Receiving Wide Coverage ...
Another Foreclosure Error: First, the OCC and Federal Reserve oversaw a foreclosure review process that benefited independent consultants more than actual homeowners. Next, the regulators replaced this costly foreclosure review with a settlement that gave only $300 to most affected borrowers. Then some of the checks mailed to borrowers bounced. Now regulators have disclosed that nearly 100,000 borrowers received checks for less than what they were owed, due to a clerical error by Rust Consulting, the firm hired to distribute the payments. (The New York Times article about the error begins: "At least these checks cleared.") Rust has been ordered by the Fed to fix its mistake by sending supplemental checks to affected borrowers. These checks are expected to go out as soon as May 17. Meanwhile, Jon Stewart may want to issue an update to his very recent Daily Show segment (with a cameo from American Banker Editor in Chief Neil Weinberg) on just how bungled this review/settlement has been. Wall Street Journal, Washington Post
More on Dimon's Dual Role: A Journal article suggests splitting the role of CEO and chairman doesn't always benefit companies, ahead of a May 21 vote on a shareholder proposal that could take away JPMorgan Chase chief Jamie Dimon's chairman title. Per the article, a study from Indiana University's Kelley School of Business found "if the roles are separated in a year when a company books a positive 30% return, the next year the company would post a negative return of 42% … That reasoning could argue against a split at JPMorgan, where shares have risen about 20% in the past year." Meanwhile, this Forbes op-ed outlines four reasons JPM needs Dimon as chairman and CEO right now. (Among them, "If Dimon leaves there are not many experienced players on the JPM bench of executives that seem to be clear successors.") But it's not all positive press for the JPM chairman and CEO as this Dealbook article outlines the reasons why Calpers, a California public pension plan and JPM investor, plans to vote in favor of splitting up the titles. "There's a fundamental conflict in combining the roles," a spokeswoman for the pension plan tells the website. "It's all thrown into stark relief when you're dealing with a company that's too big to fail." In other JPM corporate governance news, the Journal also reports the bank "is looking for more directors who can serve on the board's risk committee," though it's unclear if these directors would replace any existing ones. Recall, two shareholder advisory firms suggested voting against three directors on the bank board's risk policy committee earlier this week.
