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Pimco's Gross: JPMorgan 'One of the Best-Run Banks'

Friday, 11 May 2012 | 10:56 AM ET

One day after JPMorgan Chase announced that it had suffered a trading loss of at least $2 billion, Bill Gross, Pimco's managing director and co-CIO, told CNBC that it was still one of the “best-run banks in the world.”

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“It’s got $120 billion of Tier-1 capital,” he said. “That’s 10.5 percent, which is higher than the 9-percent U.S. average.”

JPMorgan's trading loss stemmed from a failed hedging strategy. The disclosure shocked many investors and sent the company's stock down 8 percent in trading on Friday.

Still, Gross stood by the bank's capital levels.

“So it’s a well-run bank and decently capitalized bank” he added. “I think we should ask the question and you have — should banks in general should be doing these types of trades?”

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Gross said he would like to see Basel III regulation increase the level of bank equity and bank capital.

“What Pimco trusts is capital — the more capital the better and the less risk,” he said.

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