Abigail with attitude: Halo Dimon, goodbye veneer

Abigail Hofman
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Ackermann has experienced the chill of unwelcome publicity in recent days but how, I wonder, does Jamie Dimon feel when every day seems to bring another cloud, if not a hailstorm? I have written recently about how Jamie’s halo has become tarnished.

Yet it is obvious that dedicated Dimon continues to have the confidence of the JPMorgan board. Surely, the board, which strikes me as an august but emasculated organ, is collectively suffering from what one could term ‘charismatic chief executive syndrome’.

Nevertheless, might we now be entering the nemesis stage of Dimon’s tenure at JPMorgan? Do you recall how Jamie loved to crow about Morgan’s "fortress balance sheet" and paint the firm as the good citizen of the evil banking landscape? Something seems to have cracked: JP and JD now face a torrent of negative publicity, lawsuits and punitive fines.

The London Whale incident made Morgan look incompetent whereas the financial crisis solidified its reputation for competency.

And now come stories that the pukka US bank is being investigated for its hiring practices in Asia. Ostensibly, children of top officials were hired because of potential future deals with the grateful parents. These recruitment policies have attracted the ire of both the SEC and the US Department of Justice.

Back on home turf, the bank is accused of manipulating the US energy market, while the housing regulator, the Federal Housing Finance Agency, is seeking more than $6 billion compensation from the firm. The FHFA suit relates to mortgage securities that the JPMorgan group sold years ago and that declined in value during the crisis.

If I were Jamie, I’d pour myself a large whisky and try to forget about work for a while. Nevertheless, the more cracks that appear in the pristine portrait – think Dorian Gray – the more the bank appears too big to manage and too large to fail.