JPMorgan Chase (NYSE:JPM) co-chief operating officer Frank Bisignano has left the building.
Bisignano was one of CEO Jamie Dimon's hand-picked, top-level managers, and a potential successor for Dimon himself. JPMorgan has seen plenty of management changes of late, and the superbank -- as well as its investors -- really don't need to see anymore. Is this a sign of things to come?
According to a statement from the bank, Bisignano left to become CEO of First Data Corp, a global payments processor. The same statement also announced that Matt Zames, JPMorgan's other co-chief operating office, will now take on the role of chief operating officer by himself.
Dimon had the usual nice things to say top executives say about other top executives when they leave a company: we'll miss him, we wish him all the best, etc. And according to Financial Times, Bisignano left "because he wanted to run a company for himself."
Foolish bottom line
Zames and Bisignano became co-chief operating officers in in the wake of last year's London Whale trading scandal, as Dimon purged the bank of top management he didn't feel were up to newly evolving snuff. Bisignano, characterized by Financial Times as Dimon's "enforcer and fix-it man," is known for having revamped JPMorgan's mortgage-servicing platform.
Zames should be perfectly capable of filling the role of chief operating officer all by himself. Dimon is famously fond of him and a full believer in his capabilities, once referring to him as someone "you want to be in a foxhole with." So there's no problem for JPMorgan there.
And Bisignano was rumored to be part of the possible line of succession for CEO. But so is Zames, as well as Dimon's other hand-picked people: Mike Cavanagh, co-head of corporate and investment banking, and Mary Erdoes, head of asset management. So it's not like JPMorgan will be wanting for Dimon-approved CEO candidates when the time comes.
But it was a tough 2012 for JPMorgan. The London Whale scandal did serious damage to Dimon's reputation as a risk manager (though I believe he's still the best in banking). And Dimon's purge was an aggressive attempt to fill top management with people he knows and trusts implicitly, and people he feels can take up the reigns of CEO when he decides to retire.
This is a delicate time for Dimon. He's still facing a proxy vote to split the roles of CEO and COB, positions he now holds himself -- this too as a result of the $6 billion London Whale trading loss.
Goldman Sachs (NYSE:GS) CEO Lloyd Blankfein just narrowly avoided having to face a similar vote, at least in part because the activist shareholder group behind the proxy move -- CtW Investment Group -- wanted to focus its considerable energies on splitting the roles at JPMorgan. JPMorgan shareholders don't need to see anyone at the top jumping ship, a possibly poor reflection on Dimon himself.
Bisignano's departure seems smooth and rancor free, and more details may yet emerge, but I hope this isn't a first sign that Dimon's post-purge managers will be leaving the JPMorgan building. The bank -- and its investors -- don't need any more dramatic exits.
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