Can’t Wait for <i>This</i> Hearing: Carl Levin’s Subcommittee Probes Dimon’s Bank

Receiving Wide Coverage ...

Carl Levin, Whale Hunter: Just when you thought you'd heard the last about the London Whale affair … Senator Carl Levin's Permanent Subcommittee on Investigations is conducting a probe of the JPMorgan chief investment office's derivative trades, the FT and Bloomberg News report. The subcommittee has subpoenaed JPM's regulators for documents and is seeking testimony from CIO veterans, the reports say. If the bank's executives are asked to testify before the subcommittee, we suspect it'll be a less decorous affair than Jamie Dimon's June appearances before the Senate and House banking panels, given Levin's penchant for indignant showboating. Especially since Dimon could give Levin a run for his money in a grandstanding competition. We wonder if Levin might also take the opportunity to ask someone at JPM about its planned copper exchange-traded fund, which the senator warns could corner the copper market but that the bank insists won't affect prices.

…And Speaking of JPMorgan's CIO: Craig Delany, most recently the chief operating officer of JPMorgan's mortgage banking unit, was named the bank's new chief investment officer, taking over from Matt Zames, who'd been running the CIO since Ina Drew's ouster in May. Wall Street Journal, New York Times

Things Go Better with Coke, But Not Basel III: SunTrust is unloading its shares in Coca-Cola, which the Atlanta bank has held since 1919, when it underwrote the soft drink maker's IPO. SunTrust had previously agreed to sell the stock in a couple years anyway, "but after reviewing its position in light of … Basel III, SunTrust realized holding onto its Coke shares would punish its capital standing," according to the Journal. Actually the story's more complicated and interesting than that, but Dealbreaker's Matt Levine tells it so beautifully we won't try to reinvent the wheel. Suffice to say SunTrust had entered into a "postpaid bifurcated collateralized variable share forward" contract on its stake in Coke. If that doesn't make you want to read the story, surely this headline will: "Spoilsport Banking Regulators Ruin Another Derivative That Was Too Beautiful To Live."

Super Mario: European Central Bank chief Mario Draghi elated financial markets by announcing an "unprecedented" step of unlimited purchases of troubled governments' debt to shore up the continent's economy. Wall Street Journal, Financial Times, New York Times, Washington Post

Wall Street Journal

The paper profiles Jerome Powell, a former private equity executive who joined the Fed Board of Governors in May and is its wealthiest member.

"Wall Street" (which in this context means "Goldman Sachs and Morgan Stanley") has begun holding conference calls for fixed-income investors along with the usual shareholder calls. The development shows bondholders' growing clout in these uncertain times for financial firms.

Financial Times

The National Credit Union Administration is suing UBS for allegedly misleading two corporate credit unions that later failed into buying junky mortgage securities.

After two years of job cuts, crimped investment banks across the globe are taking the more drastic step of quitting business lines that aren't their strong suits, as it were.

New York Times

The "Bucks" personal finance blog covers a Pew Charitable Trusts report comparing the costs to consumers of checking accounts and prepaid cards.

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