March 28, 2023

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JPMorgan investors deliver rare reprimand to Dimon, object to $53 million bounty

JPMorgan investors deliver rare reprimand to Dimon, object to $53 million bounty

Chairman and CEO of JP Morgan Chase & Co. Jamie Dimon testifies before the House Financial Services Committee on accountability for mega-banks at Rayburn House office building on Capitol Hill in Washington, D.C. on April 10, 2019.

Mandel Ngan | AFP | Getty Images

c. B. Morgan Chase Executive Director Jimmy Damon He received a rare reprimand on Tuesday with shareholders rejecting the massive retention bonus announced by the bank last year.

Just 31% of investors attending the New York-based bank’s annual shareholder meeting backed a $52.6 million prize that was part of Damon’s 2021 compensation package.

The reward is in the form of 1.5 million and options which Dimon could exercise in 2026, is designed to keep the CEO and Chairman of the Board at the helm of JPMorgan for another five years. Its estimated value, pegged last year, fluctuates and depends on the rise in the bank’s share price, according to bank spokesman Joe Evangelisti.

“The special award was extremely rare – the first in over a decade for Mr. Damon – and it reflects exemplary leadership and additional incentive for a successful leadership transition,” Evangelisti said.

While the results of the so-called “say on salary” vote are nonbinding, JPMorgan’s board said it takes investor opinions “seriously” and intends the Dimon bonus to be a one-time event, he added.

The rejection was the first time that JPMorgan’s board of directors suffered a negative vote on compensation since the wage control measures were introduced more than a decade ago. Dimon, 66, has led JPMorgan since 2006, helping guide it through several crises and making it the largest US bank by assets.

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Earlier this month, including proxy consulting firms Glass, Lewis & Co.. Shareholders recommended vote against Damon and his first lieutenant, Daniel Pinto, salary package. Including the retention bonus, Damon’s salary last year was $84.4 million.

“Excessive one-off grants to the CEO and COO amid relative tepid performance exacerbate long-standing concerns regarding the company’s CEO pay program,” Glass Lewis said in its report.

Damon and his other directors have otherwise received support from investors, which is the most common shareholder vote for a large corporation.

Glass Lewis also advised that shareholders vote against compensating rival CEO David Solomon, who leads Goldman Sachs He received a $30 million retention bonus in October. In this case, however, about 82% of Goldman’s shareholders vote for from management.