In late September, four hours before the Justice Department planned to hold a news conference to announce civil charges against JPMorgan Chase over its sale of troubled mortgage securities, Jamie Dimon, the bank’s chief executive, personally called one of Attorney General Eric H. Holder Jr.’s top lieutenants to reopen settlement talks, Ben Protess and Jessica Silver-Greenberg report in DealBook. The call scuttled the news conference and set in motion weeks of negotiations that have led to a tentative $13 billion deal, people briefed on the talks said.
“An account of the negotiations, based on interviews with these people, pulls back a curtain on the private wrangling to illuminate how the bank and the government managed to negotiate what would be a record deal,†DealBook writes. “It also sheds new light on the hands-on role that Mr. Dimon and Mr. Holder played in the talks. And it highlights how Mr. Dimon has so far maintained the support of the bank’s board when other Wall Street chiefs were derailed by the financial crisis.â€
The deal â€" which could still fall apart over questions like how much wrongdoing JPMorgan would admit â€" would be a record for the Justice Department, representing the largest amount a single corporation has ever paid to settle. It might also embolden the Justice Department and set a precedent for the agency’s investigations of Wall Street. For JPMorgan, once known as Washington’s favorite bank, the deal would cap a stunning reversal of fortune.
Mr. Dimon is inextricably linked to the settlement, assuming the role of chief negotiator with the government. Despite the mounting legal problems, Mr. Dimon appears solidly ensconced in his job atop JPMorgan, Ms. Silver-Greenberg and Mr. Protess report in DealBook. On Sunday, several JPMorgan executives reiterated that the bank’s board remains firmly behind Mr. Dimon, who is both chairman and chief executive. “The board has not flinched in their support for him,†said a person close to JPMorgan.
While such confidence might seem bewildering, JPMorgan’s legal travails have not truly threatened the bank financially â€" a crucial metric in the eyes of the board and top executives. Even as its legal troubles have worsened, the bank’s share price has gained roughly 23 percent so far this year. “By the logic of Wall Street, putting the bank’s legal problems aside is seen as a victory for Mr. Dimon, even though those problems arose on his watch,†DealBook writes.
WEALTH FUND WARNS ABOUT HIGH-SPEED TRADING  | Norway’s sovereign wealth fund, one of the largest single investors in the world, is preparing to speak out on a sensitive issue: the increasing computerization of the stock markets and the costs that has imposed on big long-term investors, Nathaniel Popper reports in DealBook. While Wall Street firms and exchanges have long said that the speed and competition have made trading cheaper for everyone, the top trader at the Norwegian fund, Oyvind G. Schanke, said not enough was heard from long-term investors like the fund, which holds $110 billion in United States stocks.
“The U.S. market has gone through a lot of changes and has become quite complicated â€" and this complexity of the market creates a lot of challenges for a large investor like us,†said Mr. Schanke, the global head of stock trading for the fund, Norges Bank Investment Management. Compared with five years ago, he said, “We don’t see any evidence that it is cheaper for us to trade.â€
ON THE AGENDA  | Data on existing home sales in September is released at 10 a.m. McDonald’s reports earnings before the market opens, while Netflix announces results this evening. Stephen M. Case, an AOL co-founder, is on Bloomberg TV at 8 a.m.
DOING TRIAGE ON EUROPE’S BANKS  | “All Ignazio Angeloni has to do is figure out Europe’s banking system,†Danny Hakim writes in The New York Times.
