JPMorgan Chase & Co. could lose as much as $5 billion due to its exposure to sickly Portugal, Ireland, Italy, Greece, and Spain, CEO Jamie Dimon said in an interview with Class CNBC, which was carried in the Italian newspaper Milano Finanza on Saturday.
Dimon said the bank was exposed to the five countries (also known as PIIGS) to the tune of about $15 billion.
"We fear we could lose up to $5 billion ... We hope the worst won't happen, but even if it did happen, I wouldn't be pulling my hair out," he said.
Dimon said Europe was the worst problem for the banking sector.
"But the [European Union] and euro are solid even if the states will have to be financially responsible and do all they can to develop common social policies," he said.
Dimon said the recent extraordinary liquidity measures taken by the European Central Bank had been a good move.
"Banks will have to have more capital and sell assets, but at least they have liquidity," he said.
Asked about the U.S. Federal Reserve's bank stress tests, set to come out in March, Dimon said his bank would pass.
"I hope the test shows American banks, perhaps with one or two exceptions, are very well capitalized, indeed too much," he said.
Dimon said JPMorgan had bought back shares last year for $8 billion. "I hope in 2012 we will do more or less the same."
Asked if the bank could take advantage of the problems facing Europe's banks and buy assets, he said, "we have already bought some assets and would like to possess others."
(Reporting by Stephen Jewkes, editing by Jane Baird)