WASHINGTON — He came, he saw, he conquered.
Jamie Dimon, the chairman and chief executive of JPMorgan Chase (JPM) easily won a Senate Banking Committee hearing on Wednesday probing the more than $2 billion loss at his firm, signaling that his star status on Capitol Hill remains relatively unchanged despite ongoing questions about the unusual trades.
But it wasn't much of a fight.
Far from facing tough questions from skeptical lawmakers, Dimon's inquisitors — with a few notable exceptions — lobbed a series of softballs. Some senators seemed almost obsequious to the JPMorgan chief, dismissing his own admissions of fault and seeking his advice on ways to reform existing regulations.
"We can hardly sit in judgment of your losing $2 billion," said Sen. Jim DeMint, R-S.C. "We lose twice that every day here in Washington… It's comforting to know that even with a $2 billion loss in a trade, your company still had a $19 billion profit."
Later, DeMint asked Dimon for help.
"I'm really honestly looking for some ideas as we look over the next year and hopefully in a position where we can make some positive changes," said DeMint, referring to the possibility that the GOP could win control of the Senate in the November elections.
Although Senate Democrats had more to gain from challenging Dimon in an effort to bolster their defense of the Dodd-Frank Act, most demurred. Sen. Charles Schumer, D-N.Y., sought Dimon's input as "somebody who knows the financial industry," on whether other firms engage in the same types of activities that got JPMorgan into trouble. But he did so while seemingly going out of his way to praise the bank.
"What frightens most people about what happened is not the effect on JPMorgan," Schumer said. "It's a large institution, well capitalized and the shareholders lost, but the taxpayers and customers didn't."
The parade of easy questions brought disdain from political observers and many in the media.
"Schumer is basically asking Dimon for advice on regulation now," tweeted John Carney, who runs the NetNet blog for CNBC. "It's regulatory capture happening right before our eyes."
As for the man himself, Dimon appeared sure and confident — in essence, like he usually does. Perhaps the strongest signal that he had his mojo back was his extended, passionate defense of mega-banks, which have come under increasing fire because they can be hard to manage and to regulate.
"There is a place for large companies and for small companies," Dimon said. "We bank some of the largest global multinationals in America and around the world. We can bank companies in 40 different countries. We do trade finance. We give intra-day lines of billions of dollars to some of the biggest companies. We can do $5 billion revolvers or raise money for America's Fortune 100 companies in a day or two when they needed to do something."
"These are services they need," Dimon continued. "They buy them because they need them. They don't buy them because we want them to buy them."
Dimon did allow that there are some negatives to size. "You know, greed, arrogance, hubris, lack of attention to detail," he said.
But even that admission was deflated later when Dimon asserted that small institutions can be plagued by the same problems, and Republican Sen. Jerry Moran turned the statement about arrogance and hubris into a laugh line about the U.S. Senate.
Although Dimon voiced contrition for the trades that led to the losses — as well as his initial dismissive reaction to early media reports on the trades — he said the bank learned important lessons from the breakdown in risk management.
Asked by Banking Committee Chairman Tim Johnson, D-.S.D., whether JPMorgan will claw back pay from traders, managers and executives who were involved in the losses, Dimon said the bank probably will.
"It would be inappropriate to make those decisions before you finish your final review, [but] you can expect we'll take proper corrective action," Dimon said. "And I would say it's likely, though this is subject to board, but it's likely there'll be claw backs."
There were a few tough questions brought, coincidentally or not, by lawmakers that have received little or no campaign donations from the banking giant - Democratic Sens. Robert Menendez and Jeff Merkley.
Menendez seized onto Dimon's statement that the trades began as a hedge but morphed into something else, saying: "What did it morph into? Russian roulette?"
Dimon replied: "It morphed into something I can't justify. It was just too risky for our company."
Menendez, D-N.J., also pressed Dimon on his opposition to a capital surcharge for the biggest banks.
Under the Basel III framework, all banks must hold at least 7% capital by 2019, but the largest institutions must hold an additional 1% to 2.5% more. JPMorgan currently holds 8.2% Tier 1 common capital, which is well over the current requirement but below the eventual 9.5% that is likely to be required.
Dimon, who last year called Basel III "anti-American," explained those comments Wednesday by saying, "I was talking about … things which were being skewed against American banks."