The chief executive of JP Morgan Chase, Jamie Dimon, on Wednesday said "sorry" for the bank's $2 billion loss on derivatives trading and said traders had been poorly supervised.
But Dimon, a US banking star, assured the US Senate Banking Committee in Washington that the firm's balance sheet remained strong despite the loss.
"Like many banks, we have more deposits than loans - at quarter end, we held approximately $1.1 trillion in deposits and $700 billion in loans," he said, reading from a prepared text.
He said the firm's chief investment officer and the treasury unit had invested excess cash in a portfolio that included US treasuries, mortgage-backed securities and other US and international assets.
Traders had not understood the risks they were taking and the portfolio was "poorly conceived and vetted" by senior officers at the firm, he said.
The bank said in May it had lost $2 billion of its own money in the space of just a few weeks on derivatives meant to hedge its credit risk.
"This portfolio morphed into something that, rather than protect the firm, created new and potentially larger risks," Dimon said. "We have let a lot of people down, and we are sorry for it."
"Last, I would like to say that in the face of these recent losses, we have come together as a firm, acknowledged our mistakes, and committed ourselves to fixing them," he said.
During testy questioning, Dimon said he supported banking reform enacted by US Congress during the bailout period, in which hundreds of billions of dollars from US taxpayers were disbursed to keep the banks afloat.
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