JPMorgan Got Ahead of the Game With Oil-Reserve Boost, Mayo Says

Why Jamie Dimon Thinks It's Good JPMorgan Is a Big Bank

JPMorgan Chase & Co., the biggest U.S. bank, has sufficient funds set aside against possible losses on energy loans after announcing a $500 million boost to the reserve, according to Mike Mayo, an analyst at CLSA Ltd.

“They are ahead of the game,” Mayo said Wednesday in an interview on Bloomberg Television.

JPMorgan said Tuesday its reserves for impaired energy loans would increase by about $500 million in the first quarter. The New York-based company said it would have to add an additional $1.5 billion to the set-aside if oil prices held at $25 a barrel for about 18 months.

Mayo said JPMorgan, whose shares have fallen 17 percent this year, is “one headline away” from turning the corner and starting to perform better. He said the catalyst could be positive news on oil prices, interest rates, stocks or capital.

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