While there are incessant calls to break up large financial institutions, Jamie Dimon, CEO of JP Morgan Chase and a highly vocal defender of the industry, says “big banks have a function in society,” The New York Times reported.
When critics toss out arguments in favor of breaking up the banks, Dimon seems ready to bat them down.
JPMorgan recently provided the anti-big bank crowd with fuel for their fire when the firm suffered huge losses associated with bad investments dubbed the London Whale trades.
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Even with that $4.4 billion trading loss, Forbes says the firm recorded net income of $5 billion on $22.9 billion in revenue during the second quarter.
Dimon continues to point to these results when facing criticism or questions, such as one posed this week by Barclay's analyst Jason Goldberg at the Barclay's 2012 Global Financial Services Conference.
When critics want to whip out the big guns, they tend to point to the financial crisis and the need for banks to be bailed out because they were too big to fail. But Dimon has a counterpoint for this argument too.
“There are huge benefits to size” The Times says Dimon explained at the conference. He noted that JPMorgan's size allowed it to be “a port in the storm” during the market turmoil of 2008.
The United States has the “best, widest, deepest and most transparent capital markets in the world,” The Times quoted Dimon as saying. Offering advice on reform, he adds, “Let's make sure we keep that before we do a bunch of stupid stuff to destroy that.”
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