Jamie Dimon’s Magic Doesn’t Cross Borders, Apparently

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Jamie Dimon was surely the sort of guy upon whom the gods of high school popularity smiled. (Please, see picture.) The self-assurance is practically oozing, goldenly, from his veins. But remember those guys who peaked before getting out into the great big world, comfortable in one contained sphere but unable to replicate their magic elsewhere? The Wall Street Journal implies Dimon might be headed for the bank CEO version of the same: Even while Dimon's JPMorgan is on a tear, with the largest global share in the beginning of 2011, the bank's profits have decreased outside the United States, perhaps because of some strategic failures on Dimon's part.


Shortly after taking over as chief executive in 2005, Mr. Dimon nixed deals that would have secured footholds for the New York company in some hard-to-crack emerging markets. And he allowed a debate to fester between other executives over whether J.P. Morgan should acquire a major global bank.

Citibank, meanwhile, despite its generally less stellar performance of late and smaller total revenues, has twice the overseas haul as JPMorgan. And it seems as if Dimon might just have some Citibank size-related insecurities. "You should go work for a real bank," he told a Citibank guy at Davos (before shoving him in a locker). Also, "At meetings with potential customers, J.P. Morgan bankers showed slides of Citigroup's shriveled market value, while J.P. Morgan's held steady."

The counterargument is that recent years haven't been the smartest time to expand, and banks like Wells Fargo that made such a push haven't emerged unscathed. But JPMorgan, with 80 percent of its revenue domestic, is bumping up against federal regulations on the size of holdings. International expansion looks like the best option for growth. Post-2009 efforts to parlay the bank's momentum into shoring up global operations haven't done as well as hoped, and now it seems as if "it is too late to buy a big retail bank outside the U.S., executives concluded at a retreat last summer." Glory days, well, they'll pass you by?

Dimon's Global Growth Pains [WSJ]