{"id":16602,"date":"2025-10-14T22:35:04","date_gmt":"2025-10-14T22:35:04","guid":{"rendered":"https:\/\/nationalgunowner.org\/index.php\/2025\/10\/14\/jamie-dimon-warns-of-credit-weakness-following-tricolor-bankruptcy\/"},"modified":"2025-10-14T22:35:05","modified_gmt":"2025-10-14T22:35:05","slug":"jamie-dimon-warns-of-credit-weakness-following-tricolor-bankruptcy","status":"publish","type":"post","link":"https:\/\/nationalgunowner.org\/index.php\/2025\/10\/14\/jamie-dimon-warns-of-credit-weakness-following-tricolor-bankruptcy\/","title":{"rendered":"Jamie Dimon Warns of Credit Weakness Following Tricolor Bankruptcy"},"content":{"rendered":"
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Jamie Dimon warned that there could be more to come after the bankruptcies of Tricolor and First Brands. Photo: Noam Galai\/Getty Images<\/span><\/figcaption><\/figure>\n

Last month\u2019s collapses of Tricolor and First Brands, a subprime auto lender and auto-parts supplier, respectively, sent alarm bells ringing across Wall Street about the health of the consumer credit market. Those concerns deepened today (Oct. 14) as JPMorgan Chase<\/a> CEO Jamie Dimon<\/a> warned during the bank\u2019s quarterly earnings call that \u201ceveryone should be forewarned\u201d by the recent bankruptcies.<\/p>\n

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\u201cMy antenna goes up when things like that happen,\u201d Dimon told analysts. \u201cI probably shouldn\u2019t say this, but when you see one cockroach, there are probably more.\u201d<\/p>\n

Tricolor filed for bankruptcy in September amid allegations of fraud. The Dallas-based company specialized in providing auto loans to so-called \u201csubprime\u201d lenders with low credit scores. First Brands, a car parts manufacturer headquartered in Rochester, Mich., went bankrupt shortly afterward, with more than $2 billion in funds unaccounted for. Both companies had received financing from various Wall Street banks, sparking fears that financial institutions could increasingly be put at risk due to their exposure to non-bank lenders.<\/p>\n

JPMorgan said it had no exposure to First Brands. But it was impacted by Tricolor\u2019s collapse, taking a $170 million charge-off\u2014a loss recognized when a loan won\u2019t be repaid\u2014stemming from the company\u2019s bankruptcy. The hit took place during an otherwise strong quarter for JPMorgan, which beat analyst expectations on both revenue and profit for July through September. Revenue rose 9 percent year-over-year to $47 billion, while net income climbed 12 percent to $14.4 billion.<\/p>\n

Dimon said the bank is now reviewing \u201call processes, all procedures, all underwriting\u2014all everything\u201d in light of the Tricolor collapse. \u201cThere clearly was, in my opinion, fraud involved in a bunch of these things. But that doesn\u2019t mean we can\u2019t improve our procedures,\u201d he added.<\/p>\n

Dimon, who has led JPMorgan for nearly two decades, also warned that weaknesses in the credit market could worsen if the economy deteriorates. \u201cWe\u2019ve had a benign credit environment for so long that I think you may see credit in other places deteriorate a little bit more than people think when, in fact, there\u2019s a downturn,\u201d he said, adding that he is hoping for a \u201cfairly normal credit cycle.\u201d<\/p>\n

Even so, the bulk of JPMorgan\u2019s lending to non-bank financial institutions (NBFI) is not particularly risky, said Jeremy Barnum<\/a>, the bank\u2019s chief financial officer. \u201cThe vast majority of that type of lending that we do is highly secured or in some way structured or securitized,\u201d he told analysts today. \u201cI\u2019m not sure that our lending to the NBFI community is an area of risk that we see as more elevated than other areas of risk.\u201d<\/p>\n

\t\t\t\t\"JPMorgan<\/p><\/div>\n