JPMorgan Chase will likely slash the bonus of its CEO Jamie Dimon over the bank's major trading loss earlier this year, according to a Wall Street Journal report.
JPMorgan’s board will weigh releasing an internal report this week that pins some of the fault for the bank’s “London Whale” trading loss earlier this year -- which cost the company more than $6.2 billion -- on Dimon, Bloomberg reports, citing “two people with direct knowledge of the matter.” What’s more, the board will likely cut Dimon’s bonus, the WSJ reports, citing “people close to the company.”
The report, which board members will decide whether to make public, also takes ex-CFO Doug Braunstein and former Chief Investment Officer Ina Drew to task for their role in the loss, according to Bloomberg. Drew retired earlier this year in the wake of the scandal. Some British regulators are urging Dimon to keep the report private until they’ve reviewed it, according to the WSJ, but Dimon reportedly would rather take a more transparent approach.
If Dimon’s bonus suffers from the London Whale loss, it could put him at risk of losing the title of best-paid banker. Dimon took home $23.1 million in total pay in 2011; that’s more than Bank of America CEO Brian Moynihan’s $7 million and former Citigroup CEO Vikram Pandit’s $14.9 million, according to a separate Bloomberg report.
The reports that Dimon will be faced to shoulder some of the blame for the loss come after the CEO criticized some of his executives for the way they acted in the wake of the news. “Instead of helping, they were running around with their head chopped off. 'What does this mean for me personally? How's my reputation?” Dimon told the audience at a conference earlier this month.
The loss came from a complicated bet on credit derivatives made by Bruno Iskil, a trader known at the time as the “London Whale” who was working out of the London unit of the chief investment office. Iskil left JPMorgan in July and the bank took back about two years’ worth of his pay.