SecProbe.io

July 25, 2012

Via E -mail
Douglas L. Braunstein
Executive Vice President and Chief Financial Officer
JPMorgan Chase & Co.
270 Park Avenue
New York, NY 10017

Re: JPMorgan Chase & Co.
Form 10-K for Fiscal Year Ended December 31, 2011
Filed February 29, 201 2
Form 10 -Q for Fiscal Quarter Ended March 31, 2012
Filed May 10, 2012
Forms 8 -K Filed July 13, 2012
  File No. 001-05805

Dear Mr. Braunstein :

We have reviewed your filings  and have the following comments.  In some of our
comments, we may ask you to provide us with information so we may better understand your
disclosure.

Please respond to this letter within ten business days by providing the requested
information, or by advi sing us when you will provide the requested response.   Where we have
requested changes in future filings, please include a draft of your proposed disclosures that
clearly identifies new or revised disclosures.  If you do not believe our comments apply to y our
facts and circumstances , please tell us why in your response.

After reviewing the information you provide in response to these comments, including
the draft of your proposed disclosures, we may have additional comments.

Form 10 -K for Fiscal Year Ended December 31, 2011

Risk Management, page 15

JPMorgan Chase’s framework for managing risks may not be effective…, page 15

1. We note from your disclosure provided with your Forms 8 -K on July 13, 2012 that
management has evaluated risk procedures in pla ce within your Chief Investment Office
and concluded that certain risk management practices were ineffective.  Beginning with
your next Form 10 -Q, please revise your risk factor disclosure to discuss the risks

Douglas L. Braunstein
JPMorgan Chase & Co.
July 25, 2012
Page 2

 presented by the recent trading losses within your Chief Investment Office and the
shortcomings identified with respect to your risk management strategies.

Item 9A: Controls and Procedures, page 20

2. Given the Item 4.02 Form 8 -K filed on July 13, 2012 and the risk management and
controls issues identi fied through your internal investigation into the trading losses within
the Chief Investment Office, please provide us with your analysis as to how you
concluded that your internal controls over financial reporting were effective as of
December 31, 2011.

Management’s Discussion and Analysis, page 64

Risk Management, page 125

3. We refer to your disclosure that “Risk Management coordinates and communicates with
each line of business through the line of business risk committees and chief risk
officers…” and note that various committees “meet frequently” to discuss and consider
risk issues.  Please revise your disclosure in future filings to explain in greater detail
Risk Management’s, the individual business lines’  and the various committees’
responsibilities for communicating risks and maintaining risk governance.

4. In future fil ings, please expand your disclosure in this section to clearly explain your
policies in the event of a risk limit breach.  For example, please  disclose how breaches in
risk limits are reported to Risk Management, senior management and the Board of
Director s, and by whom.  To the extent that your policies for reporting differ depending
on the severity of the breach, please explain.

5. We note from your disclosure in Exhibit 99.3 furnished with your Form 8 -K on
July 13, 2012 that you have implemented several  changes to the risk management
structure within your Chief Investment Office.  In future filings, please revise this section
to explain material risk governance changes that you have made.

Country Risk Management, page 163

Selected European Exposure , page 164

6. We note your response to comment three  of our letter dated April 17, 2012 and we
continue to believe that providing a further breakout of the individual countries, as well
providing both the gross amounts for your lending activities and your cred it default
swaps , provides appropriate transparency to your Selected European country disclosures.
Please address the following regarding the disclosure around your Country Risk
Management, including your Selected European exposure, in future filings:

Douglas L. Braunstein
JPMorgan Chase & Co.
July 25, 2012
Page 3

 Please provide a breakout of your Ireland, Portugal, and Greece exposures to
provide greater transparency around your activities in each of these individual
countries.

 For your lending activities, please provide the gross amount prior to the deduction
of the allowance for loan losses to supplement your presentation of the net
amount after allowance for loan losses.

 We note your disclosure regarding  your credit default swaps including both the
gross notional and fair value.  In future filings,  please provide this information on
a country -by-country basis, preferably included in the table on page 165 to
provide greater transparency around your activities in each of these individual
countries.

