JP Morgan gets a new boss as probe deepens

City A.M. Reporter
JP Morgan Chase yesterday named senior mortgage executive Craig Delany as head of its chief investment office more than three months after the discovery of a wayward derivatives trade in the division that caused at least $5.8bn (£3.6bn) in losses.

The 41-year-old banker most recently served as chief operating officer of mortgage banking, a job he took on last year to work through JPMorgan’s problematic mortgage loans and bank-owned real estate.

It came on the same day a US Senate committee launched a probe into firm’s trading losses, known as the “London Whale” incident after the trader responsible.

The Permanent Subcommittee on Investigations, chaired by Senator Carl Levin, is interviewing current and former employees of JPMorgan's chief Investment office in connection with the loss, according to a source.

The losses stemmed from bets by London-based CIO trader Bruno Iksil on an index for credit default swaps. His outsized positions earned him the nickname “London Whale” from the hedge fund traders taking the other sides of his positions.

New boss Delany will report to co-chief operating officer Matthew Zames and will also remain on the bank’s executive committee, according to a memo to JPMorgan employees yesterday.