As CEO, president and chairman of JPMorgan Chase & Co., the $2 trillion multinational banking and financial services holding company, Jamie Dimon is arguably the world's most prominent banker.
Dimon, 57, is in Oklahoma City this week, visiting with Chase employees, clients and local policymakers. He also wanted to take note of the $1.2 million that his company, employees and customers contributed to Oklahoma's relief efforts after the deadly spring tornadoes.
Dimon's road trip also took him to two other Midwest states, where he planned to spread a message of optimism.
“I get to travel the world; I get to see everything and when I come back to the United States, it always reminds me how good we have it,” he said. “I wish the message got out more: Best military; best universities, best businesses — being large or small; best technology from factory floor to Steve Jobs; widest, deepest, most transparent markets the world has ever seen. And that's not Wall Street, but investors, individuals, corporations, private equity, venture capital and public and private capital markets; a great rule of law, a great work ethic, very low corruption. This country has it all.”
Chase is the largest bank in America, and the fourth-largest deposit-holder in Oklahoma. Chase was one of the nation's few huge financial institutions that weathered the economic crisis without tottering or crumbling, and Dimon earned plaudits for his leadership.
However, Chase and Dimon last year were forced to disclose an embarrassing $6 billion loss by an overseas derivatives trader. In response, the company cut Dimon's annual pay in half, from $23 million to $11.5 million.
Earlier this year, Chase agreed to pay $410 million to federal regulators after the firm's electricity traders used a variety of deceptive tactics to gouge ratepayers.
The increasing concentration of assets among the nation's largest banks in the wake of the economic crisis has raised alarm among some, including native Oklahoman Elizabeth Warren, the U.S. senator representing Massachusetts. Warren, backed by Sen. John McCain among others, has called for a 21st-century version of the Glass-Steagall Act, which would force banks to spin off their investment banking operations.
Dimon, during a brief telephone interview with The Oklahoman, weighed in on such regulation and other matters. This is an edited version of that conversation.
Q: I wanted to ask you your feelings about native Oklahoman Elizabeth Warren and her push for a new Glass-Steagall law?
A: I have a very good relationship with Elizabeth. It doesn't mean we have to agree on everything.
Our issues have nothing to do with Glass-Steagall in America. And a lot of the rest of the world didn't have Glass-Steagall and didn't have problems, like Canada, Australia, Japan, etc. So obviously we all have a huge vested interest in having a really strong financial system and a strong regulatory system. How you do it, you can have long debates on the right way to do it — there's not necessarily just one right way to do it. Maybe several. But there are so many things being passed. At one point, we've got to take a deep breath and get one of them done. Finish it. Dodd-Frank accomplishes most of what people want to accomplish.
Q: Some argue that your bank is simply too big, and shouldn't be engaging in some kinds of investment with implicit and explicit support of government protections.
A: It's a fiction when people come up with a number that banks are subsidized. They are not. If you look at the analytics that people come up with, we borrow money in the marketplace every day. We pay the same that a single-A industrial company would pay. What kind of subsidy is that? That means the real money buyers are demanding a premium — a rich premium — to do our debt. If we had the implicit support of the government, we would be trading like Fannie Mae debt, which has the implicit support and they trade at 10 to 20 basis points over Treasuries.