J.P. Morgan CEO Buys 500,000 of Bank's Shares -- Update
February 11 2016 - 6:24PM
Dow Jones News
By Justin Baer
J.P. Morgan Chase & Co. Chairman and Chief Executive James
Dimon bought 500,000 of his bank's shares on Thursday, a person
familiar with the matter said.
The $26 million purchase is designed to stem the tide of
negative sentiment overwhelming bank stocks this year. The
big-ticket stock purchase from one of the country's most well-known
bankers followed a 20% decline in J.P. Morgan's share price so far
this year and a broader selloff that has hit big banks such as
Citigroup Inc. and Bank of America Corp. particularly hard.
Bank stocks have fallen about twice as much as broader
stock-market averages this year as investors fret over slowing
economic growth, falling energy prices and the possibility that
interest rates will fall, a tough combination for bank profits.
"Jamie Dimon stepped up to the plate," said Mike Mayo, an
analyst with CLSA, who took the purchase as a positive sign for
shares. "It's a big number." The recent market decline is "either a
financial catastrophe, or this is an epic buying opportunity, and
Dimon is in position to know what outcome is more likely."
Including his latest purchase, Mr. Dimon will own 6,746,402
shares worth a total of about $357.7 million, based on Thursday's
closing price. J.P. Morgan shares rose 2% in aftermarket trading
after sliding 4% during the regular trading session.
In recent days, the slide in bank stocks has become an
avalanche. Bank of America Corp. shares tumbled 6.8% Thursday,
their biggest one-day loss in nearly three years. Citigroup fell
6.5%. In the first six weeks of this year, the biggest U.S. banks
have given up nearly three years of gains.
Citigroup and Bank of America now trade for about half their
book value, a level last seen in late 2012.
Meanwhile, Citigroup Chief Financial Officer John Gerspach
bought about $500,000 worth of Citigroup shares Tuesday, the New
York bank disclosed Thursday in a regulatory filing.
Write to Justin Baer at justin.baer@wsj.com and Christina
Rexrode at christina.rexrode@wsj.com
(END) Dow Jones Newswires
February 11, 2016 18:09 ET (23:09 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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