NEW YORK, Feb 7 (Reuters) - JPMorgan Chase & Co (JPM.N) Chief Executive Jamie Dimon on Thursday said downgrades of major bond insurers below the “triple-A” category will not trigger major turmoil in the banking industry, including at the third-largest U.S. bank.
“There are two things that can happen: a downgrade to ‘double-A’ or ‘single-A,’ or a default,” the latter of which is unlikely, Dimon said at a Credit Suisse financial services conference. “For the most part, it’s not going to be that big a deal for the industry, or for JPMorgan.”
Dimon also said that unlike hundreds of rivals, he is not retreating from the subprime mortgage business, and plans to expand JPMorgan’s presence in that area. He said some subprime lenders, however, took on too much risk.
“I personally think that subprime is not a bad thing,” Dimon said. “It’s something that went to excess.” (Reporting by Jonathan Stempel; Editing by Gerald E. McCormick)