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US politicians have renewed calls for tighter financial regulation, after JPMorgan Chase bank revealed a trading loss of $2bn (�1.2bn) on Thursday.

The bank's shares plunged by almost 10% on Friday, wiping $14bn from its value.

Democrat Congressman Barney Frank said the scale of the mistakes "blows up" the argument against tighter rules.

JPMorgan boss Jamie Dimon said the losses resulted from a strategy of hedging that was supposed to protect the bank from risk.

But critics disputed his claims, alleging that such losses were more likely to have come from risky bets.

"This is not a hedge," said Democratic Senator Carl Levin, who helped frame the 2010 Dodd-Frank Act on financial regulation.

"This was a major bet on the direction of the economy, and when those kind of bets are lost, we all pay the price."

Other proponents of tighter rules also seized the chance to air their concerns about the regulatory system.
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The shock evinced by Mr Dimon will reignite the debate about whether regulators need to take more decisive action to curb the complexity of investment banks�

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Congressman Frank, who also helped to frame the Dodd-Frank Act that bears his name, said: "When a supposedly responsible, well-run organisation could make such an enormous mistake with derivatives, that really blows up the argument: 'Oh, leave us alone, we don't need you to regulate us.'"

JPMorgan weathered the 2008 financial crisis better than most of its rivals, and Mr Dimon emerged as the chief opponent of greater regulation.

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OthellaLuciano289: Created page with 'US politicians have renewed calls for tighter financial regulation, after JPMorgan Chase bank revealed a trading loss of $2bn (�1.2bn) on Thursday. The bank's shares plunged b…'