Anatomy of a financial disaster

Published: May 28, 2012

Questions remain whether J.P. Morgan’s failed derivatives trade was a mismanaged hedge for its loan portfolio, or a prop bet that would pay off in an improving credit environment.

CIO assets grow . . .

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The role of J.P. Morgan’s Chief Investment Office is managing the firm’s liquidity, interest rate and foreign-exchange risk, and other structural risks. Available-for-sale assets managed by the CIO group grew an annualized 32% since the first quarter of 2007 − compared with 5% for the firm's total wholesale credit exposure.
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