Fitch lowered JPMorgan's short-term and long-term debt -- reducing the long-term grade to A+ from AA-, CNN Money reported. Fitch placed the bank on ratings watch negative.
In a statement announcing the downgrade, Fitch said it considered the $2 billion loss as "manageable" but said "the magnitude of the loss and ongoing nature of these positions implies a lack of liquidity."
"It also raises questions regarding JPM's risk appetite, risk management framework, practices and oversight," Fitch said.
Shares of JPMorgan fell 9 percent in New York Friday, and the falloff persisted after hours, CNN said.
U.S. and British regulators said they have been discussing the losses at JPMorgan Chase for almost a month.
The New York Times reported Friday that inquiries, although none of them are formal yet, have centered on a derivatives trader based in London, who has been tagged with the nicknames "The London Whale" and "Voldemort." The trader, Bruno Michel Iksil, had built up derivative positions valued at $100 billion, The Wall Street Journal reported.
The bank said Thursday it had lost $2 billion in trades at its Chief Investment Office, a risk assessment branch where Iksil works.
Iksil did not return calls requesting a comment. He still works at the bank, the Journal said.
Chief Executive Officer James Dimon said Thursday the losses were "self-inflicted and this is not how we want to run a business."
By Friday pundits and politicians were calling the losses validation of the so-called Volcker Rule, named after former U.S. Federal Reserve Chairman Paul Volcker. The rule is meant to limit or ban proprietary lending by commercial banks -- and prohibit them from owning hedge funds, which are storefronts for investment risks.
That rule, part of the Dodd-Frank financial overhaul bill, is set to go into effect July 21 but regulators are still working on details that could delay its implementation, the Journal reported.
Notable deaths of 2014 [PHOTOS]