 We also note your disclosure that you have offset po rtfolio hedges against your
European exposures.  It is not clear from these disclosures what makes up the
amounts in this column.  Do they represent just single name CDS purchased and
sold on European sovereigns, or do they also include credit indices, and  other
types of credit protection other than single name CDS?  Do the amounts included
represent your total net hedging positions or do they take into account how
effective these portfolio hedges are in actually mitigating your country -specific
exposure?

Notes to Consolidated Financial Statements , page 182

Note 3 – Fair value measurement, page 184

7. We note your response to comments five and six of our letter dated April 17, 2012.
However, it is not clear from the  proposed disclosure in your response tha t inventory that
is not subject to fair value hedge accounting is carried at lower of cost or market.  In
future filings, disclose the fact that not all of your physical commodities are carried at fair
value.  Please disclose the amount of inventory that a re carried at market value, or if the
difference between “market value” and “fair value” is immaterial, disclose that fact.
Please briefly disclose your reasons for including all of the physical commodities in the
fair value hierarchy table.

Definitive  Proxy Statement on Schedule 14A filed April 4, 2012

Compensation Discussion and Analysis, page 15

Long -standing recovery provisions, page 24

8. We note from your disclosure provided on July 13, 2012 that you have determined to
claw back compensation from Chief Investment Office management with responsibility

Douglas L. Braunstein
JPMorgan Chase & Co.
July 25, 2012
Page 4

 over the synthetic credit portfolio.  Please provide expanded disclosure in future filings
that explains in greater detail the process by which you determine to claw back
compensation.  Please explain the extent to which the Compensation & Management
Development Committee (or another committee) is responsible for claw back decisions
and clarify  the role of the Board of Directors (e.g., must the Board review every claw
back decision?).  Please also clarify whether any of your policies relating to
compensation recovery have changed as a result of the recent events with your Chief
Investment Office .

Form 10 -Q for Fiscal  Quarter Ended March 31, 2012

Management’s Discussion and Analysis , page 3

Business Segment Results , page 14

Treasury and CIO, page 33

9. Tell us and revise your future filings to more clearly disclose how your synthetic credit
portfolio is reflected in the amounts presented in this section.  Please similarly address
your disclosure on pages 54 and 59.

Market Risk Management , page 73

Value -at-risk, page 73

10. We note your disclosure that your VaR model is continuously evaluated a nd enhanced in
response to changes in the composition of your portfolios, changes in market conditions
and dynamics, improvements in modeling techniques, system capabilities, and other
factors.  Please respond to the following and expand your disclosure in  future filings as
appropriate:

 Tell us the number of different VaR models that are used to determine your total
trading VaR as disclosed here, and discuss the drivers regarding the need to use
multiple different models.

 Tell us how the results of the respective VaR models used are aggregated to arrive
at your total trading VaR as well as the individual market risk categories
disclosed. For example, clarify whether you simply aggregate the outputs from
the different models  or whether adjustments are made, and if so, how the
adjustments are determined.

 Tell us the extent to which the VaR models used for regulatory capital purposes
are the same as the VaR models used for your market risk disclosures. To the

Douglas L. Braunstein
JPMorgan Chase & Co.
July 25, 2012
Page 5

 extent that cert ain of the models used for each purpose differ, please tell us the
drivers behind those differences.

 Discuss the process and validation procedures in place prior to implementing
significant model and assumption changes, and explain the extent to which th ese
validation processes may vary across your company. For example, discuss the
approval process required, back -testing procedures performed, and periods of
parallel model runs before implementation.

 To the extent that all or some of your VaR models used  for your market risk
disclosures are different than those used to calculate regulatory capital, please tell
us whether the model review process and model oversight processes are the same
for both. As part of your response, please clarify when approval is required from
any of your regulators regarding VaR model changes.

 Given that your VaR models are evolving over time, tell us how you consider
when disclosure is required under Item 305(a)(1)(iii)(4) of Regulation S -K
regarding model, assumptions, and par ameter changes.

Note 3 – Fair value measurement, page 91

11. You disclose that you have a well established policy of determining fair value, and you
also disclose that you have a price verification group that is independent from your risk
taking function.  With respect to your valuation process, please address the following in
your response as well as your future filings:

 Describe the process for determining the fair values that are ultimately used in the
financial statements.

 Are the prices that are ultimately used to determine fair value always
supplied by the traders or other risk -taking functions within the
organizations and then subsequently verified by the independent pricing
group?

