(Reuters) - JPMorgan Chase & Co (JPM.N) is close to settling investigations into its London Whale derivatives loss and expects to pay about $700 million, according to a source familiar with the matter.
Completion of the deal depends on coordinating agreements with multiple government agencies, the source said.
The source spoke after Bloomberg News and the Wall Street Journal reported that JPMorgan has agreed with regulators on how much it will pay.
The bank lost $6.2 billion last year on the trades, which were made from its offices in London.
The U.S. Department of Justice brought criminal charges last month against two former JPMorgan traders in the London office, alleging they deliberately understated the size of the mounting losses early last year. It was not immediately clear which government agencies would be included in the settlement. In addition to the Justice Department, the U.S. Securities and Exchange Commission, the state of Massachusetts and securities law enforcers in the UK have been investigating the matter.
JPMorgan has been pushing for weeks to resolve the company’s liability to regulators. News of an imminent settlement came on a day the company’s board of directors planned to meet.
The bank is trying to mend its relationships with regulators after surprising them with the derivatives loss at a time when Chief Executive Jamie Dimon was complaining that the regulators were going too far with reforms to avert another financial crisis.
The company recently said it would record more than $1.5 billion of additional legal expenses in the third quarter.
The debacle took on the “London Whale” nickname, which hedge funds gave to former JPMorgan employee Bruno Iksil for the large size of the trades he made for the company’s Chief Investment Office in London.
JPMorgan shares rose 1 percent on Monday to $53.14 at the close of regular trading in New York. The stock traded at $40.74 at the market close immediately before JPMorgan acknowledged on May 10, 2012 that it was losing billions of dollars are on the derivatives.
Reporting by David Henry in New York; Editing by Carol Bishopric