presenting a buying opportunity.
“My worry is that JPMorgan overreacts and overcompensate on risk control,” he said. “They need to take risk; I want them to earn money.”(CHASEHOMEFINANCESUX RESPONSE: Good Luck With That Confidence You Have In JPMorgan!, Cuniff and Wirtz LOL)
The following article is brought to you by Phil Mattingly at BusinessWeek.Com.
JPMorgan Chase & Co. (JPM) (JPM) Chairman and Chief Executive Officer Jamie Dimon should “impose financial penalties” on the employees responsible for the bank’s trading loss of more than $2 billion , U.S. Senator Scott Brown said.
“It has been very frustrating to watch the continuing volatility in our financial markets, and this $2 billion loss, while painful, provides a good opportunity for JPMorgan to prove that compensation practices have truly changed since the 2008 financial crisis,” Brown, a Massachusetts Republican, wrote in a letter yesterday to Dimon.
Brown, one of three Senate Republicans who supported the 2010 Dodd-Frank Act, is seeking reelection in a close race with Democrat Elizabeth Warren, who advised President Barack Obama in setting up the Consumer Financial Protection Bureau. JPMorgan may reclaim incentive pay from employees responsible for the loss, Dimon said this week.
JPMorgan, the biggest and most profitable U.S. bank, is facing scrutiny from federal regulators and a Department of Justice investigation in the wake of Dimon’s disclosure of the losses, which occurred in the bank’s chief investment office. Ina Drew, who headed that unit, stepped down this week.
Stock awards for members of JPMorgan’s operating committee can be canceled or reclaimed if a member “improperly or with gross negligence” fails to identify risk, the bank said in its annual proxy statement. Drew and others who served on the panel also can have 2012 stock awards canceled if Dimon deems their performance was “unsatisfactory for a sustained period of time,” according to the proxy.
“It is my hope that you will use this provision to its full potential to address this situation,” Brown said in his letter, referring to the language in the proxy statement.
The following article is brought to you by Jesse Hamilton at BusinessWeek.Com.
U.S. Comptroller of the Currency Thomas Curry, whose agency is the main regulator for JPMorgan Chase & Co. (JPM) (JPM)’s North American bank, said that operational risks are eclipsing credit risk as the regulator’s chief concern.
Without naming JPMorgan specifically, Curry said that operational risk – the risk of loss from failures by people and bank processes — is “high and increasing” and made worse when bank procedures are most complex.
“Some of our most seasoned supervisors, people with 30 or more years of experience in some cases, tell me that this is the first time they have seen operational risk eclipse credit risk as a safety and soundness challenge,” Curry said in remarks prepared for delivery today before the Exchequer Club of Washington. “Rising operational risk concerns them, it concerns me, and it should concern you.”
Curry said the OCC, which regulates U.S. national banks, has seen faulty management of the “interrelationship of risks in different markets on the value of the institution’s assets” and that the agency has too often seen “conspicuous and expensive examples of the toll that one form of operational risk — flawed risk models — can take.”
This speech, a week after JPMorgan’s Chief Executive Officer Jamie Dimon said the bank made “egregious” mistakes and had so far lost about $2 billion tied to synthetic credit securities, is the first scheduled by Curry since being confirmed by the Senate last month to become Comptroller of the Currency.
‘Breakdown of Control’
Bryan Hubbard, an OCC spokesman, said yesterday that the agency does not “approve specific models” or trades at the banks it oversees, including JPMorgan Chase Bank N.A. He said the agency focuses on “risk management policies, processes, procedures, limits and controls” and in the case of JPMorgan are looking to see whether a “breakdown of control” caused the bank’s activities to swing far from expectations.
“The primary bank regulators are at fault here for not anticipating this better and short-circuiting the risk-taking better, and they have to own up to that responsibility and be accountable,” said David Hendler, an analyst at CreditSights Inc., a New York-based research firm.
In his speech, Curry also cited third-party relationships and anti-money laundering compliance as frequent points of operational risk at banks.
“All institutions, regardless of size, must resist the temptation to under-invest in the systems and controls they need to prevent greater risk and larger losses in the future,” he said.
The following article is brought to you by Jia Lyn Yang at the WashingtonPost.Com.
A class-action lawsuit was filed Tuesday against JPMorgan Chase on behalf of investors accusing the bank of misleading shareholders about the $2 billion in trading losses that have roiled the company this week.
Lawyers said the bank did not fully disclose the risky nature of JPMorgan’s trades. The lawsuit alleges the bank falsely told shareholders that its bets on financial instruments known as derivatives were “hedges” that would help the firm offset overall risk in its portfolio. Instead, lawyers say, the bank was betting purely for profit and did not fully disclose how much money the bank had already lost before by the time it held an April 13 conference call with investors.
Sen. Bob Corker, a Republican who serves on the Senate Banking Committee, has called for a hearing on the $2-billion trading loss by JP Morgan, saying that “policies are going to be derived out of what’s happened.”
JPMorgan shareholder meeting draws protesters: JPMorgan Chase, the nation’s largest bank, held its annual shareholder meeting in Tampa on May 15, just days after it disclosed its $2 billion trading blunder. Protesters came out to show their disapproval of the company.
The result was that JPMorgan’s stock price traded at “artificially inflated prices,” the lawsuit alleges.
“These derivative bets went horribly wrong, resulting in billions of dollars in lost capital for the Company and billions more in lost market capitalization for JPMorgan shareholders,” said a press release from Murray Frank LLP, the law firm that filed the suit in U.S. District Court for the Southern District of New York.
The law firm is still seeking a lead plaintiff for the lawsuit and others who bought the company’s stock between April 13 and May 10.
JPMorgan declined to comment Wednesday morning.
The bank has come under increasing pressure in the last week about the exact nature of its trades. The Justice Department has begun an inquiry into the bank’s losses, a law enforcement representative said Tuesday.