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Jeffrey Orr, president and chief executive officer of Power Financial Corp.Fernando Morales/The Globe and Mail

Governments should refrain from the temptation to tighten regulation of the financial services industry, despite incidents like the recent $2-billion (U.S.) trading loss at JPMorgan Chase & Co. , said Power Financial Corp.'s chief executive.

"I do believe that regulators around the globe have increased the level of regulation dramatically in the past four years. The danger remains that the pendulum swings too far and chokes off economic activity," Jeffrey Orr told reporters after the Desmarais family's holding company's annual meeting Monday morning.

Assets in the Power Financial stable include life insurance giants Great West Lifeco and London Life, and investment management firms Mackenzie Financial and Investors Group.

In his speech to shareholders, Mr. Orr warned that a regulatory climate that was too severe would jeopardize attempts to find solutions to the current global economic slump.

Mr. Orr declined to comment on what happened at JPMorgan, which announced Monday that its chief investment officer was stepping down in the wake of the surprise trading loss.

Asked during the meeting's question period about challenges Power Financial faced this year, Mr. Orr replied there were two: skittish investment markets where he doesn't expect a lot of growth, and "very low interest rates" that put the squeeze on insurance products.

Montreal-based Power Financial on Monday reported a first-quarter profit of $455-million (Canadian) or 64 cents per share, compared with $370-million or 52 cents in the year-earlier period.

The 23 per cent increase in profits was in part due to gains by subsidiary Groupe Bruxelles Lambert on the partial disposal of wine-and-spirits maker Pernod Ricard and the sale of French chemicals producer Arkema.