J.P. Morgan, Goldman Investors Playing with Fire
With annual meeting season quickly approaching, top bankers are preparing for their yearly rite of passage: protecting themselves from angry investors who are calling for their jobs.
This year, two of Wall Street’s most successful chief executives – Goldman Sachs’ Lloyd Blankfein and J.P. Morgan’s Jamie Dimon – are fighting to keep their second job as chairman of their respective banks. If activist investors get their way, and successfully split the roles of CEO and chairman, they could be looking at entirely different management teams.
Charles Peabody, an analyst at Portales Partners, believes that if Dimon is stripped of his chairman role, he would likely leave the bank within the year, according to Bloomberg. J.P. Morgan’s top man has suggested as much.
Dimon has been at the center of “London Whale” controversy, but has sidestepped major damage by leading the bank through the recession relatively unscathed, at least financially. The board has made it clear that it wants Dimon to hold both reins, but investor fervor over the trading loss continues to percolate.
Goldman CEO Lloyd Blankfein is facing a similar challenge. While helping drive the bank through an impressive last six months, Blankfein is being questioned by investors who believe an outsider should fill the chairman role.
Blankfein has yet to comment on whether he would follow a similar trail as Dimon if his role was split, but it’s certainly conceivable. Blankfein is 58-years-old, and, perhaps more importantly, has been on the job for more than six years. Losing power is an easy way for a very rich man to hang them up.
Investors better look out for what they’re wishing for.
Altius Headcount on the Rise (eFinancialCareers)
Bucking the trend among smaller private equity houses, Altius Associates has increased its headcount by around 20% over the past 12 months and is still hiring.
Lightning-Fast Withdrawals (WSJ)
Jeffrey Vinik's hedge fund is hemorrhaging client money. Vinik Asset Management, which moved from Boston to Tampa in 2012 to keep the firm’s founder closer to his favorite investment, the Tampa Bay Lightning, has watched $1.5 billion in capital walk out the door.
The Senate has confirmed former prosecutor and Wall Street defender Mary Jo White as the new head of the Securities and Exchange Commission.
Roughly 80% of companies that have played in the soon-to-be-regulated derivatives market have yet to complete the paperwork necessary to trade after May 1. If the trend continues, dealers that specialize in swaps trading are likely to take a hit.
More than Double (Financial News)
One reason U.S. investment banks are clobbering their European rivals? The average equity capital markets fee disparity is large…and widening.
Wall Street’s Playground (Business Insider)
Wall Streeters love playing golf. Here are the 12 courses that hold their heart.
Finance Team Dismantled (Financial News)
Lloyds Banking Group has cut eight staffers from its mid-market leveraged finance team, including managing directors Neale Broadhead and Mark Bickford. Likely another effort to trim its capital position.
Career Resurrection (eFinancialCareers)
Famed rogue futures trader Nick Leeson, who was sentenced to 6 ½ years for essentially bankrupting Britain's oldest merchant bank, Barings, has found full-time employment, although he may be taking a pay cut. He’s been hired by Belfast-based debt-restructuring firm GDP Partnership.
Buzz Around the Office
A Loughborough, England woman believes her house is haunted, and has asked her housing association for new accommodations. The spirit’s name is named Nigel, he’s in his 30s and has learning disabilities.
List of the Day: Mad Men
The TV show Mad Men can teach us a lot of things, mostly how not to act in the office. Here are three lessons born from the show.
- Beware of the office romance.
- People – not technology – are the producers.
- Managing your personal brand is critical.