JPMorgan CEO: The banking crisis is not over yet

Jamie Dimon, CEO of US investment bank JPMorgan, gave assessments on the US banking crisis that rocked markets last month.

Dimon said the crisis was not over yet and predicted its effects would be felt for years to come. The famous CEO said US authorities should not “overreact” to the crisis with more rules.

Commenting on many topics in his comprehensive annual letter to shareholders, Dimon touched on many topics, including his goals on the use of artificial intelligence and ChatGPT, and his views on geopolitical issues.

‘THE CRISIS IS NOT OVER YET’

“As I write this letter, the current crisis is not yet over and the repercussions will continue even after the crisis is over,” Dimon, the bank’s longtime chief executive, said in his annual letter.

Arguing that recent events are different from those experienced during the 2008 global financial crisis, Dimon said: “Any crisis that hurts Americans’ confidence in their banks hurts all banks. This was a known fact before the crisis,” he said.

‘STORM CLOUDS THREATEN THE ECONOMY’

Noting that ‘storm clouds’ are still threatening the economy this year, as they did last year, Dimon said:

“The Silicon Valley Bank (SVB) and Credit Suisse collapses significantly changed market expectations, bond prices rallied significantly, the stock market fell, and the market was more likely to enter a recession. While this may not look like 2008 at all, it’s unclear when this current crisis will end.

It has caused a lot of stress in the market and it is clear that it will cause financial conditions to tighten a bit as banks and other lenders become more conservative. But it’s not clear if this disruption will slow consumer spending.”

‘FOLLOWING REGULATORY REQUIREMENTS IS NOT ENOUGH’

Dimon also warned against any sudden changes regulators might make to the system. Referring to recent problems in the US banking system, Dimon said: “Given the stress on the banking system, it is not enough to just comply with regulatory requirements.”

Lastly, Dimon stated that the world is going through a difficult period, citing the war in Ukraine and the growing geopolitical tensions with China.