JPMorgan Chase & Co has “plenty of capital” and wants governments to stop talking about nationalizing banks, its CEO said.
“JPMorgan would be fine if we stopped talking about (the) damn nationalization of banks ... we've got plenty of capital,” Jamie Dimon said at the annual meeting of the World Economic Forum in Davos, Switzerland.
On January 15, JP Morgan reported a 76% fall in fourth-quarter profit as it wrote down bad loans, signaling that even the bank that has avoided the worst of the credit crunch is struggling with the recession.
At the time, Dimon called the results “very disappointing.”
Underlining the bank's confidence, Dimon said JP Morgan had lent $150 billion in the last 90 days including $50 billion in the interbank market, also to European and British banks, but added: “It's scary because at the end of the day you have to survive.”
“I'm hoping by the end of the year we're coming out of the crisis,” he told journalists.
He said more acquisitions were unlikely as JP Morgan was busy absorbing recent buys.
Dimon admitted bankers had done “some really stupid things” but he also hit out at policy makers and regulators, adding that the Basel II capital rules has flaws and needed to be adjusted.
“I haven't yet seen people get all the right people in a room, close the damn door and come out with a solution,” he said.
The US and other countries are considering setting up a so-called “bad bank” to mop up the toxic assets of stricken lenders. It would take billions of dollars of the worst assets off banks' balance sheets.
Dimon welcomed the idea: “It's all in the execution. If it's executed well, set up properly, it would be good.”
He also supported creating a clearing house for credit default swaps - insurance-like protection against defaults or restructuring - although he disputed the view that a lack of regulation of the CDS market caused the financial crisis.
Dimon questioned China's tendency to blame the US policy of running a large current account deficit.
“It was an imbalance that both benefited from and both are losing from. It's kind of immature and childish to act like one was to blame. One was the other side of the coin,” he said. (Reuters)