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Wednesday, January 16, 2013 1:13:44 PM
J.P. Morgan Chase JPM +0.26% & Co. hit Chief Executive James Dimon with a 50% pay cut for 2012 because of the "London Whale" trading debacle that cost the nation's largest bank at least $6.2 billion in losses, and found Mr. Dimon bore "ultimate responsibility" for the failure.
The move came as the New York company posted record 2012 net income of $21.3 billion, on the back of robust lending and deposit growth and strong results across segments of the bank. For the fourth quarter, the largest U.S. bank by assets reported net income of $5.69 billion, up from $3.73 billion a year ago.
Mr. Dimon's reduced bonus is the latest fallout from an episode that has shaken the bank and its top executives over the last eight months. The trading losses in the Chief Investment Office, which invests the bank's excess cash, tainted J.P. Morgan's reputation as one of the industry's best risk managers. Several traders and executives involved in the trades were replaced, and some incentive pay was clawed back.
The bank also released a pair of internal investigation reports faulting bank management for the handling of the trade, tied to synthetic corporate credit derivatives, and its aftermath last spring, two days after two federal regulators slapped the bank with enforcement orders citing lax risk management at the company.
http://online.wsj.com/article/SB10001424127887323968304578245352454016848.html
The move came as the New York company posted record 2012 net income of $21.3 billion, on the back of robust lending and deposit growth and strong results across segments of the bank. For the fourth quarter, the largest U.S. bank by assets reported net income of $5.69 billion, up from $3.73 billion a year ago.
Mr. Dimon's reduced bonus is the latest fallout from an episode that has shaken the bank and its top executives over the last eight months. The trading losses in the Chief Investment Office, which invests the bank's excess cash, tainted J.P. Morgan's reputation as one of the industry's best risk managers. Several traders and executives involved in the trades were replaced, and some incentive pay was clawed back.
The bank also released a pair of internal investigation reports faulting bank management for the handling of the trade, tied to synthetic corporate credit derivatives, and its aftermath last spring, two days after two federal regulators slapped the bank with enforcement orders citing lax risk management at the company.
http://online.wsj.com/article/SB10001424127887323968304578245352454016848.html
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