May 21 - J.P. Morgan shareholders have rejected a proposal to split Jamie Dimon's dual roles as Chairman and CEO. Bobbi Rebell reports.
Jamie Dimon won a vote of confidence at JP Morgan Chase- and will retain both the Chairman and the CEO title of the company. Despite a bitter, months-long shareholder campaign- they voted by an overwhelming margin not to split the roles. Dimon had suggested he would leave the bank had the vote gone the other way. New York University Executive-in Residence and finance professor John Biggs- who is also a shareholder- says it's an all around win: SOUNDBITE: JOHN BIGGS, EXECUTIVE IN RESIDENCE AND ADJUST PROFESSOR OF FINANCE, NEW YORK UNIVERSITY (ENGLISH) SAYING: "First off, his record is unbelievably outstanding. And I don't think there is anybody that can add value to putting in, somehow confusing their role. Jamie Dimon is and incredibly hard-working, able, there is nobody even close to him in the financial world in terms of his ability to run that enterprise. And it just clutters it up to force somehow a chairman. I think it could probably only hurt the company, in a sense that it would just confuse who is in charge." S&P Capital IQ's Erik Oja thinks in general, banks should have the top jobs separated- just not in this case: SOUNDBITE: ERIK OJA, EQUITY ANALYST, S&P CAPITAL IQ (ENGLISH) SAYING: "We think that in this case it's unique for JP Morgan Chase because Mr. Dimon has done a really good job of running the bank since 2006 and secondly he doesn't have yet an appointed successor." Shares of JP Morgan Chase rose on the news. Oja raised his price target on the stock after the vote- and has it rated a buy. SOUNDBITE: ERIK OJA, EQUITY ANALYST, S&P CAPITAL IQ (ENGLISH) SAYING: "We think the stock is very attractive, particularly on price to earnings. Our target price of $58 is just over 10 times our forward EPS estimate, so we find it attractive. And we think that JP Morgan Chase is particularly strong with capital markets and we think that this quarter, which will be reported in mid-July, should have yet another good quarter of capital markets." Some investors say Dimon does need more oversight- after the bank posted more than $6 billion in losses last year- just not so much oversight that he would quit. JP Morgan does have a lead independent director- former ExxonMobil CEO Lee Raymond- who says that changes were coming on the board's risk committee- but did not elaborate. Despite this case, there has been a trend of splitting up the Chairman and CEO roles- many investors believe doing so keeps the CEO from having too much power over the board.