WASHINGTON — The front-line regulator charged with overseeing JPMorgan Chase conceded Wednesday that his agency stumbled when it overlooked a multibillion-dollar trading loss that has damaged the bank’s image and stock price.
At a Senate Banking Committee hearing, the comptroller of the currency, Thomas J. Curry, faced the brunt of the scrutiny, including a fiery round of questions from Senator Sherrod Brown, Democrat of Ohio. Brown asked whether the agency met a broad ‘‘standard that it set for itself.’’
Curry replied, ‘‘No, not in this particular case.’’
“We would expect to be aware of significant risks,’’ he said in his first congressional testimony since taking the helm of the comptroller’s office in April.
Curry disclosed that the agency was conducting ‘‘a critical self-review,’’ which he said he hoped would be completed in the next several weeks.
The hearing Wednesday was the second in a string of inquiries planned to examine JPMorgan’s loss. The hearing included testimony from officials at four other federal agencies: the Federal Reserve, Treasury Department, Consumer Financial Protection Bureau, and Federal Deposit Insurance Corp. In May, the committee called the leaders of the Commodity Futures Trading Commission and Securities and Exchange Commission, which also regulate JPMorgan, to testify after the company disclosed that it lost at least $2 billion on dubious derivatives trading.
Lawmakers are building to the much-awaited appearance next week of JPMorgan’s chief executive, Jamie Dimon, who is expected to shed light on the bank’s trading blunder. Dimon is also scheduled to testify before the House Financial Services Committee later in June.
“While the JPMorgan trading loss does not appear to have caused systemic problems, it is a clear reminder that Wall Street continues to need better risk management, vigorous oversight and, if the rules are broken, unyielding enforcement,’’ said Senator Tim Johnson, Democrat of South Dakota, who leads the banking committee.
The hearing Wednesday gave lawmakers an opportunity to inveigh against Wall Street risk-taking.
In the case of JPMorgan, some Democrats said that of the 65 examiners from the comptroller’s office assigned to the bank’s Manhattan headquarters, none kept a daily watch over the chief investment office, which was responsible for the trades. And the agency has only five officials stationed in London, where the trades were executed. Those examiners must keep an eye on a half-dozen banks, Curry said Wednesday.
“We are assessing the adequacy of risk management throughout the bank,’’ Curry said.