Chillin' out till it needs to be funded
As we mentioned in our analysis the day after the Whale broke out, the bank did not continue its share buybacks of $12-$15 B promised in the new Capital plan as it maintains yet that it would ‘like’ to pay the promised 30% dividend in 2012( 30 cents a share). The bank had hit a wall in the CDS market in trying to dispose/ maintain excessive positions built by Bruno Iskil and added $1 B in losses on the positions in the last week. Now the bank’s buy back plan has to be suspended as it would be a waste putting buybacks into the rapidly flailing share prices at this juncture with no end in sight for the bad press , Jamie Dimon himself said he deserved. The latest quotable quote suggests JP Morgan would like to put it behind it by the end of the year.