By Emily Glazer
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (February 26, 2018).
When JPMorgan Chase & Co. tried last month to clarify the
question of when Chairman and Chief Executive James Dimon would
step down, the firm got a lot more questions about who could fill
one of the most powerful roles on Wall Street.
One of the most intriguing: What about Marianne Lake?
JPMorgan's 48-year-old chief financial officer, Ms. Lake is one
of the most senior women on Wall Street and has been on the bank's
short list of possible successors for years, people familiar with
its board say. January's announcement by the bank of executive
moves makes her an even more likely contender.
In one respect, Ms. Lake would be a historic choice, the first
female chief executive of one of the largest U.S. banks. A single
mother of three young children, Ms. Lake has already become a role
model for women in finance, juggling a high-profile job and family
demands.
In her first year as CFO, 2013, Ms. Lake won praise for her
handling of the fallout from the bank's 2012 "London whale" trading
loss. She is well known to investors and analysts, a fixture on the
bank's quarterly earnings calls who sometimes acts as a diplomatic
foil to her outspoken boss.
During one call in October, for example, Ms. Lake tempered
criticism Mr. Dimon had levied on the volatile digital currency
bitcoin, which he'd recently called a "fraud." After Mr. Dimon
deflected follow-up questions, Ms. Lake gave a more measured
response, saying the bank is "very open minded to the potential-use
cases...for digital currencies that are properly regulated."
Of course, the palace intrigue about Mr. Dimon's successor is in
its early days. And another female executive, Mary Callahan Erdoes,
is also a contender.
Even Ms. Lake's supporters said she would have to move into
another job leading a business and do well there to create the
momentum that would be needed to succeed Mr. Dimon.
A 19-year veteran of the bank who grew up in England, Ms. Lake
has mostly held finance-related jobs that don't produce
client-driven revenue. Before her appointment as CFO, Ms. Lake led
finance for the consumer banking unit and earlier was the
investment bank's global controller.
Other candidates viewed among JPMorgan insiders as possible CEOs
of the largest U.S. bank by assets have run divisions that generate
revenue. For example, Doug Petno, 52, is head of the bank's
commercial-banking business. Ms. Erdoes, 50, leads the asset and
wealth-management businesses.
Ms. Erdoes was awarded $19.5 million in compensation last year,
compared with $13.5 million for Ms. Lake and $12 million for Mr.
Petno.
Those two executives and Ms. Lake were mentioned in JPMorgan's
January announcement of executive moves. Most important, the bank
and its board said in the announcement that Mr. Dimon plans to stay
in his role about five more years.
That marked the first time the bank publicly put a timeline on
what is likely to be the length of his tenure. Having become chief
in late 2005, Mr. Dimon is the longest-serving CEO of the big-six
U.S. banks.
The announcement turned the succession race within JPMorgan's
C-suite, which has produced years of jockeying by executives, into
a real event.
Ostensibly, the front-runners are Gordon Smith and Daniel Pinto.
The January announcement featured their promotion to the No. 2 role
below Mr. Dimon.
However, the five-year horizon given for Mr. Dimon suggests
those two executives may actually be out of the running, people
close to the bank said. This is because both will be 60 or older at
the end of that period, an age many analysts and investors believe
will likely put them out of the running.
Ms. Lake, Mr. Petno and Ms. Erdoes, on the other hand, would be
in their 50s, a more common age for a new bank CEO. At the big-six
U.S. banks, the current CEOs took over when they were at or between
the ages of 49 and 56.
A JPMorgan spokesman said all the executives declined to
comment.
The elevation of Messrs. Smith and Pinto is also potentially
significant for Ms. Lake in another way, according to people
familiar with the matter. Those executives run the retail division
and the corporate and investment bank, respectively.
Ms. Lake will likely be a candidate to fill one of these spots,
or to take up part of the duties of one of the positions, according
to people familiar with the matter.
Meanwhile, Ms. Lake will again MC JPMorgan's investor day on
Feb. 27 as she has done in the past. But this year that role is
expected to take on added prominence, according to people familiar
with the matter.
Write to Emily Glazer at emily.glazer@wsj.com
(END) Dow Jones Newswires
February 26, 2018 02:47 ET (07:47 GMT)
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