JPMorgan CEO: Banks will have too much capital by 2015

27 February 2013

Banks are accumulating more capital than they need due to incoming regulatory changes.

That is the opinion of Jamie Dimon, chief executive officer of JPMorgan Chase & Co, who believes alterations to the banking landscape such as the Basel III ruling are forcing financiers to hold greater levels of capital than is necessary, Bloomberg reports.

Under the terms of Basel III, lenders are required to significantly boost their capital reserves as regulatory bodies seek to make sure organizations' balance sheets are strong and healthy enough to resist any future shocks to the global financial system.

Many banks have already begun the process of complying with these new rules by making a conscious effort to improve the state of their capital holdings by restructuring their businesses through measures such as job cuts.

However, Mr Dimon feels that this could lead to an issue where firms are too well-stocked in this area.

"I think all banks will have too much capital in two and a half years. And they're not going to know what to do with it," he noted.

By Gary Cooper

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