The U.S. Senate Banking Committee said JPMorgan Chase & Co. (JPM:US) Chief Executive Officer Jamie Dimon was invited to testify on June 7 about the New York-based lender’s credit derivatives losses.
“I expect Mr. Dimon to come prepared to provide the committee a better understanding of this massive trading loss,” Senator Tim Johnson, the committee’s chairman and a South Dakota Democrat, said in a statement today. Dimon, who runs the largest bank in the U.S. by assets, indicated previously that he will accept an invitation.
“Jamie will of course be able to testify next month,” said Jennifer Zuccarelli, a spokeswoman for JPMorgan, without specifying a date. “We are working with the House and Senate to determine a timeframe that will work for both chambers in June and allow us to provide the most thorough testimony.”
Dimon is under pressure to explain how bets on illiquid credit derivatives led to at least $2 billion in losses (JPM:US) at his chief investment office, which is supposed to manage excess cash while minimizing risk. The strategy was “flawed, complex, poorly reviewed, poorly executed and poorly monitored,” according to Dimon, 56.
His testimony may influence lawmakers as they haggle over rules for the Dodd-Frank regulatory overhaul enacted two years ago. They’re debating along with regulators whether the new law would have prohibited the errant trades and if the rules should be tighter. Dimon has been campaigning for a looser interpretation.
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