(AP) NEW YORK - JPMorgan Chase CEO Jamie Dimon owned up to stock analysts and went on TV to accept blame for a $2 billion trading mistake. Next he faces shareholders, who are considerably less wealthy since the blunder was disclosed.
While Dimon may be greeted by colorful protesters and tough questions at the JPMorgan annual meeting in Tampa, Fla., on Tuesday, shareholders are unlikely to call for his head.
For them, facing the crisis without Dimon might be a bigger nightmare than the trading loss itself.
"When a bank is dealing with this sort of a challenge, you want someone of his caliber to shepherd it through," said longtime JPMorgan shareholder Michael Holland, chairman and founder of money manager Holland & Co.
That has not been a universal opinion since Thursday, when Dimon disclosed to analysts that the bank had lost $2 billion by making a bad bet with so-called credit derivatives.
Investors lopped almost 10 percent off JPMorgan's stock price the next day, and 3 percent more on Monday. Since Dimon made the announcement, almost $20 billion in market value has evaporated.
Over the weekend, Elizabeth Warren, architect of the Consumer Financial Protection Bureau and a Senate candidate from Massachusetts, called for Dimon to give up his board seat at the Federal Reserve Bank of New York.
Obama: JPMorgan shows need for strong Wall St. rules
CBS MoneyWatch: What JPMorgan's loss means to you
SEC chief: Regulators "focused" on JPMorgan
JPMorgan chief investment officer leaving
And on Monday, White House press secretary Jay Carney, without singling out Dimon, said that Washington can't prevent "bad decisions being made on Wall Street."
He pointed out that it was the bank and its shareholders, not bailout-weary taxpayers, who were suffering this time.
Dimon will be talking to shareholders from a position of weakness for the first time. He has built a reputation as a cost-cutting zealot and an expert at keeping risk under control.
He led JPMorgan into a stronger position than almost any other bank after the 2008 financial crisis, which brought him more praise than at any other time in his career.
Shareholders rarely lash out against Dimon. Vikram Pandit of Citigroup and Brian Moynihan of Bank of America are not so fortunate: Shareholders at those banks take the slightest opportunity to call for them to step down.
Dimon's reputation has been severely damaged now. But shareholders still appear to believe he should be given the chance to prove himself again.
"He's earned enough market respect to have the opportunity to correct this," said Benjamin Wallace of investment firm Grimes & Co., a longtime shareholder that sold its JPMorgan shares six months ago.
"I don't think anyone else can do a better job than him, and we would not be calling for his ouster," Wallace said.
Dimon said on Sunday that the bank had "made a terrible, egregious mistake" and that there was "almost no excuse for it."
Yet there have been no signs of a shareholder insurrection against Dimon, and no member of the board of directors has spoken out against him since he disclosed the loss.
He still holds a reputation as the man who restored Bank One to a profit a decade ago when few thought it was possible and who kept JPMorgan Chase profitable through the financial crisis by managing its risk.
And while $2 billion was a stunning figure, as the investor reaction demonstrates, JPMorgan is more than big enough to absorb the loss. The bank made $19 billion last year alone.
"Banking is a people business, and people are going to make mistakes," said Steve Shafer, chief investment officer of the hedge fund Covenant Global Investors in Oklahoma City, which bought JPMorgan shares on Friday.
"If anything, this just reveals how difficult it is, with some of the smartest hedgers on the face of the earth, to interpret what the markets are going to do," he added.
Dimon has said the bank lost the money in a strategy to hedge against financial risk, as banks often do, not because it was trading for its own profit. Some lawmakers have cast doubt on that portrayal.
