Jpmorgan S Dimon Warns Of Possible 1 Billion Russia Loss

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Dimon is concerned about the side effects of the conflict in Ukraine Damon calls for increased US military presence in Europe Dimon urges renewal of US supply chain Fed interest rate hikes could be higher than the market expects -Dimon

NEW YORK, April 4 (Reuters) – JPMorgan (JPM.N) could lose about $ 1 billion from its exposure to Russia, CEO Jamie Dimon said Monday, citing for the first time the extent of its potential losses. bank since the conflict in Ukraine. . In his annual letter to shareholders, the president and CEO of the largest US fortune bank also urged the United States to increase its military presence in Europe and reiterated its call for a plan to ensure energy security for itself. and its allies. Dimon did not give a timeline for JPMorgan’s possible losses in Russia, but said the bank was concerned about the side effects of Russia’s invasion of Ukraine on companies and countries. Russia calls its actions a “special operation.” Sign up now for FREE unlimited access to Reuters.com Register World banks have detailed their report on Russia in recent weeks, but Dimon is the highest-profile global business leader who has not yet commented on the wider impact of the conflict. “America must be prepared for the possibility of a full-scale war in Ukraine with unpredictable consequences. We must prepare for the worst and hope for the best,” he wrote. (For five key points from Dimon’s letter, click Read More) Damon could run for president when he finally resigns as chief executive, the bank said Monday. The revelation, in a report to shareholders ahead of JPMorgan’s annual general meeting in May, said the bank had found that most major shareholders wanted Dimon to remain chairman. The board also said it tended as a “general policy” to separate the posts of chairman and CEO after Dimon’s departure. Many shareholders have a general preference for split positions, he said. Dimon did something funny, constantly saying that he would resign in five years. In 2019, he said the five-year clock had indeed begun. In his letter to shareholders, Dimon referred to the relationship between the United States and China and said that the United States should renew its supply chain to limit its scope to suppliers within the United States or to include only “Completely friendly allies”. He urged the United States to rejoin the Trans-Pacific Partnership (TPP), one of the largest multinational trade agreements in the world. Commenting on the macroeconomic environment, Dimon said the number of Federal Reserve interest rate hikes “could be significantly higher than the market expects”. He also announced the bank’s rising costs, in part due to technology investments and acquisition costs. The letter is Dimon’s 17th as CEO. Although Damon is not the only CEO of a leading American bank to write such letters, his letters have become a must-read among elites and Wall Street politicians for the views they provide on his political and economic ideas. ‘GUARD BALANCE’ This year’s letter comes as the Russia-Ukraine war and high inflation hurt the economy and as Dimon faces new skepticism from investors about spending. Some question his plans to increase the bank’s IT spending and market share campaigns in companies and geographical areas where JPMorgan currently follows competitors such as Germany and the United Kingdom. JPMorgan decided to hold its first investor day earlier this year since the pandemic began to cast doubt on its spending plans. The meeting will take place on May 23. Damon has spent more than a decade building what he calls the bank’s “fortress balance sheet” and said he is now strong enough for JPMorgan to withstand $ 10 billion or more in losses and “still be in very good shape.” . While Dimon wrote that he was not worried about the bank’s exposure to Russia, he said that the war in Ukraine would slow down the world economy and affect geopolitics for decades. “We are facing challenges at every step: a pandemic, unprecedented government action, a strong recovery after a sharp and deep global recession, highly polarized US elections, rising inflation, war in Ukraine and dramatic economic sanctions against Russia,” he said. . As for the acquisitions, Dimon said the bank will reduce its shareholdings next year to meet the capital increases required by federal rules “and because we have made some good acquisitions that we believe will strengthen our company’s future”. . JPMorgan has been on a shopping spree, spending nearly $ 5 billion on acquisitions over the past 18 months. Damon said he would increase “incremental investment spending” by about $ 700 million this year. Investing in technology will add $ 2 billion to spending this year, Dimon said. Sign up now for FREE unlimited access to Reuters.com Register Additional references by David Henry. Editing: Michelle Price, Muralikumar Anantharaman and Nick Zieminski Our role models: The Thomson Reuters Trust Principles.