JPMorgan reduces credit to China's Tsingshan and global metals clients

by Eric Onstad, Pratima Desai and Peter Hobson LONDON (Reuters) – JPMorgan Chase & Co (NYSE: 200JPMorgan) has cut lending to China’s Tsingshan, one of the world’s largest nickel producers, which has cut credit to other customers in Europe and Asia following a risk assessment, sources close to the situation said. Tsingshan Holdings Group was at the center of the crisis on the London Metal Exchange in March, when nickel prices more than doubled in a matter of hours, Forcing the LME to halt trading and cancel billions of dollars in deals. Tsingshan has approached at least two LME brokers to be the its customers or increase their credit lines. JPMorgan Chase, one of the biggest banks in the metals industry, and its shrinking financial operations are causing the industry to lose money, two sources said. Come chill. JPMorgan has reduced credit lines to several clients in Asia and Europe, or has notified five sources, who asked not to be named They will do so by the end of the year. They have no right to speak to the media. JPMorgan declined to comment, and Tsingshan was not immediately available for comment by phone or email. In March, JPMorgan’s maximum exposure was approximately These positions, most of which are over-the-counter (OTC) derivatives, Blame the March 8 LME price in Russia for the invasion of Ukraine. Tsingshan’s short position sparked billions of dollars in margin calls that could lead to some banks and brokers Breach of contract.