The announcement on Wednesday that JP Morgan CEO and Chair Jamie Dimon's compensation for 2012 will be $ 11.5 million -- roughly half of his compensation for 2010 -- may provide some hope that the big banks will begin to bring executive compensation into better alignment with results. Although Mr. Dimon will not have to change his lifestyle because of his pay adjustment, it does show that JP Morgan is taking the "London Whale" fiasco and its continuing fall-out seriously.
But some commentators believe that the bank did not go far enough. Slate's Agnes T. Crane argues that Dimon should have been relieved of his Chairmanship. Whether this should have been done as an additional sanction or simply as a matter of sound management restructuring, the benefits of separating the two offices that Ms. Crane point out are real. And Bloomberg's Jonathan Weil faults the Bank's report on the London trading scandal for not analyzing how the Bank's Chief Investment Office morphed from a risk management operation into a speculative powerhouse -- a transformation urged by Mr. Dimon.
Still, a journey of a thousand miles ... . There are many chapters yet to written in this, and the many other, trading scandals that came to light last year. It is difficult, however, for those who maintain even a shred of optimism about whether the US financial sector can be salvaged in its present form not to see this as a ray of hope -- dim and flickering, perhaps -- but still as step in the right direction.
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