After repaying the U.S. government $25 billion, JPMorgan Chase is adamantly fighting the government’s proposed legislation on derivatives and telling the Treasury Department it is fed up with the value of warrants that the government holds in the company, reports Robin Sidel of The Wall Street Journal.
JPMorgan is expecting to report strong quarterly numbers on Thursday, solidifying its place as the strongest major commercial bank. While its credit card businesses are struggling, the bank’s other financial endeavors are reaping rewards.
“While some banks have spent the cycle shrinking to survive, JPMorgan has been investing, acquiring and expanding,” John McDonald, a banking analyst at Sanford C. Bernstein & Co., wrote in a recent report.
CEO James Dimon was furious when the government banned firms that received TARP funds from hiring foreigners to work in U.S. offices. He was increasingly irked whenever the government referred to the firm as a ‘bailed-out bank.’
The company is also in disagreement with the White House’s financial plan that deals with the regulation of derivatives. The bank’s derivatives contracts were valued at approximately $81 trillion at the end of the first quarter, representing 40 percent of the derivatives held by banks, according to the Office of the Comptroller of the Currency. The bank has played down any risk from the contracts, saying the notional value doesn’t indicate that there is high risk associated.
JPMorgan made a bold move after hiring William Rifkin, one of Wall Street’s best-known investment bankers, away from Bank of America. Rifkin was also named vice chairman of its mergers-and-acquisitions department.