ALSO READJPMorgan says India bonds 'attractive' JPMorgan quarterly profit plunges 37% to $6.7 billion on tax hit JPMorgan, Morgan Stanley put India realty investments on hold JPMorgan seriously breached anti-money laundering regulations: Switzerland Being an American abroad is an 'embarrassment': JPMorgan CEO
JPMorgan Chase & Co’s equities business took a big hit from Steinhoff International Holdings last quarter. The bank recognised a $143 million mark-to-market loss on a margin loan to a single customer in its stock-trading unit, the New York-based firm said. Chief Financial Officer Marianne Lake confirmed with reporters that the writedown was tied to Steinhoff, the South African retailer engulfed in an accounting scandal. Steinhoff announced on December 5 that it had uncovered accounting irregularities.
The disclosure prompted a plunge in the share price of the Frankfurt- and Johannesburg-listed company, along with the resignation of Chief Executive Officer Markus Jooste and Chairman Christo Wiese. Steinhoff last week said it’s seeking “significant near-term liquidity” for some of its business units.Other banks will probably also have large losses tied to Steinhoff, though rivals may report the declining value of loans through higher credit provisions rather than a markdown like JPMorgan did, Lake said. The loan loss turned a potential 12 percent jump in fourth-quarter equities revenue from a year earlier to little changed.