JPMORGAN CHASE & CO. - Irish Stock Exchange

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Finally, JPMorgan Chase’s risk management strategies may not be effective because in a difficult or less liquid market environment other market participants may be attempting to use the same or similar strategies to deal with the difficult market conditions. In such circumstances, it may be difficult for JPMorgan Chase to reduce its risk positions due to the activity of such other market participants. If JPMorgan Chase does not effectively manage its liquidity, its business could be negatively affected JPMorgan Chase’s liquidity is critical to its ability to operate its businesses, grow and be profitable. A compromise to JPMorgan Chase’s liquidity can have a significant negative effect on JPMorgan Chase. Some potential conditions that could negatively affect JPMorgan Chase’s liquidity include illiquid or volatile markets, diminished access to capital markets, unforeseen cash or capital requirements (including, among others, commitments to special purpose entities (“SPEs”) or other entities that may be triggered) and difficulty or inability to sell assets. These conditions may be caused by events over which JPMorgan Chase has little or no control, including, for example, sudden or unanticipated contraction of the credit or other market or economic downturns. Further, in a period of difficult credit or other markets, JPMorgan Chase may be forced to fund its operations at a higher cost or it may be unable to raise as much funding as it needs to support its business activities. This could cause JPMorgan Chase to curtail its business activities while incurring higher costs for funding. The credit rating of JPMorgan Chase is important in order to maintain JPMorgan Chase’s liquidity. A reduction in JPMorgan Chase’s credit ratings, depending on the severity, could potentially increase borrowing costs, limit access to capital markets, require cash payments or collateral posting, and permit termination of certain contracts to which JPMorgan Chase is a party. Reduction in the ratings of certain SPEs or other entities to which JPMorgan Chase has a funding or other commitment could also negatively affect JPMorgan Chase’s liquidity where such ratings changes lead, directly or indirectly, to JPMorgan Chase being required to purchase assets or otherwise provide funding. JPMorgan Chase relies on the earnings of its subsidiaries and other affiliates for its cash flow and consequent ability to satisfy its obligations, including regulatory requirements and its obligation to make payments on any non-equity securities issued by JPMorgan Chase. These payments by subsidiaries and affiliates may take the form of dividends, loans or other payments, and it may not be in the power of JPMorgan Chase to decide if such payments are made. For example, several of JPMorgan Chase’s principal affiliates are subject to capital adequacy requirements or other regulatory or contractual restrictions on their ability to provide such payments. Limitations in the payments JPMorgan Chase receives from its subsidiaries and affiliates could negatively affect JPMorgan Chase’s liquidity position. In addition, JPMorgan Chase’s right to participate as a shareholder in any distribution of assets of any subsidiary upon liquidation, reorganisation or otherwise (and thus the ability of holders of non-equity securities to benefit as creditors of JPMorgan Chase from such distribution), is subject to the prior claims of creditors of any such subsidiary. Consequently, JPMorgan Chase’s debt securities, including any non-equity securities issued by it, will be effectively subordinated to all existing and future liabilities and obligations of any such subsidiary. JPMorgan Chase could be negatively affected in a situation in which other financial institutions are negatively impacted JPMorgan Chase could be affected by the actions and commercial soundness of other financial services institutions. Financial services institutions that deal with each other are interrelated as a result of trading, clearing, counterparty, or other relationships. While JPMorgan Chase has exposure to many different industries and counterparties, it routinely executes a high volume of transactions with counterparties in the financial services industry, including brokers and dealers, commercial banks, investment banks, mutual and hedge funds and other institutional clients, resulting in a significant credit concentration with respect to the financial services industry overall. As a result, a default by, or even concerns about, one or more financial services institutions could lead to significant market-wide liquidity problems, or losses or defaults by other institutions, including JPMorgan Chase. Derivative and other transactions may expose JPMorgan Chase to unexpected risk and potential losses JPMorgan Chase is party to numerous derivative and other transactions, including transactions that require the physical settlement or delivery of securities, commodities or other obligations JPMorgan Chase does not own. If JPMorgan Chase is not able to obtain those securities, commodities or other obligations within the required timeframe for delivery, 16
this could cause JPMorgan Chase to forfeit payments otherwise due to it and could result in settlement delays which could damage JPMorgan Chase’s reputation and ability to transact future business. Derivative and other transactions entered into with third parties are not always confirmed by counterparties on a timely basis. While a transaction remains unconfirmed, JPMorgan Chase is subject to heightened credit and operational risk and in the event of a default JPMorgan Chase may find the contract more difficult to enforce. In addition, as new and more complex derivative products are created, disputes regarding the terms of the underlying contracts could arise, which could force JPMorgan Chase to incur unexpected costs and impair its ability to manage effectively its risk exposures from these products. JPMorgan Chase’s commodities activities are subject to extensive regulation, potential catastrophic events and environmental risks and regulation that may expose it to significant cost and liability In connection with the commodities activities of JPMorgan Chase’s Investment Bank, JPMorgan Chase engages in the storage, transportation, marketing or trading of several commodities, including metals, agricultural products, crude oil, oil products, natural gas, electric power, emission credits, coal, freight, and related products and indices. As a result of these activities, JPMorgan Chase is subject to extensive and evolving energy, commodities, environmental, and other governmental laws and regulations. JPMorgan Chase expects laws and regulations affecting its commodities business to expand in scope and complexity. JPMorgan Chase