CEO Jamie Dimon says succession at JPMorgan is ‘well on the way’

New York – Mr Jamie Dimon has long joked that his retirement is five years away, no matter when he is asked. But not on May 20.

The chief executive officer of JPMorgan Chase told shareholders that the timetable is “not five years any more”, in response to a question about how long he planned to remain CEO.

The largest US bank is “well on the way” with its succession plans, he said during the firm’s investor day.

The question of who might steward the firm after Mr Dimon – who has held the top job since 2006 – has loomed over the industry. Earlier in 2024, about halfway through Mr Dimon’s five-year retention package, the 68-year-old CEO moved some of his top lieutenants into new senior roles, positioning them for more experience running the firm’s operations as he prepares potential successors.

The shuffle placed Ms Jenn Piepszak and Mr Troy Rohrbaugh atop an expanded commercial and investment bank, while Ms Marianne Lake, who had co-led its consumer and community bank alongside Ms Piepszak since 2021, got sole control of the segment, overseeing more of its business lines.

“It’s up to the board – it’s not up to me,” Mr Dimon said on May 20. “I have the energy that I have always had. That’s important. I think when I can’t put the jersey on and give it my fullest, I should leave, basically.”

Reviewing the days’ presentations from the leaders of JPMorgan’s various business lines, Mr Dimon tempered expectations from some analysts that the bank’s excess capital might support increased share buybacks.

“We are not going to buy back a lot of stock at these prices,” he said, adding that the bank will be more aggressive about repurchases when its stock price declines. The shares, which closed at a record high last week, fell after his comments and ended the day 4.5 per cent lower. They are still up 15 per cent in 2024.

Guidance boost

The bank raised its forecast for 2024’s net interest income (NII) to US$91 billion (S$122.6 billion), after predicting in April a US$90 billion haul, on less-than-expected interest rate cuts by the US Federal Reserve. Fewer customers are also shifting money to higher-yielding accounts than anticipated, according to the bank. In the first quarter, JPMorgan had posted US$23.1 billion of NII, breaking a streak of seven quarters of a record for the metric.

JPMorgan also offered details of potential fallout from a proposed plan to increase capital requirements for big banks. Fed officials have indicated that the proposals, known as Basel III Endgame, will be pared back. Bloomberg reported that agencies are working on a new version that could be finalised as soon as August.

Even with the potential for stricter capital requirements, JPMorgan expects to deliver a 17 per cent return on tangible common equity over the medium term, it said in its presentation.

Investors also heard from Ms Piepszak and Mr Rohrbaugh about progress in JPMorgan’s commercial and investment bank.

JPMorgan expects the emergence of a deal rebound to help bolster investment banking fees for the second quarter by a percentage in the “mid-teens” compared with a year earlier, Mr Rohrbaugh said.

For the markets business, the increase will probably be in the “mid-single digits”, he said. BLOOMBERG