The European Central Bank (ECB) announced on Thursday it had fined JPMorgan a total of 12.2 million euros ($14.4 million) for misreporting risk, the largest fine so far levied by the Frankfurt institution.
The U.S. investment bank has been found that it had misclassified some transactions and excluded others from its calculations between 2019 and 2024, the ECB said.
"This occurred because, for 15 consecutive quarters, the bank misclassified corporate exposures and applied a lower risk-weight for credit risk to them than what banking rules prescribe," it said in a statement.
It said JPMorgan had reported that its capital buffers were bigger than they actually were.
"The bank committed both breaches with serious negligence, driven by evident deficiencies in its internal processes," the ECB said.
"The bank's internal controls did not detect the breaches in a timely manner," it added.
Banks are required to keep a certain amount of cash or highly liquid assets on their books in proportion to the amount of risky holdings they have.
Artificially lowering the proportion of risky assets on its books would have freed up cash for JPMorgan to invest in other areas.
The ECB last week fined French bank Credit Agricole 7.55 million euros for being too slow to evaluate its climate change-related risk in response to a request from the central bank.
