JPMorgan shares rise after Fed OKs restart of buybacks
NEW YORK JPMorgan Chase (JPM) said Thursday that it has won approval from the Federal Reserve to start buying back its own stock. The bank suspended the plan in May, after it revealed a surprise trading loss that grew to more than $6 billion.
The bank said in a regulatory filing that the Fed gave the OK earlier this week. The plan calls for JPMorgan to buy back $3 billion of its stock in the first three months of next year.
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Buybacks are popular with stockholders because they increase a company's earnings per share for the stock still held by the public. Companies also use them to compensate for shares of stock that they award to employees.
JPMorgan was among the best-performing bank stocks Thursday, rising 0.8 percent in midday trading.
The bank also said it has reached an agreement in principle with the Securities and Exchange Commission to resolve two investigations into sales of mortgage-backed securities.
One involves securities sold by Bear Stearns, which was near failure when JPMorgan bought it in March 2008. JPMorgan did not say what it might pay under the settlements, and an SEC spokesman declined comment.