Receiving Wide Coverage ...
Dimon's Big Day: The votes are in and it's Jamie Dimon by a landslide. After all the hoopla, the still chairman and CEO of JPMorgan Chase won the support of 68% of shareholders who rejected a proposal to strip him of the dual roles. For those keeping score, that means 32% voted in favor of separating the titles, a decrease from the 40% of shareholders who supported a similar proposal last year. "Vote Strengthens Dimon's Grip" at JPM, this Journal article proclaims. "The victory leaves Mr. Dimon, 57 years old, in a stronger position to grapple with his No. 1 priority: getting [the bank] through a thicket of regulatory problems threatening to hamstring the company for years." What led Dimon to such a decisive victory? Lobbying efforts? No doubt. Threats of resignation? Those could have helped, but Washington Post columnist Jena McGregor offers this explanation: "Despite big questions about Dimon's role in the 'London Whale' trading scandal and potential changes to the make-up of JPMorgan's board, the bank still posted record profits last year even after posting huge losses. And JPMorgan's shares have risen by more than 50% in the last 12 months." Still, it's not all sunshine and roses at JPM. While Dimon won his vote, three board members David Cote, James Crown and Ellen Futter, who was conspicuously absent from the meeting drew less than 60% support, leading many news outlets to predict a board shake-up may be on the way. "The vote created enough waves that JPMorgan might have to do something," the FT's Lex column argues. "Both JPMorgan's board and management are implicated in the Whale debacle (and presumably responsible for the bank's long-term success) but board members are more expendable." And the bank "is facing inquiries on multiple fronts," another Washington Post article notes, including, but not limited to a Federal Energy Regulatory Commission probe into its bidding practices and a lawsuit from California Attorney General Kamala Harris over alleged credit card abuses. As for Dimon himself, some news outlets note he still has a reputational issue to overcome. "The vote's outcome can't erase the months of harsh spotlight it focused on Dimon's power, his board's composition and governance style, and the London Whale trading losses that, a year later, continue to nip at Dimon's once-pristine reputation as the industry's best CEO," American Banker reports. But others see the vote as a sign that JPM's exec is made of Teflon. "No matter what happens, it seems that as long as Jamie Dimon is making money for JPMorgan, he can get away with basically anything," New York magazine columnist Kevin Roose concludes. And others were quick to label the proposal's failure an overall defeat for corporate governance. "The episode perfectly illustrates the common sense behind separating the two roles," write Agnes T. Crane and Antony Currie at the Times.
Lloyds, RBS Plans: Royal Bank of Scotland and Lloyds Banking Group said they will "not have to raise additional capital in the financial markets" to plug a combined £25 billion ($38 billion) gap identified by U.K. regulators back in March, says Dealbook. Instead, RBS plans "to cut the size of its investment bank, sell assets and float part of its U.S. Citizens Financial Group," the Journal reports. According to a statement printed in the FT, Lloyds will meet requirements "through its strongly capital generative core business, continued progress in executing the group's customer focused strategy and further capital accretive non-core asset disposals."
Wall Street Journal
The single-loan bond market is growing in popularity as investors continue to search for new ways to pull in income. "A tweak in how some commercial-mortgage deals are evaluated" by Standard & Poor's is also contributing to the rise, underscoring "the power that rating firms can exercise."
The Lex column calls the increase of C&I loans in the U.S. both good and bad. A spike in business borrowing can bolster the economy. However, "it is hard to know which banks, if any, are losing track of common sense," the op-ed notes. "At best, some may be making unprofitable loans, which will not do much for their margins. At worst, when rates rise, defaults will, too."
New York Times
Having Judd Gregg and Ken Bentsen at the helm may be good for the Securities Industry and Financial Markets Association. "The previous leadership under Tim Ryan, a former banker scored some successes battling new rules," columnist Daniel Indiviglio writes. "But using former politicians to sweet-talk regulators and try to improve the image Main Street has of the industry could be a better strategy."
Former Goldman Sachs director Rajat Gupta, who was found guilty in an insider trading case, is appealing his conviction in hopes of receiving a new trial.