A view of the home of former JP Morgan chief investment officer Ina Drew in Short Hills, New Jersey, May 14, 2012.
Credit: Reuters/Eduardo Munoz
WASHINGTON |
WASHINGTON (Reuters) – Ina Drew, the former JPMorgan Chase & Co (JPM.N) executive in charge of the unit that harbored the disastrous “London Whale” trades, said on Friday that she does not bear personal responsibility for the losses, and instead blamed others for deceiving her.
Drew, the former Chief Investment Officer, said in testimony before the Senate Permanent Subcommittee on Investigations that risk models were severely flawed and that some members of the London trading team misvalued positions and hid important risk information from her.
“I believe that my oversight of the synthetic credit portfolio, including during 2012, was reasonable and diligent,” Drew said. “I have since come to learn – based on the company’s public statements in July 2012 and Task Force Report in January of this year – that valuations for many of the book’s positions were inflated and not calculated or reported in good faith.”
She said: “Needless to say, I had no knowledge of these things at the time.”
The Senate issued a report on Thursday finding that JPMorgan ignored risks, misled investors, fought with regulators and tried to work around rules as it dealt with mushrooming losses in a derivatives portfolio.
(Reporting By Karey Van Hall; Editing by Gerald E. McCormick)
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BERLIN, March 3 |
BERLIN, March 3 (Reuters) – Germany’s Social Democrats are vowing to “tame” financial market radicalism, split up banks and raise taxes on high earners in a left-leaning campaign programme the party hopes will help it defeat popular Chancellor Angela Merkel in a September election.
According to a draft of the programme seen by Reuters on Sunday, the SPD said no financial market participants, financial products or markets should be left unregulated in the future.
“The era of market radicalism is over. The ideology of conservatives and neo-liberals that markets look after the common good and increase prosperity by themselves was … buried under the ruins of the global financial catastrophe,” it said in a draft which the SPD executive will discuss on Monday.
“Europe needs to be at the vanguard of new market regulations with which we will tame the financial markets.”
The SPD hopes its shift left, prompted by Merkel’s move to the centre, and its increasingly sharp attacks against the powers of big banks will help it win back voters who deserted the party in the 2009 election when its percentage of the vote fell to a post-war low of 23 percent.
An Emnid poll on Sunday showed support for the SPD was at 27 percent.
SPD leader Peer Steinbrueck has got off to a bad start with his campaign however, alienating many core supporters by revealing his lucrative earnings as a public speaker, saying chancellors should earn more and scoffing at wine that costs less than 5 euros a bottle.
This week he also caused an uproar by calling Italian former Prime Minister Silvio Berlusconi and comic-turned-politician Beppe Grillo “clowns” following their strong performance in weekend elections.
In its draft programme the SPD reiterated its plans to separate retail and investment banking and said it wanted to regulate the shadow banking system, ban speculative financial products and force derivatives trading onto regulated platforms.
The party also said it wanted to limit high-frequency trading and impose minimum holding periods on the practice which involves numerous lightning-speed automatic trades that make money from tiny price moves in the market and which has been blamed for causing market volatility.
The party said it planned to raise the top rate of tax to 49 percent after the last SPD-Greens government cut the top tax bracket: “In future we want to draw more on high earners and the wealthy to finance our community,” the draft read.
It also said it wanted European states to coordinate more closely on tax policy and introduce compulsory minimum standards for corporate profits and income from capital.
The SPD said it would call for a European restructuring fund for big banks and a European investment and reconstruction fund which would make financing EU-wide programmes to promote sustainable growth and boost domestic demand mandatory.
The party hopes to seize on evidence that many Germans have not benefited from robust growth in 2010 and 2011, when Germany’s economic output grew by a post-reunification record of 4.2 percent and 3 percent respectively.
It said it wanted a debt redemption fund and a compulsory plan for debt reduction and reforms so that the European Central Bank no longer has to intervene in bond markets. (Reporting by Holger Hansen and Michelle Martin; Writing by Michelle Martin; Editing by Jon Hemming)
