Angry JP Morgan shareholders seek to strip Jamie Dimon of chairmanship

US banking giant facing revolt by dissidents in wake of $6bn London Whale trading loss last year

guardian.co.uk, Dominic Rushe in New York,  Sunday 19 May 2013

Jamie Dimon, chairman, president and chief executive officer of JP Morgan
Chase. Photograph: Bloomberg/Getty Images

JP Morgan faces an angry shareholder revolt this week as investors attempt to strip boss Jamie Dimon of the chairmanship of the banking giant.

The revolt in the wake of last year's $6.2bn (£4bn) London Whale trading loss has been aggravated by a decision to cut off dissident shareholders' access to voting information ahead of the bank's annual meeting on Tuesday.

Last year a proposal to split Dimon's roles as chairman and chief executive gained 40% of the vote.

But that vote came before the magnitude of the incident was clear and ahead of regulatory and internal reports that have been highly critical of the failures of oversight at the bank.

A vote to strip Dimon of the chairman's job, while not binding, would be a heavy blow and there have been reports that he has considered resigning if he does not keep both titles.

Shareholders also intend to vote against the reelection of several other directors over their role in the trading fiasco.

Last year's vote was sponsored by the American Federation of State, County and Municipal Employees (AFSCME) pension fund.

This year support for the vote has grown and AFSCME has been joined by employee retirement plans for New York city and the state of Connecticut, as well as the UK's Hermes fund managers.

The split has the backing of major investors and the influential advisory firms Institutional Shareholder Services and Glass, Lewis & Company.

But Dimon has fans too. The T Rowe Price group, one of the firm's top 10 investors, has publicly backed Dimon ahead of the meeting, an unusual move for a large shareholder.

Prof Peter Henning of Wayne State University in Detroit said he expected the roles would not be split. He said the bank's financial returns had been exemplary, though "hubris" had clearly played a part in the London losses.

"There are good reasons why the roles should be split that have nothing to do with the Whale. This shouldn't be a referendum on Dimon," he said.

"The problem is that there is no guarantee that an independent chair would give any greater degree of oversight."

But Prof Charles Elson, corporate governance expert at the University of Delaware, said it was clear the roles should be split.

"The chairman of the board is there to monitor the CEO. A good CEO recognises that," he said. "Titles have meaning."

Last week the split's backers were denied access to a running tally of how the vote was going.

Broadridge, the firm that collated the votes, was asked to restrict access by the Securities Industry and Financial Markets Association, Wall Street's main lobby group. As the banks are its clients, Broadridge said it was contractually obliged to comply.

The split's supporters argue JP Morgan has been handed an unfair advantage in the final stages of the fight. Large index funds, for example, often wait until the last 48 hours to cast their vote.

The Council of Institutional Investors, whose members manage $3tn of assets in total, is now lobbying for the Securities and Exchange Commission to review the situation.

Shares of JP Morgan Chase have been broadly flat since December 2006, when Dimon assumed the chairmanship.

But the bank has significantly outperformed its peers and Dimon is credited with steering the bank through the credit crisis with aplomb.

Dimon initially dismissed the Whale losses as a "tempest in a teapot" but the losses rattled Washington and led Barack Obama to push for tighter regulation of Wall Street. Dimon's thinking on the situation seems to have evolved too.

In April he told shareholders the loss was the "stupidest and most embarrassing situation I have ever been part of".

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Ascension is Not Distant But Very Current and Underway – Mar 12, 2013 (Archangel Michael channeled by Linda Dillon)

“… SB: Well, that is very helpful. Could you, in the time that’s remaining, could you tell us a little bit about the continuing impact and success of containment? Perhaps as specific and detailed an account as you can give us?

AAM: You know when we place people in containment — and I use the word people because in this situation we are talking about very specific human beings, as you know. And I would not be averse to going down the list, if you wish. But I also wish to re-emphasize what we have said before, is that containment is something that is done very rarely and with great consideration. And the reason is it does not remove free will but it literally contains free will.

The beings that have been put in what you can think of, and we know that you are aware that there are various levels of containment, but think of the most epic, and they are basically in light boxes, and that light and love is penetrating them completely and fully, and they will not be released until they have been fully penetrated.

That is why that decision is not made casually. It is much more invasive than even you are imagining. So, it is something we do with great respect, yes, even for what you would think of as the darkest players. When we contain them, it is done with a great deal of respect.

Now, those who have been in key positions, leadership positions, are being kept in those containers of light not just until the darkness has fled or been cleansed, but the plan on our side is that they are being kept in that realm until they are extraordinary light beings. So, it is almost as if when they re-emerge you will barely recognize them.

Now, you say, “But, Lord, we are still witnessing some terrible atrocities on our planet.” And as the Prince of Peace and the Warrior of Peace, I am very aware of that. But I also suggest to you that some of those people that you see are almost like puppet shells, and the true person is in a light chamber.

Is it being successful? Yes. Now, there are some who have been released from their containment, and they have chosen to come forward to make… to fulfill their mission and purposes. And they were ready to do that. Yes, the Pope was a good example of that. Then there are… there are others, particularly within the financial world, who are returning to put things to rights.

Yes, Jamie Dimon is one of those beings.

SB: Is Queen Elizabeth in containment, Lord?

AAM: She is re-emerging.