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Jamie Dimon, the chief executive of JPMorgan Chase, during a hearing on Capitol Hill about financial markets, in Washington, April 3, 2008.

Doug Mills/New York Times/Doug Mills/New York Times

JPMorgan Chase & Co.'s trading losses have mounted to at least $3-billion, the New York Times reported Wednesday night, citing unnamed sources.

Last Thursday, the bank announced that it had lost $2-billion on a bad hedging strategy, and warned it could lose more in the coming quarters.

But the losses surged past the $3-billion mark after just four days of trading, according to the report, as investors and hedge funds took advantage of JPMorgan's plight, further deteriorating the bank's underlying credit market positions.

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JPMorgan outperformed many other banks during the credit crisis, and its shares had been nearing their pre-crisis levels before chief executive Jamie Dimon announced the losses. Speaking to investors on a conference call last Thursday, he called the damage embarrassing but said the bank's overall health is still strong.

The bank had been trying to unwind a hedge position it held against volatility in the credit markets when the strategy began to backfire, leading to added mistakes that top executives failed to catch.

The Federal Bureau of Investigation announced this week that it would look into the losses, which the U.S. Securities and Exchange Commission and the Federal Reserve are also probing.

Meanwhile, pressure has been mounting for the bank to claw back some of the money it paid to the executives in charge of overseeing the trades. Mr. Dimon has said those responsible would face disciplinary action.

Banks typically use hedges to protect themselves against large swings in the market. As the previous hedge expired, JPMorgan traders, working out of the bank's London office, had begun building a new hedge position to replace it.

However, through market swings over the last several months, the traders made a series of bad bets and increasingly complex trades, compounding the damage.

"It was a bad strategy, it was badly executed, became more complex, [and]it was poorly monitored," Mr. Dimon said last week.

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With a report from Grant Robertson and Reuters

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