Jamie Dimon, CEO of JPMorgan Chase, said that he expects the coronavirus crisis to include a “bad recession” and elements of financial strain similar to the 2008 downturn.

The head of the biggest U.S. bank said that while JPMorgan entered the crisis from a position of strength and that lenders have prepared for this, the pandemic is playing out in ways that are “dramatically different” from the industry’s Federal Reserve stress tests. 

“We don’t know exactly what the future will hold – but at a minimum, we assume that it will include a bad recession combined with some kind of financial stress similar to the global financial crisis of 2008,” Dimon said Monday in his annual shareholders letter. “Our bank cannot be immune to the effects of this kind of stress.”The bank’s 2020 submission to the annual Federal Reserve stress tests indicate that even in an “extremely adverse scenario,” JPMorgan can lend out an additional $150 billion for clients, Dimon said. The New York-based bank had $500 billion in total liquid assets and another $300 billion in borrowing ability from Fed sources, he added. 

Dimon was forced to step back from JPMorgan last month when he had an acute aortic dissection, or a tear in the lining of a crucial blood vessel branching off the heart. His doctors declared the operation successful; he was discharged after a week in the hospital and returned to work as CEO last week.

Dimon added that while JPMorgan will “will participate in government programs to address the severe economic challenges, we will not request any regulatory relief for ourselves.”

He praised the Fed’s actions to relieve strains in financial markets, saying that the central bank could take several more steps, including additional lending facilities and relaxing capital and liquidity requirements to boost the system if needed. 

“After the crisis subsides (and it will), our country should thoroughly review all aspects of our preparedness and response,” Dimon said. “And we should use the opportunity to closely review the economic response and determine whether any additional regulatory changes are warranted to improve our financial and economic system. There will be a time and place for that – but not now.”

While the lender is fresh off a record year for revenue and profit, Dimon warned that the bank’s earnings “will be down meaningfully in 2020” because of the coronavirus.   

Here’s the full letter.

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