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'London Whale' took big bets beneath the surface

Pedestrians walk past the JP Morgan Chase headquarters in New York.

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Bruno Iksil was dubbed the 'London Whale' in credit markets due to the size of the trading positions he took, but for years he stayed well below the surface avoiding detection.

Now, the French-born JPMorgan trader has been dragged from the anonymity of the trading floor into the eye of a very public storm over a $2-billion trading loss at the U.S. investment bank where Mr. Iksil worked in a little-known group called the Chief Investment Office (CIO).

Friends, colleagues and fellow traders describe an unassuming man, a far cry from the brash image normally associated with traders staking huge bets in fast-moving financial markets, including derivatives.

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"He's a really nice bloke. A quiet bloke. He's not an arrogant trader, he's quite the opposite. He's very charming," one former colleague at JPMorgan said of Mr. Iksil, whom he said was married with "a couple of kids".

Mr. Iksil, who graduated in engineering in 1991 from the Ecole Centrale in Paris, looks older than he is, seldom wears a suit, and according to ex-colleagues lives outside central London.

There have been no suggestions that Mr. Iksil's activities were in any way irregular, but over a period of years he and his team amassed a book of bets estimated by some to be $100-billion.

When these became public, opportunistic hedge funds could not resist trading against the 'Whale'.

As markets moved against him, whispers of Mr. Iksil's enormous latent losses circulated, ultimately undermining JPMorgan's reputation as the canniest risk-manager in global finance.

For all the talk of the 'Whale', the handful of London-based bankers and traders who have done business with him say they know little about the man behind the trades.

"Everyone knows The Whale, whenever there was a big move in CDS markets, you knew it was the Whale," one hedge fund manager said, adding that Mr. Iksil managed to maintain "a very low-profile" out of kilter with his big influence on the multi-trillion dollar credit default swaps market.

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Mr. Iksil, who did not return calls or emails, is a member of London's thriving French expatriate community, estimated at 350,000 people, which includes a large contingent of professionals involved in banking.

French banks like BNP Paribas and Societe Generale have big London bases and French finance workers, famed for their top-notch mathematical skills acquired at France's prestigious "grande ecole" universities, are in high demand among international rivals and hedge funds, especially in areas such as equity derivatives.

Senior traders and dealers described Mr. Iksil as a "bright guy", who was faithfully executing strategies demanded by the bank's risk management model but who may have simply misjudged the amount of liquidity in the markets.

Mr. Iksil's bosses include Achilles Macris and Ina Drew, both well-known as strong personalities with ambitions to grow the CIO, allowing their charges to trade freely in all products with the exception of commodities, the first ex-employee said.

Mr. Iksil's former colleague in the CIO unit said that his managers "were happy to sign off on the trades".

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