JPMorgan (JPM) Could Feel Largest Impact From Financial Reform

Despite assumptions that Goldman Sachs (NYSE: GS) will feel the largest impact of the financial reform bill, that is not what the firm is telling its clients, FOX Business Networks' Charles Gasparino has learned.

According to the report Goldman executives has been telling its investors that its biggest rival, JPMorgan Chase & Co. (NYSE: NYSE: JPM) will be the firm hit the hardest by financial regulators.

The biggest issue with JPMorgan is its commercial bank status will require a tougher level of capital, and under the plan to have banks spin-off their derivatives businesses into separate units, JPMorgan would be required to hold more capital that Goldman.

Gasparino is reporting that JPMorgan officials are working diligently to soften the blow of the financial reform, including the bank’s Chief Executive Officer Jamie Dimon.

"They have many more pressure points than we have," one senior Goldman executive told Gasparino under the condition of anonymity.

The financial reform, which will put limits on the risky trading that is seen as the trigger for the recent economic meltdown, was seen as a direct shot at Goldman’s business model. Goldman said that it will lose money as it will be forced to eliminate certain activities, but the firm believes that the reform will end up mostly being a wash.

The additional rules in the reform bill will place more pressure on commercial banks like JPMorgan than on Goldman.

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