Updated with additional analyst comments.
NEW YORK (
) -- A credit downgrade to the U.S. could benefit
, bank CEO and Chairman Jamie Dimon acknowledged Thursday during a conference call with analysts.
"It's possible, but we're not hoping for that," Dimon said in response to a question from RBC Capital Markets Gerard Cassidy. The CEO said he wants to see a healthy U.S. economy, adding, "if that's bad for JPMorgan's market share, so be it."
In a follow-up email exchange Cassidy explained that a one notch credit downgrade to the U.S. could lead to increased sales activity since triple-A treasuries are used as collateral for certain transactions and/or contracts.
"If they were downgraded to AA+, some of those contracts that require triple-A investments as collateral would need to be sold leading to increased sales activity," Cassidy explained.
Earlier on the same call, Dimon said a U.S. default would force some owners of U.S. Treasuries to sell their holdings, and possibly lead to a multi-notch downgrade of the U.S. credit rating.
"No one can say definitively there's no chance of a catastrophic outcome so why would you take that risk," Dimon said.
Dimon's warning comes as Congress and the White House try to work out a deal to raise the debt ceiling to avoid a possible default early next month. Republicans have said they will not raise the debt ceiling if it is accompanied by tax increase, while the White House and Congressional Democrats insist an increase is necessary.
Wall Street trade group SIFMA, which represents JPMorgan and other big banks like
Bank of America
to discuss potential operational issues related to a U.S. default.
Written by Dan Freed in New York
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.