JPMorgan just announced that it's promoting two of the bank's top female executives to co-manage its sprawling investment bank, cementing both of them as potential contenders to succeed CEO Jamie Dimon, who has insisted that isn't planning on retiring anytime soon, despite being sidelined by a heart-attack in the middle of the pandemic-inspired market chaos last March.
Gordon Smith, the longtime JPM co-president and co-COO tasked with overseeing the bank's sprawling consumer-banking business, has decided to retire, and in his place, the bank is appointing Marianne Lake (one of its most visible executives) and Jennifer Piepszack to jointly-run the division, where they will presumably jockey to replace Dimon when he finally steps down from the top job. While we have no idea when that might be (Dimon's perpetual answer is "five more years"), it's notable that the CEO has become more politically vocal in the past few years, with some even citing him as a potential presidential contender.
Lake served as CFO before Piepszack (the bank's current CFO) and for the last two years has been running the bank's consumer lending business. Both women will report to Smith until his official retirement at the end of the year.
Jennifer Piepszak and Marianne Lake
Thanks to their experience as CFO, they are familiar to investors and journalists thanks to their appearance on the bank's post-earnings conference calls. Both women were established as front-runners to lead the bank two years ago when they were first moved to their current roles. Both of them are also 51, more than a decade younger than Smith and other male senior executives in Dimon's inner circle.
Succession planning has become something of a priority for the bank since Dimon's heart attack last year, which briefly left co-COOs Smith and Daniel Pinto to run the bank in the middle of a crisis while he underwent emergency surgery.
Once Smith leaves, Pinto will be the only JPM executive who has been in the C-Suite since the financial crisis.
Both women have served as finance chiefs for the bank. Now, running the consumer division will give them the broad-based experience required to run one of America's biggest financial supermarkets.
Another factor of the reshuffle is the bank has named Jeremy Barnum, head of global research for the corporate and investment bank, to replace Piepszak as CFO.
A few months back, Citigroup became the first American megabank to appoint a female CEO when Jane Fraser took over from Michael Corbat, a move that was greeted by no shortage of glowing profiles like this one from WSJ.
As the reaction to Citi's decision has shown, appointing a female CEO is a much more cost-effective way for an American megabank to virtue-signal than, say, raising wages for the lowest-paid employees, like Bank of America just did (which announced Tuesday that it would hike its minimum hourly wage to $25).
The bank confirmed the management reshuffle in a press release:
New York, May 18, 2021 – JPMorgan Chase & Co. (NYSE: JPM) (“JPMorgan Chase” or the “Firm”) today announced senior management changes to help build upon its success as a leader in global financial services for its customers and communities.
Gordon Smith, Co-President and Chief Operating Officer, and Chief Executive Officer of Consumer & Community Banking (CCB), recently informed Chairman and CEO Jamie Dimon of his decision to retire at the end of this year. Mr. Smith will continue to carry on his current responsibilities until December, when Daniel Pinto, Co-President and Chief Operating Officer and Chief Executive Officer of the Corporate & Investment Bank (CIB), will become sole President and Chief Operating Officer of the firm. In the new year, Mr. Smith will continue as a senior advisor to Jamie Dimon and other executives, with a focus on consumer, digital and payments opportunities.
Marianne Lake, CEO of Consumer Lending, and Jennifer Piepszak, Chief Financial Officer of the firm, will become co-heads of CCB effective immediately, reporting to Mr. Smith. As co-heads of CCB, Marianne and Jenn will be responsible for our home lending, auto finance, small business and U.S. wealth management businesses, as well as our industry leading Chase consumer banking and credit card businesses. The CCB businesses generated revenues of more than $50 billion last year.
Jeremy Barnum, head of Global Research for the Corporate & Investment Bank, will succeed Ms. Piepszak as Chief Financial Officer, also effective immediately. Jeremy was CFO for the Corporate & Investment Bank from 2013 through the beginning of this year.
Jamie Dimon said: “Gordon Smith has done a simply outstanding job. As one of the best hires I’ve ever made, he has achieved so much, made us a better company through his strategic focus, compassion and commitment to diversity, and has helped mentor so many of our people, including those being promoted today. Professionally, Gordon has been an exceptional business leader and partner for the past 13 years, and I’m so pleased he’ll continue to be a wise resource for me and our senior management team. Personally, I am proud to call Gordon my friend and am immensely grateful for all he has done for our company and our people.”
Gordon Smith said: “I am so proud of our team here at JPMorgan Chase and all that they have achieved. It is personally bittersweet for me to leave this first-class team, but I am happy to support them in any way I can going forward and am excited about the firm’s bright future. I want to thank Jamie for this extraordinary opportunity and throughout the entire journey I have greatly valued his counsel and friendship.”
Mr. Dimon added: “We are fortunate to have two such superb executives in Marianne and Jenn – they both are examples of our extremely talented and deep management bench. Both have proven track records of working successfully across the firm and both are well known and respected within the financial industry for their exceptional character and capabilities.
We are also lucky to have another extraordinary talent, Jeremy Barnum, become our CFO. His breadth of experience within our complex, global CIB positions him well for this critical firmwide role. In addition, he is recognized within our company and in the financial and regulatory communities for his deep intellect and integrity.
Over the past several years, JPMorgan Chase has produced consistently strong and market-leading results for our customers, communities and shareholders. I’m honored to work with such an exceptional group of people and want to thank the Board for its invaluable contributions to our company.”
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