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JPMorgan investors rarely reprimand Dimon, protesting a $ 53 million bonus

JP Morgan Chase & Co. Chairman and CEO Jamie Dimon testified before the House Financial Services Committee on responsibility for the mega banks in the Rayburn House Office Building on Capitol Hill in Washington, DC on April 10, 2019.

Mandel Ngan | AFP | Getty pictures

JPMorgan Chase CEO Jamie Dimon was given a rare reprimand on Tuesday with the shareholder̵[ads1]7;s rejection of his massive retention bonus announced by the bank last year.

Only 31% of investors who attended the New York-based bank’s annual shareholders’ meeting supported the $ 52.6 million price that was part of Dimon’s 2021 compensation package.

The bonus, in the form of 1.5 million options that Dimon can exercise in 2026, was designed to keep the CEO and chairman of the board at the helm of JPMorgan for another five years. The estimated value, fixed last year, fluctuates and is dependent on the bank’s share price rise, according to the bank’s spokesman Joe Evangelisti.

“The special award was extremely rare – the first in more than a decade for Mr. Dimon – and it reflected exemplary leadership and further incentive for a successful leadership transition,” Evangelisti said.

While the results of the so-called “say on pay” poll are non-binding, JPMorgan’s board said they take feedback from investors “seriously” and believed that Dimon’s bonus should be a one-time event, he added.

The rejection was the first time JPMorgan’s board received a vote on compensation since the payment watchdog measures were introduced more than a decade ago. Dimon, 66, has led JPMorgan since 2006, helping it through several crises and building it into the largest U.S. bank by assets.

Earlier this month, proxy consulting firms including Glass, Lewis & Co. recommended. that shareholders voted against the salary package of Dimon and his top lieutenant, Daniel Pinto. Including the retention bonus, Dimon’s salary last year was valued at $ 84.4 million.

“Excessive one-time allocations to the CEO and COO amid lukewarm relative performance exacerbate long-standing concerns about the company’s executive pay program,” Glass Lewis said in its report.

Dimon and his other board members received support from investors, which is more typical of a shareholder vote in a large company.

Glass Lewis had also informed shareholders to vote against the compensation of rival CEO David Solomon, who heads Goldman Sachs and was awarded a $ 30 million bonus in October. In that case, however, around 82% of Goldman’s shareholders voted for the management.

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