 What percentage of prices are verifie d?

 For prices that cannot be independently corroborated, what is your process
to ensure that the prices used are appropriate?

 Is the independent verification process only for Level 3 instruments or for
all fair value measurements?

 Describe the exten t to which your valuation policy is consistent across your
various business lines/segments, regardless of business purpose (market making

Douglas L. Braunstein
JPMorgan Chase & Co.
July 25, 2012
Page 6

 versus investments).  If the polices are different across the firm, explain both the
business reasons and your basis u nder GAAP for this inconsistency.

12. We note your disclosure on page 97 that there are adjustments made to the fair value for a
variety of factors including liquidity.  Tell us the instruments for which you have made
liquidity adjustments, the amount of such  adjustments, your basis for the adjustment, and
how you considered guidance in ASC 820 -10-35-36B with respect to these adjustments.

13. It appears from your fair value hierarchy disclosures that the majority of your credit
derivatives are Level 2.  Please ad dress the following regarding your credit derivatives in
your synthetic credit portfolio in your CIO office:

 Tell us the level in which you have classified these instruments in the fair value
hierarchy as well as your basis for including the item in that particular level.

 Tell us if there were any adjustments made for liquidity or any other adjustments
made to the fair value of these positions.  If so, tell us how you consider whether
the adjustment is significant to the overall fair value measurement for purposes of
classi fication in the fair value hierarchy.

14. We note that you disclose on page 98 that for Corporate debt securities, obligations of
U.S. states and municipalities, and Other, “price” is an unobservable input.  Please revise
your disclosure in future filings a s follows:

 In both your qualitative disclosure of valuation techniques as well as your tabular
quantitative disclosures, each time you disclose price as an unobservable input
revise to clarify whether you are using comparable prices for similar instrument
(market comparables) or prices/quotes from third -party pricing services/brokers
(vendor prices).

 It appears that a yield may have been considered in coming up with the price for
various financial instruments.   If so, please disclose in future filings the  yield or
implied yield from the financial instrument as a significant unobservable input, or
tell us why such disclosure is not appropriate or meaningful.

15. We note your disclosure on page 99 about the impact of a change in an unobservable
input on the fai r value measurement and the interrelationship of unobservable inputs.  It
appears that your disclosure is very general and does not discuss specific instruments.
Please revise your disclosure in future filings by providing more granular disclosures in
this area (e.g., separately disclose the impact that a change in each unobservable input
would have on the fair value of the instrument). Such information can continue to be
included as part of your qualitative discussion or incorporated into your quantitativ e
tabular disclosure of Level 3 valuation techniques through the use of footnotes or the
addition of another column.

Douglas L. Braunstein
JPMorgan Chase & Co.
July 25, 2012
Page 7

 16. We note your disclosures about the fair value of financial instruments that are not carried
on the Consolidated Balance Sheets at fair valu e as required by ASC 825 -10-50-10.
In future filings , please provide a breakout of the fair value hierarchy, similar to the
presentation you have for your assets and liabilities measured at fair value on a recurring
basis , as such disclosure provides gre ater transparency compared to providing only
footnotes as to the category to which these line items predominately belong.

17. In light of the significant ranges presented in your table of Level 3 inputs on page 98,
please revise to your presentation in future  filings to include a column quantifying the
weighted average input values to supplement the ranges provided.  Please refer to
ASC 820 -10-55-103 for guidance.

Note 5 – Derivative instruments, page 103

18. We note your disclosures around your derivatives gains and losses not designated as
hedging instruments on page 107.  You also note that these disclosures do not include
derivatives used in market -making activities or to manage enterprise risk exposures.
Please address the following in your response as well as in your future filings:

 Clarify the extent to which these disclosures include the credit derivatives in the
synthetic credit portfolio in your CIO office.

 If not, discuss your reasons for not i ncluding these derivatives in this table.

 Identify whether there are any collateral arrangements for credit derivatives in
your CIO synthetic credit portfolio, and if so, disclose how much cash or other
collateral you have  posted.

 Identify the collate ral posting triggers for these contracts, including the extent to
which such triggers are only credit -related.

In future f ilings, please expand the disclosure in your derivatives footnote to clarify
which tables include the credit derivatives originatin g in your CIO synthetic credit
portfolio, since currently it is difficult to tell which tabl