JPMorgan Chase announced that the losses it got from the massive trading error in the bank’s London have already reached $5.8 billion. It estimated that the cost could go up to $7 billion. The bank was forced to restate its first quarter results after it was discovered that traders tried to hide losses from failed trades.
The bank said that it lost $4.4 billion from its London office in the second quarter, which is up from the $2 billion loss it initially announced in May. The company recently discovered information that caused concern on the integrity of the trader marks.
The bank reported second quarter profits of $5 billion, which is down 8.7 percent from a year ago. It earned $1.21 per share in the second quarter of 2012, which is down from $1.27 per share a year but still higher than what analysts have predicted.
Revenue of JPMorgan Chase increased to $22.9 billion, which is down 16 percent from the $27.4 billion in the same quarter a year ago. Jamie Dimon, chairman and chief executive officer of the bank, said that it continues to maintain strong reserves and decreased its synthetic credit risk.
According to reports, three bankers who were at the center of the credit fiasco involving investments in corporate credit indexes by the bank’s Chief Investment Office have already left the company. There were Achilles Macris, Javier Martin-Artajo, and Bruno Iksil. Ina Drew used to be the head of CIO before she resigned in May.
The three bankers were stripped of their trading duties after the losses were announced by JPMorgan Chase. They were still part of the company as they wait for the result of an internal review of what occurred. Iksil was known as the London whale because his trades were so huge that they moved markets.