JPM CIO unit holds $100bn in 'risky bonds'

J.P. Morgan Chase's CIO unit - the arm at the centre of a $2bn trading loss - has more than $100bn invested in asset-backed securities and structured products, according to reports.

The holdings include European mortgage-backed bonds and other complex debt securities such as collateralised loan obligations, of which J.P. Morgan has been the biggest buyer in three years, the FT reports. Asset-backed securities and structured products were among the complex products that were at the centre of the financial crisis in 2008. The $2bn derivative trading loss came to light last week and has prompted regulator investigations into the bank in the US. One credit trader speculated the firm may find it difficult to unwind these positions due to their size.