J.P. Morgan analysts forecast that losses related to the collapse of Archegos Capital could reach as high as $10 billion, doubling the bank’s previous estimate.
Archegos-linked losses could total $5 billion to $10 billion, according to a note by J.P. Morgan led by analyst Klan Abouhossein.
The new estimates double the previously expected range by the bank of $2 billion to $5 billion.
Credit Agency Response
J.P. Morgan analysts advised investors to monitor statements from credit rating agencies over poor risk management.
«We are still puzzled why Credit Suisse and Nomura have been unable to unwind all their positions at this point,» the analysts said, adding that full disclosures from the banks were expected by the end of the week.
J.P. Morgan’s high estimate of $10 billion significantly exceeds the potential losses reportedly felt thus far by Nomura, Credit Suisse and, most recently, Mitsubishi UFJ, which totaled up to $6.3 billion.
