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2. After vote, JPMorgan shaking up its board

If the vote to split the Chairman and CEO positions at JPMorgan (NYSE:JPM) was indeed a referendum on Jamie Dimon, the combative leader of the bank just scored a resounding victory. In what has to be considered something of a shocker, just 32.2 percent of shareholders voted in favor of the split, compared with 40 percent last year.

Heading into the annual shareholder meeting, my gut feeling was that Dimon would prevail but that the vote percentage would be higher than last year's 40 percent but less than the 50 percent necessary for passage. Lots of people probably held similar predictions.

The big victory at the meeting in Tampa may reflect the intense lobbying the board of directors did on Dimon's behalf, the veiled threat that he might quit if he lost, and the strong earnings record the bank has achieved. All that weighed in his favor. It's quite possible that the board cut some informal deals as well, promising other, undisclosed corporate governance changes.

Promises or not, there will be some massive changes. Indeed, the most controversial directors did not fare anywhere near as well as Dimon.

The three directors on the risk policy committee -- Ellen Futter, David Cote and James Crown -- won re-election by slim margins. Futter managed just 53.1 percent of the vote, Crown got just 57.4 percent, and Cote got just 59.3 percent. All three had been targeted by proxy advisory firms and others. Laban Jackson, head of the audit committee, won 91.7 percent of the vote, despite being targeted by at least one proxy advisory service. All other directors got more than 90 percent of the votes.

The company has already made it known that it will restructure the board, and you can bet an all-new risk policy committee will be constituted.

All in all, the 2013 annual shareholders' meeting represents another chapter in the storied career of Jamie Dimon.

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By Jim Kim

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3. Utah on the rise in financial services

In the end, will the shareholders win anyway?

When it comes to the shareholder drama that culminated at JPMorgan's (NYSE:JPM) annual shareholder meeting, it was never really about whether the proposal to split the Chairman and CEO positions or the proposal to sack certain directors passed with a majority of votes. The votes are nonbinding. It was always about whether the percentage voting in favor of the proposals was untenably high.

As it looks now, management and the board at the embattled bank seem to have prevented majority votes on these crucial issues. But they can easily lose, even if they win.

The board seems to understand that paradoxical reality when it comes to the most controversial directors, notably those on the risk policy committee and the head of the audit committee. All were targeted by shareholder advocates. It remains to be seen what percentage of the vote they won, but it doesn't matter now.

The company is set to replace them anyway. Most likely, the board saw the early returns and concluded that the support was weak enough that it couldn't defend keeping them on the payroll.

The three directors most likely to transition away -- Ellen Futter, David Cote and James Crown -- were among the most criticized, given their role on the risk policy committee. Two other controversial directors, audit committee head Laban Jackson and presiding director Lee Raymond, are both past the company's suggested retirement age of 70.

The board really has no choice given the lack of a resounding victory at the meeting. A big issue now is how the board will position the upcoming changes. It could go one of two ways. It could deny that the shareholder vote had anything to do with the decision to recruit new directors. Or it could say that the board has heard shareholders' message loud and clear and acted accordingly.

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By Jim Kim

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4. Wall Street banks band together against Bloomberg

Is it best to see Utah as the latest regional financial center, akin to a Singapore or Brazil? Or is it the latest outsourcing hotspot, akin to Mumbai or other outposts?

You can make an argument for either interpretation, but all would have to agree that the state has made a major move as an employment destination for top banks. Goldman Sachs certainly put Salt Lake City on the Wall Street map, as it has continued to invest heavily in its Utah operations, where it employs 5 percent of its workforce.

The company will hold its annual shareholder meeting at its Salt Lake City offices for this first time this week, amid a growing clamor by other banks to expand in the area.

As noted by Bloomberg, "Morgan Stanley has expanded its Utah operations three times in the decade since it opened an office there. In November, Royal Bank of Scotland (rbs) committed to hiring 310 workers in the state, in exchange for $5.3 million in tax credits."

The state has certainly been aggressive in wooing banks with lucrative deals. In addition, the state has pledged to keep state taxes on individuals and businesses at just 5 percent.

Some might think that culture clashes will be inevitable. There might have been some, but they are rather meaningless in the face of other synergies.

The Telegraph writes that, "It was easy to imagine that Mormons, with their emphasis on simple living and the spiritual life, would find the bank distasteful. In fact, these unlikely bedfellows have forged a strong relationship. Goldman has tapped a valuable pool of talent, such that it claims that Utah's low taxes are no longer its primary reason for being in the city. Although salaries are relatively low in Salt Lake, the Mormon population, which accounts for about half of all residents, tend to be highly educated, hard-working and loyal. More than half are fluent in a second language, thanks in large part to the Latter-day Saints' tradition of doing a two-year stint as a missionary overseas."

For more:
- here's the article

Related Article:
Goldman Sachs to hold annual meeting in Utah

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By Jim Kim

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5. What sort of deal is Steven Cohen seeking?

The news that top Wall Street banks have formed a partnership to develop an alternative to Bloomberg's chat service is not novel. The financial information juggernaut, which has its eyes on electronic trading as well, has long inspired fear in top banks, even before it became the leading vendor.

Way back in the 1990s, when Bloomberg (then owned partially by Merrill Lynch) was considered something of an underdog against the likes of Reuters and Telerate, banks were seeking to blunt its growth by forming EJV. Salomon Brothers, Goldman Sachs and other premiere banks wanted to develop a competing terminal that they could control.

But in the end, they failed miserably. EJV never really took off, and just as the banks feared, Bloomberg vanquished the field, including Telerate (owned by Dow Jones), Quotron (owned by Citi) and many others.

So will the effort by top banks today meet a similar fate?

As noted by DealBook, Goldman Sachs, Deutsche Bank, Citigroup and others are working with Reuters and Markit to develop a competing chat service.

"The program would allow bank employees to talk to business partners at other firms in the way that they do now on the closed Bloomberg network. Such chat systems are vital to everyday work on Wall Street, like communicating with competitors and clients to work out prices for trades."

The effort was reportedly set in motion way before Bloomberg's snooping controversy broke out. The article suggests that the buy-side remains "iffy" on whether to embrace the new system, so it's fair to say that the jury is out on the new chat service.

At this point, it wouldn't be wise to bet against Bloomberg, even if Wall Street banks have had enough.

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- here's the article

Read more about: Merrill Lynch, Goldman Sachs
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By Jim Kim

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