Financial services giant JPMorgan Chase (NYSE:JPM) was fined $348.2 million by U.S. regulators for deficiencies in its trade surveillance program. The Office of the Comptroller of the Currency (OCC) imposed a $250 million penalty, citing inadequate data controls over trade surveillance. Additionally, the U.S. Federal Reserve levied a fine of around $98.2 million against the company.
The OCC said that JPMorgan Chase failed to monitor billions of instances of trading activity across at least 30 global trading venues. The regulator termed these activities “unsafe or unsound banking practices.”
Last year, JPMorgan Chase was fined for record-keeping lapses by the SEC (Securities and Exchange Commission). Besides for JPM, Citigroup (NYSE:C), Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS), and Wells Fargo (NYSE:WFC) were also penalized. As JPM is time and again fined for compliance failures, let’s delve deeper into JPM’s risk profile.
JPM’s Risk Analysis
JPMorgan Chase’s businesses are highly regulated, with laws, rules, and regulations substantially influencing its business activities. In addition, factors such as economic fluctuations, market conditions, governmental policies, and shifts in interest rates and credit spreads can significantly impact its operations.
TipRanks’ Risk Analysis tool shows that JPM’s legal and regulatory exposure is higher than the industry average. JPM’s legal and regulatory risks constitute 19% of its overall risk profile, exceeding the industry average of 16.9%. Further, its macro and political risk accounts for 23.8% of its total risk, significantly higher than the industry average of 9.7%.
What is the Future of JPM Stock?
JPM stock has gained 50.7% in one year. Meanwhile, Wall Street is cautiously optimistic about JPM’s prospects. It has 17 Buy and six Hold recommendations for a Moderate Buy consensus rating. Analysts’ average price target on JPM stock is $195.45, implying the stock could rise by 3.98% from current levels.
