Effects Of Bank Failures Will Be Felt For ‘Years To Come’

Topline

The banking crisis is far from over, JPMorgan Chase CEO Jamie Dimon wrote Tuesday morning in an annual letter to shareholders, offering the most in-depth insight into recent industry-wide turbulence from the head of the country’s biggest bank yet.

Jamie Dimon, CEO of JPMorgan Chase, during testimony at the Senate last September.

CQ-Roll Call, Inc via Getty Images

Key Facts

“Repercussions” from the ongoing banking calamity will linger “for years to come,” Dimon wrote, referring to the failures of American banks Silicon Valley Bank and Signature Bank and the unraveling of Swiss stalwart Credit Suisse over a two-week period last month.

Dimon pointed to shortcomings among bank management at the collapsed institutions, federal regulators and venture capitalists pushing Silicon Valley Bank as the principal groups behind the situation, writing the last month hasn’t been “the finest hour for many players.”

Dimon commented on the notion of larger banks like his benefitting from the growing distrust in smaller competitors as “absurd,” as shares of JPMorgan, by far the largest bank in the U.S. by assets and market capitalization, are down nearly 10% over the past month, shedding $40 billion in market value as bank stocks broadly sank.

The billionaire did offer some optimism, writing the ongoing situation is “nothing like” the late 2000s crisis that led to the Great Recession, calling for more transparency and modernity in bank regulation.

Big Number

$332 billion. That’s how much market cap 25 of the biggest U.S. banks lost last month.

Forbes Valuation

Dimon is worth $1.6 billion, according to our estimates, thanks largely to his more than $1 billion stake in the bank. The value of his JPMorgan shares dwindled by $116 million over the last month as the stock slipped.

What To Watch For

JPMorgan reports quarterly financials April 14, kicking off an ever-crucial bank earnings season.

Tangent

Dimon agreed to testify as part of two lawsuits concerning JPMorgan executives’ involvement with the late financier and convicted sex offender Jeffrey Epstein, according to reports last week.