JAMIE DIMON, the straight-talking chief executive of JPMorgan, has admitted the bank considered pulling out of the euro zone’s most troubled periphery on economic grounds, but opted instead to stay for the long term.
“We have about $15 billion exposure across the euro five,” Mr Dimon said, referring to Ireland, Portugal, Italy, Greece and Spain.
“It’s largely to corporations and sovereign and some banks. But we made a decision which was largely social, and partially economic, to stay.”
Mr Dimon said the bank and its board was aware of the risks involved, but added: “I hope we will still be doing business there in 50 or 75 years.”
The revelation, at a debate on the future of the global economy at Davos, comes amid intense discussion at the forum over the euro zone’s woes.
Mr Dimon told the panel that he was fed up with banks and big business generally being seen as only motivated by short-term gain.
“Short-term profit means nada,” he said.
“If you asked me to increase profit by 50 per cent next year, I could do it. Take a little more risk.”
But that would not be in the longer-term interest of customers, employees and communities as well as shareholders, he said, adding that he was making decisions now to drive the bank’s business for the next “five, 10, 15 years”.
Nonetheless, the banker continued his critical view of his industry while also expressing frustration at political leaders who put excessive blame on the financial industry for all the world’s woes.
“An American has the right to say: ‘Wall Street and the government let me down’.” Yet Mr Dimon, a long-time Democrat, who describes himself now as “only just” a Democrat, admits the toughness of political life.
“Being a politician is a very complex job, a bit like three dimensional chess.
“It’s probably easier to run a business than a country with all the moving parts,” he said.
Mr Dimon said he might support President Barack Obama’s “Buffett rule”, which would raise taxes on high-earning Americans. He said the US should have a “conversation” about tax rates.
At last year’s Davos event, Mr Dimon made a name for himself when he clashed with Nicolas Sarkozy, the French president, in a discussion about the financial crisis. – (Copyright The Financial Times Limited 2012)
