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CNBC ON DIGG

No Bank Should Be Considered Too Big to Fail: Dimon

Published: Friday, 13 Nov 2009 | 8:18 AM ET

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By: CNBC.com

No bank should be too big to fail, according to JPMorgan Chase CEO Jamie Dimon, who includes his own institution on the list.

CNBC.com

Dimon, in a Washington Post opinion piece, said the government shouldn't provide artificial life support to banks that don't perform.

"The term 'too big to fail' must be excised from our vocabulary,'" Dimon wrote in Friday's Post.

Yet he said it shouldn't be the size of the institution that drives the new regulatory policies being considered in Congress but rather their ability to manage risk and provide the best services for customers.

The government should be able to lead an orderly failure of banks but shouldn't impose arbitrary size limits on the institutions, he added.

"Artificially limiting the size of an institution, regardless of the business implications, does not make sense," Dimon wrote. "The goal should be a regulatory system that allows financial institutions to meet the needs of individual and institutional customers while ensuring that even the biggest bank can be allowed to fail in a way that does not put taxpayers or the broader economy at risk."

Limiting the size of banks such as JPMorgan [JPM Loading... () ], Dimon wrote, would also limit corporations that expand globally and need large financial institutions to help underwrite their endeavors.