The Associated Press May 15, 2012, 5:19PM ET

Shareholder voices from JPMorgan Chase meeting

Jamie Dimon only faced shareholders for 40 minutes, but he got an earful.

The CEO of JPMorgan Chase was in Tampa, Fla., on Tuesday for the annual meeting, five days after the company disclosed an embarrassing $2 billion trading loss at one of the bank's divisions.

Shareholders have lost big since the disclosure: JPMorgan stock is down 11 percent.

The trading loss came from a bad bet on so-called credit derivatives, and the bank expects to lose more in the coming months. It was a black eye for Dimon, who is considered a master at managing risk.

The usually loquacious CEO was unusually subdued in his answers to shareholders, keeping his responses to an "OK, thank you" in most cases.

Here is a sampling of what shareholders told Dimon:

"If the CEO is also the chairman, as is the case here, then Mr. Dimon is effectively in charge of monitoring his own performance. The stakes are too high to continue where an all-powerful CEO is his own boss. Looking for an infallible CEO is a fool's errand... Independent board leadership would be in the best interest of the shareholders."

-- Lisa Lindsley, director of capital strategies at the American Federation of State County and Municipal Employees.

"Fifteen months ago, you shared your disappointment at mistakes that your company has made on the foreclosure debacle. ... We've heard the same refrain: We have learned from our mistakes; this will never be allowed to happen again. ... Three nights ago, we heard you describe the latest lapse in oversight. On `Meet the Press,' you said there were `warning signs' and `red flags,' yet management didn't respond until it was $2 billion too late. ... We are all weary of mistakes, and as shareholders we will continue to hold you to a very high standard. I can't help wondering if you are listening and hearing the many voices that have been speaking out recently."

-- Father Seamus Finn, on behalf of shareholders representing the Missionary Oblates of Mary Immaculate.

"Will the revelations of last week affect the dividend?"

-- John Lackey, a shareholder from Richmond, Ky.

(Dimon's response: "I certainly hope not. I don't want to make light of a $2 billion problem. But the company is sound and profitable and has a fortress balance sheet. The board makes that decision. We don't see any reason that it would be needed.")

"JPMorgan's loss of more $2 billion is garnering considerable publicity to say the least. However, it pales before the losses to investors and borrowers from the lack of action on mortgage loans serviced. That is why we take the issue of mortgage servicing and foreclosure avoidance so seriously.

-- The Rev. William Somplatski-Jarmon, coordinator of the Presbyterian Church's Committee on Mission Responsibility Through Investment.

"We find there to be a conflict of interest for you serving on the Federal Reserve Bank of New York. To be both one's own boss and one's own regulator draws questions to the system of integrity of checks and balances."

-- Peter Skillern, director of Reinivestment Partners, a community and housing advocacy group.

(Dimon's response: "The New York Fed Board is an advisory board. I'm not involved at all involved at all in the supervisory aspect of the Fed.")

"We're deeply concerned about the persistent and fundamental problems in Chase's mortgage servicing practices with homeowners. There is a huge disconnect between the picture painted by the company in your reports and the reality on the ground. This creates great reputational and financial risk for the company, particularly with Chase being one the biggest mortgage servicers in the country."

-- Josh Zinner, co-director of nonprofit NEDAP, the Neighborhood Economic Development Advocacy Project.

"My state is in crisis. Housing is the key to that. ... In our survey of housing counselors, 72 percent said always or almost always that people were foreclosed on while they were talking about loan modification with your bank. ... Also, we're concerned about tenants. About 40 percent of those evicted are tenants. Many of them are in houses where there's no chance to rent them. It would be better for the bank and the neighborhood and banks for the tenants to stay there."

-- Alan Fischer, California Reinvestment Coalition, representing 300 nonprofit community organizations.

"You said on `Meet The Press' that the $2 billion loss was not going to have a substantial effect on your bottom line. So if Chase can afford to gamble with $2 billion and not have it affect its bottom line, why can't you reduce principal for borrowers? You said that none of your clients suffered with that loss. But the real suffering that's happening every day is that families are being dragged out of their homes and children left to live on the streets. I was a housing counselor for five years and talked to people at Chase every day, and got nothing but roadblock. You purchased bad loans at a discount. Pass that along to the people. Reset the economy, and get it growing again."

-- Laura John, a shareholder.


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