“Mr. Angeloni, 59, heads the European Central Bank’s financial stability division, giving him a lead role in a task about to begin: examining the books of the 130 or so largest banks in the 17 members of the European Union who use the euro. It will be financial triage aimed at determining which banks are sound and which are not. Good luck with that.â€
Office Supply Merger Expected to Receive F.T.C. Approval  | The planned merger between Office Depot and Office Max “is on track to receive antitrust clearance from the Federal Trade Commission after a lengthy government review, according to people familiar with the matter,†The Wall Street Journal reports. WALL STREET JOURNAL
AT&T in $4.85 Billion Tower Deal With Crown Castle  | Under the terms of the deal, Crown Castle will buy the rights to run cellphone 9,100 towers for an average lease of 28 years, with the right to acquire the towers outright from AT&T in the future for about $4.2 billion. Crown Castle will also buy about 600 towers outright. DealBook »
Douglas of Germany in Talks to Buy French Perfume Chain  | The German retailer Douglas said it was in exclusive talks to buy Nocibe of France, “part of plans by Douglas to expand its perfumeries business,†Reuters writes. REUTERS
Chinese Billionaire May Privatize Hong Kong Developer  | Zhang Zhirong, a Chinese industrialist who was involved in an insider trading case in the United States last year, may make a takeover bid for Glorious Property Holdings, a Hong Kong developer in which he owns a majority stake. DealBook »
Regulator Said to Seek $6 Billion From Bank of America  | The Federal Housing Finance Agency, negotiating a deal over mortgages, is seeking a penalty of more than $6 billion from Bank of America, The Financial Times reports, citing unidentified people familiar with the matter. FINANCIAL TIMES
Morgan Stanley, Under Gorman, Returns to Basics and Profit  | The Wall Street bank’s positive results capped off a week of disappointing bank earnings and lifted Morgan Stanley’s share price 2.6 percent higher by the end of trading. DealBook » | Earnings and China Data Push Shares Higher
Interview With a Nobel Winner in Economics  | Robert J. Shiller, an economist at Yale, who learned last week that he had won the Nobel along with two others, tells The New York Times: “I’m just naturally skeptical of people who look impressive.†NEW YORK TIMES
A Former Fed Chairman Reflects on Bubbles  | Alan Greenspan spends part of his new book, “The Map and the Territory,†discussing the irrational behavior of market participants. But the “rest of this book is instead devoted to a discursive tour of recent economic history, punctuated by conservative policy prescriptions,†Binyamin Appelbaum writes in The New York Times. NEW YORK TIMES
If You Feel Compelled to Do Something, Don’t  | Taking the time to reflect gives us the opportunity to make a more considered choice about how to act, Tony Schwartz writes in the Life@Work column. DealBook »
British Firm Said to Consider Bid for Unit of G4S  | Charterhouse Capital Partners, a British private equity firm, is considering making a roughly $1.6 billion offer for the cash solutions business of G4S, the world’s biggest provider of security services, Bloomberg News reports, citing three unidentified people familiar with the matter. BLOOMBERG NEWS
K.K.R. to Buy European Debt Investment Firm  | K.K.R. is wagering that new global banking rules will allow alternative lenders to step up and provide financing to companies. DealBook »
Pension Funds Pay Millions and Lag Behind the Market  | “Fans of alternative investments argue that they can generate higher returns. But the increased risks, higher fees and lack of transparency associated with such investments make them problematic,†Gretchen Morgenson writes in the Fair Game column in The New York Times. NEW YORK TIMES
Hutchison Whampoa Said to Consider I.P.O. of Unit  | The Hong Kong conglomerate Hutchison Whampoa “is considering a plan for an initial public offering of stock of its A.S. Watson & Company unit, a retailer with 11,093 stores,†The Wall Street Journal reports. WALL STREET JOURNAL
Putting a Price on Twitter  | Twitter is not profitable, while Facebook was when it went public. But Twitter’s revenue is growing faster, Robert Cyran and Richard Beales of Reuters Breakingviews write. REUTERS BREAKINGVIEWS
Tech Wealth Meets the News Business  | “Silicon Valley and its various power brokers â€" some who had roles in putting the news business in harm’s way to begin with â€" are suddenly investing significant sums of money in preserving news capacity and quality,†David Carr writes in the Media Equation column in The New York Times. NEW YORK TIMES
Silicon Valley in the Kitchen  | “I’m using the same kinds of thinking that I used in technology start-ups while I build this food business, too,†Megan Miller, a co-founder of Chirp Farms, a start-up that makes food from insects, tells Nick Bilton in the Disruptions column on the Bits blog. NEW YORK TIMES BITS
Case Against Madoff Sons Is Dismissed in London  | A British judge has concluded that neither Andrew nor Mark Madoff had any knowledge of their father’s Ponzi scheme. He also had some harsh words for the trustee seeking to recover money for victims of the fraud. DealBook »
Israel Names Head of Central Bank  | Karnit Flug, who had been acting chief of the Bank of Israel since her predecessor stepped down in June, would be the first woman to head the central bank, Reuters reports. REUTERS
Adviser in ‘Big Short’ Faces S.E.C. Action  | The Securities and Exchange Commission accused Wing F. Chau, an investment adviser who appears in the book “The Big Short†by Michael Lewis, and his New Jersey firm of misleading investors in a collateralized debt obligation and breaching their fiduciary duties. DealBook »
Lobbying the European Union  | “As the European Union has emerged as a regulatory superpower affecting 28 countries that collectively form the world’s largest economy, its policies have become ever more important to corporations operating across borders,†The New York Times writes. “In turn, the influence business in Brussels has become ever larger and more competitive, rivaled only by Washington’s.†NEW YORK TIMES
Drunken Driving Arrest for Former Refco Finance Officer  | Robert C. Trosten, the former financial chief, pleaded guilty to fraud in the Refco case and has been cooperating with prosecutors. Cooperation agreements typically require that defendants not commit any further crimes. DealBook »
HSBC to Appeal $2.46 Billion Judgment  | The HSBC Group said on Friday that it would appeal a $2.46 billion judgment in a long-running securities fraud lawsuit in the United States related to a consumer loan and credit card business that the British bank acquired more than a decade ago. DealBook »
