Dimon’s annual letter to shareholders, which is closely watched by banking executives and traders, comes after the collapse of Silicon Valley Bank (SVB) and Signature Bank rattled the financial system. 

“As I write this letter, the current crisis is not yet over, and even when it is behind us, there will be repercussions from it for years to come,” Dimon wrote in the letter. 

Though Dimon acknowledged the recent bank failures are “nothing like” what happened during the 2008 financial crisis, he added that “any crisis that damages Americans’ trust in their banks damages all banks – a fact that was known even before this crisis.”

“While this crisis will pass, lessons will be learned, which will result in some changes to the regulatory system. However, it is extremely important that we avoid knee-jerk, whack-a-mole or politically motivated responses that often result in achieving the opposite of what people intended,” Dimon wrote. 

His comments come as lawmakers have been looking at a menu of proposed reforms to the banking system amid the ongoing crisis. Among the measures that have drawn attention in recent weeks includes pitches to roll back a law that loosened federal regulations on midsize banks and appoint an inspector general for the Federal Reserve.

In his letter Tuesday, Dimon stressed the importance of a “thoughtful” response to the recent events.

“Very often, rules are put in place in one part of the framework without appreciating their consequences in combination with other regulations,” Dimon wrote. “America has had, and continues to have, the best and most dynamic financial system in the world – from various types of investors to its banks, rule of law, investor protections, transparency, exchanges and other features.”

“We do not want to throw the baby out with the bath water,” he added.

Karl Evers-Hillstrom has more here.