Kaltbaum is also buying Varian Medical Systems (nyse: VAR - news - people ), a company that makes X-ray tubes and systems for treating cancer with radiation.
Its biggest customers early on were central and commercial banks, which began using RiskMetrics' models to meet VAR-based capital adequacy requirements.
When the mark-to-market loss on the derivatives was disclosed, JP Morgan restated VaR to be roughly double the previous claim, using a different, older model.
Berman's firm was thriving spitting out VAR calculations, but he was convinced that such number-crunching was only a sliver of what was required to gauge an institution's overall riskiness.