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Dimon shares business, career perspectives with summer interns

Jul 13, 2009

Chairman and CEO outlines how firm addressed downturn, recounts his career and counsels interns on roads to success.

 

In a wide-ranging session, attended by more than 300 Investment Bank and Asset Management interns, Jamie Dimon described how a "fortress balance sheet" helped JPMorgan Chase & Co. grow, despite one of the worst downturns in U.S. history, recounted his career path and shared his views on the qualities of leadership.

 

The firm's chairman and CEO spoke candidly for an hour, answering the interns' questions, frequently by drawing on personal experiences in his career.  He also detailed how the firm managed to gain market share during the recession, but made a point of saying how preparation was one of the keys.

 

"We always know we operate in a very difficult, risky world," he said, ticking off a litany of economic crises and recessions over the past 20 years, including the Internet bubble, Long Term Capital Management, the savings and loan crisis and the periodic recessions that have marked the period.  "To me, having a fortress balance sheet means you have plenty of capital and practice conservative accounting," he said, adding that the firm's balance sheet strength meant "we were more prepared than most."

 

That capital foundation, he told the interns, positioned J.P. Morgan to acquire Bear Stearns and, soon thereafter, Washington Mutual, when they became available, two events that strategically expanded the firm's franchise.  The firm's capital strength was complemented by the fact that J.P. Morgan had the people who could immediately mobilize to assess the proposed acquisitions and address the complexities of combining the firms.

 

Even with the economic downturn that led to a decline in earnings, Dimon thought last year would rank among the firm's finest, noting that the Investment Bank and Asset Management had gained share during the recession.  "Look at the storm we went through, and we still made nearly $6 billion and we acquired Bear Stearns and  WAMU," he said.  "And we continued to invest relentlessly in systems, people, training and marketing.  Of course, we trimmed our sails in certain areas, you have to do that, but we didn't do massive cutbacks."  Mentioning his recent Asian tour, he said every day involved calling on clients to expand the business there.

 

Asked what he sees as the next challenge, Dimon said the test is:  "Who's the best out there?"  He recognizes J.P. Morgan has tough competition, and that it could come from new quarters, Dimon said, identifying Indian banks as potential competitors in the years ahead.

 

Dimon advised the interns as they move through their careers to concentrate on doing well in their current position, rather than trying to plot out a step-by-step plan.  "If you want to do well," he advised them, "do well in your current job.  If you're always looking way up the ladder, saying 'That's where I want to be,' you'll never be happy and you'll never get there." ( Dimon addresses Harvard Business School students

 

Being successful in the current job enhances reputations "so managers will seek you out, and say, 'I want that person in my shop.'"

 

Along with working hard, he stressed the importance of setting a high standard of personal integrity, identifying Nelson Mandela and Abraham Lincoln as individuals they should emulate.  To an intern's question about leadership qualities, he listed having a good work ethic, being efficient and recognizing that learning is a lifelong process.

 

"I learn by reading and from other people, that's a never ending process," Dimon said.  "You're all plenty smart, but develop how to be a clear thinker - that's a skill - and be able to impart that to people."  As examples of individuals he believes are clear thinkers, he named columnist George Will, businessman Warren Buffett, and White House economist Lawrence Summers.  "They are so good at thinking through an issue, it's staggering," he said. 

 

To a question that comes up frequently at intern meetings, Dimon said being efficient in the office makes it possible to have a balanced family life.  "It's not possible to have quality time with kids without quantity time," he said.

 

Jamie Dimon also spoke to this year's Analyst and Associate class Thursday.