- JPMorgan Chase & Co
In a statement released on Tuesday, the bank said retail banking chief Charlie Scharf is moving to the firm's private equity arm and that other senior executives are taking on additional responsibilities in his former division.
Todd Maclin, chief executive of JPMorgan's commercial bank, will continue in that position and will also have responsibilities for the company's branch network, consumer franchise, small-business banking and private banking business, according to the statement.
Gordon Smith, CEO of card services, will take on responsibility for the company's auto finance and student lending business, on top of his current role.
In a memo to staff, Dimon said Scharf will continue to work with our consumer team to help transition the business and assist in any way possible.
The shifts come as JPMorgan tries to strengthen its retail banking arm, which has been held back by low demand for loans and hit by growing regulatory demands that will squeeze profits.
These changes reflect our ongoing commitment to focusing on the development of our leaders, Dimon said in the memo.
The bank also said its investment banking head, Jes Staley, will assume oversight of its business outside of the United States, taking over from Heidi Miller, who will retire early next year.
MORTGAGE CHIEF PUSHED OUT
The bank said in a separate memo to staff on Tuesday that its chief of home lending, David Lowman, would be leaving. He had been pushed aside in February after the bank racked up billions of dollars in losses on mortgages and became mired in litigation over foreclosures.
Dave Lowman and I have decided he will leave the firm, said the bank's administrative chief, Frank Bisignano, who was assigned in February by Dimon to the retail banking unit to fix JPMorgan's mortgage business. Bisignano will continue as chief administrative officer and head of home lending.
Lowman joined JPMorgan from Citigroup in 2006. During his tenure at JPMorgan, the bank picked up bad mortgage assets through its acquisitions of investment bank Bear Stearns & Co and retail bank Washington Mutual.
Under Lowman, the home lending unit was so disorganized that the bank seized homes of at least 33 U.S. military servicemen on active duty, violating federal law and prompting Dimon to apologize at the company's annual shareholder meeting. The bank has said it is forgiving those loans.
Lowman could not immediately be reached for comment on Tuesday.
Lowman appeared before congressional committees last year where he was chastised for his division's refusal to cooperate with borrowers and modify mortgages. Lowman said in a June 2010 hearing that the bank was understaffed but was adding employees to work on problem mortgages. In a hearing in November, Lowman acknowledged mistakes in foreclosure paperwork and said the bank was cleaning up errors.
JPMorgan and other large banks are in negotiations with the Department of Justice and state attorneys general to settle probes into mistakes in foreclosures.
The bank recorded $1.1 billion in litigation expenses in the first quarter, primarily because of mortgage-related claims. It also marked down the value of its mortgage-servicing contracts by $1.1 billion because of increased costs and booked $1.1 billion of expenses for losses on its residential real estate portfolio.
(Editing by Maureen Bavdek, Matthew Lewis and Steve Orlofsky)