Jamie Dimon stumbles in war of words with US senator over interchange fees
The J.P. Morgan CEO used his annual letter to shareholders to take a shot at politicians setting the reform agenda; this is a game he is not likely to win. April 20, 2011 | Peter HoflichOn April 7th, J.P. Morgan released its 2010 annual report, and with it CEO Jamie Dimon’s 32-page letter to shareholders. The piece has been roundly hailed by investors, such as Tom Brown, who enjoyed it for its honest discussion of mistakes made, an assessment of the Washington Mutual integration, reflections on capital standards and resolution mechanisms for failed institutions, and his take on the shadow banking industry. Among the discussions is one about the Durbin Amendment and its repeal of certain debit interchange fees—on page 25 of the report—which Dimon describes as “policy that has little basis in fact or analysis.” Durbin, of course, takes umbrage, and has produced a letter of his own to rebut Dimon’s accusations, using both strong and weak arguments, but also a fair sprinkling of populist language. Dimon has clearly stirred a hornet’s nest: Durbin is the second-most powerful democrat in the US senate and is not up for re-election until 2015. Durbin is clearly furious, coming with rebuttals to five of Dimon’s points, the first one being a claim that Durbin’s amendment was passed without “fact-finding, analysis or debate”. That’s like saying that the good senator didn’t do his homework, which seems hard to believe, and to which he mentions “years of Congressional hearings, Government Accountability Office reports, academic articles, and published studies by the Federal Reserve’s economists and payment system experts” that were considered in crafting the amendment. He also displays a great... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: Consumer Credit, Regulation, Retail Banking, Risk and RegulationConsumer Credit,riskregulation,retail,Risk and Regulation, Consumer Credit,Regulation,Retail Banking,Risk and Regulation, Keywords:Interchange Fees, Visa, MasterCard Interchange fees, Visa, MasterCard
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