JPMorgan Reveals $2 Billion Derivatives Loss (Update 1)
"This portfolio has proven to be riskier, more volatile and less effective as an economic hedge than the Firm previously believed," the bank said in its 10-Q. "The Firm is currently repositioning CIO's synthetic credit portfolio, which it is doing in conjunction with its assessment of the Firm's overall credit exposure. As this repositioning is being effected in a manner designed to maximize economic value, CIO may hold certain of its current synthetic credit positions for the longer term."
As of March 31, 2012, the value of total Available-for-Sale (AFS) securities portfolio exceeded its cost by approximately $8 billion.
--Written by Shanthi Bharatwaj in New York
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