In a New York Times article about the salary boost, reporter Peter Eavis quoted Warren Buffett, the investor and chief executive of Berkshire Hathaway (full article, here):
I think he's worth more than that.... Over all, I think the shareholders of JPMorgan and the American people should be happy that Jamie Dimon has been running the bank over this period.
I can't speak for the shareholders (as far as I know, I'm not one, although it's possible that a mutual fund that I own holds shares of JPMorgan Chase stock), but as an American, I'm a lot less happy than Buffett thinks I should be.
It was under Dimon's watch just this last year, after all, that the bank was settled withe the Justice Department for some $13 billion. In addition, JPMorgan "paid out a large sum to settle allegations that some of its traders manipulated energy prices". And then there was the agreement to pay $1.7 billion "for failing to alert authorities to suspicions relating to Mr. [Bernie] Madoff's business" (which turned out to be nothing but a Ponzi scheme.
Dimon supporters note the bank's strong profits (despite the multi-billion-dollar fines and legal fees, the bank reported 2013 profits of nearly $18 billion) and rising stock price. Moreover, they "assert that ...[the bank's] biggest fines were related to shoddy mortgage practices that did not occur under Mr. Dimon's watch" (many stemmed from irregularities, shall we say, at Bear Stearns and Washington Mutual, which were later bought by JPMorgan). If that's all there was to the story, they'd be right, and Dimon would have earned his raise.
But I'd point out that Dimon was a strong backer of the Bear Stearns and Washington Mutual purchases, and many of the other fines are directly related to how JPMorgan has chosen to run its business. In which case, the board's decision to boost Dimon's salary is wrong.
I'm glad to say that I'm not alone in questioning the wisdom of this deal. Eavis quotes a Boston University law school professor:
If there was ever a time to take a wait-and-see attitude and pay him what they paid last year, this is it... This is a thumb in the eye of regulators and a thumb in the eye for the public.
Indeed it is. Ow.