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VOL. 37 | NO. 20 | Friday, May 17, 2013
JPMorgan's Dimon survives shareholder referendum
TAMPA, Fla. (AP) — Shareholders at JPMorgan Chase voted to let Jamie Dimon, the chairman and CEO, keep both his jobs.
At the bank's annual meeting, just 32 percent of shareholders voted for a non-binding measure that would have advised the bank to split the roles. That's less than the 40 percent vote that a similar proposal received last year.
Shareholder groups lobbying for the split gained momentum from a surprise $6 billion trading loss last year, which tarnished the reputation of both JPMorgan Chase & Co. and Dimon. The bank and Dimon had argued that letting Dimon keep both jobs was the most effective form of leadership.
Dimon emerged from the financial crisis heading one of the strongest banks in the country. But his reputation has been hurt over the past year over fallout from the so-called "London whale" trading loss, nicknamed for its size and the location of the trader who made the outsized bets on complex debt securities that went wrong.
In the previous six annual meetings where Dimon has been both chairman and CEO, shareholders have been asked about separating the roles four times. Last year marked the highest level of votes in favor of the idea. In 2007 and 2008, only about 15 percent of shareholders voted for similar measures.
Investors welcomed the news that the measure had been defeated. JPMorgan's stock was up 2 percent, or $1.09, at $53.38 in midday trading. The stock is at its highest level in 12 years.
The shareholder meeting, held at company offices on the outskirts of Tampa, Fla., had fewer theatrics than last year's meeting, which was held just days after the trading loss was disclosed. Last year, two or three dozen protesters showed up. On Tuesday, one woman with a cardboard sign was spotted, but only briefly.
The bank is facing regulatory investigations and lawsuits, not only over the trading loss but other practices including foreclosures and alleged rigging of power prices. Michael Garland from the New York City Comptroller's Office, which supports splitting the roles, said he appreciated that JPMorgan led its peers by certain financial measures. But, he added, "it also leads its peers in regulatory investigations."
Lisa Lindsley from the union group AFSCME, which filed the proposal asking to split the jobs, said the bank needed "a new tone at the top." She said the proposal was never intended as a referendum against Dimon or a "personality contest," but as a measure for the best risk management.