Sources tell the New York Post that JP Morgan (JPM) is expected to cut as many as 10,000 jobs this year on top of more than 8,000 layoffs the big bank has already announced.
The latest setbacks at the largest U.S.bank, employing 250,000 worldwide, along with increased regulatory pressure could force CEO Jamie Dimon to exit the bank, according to analysts.
“It’s just beginning to hit them over the head,” Nancy Bush, a consultant and strategic adviser at NAB Research told the Post. She believes the house of Morgan is also “caught up in massive global deleveraging, which is shrinking the entire financial system” as it is being accompanied by high volatility and massive price swings in specific asset classes — a dynamic that “will reverberate through trading markets.”
“Consumers have reduced their debt,” Bush said. “The government leveraged up to fill in that hole and is now going to start deleveraging. There’ll be layoffs at JPMorgan.”
Rafferty Capital Markets’ Dick Bove, who has a Hold on JPM, says that JPMorgan’s mounting problems could lead to CEO Jamie Dimon eventually throwing in the towel.[via Dealbreaker] “I don’t know when Jamie Dimon finally throws in the towel and says, ‘I can’t take this anymore; this is absolutely absurd,’ but I am starting to believe that this point does exist,” said Bove.
J.P. Morgan has revealed it anticipates revenue from trading, including fixed income and equities to drop 20% this quarter- a hit of more than $1 billion to the balance sheet, by one estimate. The world’s biggest investment bank by revenue points to a “a continued challenging environment and lower client activity levels”, as the reasons for the drop.
JPM shares were up 66 cents/$54.67 in Monday trades.