WASHINGTON – JPMorgan Chase President Jamie Dimon made another appearance on Capitol Hill on Tuesday,this time in front of the House Financial Services Committee. Dimon faced a more heated House than the reserved Senate he sat before last week.
Dimon started off with the same opening statement he used to address the Senate Banking,Housing and Urban Affairs Committee,and faced similar questions.
He apologized for the multi-billion dollar trading loss,and re-enforced that JPMorgan Chase is a strong company that will show a profit at the end of the quarter.
Rep. Barney Frank,D-Mass.,set the tone for many Democrats when he accused Dimon of filibustering,and asked if Dimon’s salary would be cut due to the losses. Dimon responded that clawbacks would be left up to his firm’s board.
Rep. Brad Sherman,D-Calif.,accused Dimon of lying during the hearing after Sherman said Dimon sent $350 billion to his chief investment office to invest,because he decided there weren’t any small- and medium-size businesses in the United States that were credit worthy and needed loans.
Sherman argued that any representative present could give Dimon the names of 100 small- and medium-sized businesses that need loans.
“I am a little surprised by all of the hemming and hawing by my colleagues on the other side of the aisle over a private business losing private money when the federal government continues to lose billions of taxpayer dollars every day,” Garrett said.
Democrats and Republicans were divided over enforcement of the Dodd-Frank law that regulates Wall Street trading.
Rep. Maxine Waters,D-Calif.,said when it comes to regulating banks to prevent financial crisis,“I’m afraid we don’t have your support.”
Republicans questioned the law and asked Dimon for his opinions on regulation of Wall Street.
Many representatives asked Dimon’s opinion of the Volcker Rule. The rule is intended to stop banks from engaging in propriety trading for their own purposes. It would prevent firms from being able to trade stocks,bonds,currencies,commodities or their derivatives to make a profit for themselves. Banks would still be allowed to trade for their customers.
Dimon reiterated that he wasn’t sure if the Volcker Rule would have stopped JPMorgan Chase’s recent losses because the law has not been fully written yet.
There was some debate among House members over whether Dimon would be sworn in before his testimony. But Committee Chairman Spencer Bachus,R-Ala.,decided it was not necessary.
During his tenure in Congress Bachus has received $119,000 in campaign donations from JPMorgan Chase’s political action committee and employees. The banking company is his second-highest donor. JPMorgan Chase is Frank’s forth-largest donor,at $84,500.
As their colleagues did in the Senate hearing,representatives asked how they could be certain that other banks would not incur large trading losses,or to JPMorgan Chase on a larger scale. Dimon said he could not speak for other banks,but when Rep. Sean Duffy,R-Wis.,asked if JPMorgan could suffer a $1 trillion loss,Dimon responded only if Earth was hit by the moon.
Reach reporter Maddie Meyer at [email protected] or 202-326-9861. SHFWire stories are free to any news organization that gives the reporter a byline and credits the SHFWire.