Jamie Dimon, the outspoken chief executive of JPMorgan Chase, sat down on Tuesday for what banking analysts called a “fire-side chat†during the Barclays 2012 Global Financial Services Conference.
Known for his hands-on management style and confident swagger, Mr. Dimon has been navigating the fallout from a rare misstep in his career after JPMorgan announced a multi-billion loss on a complex credit bet at its chief investment office unit.
During a question-and-answer session with Jason Goldberg, a Barclays analyst, Mr. Dimon responded to questions ranging from his stance on the mounting turmoil in Europe to regulatory changes, in particular the Volcker Rule, which restricts banks from trading with their own money.
Mr. Dimon has long been a vocal opposition of some of the regulation being hammered out in Washington although some lawmakers in Washington have seized on the trading losses to push their case for a stronger oversight of the banks.
Mr. Goldberg started by asking Mr. Dimon about the rationale behind shaking up the upper echelons of JPMorgan's executive suite in July.
“It had nothing to do with the chief investment office,†Mr. Dimon said.
He said that “there is nothing mystical, folks†because the moves enabled greater cross-selling. “Cross-selling is a big deal and we do an exceptionally good job. If you reimagine the business from the bottom up, it's a consumer business.â€
Part of his management decisions, which elevated a stable of younger executives, was part of trying to “make sure we have a generation trained for other big jobs in the company,†he said.
Tackling the issue of whether the big banks should be broken up, Mr. Goldberg asked Mr. Dimon about recent calls to break up the major banks. Sanford I. Weill, the former chief executive of Citigroup and once Mr. Dimon's boss, rocked Wall Street when he suggested in July that the big banks should be broken up.
“There are huge benefits to size,†Mr. Dimon said. He noted that JPMorgan's size allowed it to be “a port in the storm†during the market turmoil of 2008. “Big banks have a function in society.â€
The United States, he added, has the “best, widest deepest and most transparent capital markets in the world.†Cautioning against needless reform, Mr. Dimon said, “Let's make sure we keep that before we do a bunch of stupid stuff that destroys that.“
Mr. Goldberg asked whether the bank would buy back stock.
“The buybacks could start sometime in the first quarter of next year,†the bank chieftain said. “I would buy back our stock all day.†Warning that capital requirements set by the Fed are too high, he said, “Banks by 2014 will have their capital cups running over.â€
When asked about Europe, the JPMorgan chief said that JPMorgan would survive even the worst-case scenario in Europe.
On the impact of the Volcker Rule, Mr. Dimon emphasized that the bank was going to “wait and see.†He said that it's important that the rules don't undercut American banks' ability to compete abroad by applying solely to United States banks.
“If the American law applies overseas to us but not to them, we can lose all the business,†he said.
Mr. Goldberg asked about the results of the independent review of the chief investment office, the unit at the center of the botched trade. The review is currently under way.
Mr. Dimon largely reiterated what he has said before, reminding the audience that the risk has been reduced and that the bank still earned $5 billion in the second quarter.
