NEW YORK — JPMorgan Chase's Chief Executive Jamie Dimon will get his pay cut by half because of a trading loss that cost the bank more than $6 billion last year and drew sanctions from federal regulators.
The bank, the country's biggest by assets, said it would cut Dimon's pay to $11.5 million for 2012, consisting of $1.5 million in salary and restricted stock awards of $10 million. That's less than half last year's pay of $23 million.
The loss, which was related to complex investments known as credit derivatives, tarnished the bank's reputation as a scrupulous manager of risk and marked a personal setback for Dimon, a longtime critic of efforts to clamp down on regulatory oversight of major U.S. financial institutions. Dimon appeared twice before Congress to apologize and explain how the losses came about.
The bank released two internal reviews of the matter on the same day that it reported a 55 percent jump in earnings for the fourth quarter of 2012. The bank's board of directors concluded that the loss was a serious mistake, but it also praised Dimon for his response, which included shutting down the division that was responsible for the loss and getting rid of top managers.
Dimon, speaking on a conference call with reporters, said the trading loss is very close to being a non-issue from a trading point of view, though he also noted that the trading loss could bring the bank more regulatory headaches.