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To: Rocket Red who wrote (98252)	12/20/2001 5:44:50 PM
From: Rocket Red	Read Replies (1) \| Respond to of 150070

Morgan Reveals Larger Enron Exposure AP Online via COMTEX December 20, 2001 J.P. Morgan Chase & Co. [JPM] now says it has $2.6 billion in exposure stemming from the collapse of Enron Corp. [ENE] -- more than double what it previously disclosed -- including nearly $1 billion it says it is owed by insurance companies. J.P. Morgan executives said in a conference call Thursday that the firm has now disclosed the entirety of its Enron exposure, and expects to receive payment on much of it. But that assurance came even as J.P. Morgan said it has sued several insurance companies demanding payments related to $1.1 billion in oil and gas contracts, including $965 million owed to the bank. Enron Corp. filed for Chapter 11 bankruptcy protection earlier this month in one of the largest corporate collapses in U.S. history. The insurance companies issued policies guaranteeing Enron obligations, but are now trying to avoid payment. In addition, Morgan said a European financial institution, which it would not identify, has failed to make payment on a $165 million letter of credit backing an Enron-related swap contract. Morgan said it will seek enforcement of the letter of credit. The bank said its secured exposure to Enron also includes $600 million in loan and trading exposure and $250 million in debtor-in-possession financing. The combination means the bank's secured exposure totals about $1.98 billion. That is significantly higher than the $400 million in secured exposure the company had specifically explained late last month. J.P. Morgan said it also has $620 million in unsecured exposure to Enron. That is higher than the $500 million initially detailed by the company, a figure it has sought to clarify in recent days. The bank said it will take a charge of $220 million in the fourth quarter and will reduce its quarterly trading revenues by $235 million to account for the unsecured exposure. The remaining exposure will be classified as non-performing. Sharada Vibhakar, an analyst at Parker Hunter Inc., said the company had previously not been candid about its exposure but the new information appears to be complete. ``I have pretty high confidence in them coming clean,'' Vibhakar said. ``I think it's at least hopeful they'll regain some of this.'' Shares of JP Morgan were down $1.02 to $36.98 in trading on the New York Stock Exchange.