By Erik Wasson - 05/13/12 01:53 PM EDT
Sen. John Thune (R-S.D.), chairman of the Senate Republican conference and a lead critic of the Dodd-Frank financial reform law, warned Sunday against jumping to the conclusion that the $2 billion loss JPMorgan Chase incurred on a risky bet means regulations need to be tighter.
“We need to make sure we get all facts before jumping to conclusions about the need for greater financial regulation,” he said on Fox News Sunday.
Thune said that he voted against the Dodd-Frank financial law primarily because of its impacts on community banks across South Dakota. He suggested that for federally insured depositories like JPMorgan, regulation on proprietary trading may be needed but a proper balance must be struck.
“It is important that we make sure we have got some good safeguards in place but in a way that doesn't impair their ability to mitigate risk and to protect themselves and their balance sheets as well,” he said.
Thune said regulators need to finish fleshing out the Dodd-Frank law before additional regulations are contemplated.
Thune's views contrasted with those of Sen. Dianne Feinstein (D-Calif.), who on the same program called the JPMorgan losses “a real danger signal.”
“There are no rules of the road...the bill provides for it but it hasn't taken place,” she said.
JPMorgan chairman Jamie Dimon has been a leading critic of the Dodd-Frank law's Volcker rule which could ban trades such as the credit derivative hedge now being blamed for the huge losses his bank is booking.