Home >Companies >News >JPMorgan names Zames sole bank COO as Bisignano joins First Data

New York: JPMorgan Chase & Co., the biggest US bank, named Matt Zames sole chief operating officer as Frank Bisignano departed to become chief executive officer of First Data Corp.

Zames is expanding his role, JPMorgan chairman and CEO Jamie Dimon said in an internal memo obtained on Sunday by Bloomberg News. Paul Compton, currently co-chief administrative officer (CAO) of the corporate and investment bank, will become CAO of the company and report to Zames, according to the memo.

Bisignano’s exit buttresses Zames’s stature as a potential successor to Dimon, 57. Zames, 42, was promoted twice within the span of 100 days in 2012 as he helped Dimon regain control of a UK unit’s wayward bets on credit derivatives that cost the bank more than $6.2 billion. Zames, who began last year as co-head of the fixed-income business, was named chief investment officer in May and co-COO in July.

Bisignano, 53, will begin his new job today, Chip Swearngan, a spokesman for Atlanta-based First Data, said in an e-mail. First Data, run by private-equity firm KKR & Co., is the largest merchant acquirer in the US, helping retailers accept credit- and debit-card payments. The New York Times reported on Bisignano’s departure on Sunday.

Consumer Lending

Technology and security were among Bisignano’s responsibilities as co-COO, and he held executive roles within the payments industry earlier in his career. He was Citigroup Inc.’s CEO of global transaction services from 2002 to 2005 and executive vice-president of consumer lending in the early 1990s for First Fidelity Bancorp.

First Data handled 16.7 billion purchase transactions made with general-purpose credit, debit and prepaid cards in the US last year, according to the Nilson Report, an industry newsletter based in Carpinteria, California. Bank of America Corp. was the second-biggest merchant acquirer with 13.5 billion.

Lou Rauchenberger, who was co-chief administrative officer of JPMorgan’s corporate and investment bank along with Compton, remains as the lone CAO of that unit, according to the memo.

The loss at the firm’s chief investment office was the focus of a probe by the US Senate Permanent Sub-committee on Investigations. The panel said last month that JPMorgan dodged regulators and misled investors as losses swelled on a bet by trader Bruno Iksil, who was dubbed the London Whale because of the size of his position. Managers manipulated risk models and pressured traders to overvalue their positions in an effort to hide mounting losses, according to the committee’s report.

Drew, Staley

In January, the Federal Reserve and Office of the Comptroller of the Currency censured JPMorgan over failures in risk controls for the derivatives trades as well as for lapses in anti-money laundering controls.

The Whale trades preceded other departures, starting with chief investment officer Ina Drew’s exit within a week of the initial disclosure of the loss. James E. Staley, who was at the company for more than 34 years and was once seen as a candidate to become CEO, quit in January to join BlueMountain Capital Management LLC, the hedge-fund firm that profited from the bank’s trading loss. Bloomberg

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