JPMorgan Chase reports that its profits were up 53 percent in the fourth quarter of 2012 but CEO Jamie Dimon's pay will be cut in half, after the bank lost billions of dollars on risky bets made in its London office. The incident tarnished the reputation of Dimon, who had successfully steered his bank through the recent financial crisis.
"This past year has been a bruising one for Dimon," as NPR's Steve Henn reports for our Newscast unit:
"Lax oversight of trading operation in London resulted in enormous losses by the bank. A single trader nicknamed Voldemort or the London Whale placed multibillion-dollar bets on complex synthetic derivatives. When those bets went bad, the bank lost billions. An internal investigation placed the blame at Dimon's feet and now the board has cut his compensation in half, to just over $11 million."
The company says that the bets made by trader Bruno Iksil cost it $6.2 billion in nine months, Bloomberg reports.
JPMorgan Chase said its net income was $5.7 billion in the fourth quarter of 2012. And the company praised Dimon for the way he handled the mess that emerged from the bad investments.
As NPR's Marilyn Geewax reported last October, Dimon told an audience at the Council on Foreign Relations that "I should have caught it ... I didn't."
He added that making mistakes and learning from them is part of capitalism.