Daily Real Estate News  |  October 16, 2008  |   J.P. Morgan Chase Invests in Risky Loans
J.P. Morgan Chase, the largest U.S. bank by market value, has begun to buy up more risky mortgages in the belief that these loans will eventually generate gains for shareholders.

Bank executives reported during their quarterly conference call Wednesday that they have seen prices for some classes of mortgages stabilize in recent weeks.

"We'll probably be mad at ourselves if we didn't buy more," says JPMorgan Chief Executive Jamie Dimon.

The move is probably a good one, says Malcolm Polley, chief investment officer of Stewart Capital in Pittsburgh. Mortgage valuations "have gotten so bad that there's not too many places to go but up," Polley says.

Source: Reuters News, Elinor Comlay (10/15/2008)