JP Morgan is considering making an improved offer for troubled investment bank Bear Stearns in order to meet the demands of shareholders in the collapsed lender.

The New York Times reports that JP Morgan is considering quintupling its offer for the firm to $10 (£5) per Bear Share. Owners of shares in the troubled firm were angry that no other bids were considered which would help them earn more from the sale of the company.

Last week, JP Morgan and the US federal reserve negotiated to rescue the 85-year-old bank as mortgage losses and the loss of key clients resulted in severe liquidity problems for Bear Stearns.

Negotiations between the three parties resulted in a deal under which JP Morgan would pay $2 (£1) per share for Bear Stearns – a price significantly lower than the $30 (£15) it was trading at the day before the announcement of the deal.

Under the agreement, the US federal reserve has also agreed to take up $30 billion of Bear’s assets, which include mortgage-based assets that have been at the centre of the turmoil in financial markets.

The New York Times reports that the US central bank was unwilling to consider a higher per share offer for Bear Stearns shareholders as it would seem as though it was bailing out the firm for risky lending practices.

The collapse of Bear Stearns resulted in stock exchanges falling around the world and raised questions about the financial stability of large financial institutions.