may incur substantial costs in complying with current or future laws and regulations and the failure to comply with these laws and regulations may result in substantial civil and criminal fines and penalties. JPMorgan Chase’s commodities business also further exposes it to the risk of unforeseen and catastrophic events, including natural disasters, leaks, spills, explosions, release of toxic substances, fires, accidents on land and at sea, wars, and terrorist attacks that could result in personal injuries, loss of life, property damage, and suspension of operations. JPMorgan Chase attempts to mitigate its risks but its actions may not prove adequate to address every contingency. In addition, insurance covering some of these risks may not be available, and the proceeds, if any, from insurance recovery may not be adequate to cover liabilities with respect to particular incidents. As a result, JPMorgan Chase’s financial condition and results of operations may be adversely affected by such events. JPMorgan Chase’s financial statements are based in part on assumptions and estimates which, if wrong, could cause unexpected losses in the future Pursuant to accounting principles generally accepted in the United States of America (“U.S. GAAP”), JPMorgan Chase is required to use certain assumptions and estimates in preparing its financial statements, including in determining credit loss reserves, reserves related to litigations and the fair value of certain assets and liabilities, among other items. If assumptions or estimates underlying JPMorgan Chase’s financial statements are incorrect, JPMorgan Chase may experience material losses. For example, JPMorgan Chase makes judgments in connection with its consolidation analysis of its SPEs. If it is later determined that non-consolidated SPEs should be consolidated, this could negatively affect JPMorgan Chase’s consolidated balance sheet, related funding requirements, capital ratios and, if the SPEs’ assets include unrealised losses, could require JPMorgan Chase to recognise those losses. Certain of JPMorgan Chase’s financial instruments, including trading assets and liabilities, available-for-sale securities, certain loans, mortgage servicing rights, structured notes and certain repurchase and resale agreements, among other items, require a determination of their fair value in order to prepare JPMorgan Chase’s financial statements. Where quoted market prices are not available, JPMorgan Chase may make fair value determinations based on internally developed models or other means which ultimately rely to some degree on management judgment. Some of these and other JPMorgan Chase assets and liabilities may have no direct observable price levels, making their valuation particularly subjective, being based on significant estimation and judgment. Current market developments may adversely affect the financial services industry and JPMorgan Chase’s business and results of operations Dramatic declines in the housing market during the past 12 months, with falling home prices and increasing foreclosures and unemployment, have resulted in significant write-downs of asset values by financial institutions, including 17
Page 1 and 2: Base Prospectus JPMORGAN CHASE & CO
Page 3 and 4: Neither the Arranger nor the Dealer
Page 5 and 6: Each prospective purchaser of Notes
Page 7 and 8: GENERAL DESCRIPTION OF THE PROGRAMM
Page 9 and 10: The Issuer’s filings with the SEC
Page 11 and 12: and/or Consolidation: Maturities: D
Page 13 and 14: nominee for a Common Depositary of
Page 15 and 16: dates on which, and the amounts in
Page 17 and 18: RISK FACTORS The risk factors descr
Page 19 and 20: JPMorgan Chase’s acquisitions and
Page 21: JPMorgan Chase faces significant le
Page 25 and 26: The success of the acquisition will
Page 27 and 28: (iv) (v) understand thoroughly the
Page 29 and 30: Inverse Floating Rate Notes Inverse
Page 31 and 32: objectives or strategies or have be
Page 33 and 34: Legal Investment Considerations May
Page 35 and 36: “ANY UNITED STATES PERSON WHO HOL
Page 37 and 38: Delivery of Notes On or after any d
Page 39 and 40: notices to the holders of Notes of
Page 41 and 42: amended (the “Exchange Act”), o
Page 43 and 44: Pre-Issue Trade Settlements It is e
Page 45 and 46: least €50,000 (or the equivalent
Page 47 and 48: euro, a day on which commercial ban
Page 49 and 50: Interest Notes will be determined i
Page 51 and 52: Transfer Agents (if applicable) and
Page 53 and 54: “D(2)” is the calendar day, exp
Page 55 and 56: (b) Early Redemption of Zero Coupon
Page 57 and 58: (f) Partly Paid Notes Partly Paid N
Page 59 and 60: Currency) equal to the sum of the v
Page 61 and 62: (C) Notice Upon the occurrence of a
Page 63 and 64: the amount of the national currency
Page 65 and 66: (C) any Additional Financial Centre
Page 67 and 68: If, prior to the delivery of the As
Page 69 and 70: (d) (e) (f) there will at all times
Page 71 and 72: In addition, modifications and amen
Page 73 and 74:
the delivery of the relevant notice
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History, Development and Organisati
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“Merger”). The Merger provides
Page 79 and 80:
TAXATION OF THE NOTES Taxation Exce
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organisations, dealers in securitie
Page 83 and 84:
case of a Registered Note that is a
Page 85 and 86:
the terms of the Variable Interest
Page 87 and 88:
in amounts equal to the annual paym
Page 89 and 90:
Foreign Currency Registered Notes I
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in that year is treated as a paymen
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U.S. Federal Income Tax Treatment o
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Part 2 Non-U.S. Holders Except wher
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with documentation upon which the b
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SUBSCRIPTION AND SALE Subject to th
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(iii) (iv) (v) if it is a United St
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Prospectus Directive. For the purpo
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Unrestricted Notes Each purchaser o
Page 107 and 108:
PART A — CONTRACTUAL TERMS Terms
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Registered Notes only] [of at least
Page 111 and 112:
the Agency Agreement) — Interest
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(v) Issuer’s Option Period (if ap
Page 115 and 116:
elate]] 27. Physical Delivery: [App
Page 117 and 118:
[Subject as provided below] [t/T]he
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[(ii)] Estimated net proceeds: [Not
Page 121 and 122:
QUALIFIED INSTITUTIONAL BUYER, (2)
Page 123 and 124:
10. No websites that are cited or r
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