By Dawn Kopecki and Max Abelson
David Olson, a former head of credit trading in JPMorgan Chase & Co. (JPM)'s chief investment office, learned about risk as a U.S. Navy nuclear submarine pilot.
When he joined the bank in 2006, his new commander, Chief Executive Officer Jamie Dimon, was transforming the once- conservative unit from a risk manager to a profit center.
"We want to ramp up the ability to generate profit for the firm," Olson, 43, recalled being told by two executives. "This is Jamie's new vision for the company."
That drive has now shattered JPMorgan's cultivated reputation for policing risk and undermined Dimon's authority as a critic of regulatory efforts to curb speculation by too-big- to-fail banks. It also may cost Chief Investment Officer Ina R. Drew, one of the most powerful women on Wall Street, her job. As U.S. and U.K. investigators descend on the firm following Dimon's announcement last week of a $2 billion trading loss, lawmakers are pointing to the breakdown at the largest U.S. bank as evidence that tougher rules are needed.