JP Morgan chief executive Jamie Dimon has announced a shake-up of the bank as he warned of further “regulatory issues” in the near future. In a memo to employees, Mr Dimon wrote he is devoting “unprecedented” resources to improve its businesses and the legal training of staff.“Never before have we focused so much time, effort, brainpower, technological power and money on a single, enterprise-wide objective,” the boss of America’s largest bank wrote. “Make no mistake – we are going to get this right.”
It comes as JP Morgan faces a bill of at least $750m (£471m) to settle US and UK investigations into the $6bn “London Whale” trading loss. That agreement could be announced as soon as today. The Wall Street giant is also the subject of a US Department of Justice probe into the alleged manipulation of energy markets.On Tuesday, Mr Dimon warned staff that there would be further legal problems to come. “Unfortunately, we are all well aware of the news around the legal and regulatory issues facing our company, and in the coming weeks and months we need to be braced for more to come,” he wrote.
JP Morgan has hired 3,000 extra staff to its control groups, which include the bank’s risk, compliance and legal operations, and increased spending in this area to $1bn. Around 500 workers have been assigned to complete the Federal Reserve’s “stress tests”.Businesses not considered “core” are also being earmarked for sale as part of the shake-up. The lender is “conducting an in-depth review of our foreign correspondent banking business”, which has come under fire from US regulators for its anti-money-laundering procedures.
“We are also proactively trying to decrease the number of vendors we have, which reduces complexity in our business and creates more jobs internally,” the memo read.
Source : telegraph.co.uk/finance/newsbysector/banksandfinance/10316080/JP-Morgan-chief-announces-shake-up-and-warns-of-further-legal-issues.html