In a letter to shareholders on Tuesday, Jamie Dimon, CEO of JPMorgan Chase & Co, conveyed that the impact of the U.S. banking crisis will persist for years to come.
“The current crisis is not yet over, and even when it is behind us, there will be repercussions from it for years to come,” stated Dimon in a 43-page annual message, covering a variety of topics ranging from JPMorgan’s performance to geopolitics and regulation.
Dimon added, “The market’s odds of a recession have increased, and while this is nothing like 2008, it is not clear when this current crisis will end. It has provoked lots of jitters in the market and will cause some tightening of financial conditions as banks and other lenders become more conservative.”
According to Dimon, it remains uncertain whether the disturbances will impede the consumer spending that powers the U.S. economy.
Dimon highlighted that the risks that led to the current crisis were obvious, such as the interest rate exposure and uninsured deposits at Silicon Valley Bank. But he downplayed the similarities to the global financial crisis of 2008, stating that the present banking crisis involves fewer financial players and issues that need to be resolved.
Following his appointment as the head of JPMorgan in 2006, Dimon oversaw the bank’s acquisition of Bear Stearns, a troubled investment bank during the financial crisis of 2008, as well as Washington Mutual, which was the largest savings and loan failure in the history of the United States.