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Sterne Agee banking analyst Todd Hagerman on how J.P. Morgan’s big loss could cause it to be put under supervisory action.
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Morgan chase is it too big to fail that so says the man in charge to be done as he testifies in front of the house financial services committee.
Joining us now is -- -- of stern -- use their banking analyst.
I'll -- -- you have a fifty dollar price target on the stock.
It's 36 dollars -- JPMorgan.
Okay I'm sorry to know but has given -- fifty dollars on there I'm 3030 -- 36 that's that's our it is right now.
Right so what's your outlook what do you think it's gonna happen over time it's just gonna -- -- at the same level sounds like.
-- there's a couple things they're likely to transpire over the course the next several weeks and months as you heard from several members of the regulatory body that was included this morning.
-- the reviews are ongoing they're gonna it they're going to continue for the next.
Couple months I would imagine and at the end of that review usually get a C a couple different conclusions one.
You know -- the regulators going to respond in terms of you know possible corrections.
Potential for supervisory action alike and I think longer term what here's the big question investors' minds right now.
How long is a share buyback going to be suspended is that a short period of time or potentially is a much longer period time that the number one question.
On investors minds right now is -- to JPMorgan -- quite accept this morning.
Well it not too different from what I heard last week with the senate meaning that mr.
Dimon again I I think he's doing very well.
With respect is testimony today.
A lot of the answers that he's providing to members of the house very consistent with his response last week to the senate.
Obviously be the house's is trying to probe a little bit deeper -- to some of the events with respect to risk management it trading.
But again mr.
Dimon kind of sticking to the strictest in the script so to speak.
And really the overtone is revisiting Dodd-Frank.
Revisiting Volcker in particular today.
Time what are your thoughts what are your observations on JPMorgan and their risk profile.
Through this chapter of the bank.
Well again I think you know JPMorgan -- as you've heard from a number of different you know investors analysts alike.
Certainly been held in very high regard for a long period time and certainly.
Difficult to kind of take that away from them so to speak at this point so they're not -- -- right now despite these hearing well.
Well if it what they're doing is still re evaluating.
And assessing what exactly happened.
And trying to determine if there was possible shortcomings.
In other parts of the organization.
Other parts of the business unit but as congress is warning out today are members of the house.
You know why couldn't this happen to a smaller organization.
How do you know that -- defenses.
Are effective in other parts of the organization.
Outside -- CIO office.
-- -- -- follow that -- what's the bigger picture what's the bigger statement on regulation -- impact large banks like JPMorgan do you think these hearings are advancing discussions to get.
I Dodd-Frank or regulation.
Profile.
For this nation's banks that's practical -- here.
I think.
Clearly what you hearing today from members of the house.
Is going in the direction of you know beefing up.
Aspects of Dodd-Frank particularly as relates to Volcker as well as derivatives over the counter.
You know trading if you -- you heard from a number of the regulators specifically the Federal Reserve Bank today talk about how they're already beginning to.
Add additional provisions to elements of Volker trying to enhance.
You know -- its effectiveness if you will wanna go forward basis -- -- time and so much for joining us.
