Risk.net

JP Morgan default swaps hit as bank receives double-downgrade

The cost of credit protection on JP Morgan Chase debt has surged more than 25 basis points following a profit warning from the US investment bank and downgrades from rating agencies Fitch Ratings and Standard & Poor's.

    • Naomi Humphries
  • LinkedIn  
  • Save this article
  • Print this page  
JP Morgan warned its third-quarter earnings will be "well below" second-quarter operating profit, blaming bad loans to the telecom sector and a sharp drop in revenue as a result of weak financial markets.

Late yesterday, both Standard & Poor's and Fitch Ratings downgraded JP Morgan's debt rating. Fitch cited "the sustained weakness in the core operating performance" of a number of the bank's important businesses, as well as "challenging conditions" that "are expected to continue" as the rationale behind its downgrade.

Five-year senior credit default swaps for JP Morgan traded as high as 100bp-mid yesterday, up from 74bp-mid at close on Monday, according to credit derivatives brokers GFInet. The credit appeared on GFI’s ‘most active list’ for yesterday’s deals.

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Copyright Infopro Digital Limited. All rights reserved.

You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/

If you would like to purchase additional rights please email info@risk.net

Copyright Infopro Digital Limited. All rights reserved.

You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/

If you would like to purchase additional rights please email info@risk.net

More on Structured products

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here