Stripping Dimon of Chairman Title Is ‘Nuts,’ Langone Says
Kenneth Langone, the billionaire co-founder of Home Depot Inc. (HD), said Jamie Dimon is one of the best U.S. business leaders and should keep his dual role as JPMorgan Chase & Co. (JPM)’s chairman and chief executive officer.
“He should be both,” Langone, 77, said in an interview on Bloomberg Television, calling it “nuts” to consider splitting Dimon’s titles. “He’s probably the finest CEO across any business in America.”
Dimon, 57, has come under increasing pressure to give up the chairman’s job since New York-based JPMorgan lost more than $6.2 billion on a derivatives bet last year. The board of directors has stood by him, urging investors to vote against a shareholder proposal to name a separate chairman at next month’s annual meeting.
“I love Jamie, I know him well personally, I love him,” said Langone. The so-called London Whale episode and the bank’s subsequent record annual profit proved that JPMorgan was a great bank, he said. “Go to Europe where they split them up. Where are the results? Where are the economic results?”
Directors of JPMorgan have said that Dimon’s dual role remains the “most effective leadership model” for the company. A similar proposal last year failed with 40 percent of the vote.
“Who’s the best-run bank in America today?” Langone said. “Certainly you’d have to say JPMorgan and Wells Fargo. (WFC)”
JPMorgan is the biggest U.S. bank by assets, and San Francisco-based Wells Fargo & Co. is the nation’s largest home lender. Langone said he owns JPMorgan warrants.
The bank’s trading loss was tied to credit derivatives amassed by Bruno Iksil, a U.K. trader in the chief investment office who was dubbed the London Whale because his positions were so big.
A CEO who doubles as chairman doesn’t need to hold himself accountable because the rest of the board’s directors will do that, Langone said.
“I’ve got nine people in a room or seven or five or whatever the number is,” Langone said. “They’ll fire me if I do the wrong thing.” Directors who don’t have the courage to do that shouldn’t be on the board, he said.
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