Other Banks Get Rich Quick in JPMorgan Debacle

They were the winning side in the London Whale's losing bets
By Kevin Spak,  Newser Staff
Posted May 22, 2012 11:05 AM CDT
Other Banks Get Rich Quick in JPMorgan Debacle
A man walks by a sign outside of the JPMorgan Chase headquarters on May 14, 2012 in New York City.   (Getty Images)

The rest of Wall Street isn't exactly broken up about JPMorgan's multibillion dollar trading loss—because it's profiting handsomely off it. Goldman Sachs and Bank of America, for instance, have together made somewhere between $500 million and $1 billion off of JPMorgan, the Wall Street Journal reports. Much of that money was made by betting against the credit default swap bets that JPMorgan trader Bruno Iksil, aka "the London Whale", was making all year.

Banks also made money selling those credit default swaps to clients—in some cases they bought them from JPMorgan with the intent of selling them to clients, failed to offload them, and then wound up with a windfall when the bets went sour. Fallout continued for JPMorgan yesterday, with the bank suspending a stock buyback program because, as CEO Jamie Dimon said, "we want to box this thing first." (More JPMorgan Chase stories.)

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