JPMorgan Chase's (JPM) CEO Jamie Dimon Hosts 2017 Annual Shareholders Meeting Conference Call (Transcript)





JPMorgan Chase & Co. (NYSE:JPM)

2017 Annual Shareholders Meeting

May 16, 2017 10:00 AM ET

Executives

Jamie Dimon - Chairman and Chief Executive Officer

Stacey Friedman - General Counsel

Lee Raymond - Director

Analysts

Tom McCaney - Walden Asset Management

Operator

Good morning. Welcome to the Annual Shareholders Meeting of JPMorgan Chase. We're going to start with a brief video and then Jamie Dimon, and our General Counsel, Stacey Friedman will begin the formal proceedings. I think we're ready to start the video.

Jamie Dimon

Good morning, ladies and gentlemen. So it’s after 10'O Clock and pleased to call or the Annual Meeting of the Shareholders of JPMorgan Chase and Company. So welcome. I am Jamie Dimon, Chairman of the Board and Chief Executive Officer, and Chairman of this meeting.

The video you just saw shows our commitment to the state and the people of Delaware, and the audience today, number of employees from the Wilmington area, I want to thank them for extending, for coming, and extending the special welcome and thank you for all the things you do for your state too.

Now, with me today is Stacey Friedman, our General Counsel and Stacey will serve as secretary of the meeting and will leads us to the agenda. Stacey?

Stacey Friedman

Thank you, Jamie. So I want to add my welcome to everyone here today. I know the many of you hopefully, all of you, our customers as well as shareholders. So before we turn to the business today, I just want to mention that if you have any questions about the services we provide, we have a team from the Executive Office here with us today who will be happy to assist you. Larry Toddy, are you right here? Larry Toddy is our Head of the Executive Office. I encourage to stop by see Larry see the Executive Office immediately, they have a table immediately outside of this room, if you have questions or comments or need help with anything today.

As a remainder, there’s no use of personal devices or other electronic equipment for recording, photographing or videoing today's meeting is prohibited. We’re now going to turn to business of the meeting; we have with us the affidavit of mailing for the notice of the meeting; number two, we have the proxy statements; we have the form with the proxy and we have the annual reports; the shareholder's list is available for inspection; representatives of the American Election Services LLC have been appointed to serve as our Inspectors of Election.

The meeting is properly convened, the forum is present and the proposed regulations set forth in the proxy statement will be filed as part of these proceedings. It is 10:05 and the polls on all proposals set forth in the proxy statement are now open. They will remain open until we announce that they’ve been closed towards the end of the meeting. We have received, just so you know before the start of the meeting, approximately 87% of the outstanding shares eligible to vote, these have been voted in accordance with shareholders’ wishes. If there are shareholders present who’ve not yet submitted their proxies and would like to do so, we’ll collect them after all of the proposals have been submitted and they will be reflected in the final vote.

Just a remainder, remarks today may contain forward-looking statements. Please do refer to our Annual Report on Form 10-K, filed with the SEC for a disclaimer regarding such statements. Jamie that can -- the necessary formalities, do you want to tell us about the state of the Company?

Jamie Dimon

Thank you, Stacy. So I would like first to recognize our directors, I want to ask each director to stand when I introduce you please hold your applause until after all the directors have introduced. Your directors are Linda Bammann, James Bell, Crandall Bowles, Steve Burke, Todd Combs, Jim Crown, Tim Flynn, Le Jackson, Michael Neal, Lee Raymond and Bill Weldon. Thank you.

I am very proud to tell you that the dedication commitment of your directors played huge part in making this a great Company. In addition to the directors, we have also with us Kathleen Kaminski, our audit partner from PricewaterhouseCoopers. Thank you for being here.

I would like to talk a about our Company for a while. So we’re pleased to be here today in Wilmington, Delaware, a state we’ve been doing business for more than 100 years. Our partnership with the State of Delaware has started in World War I when JPMorgan helped finance the DuPont Company to manufacture ammunitions and supplies purchase for Ally troops.

Throughout the following century or presence that we continue to grow, we are currently the largest private employee in the state with 10,000 employees here. Delaware is a headquarters for our credit card business and a hub, which assume today for global technology and operations functions, the Delaware Technology Center. Our commitment to Delaware goes beyond creating jobs and serving our customers. Over the last 10 years, we provided over $15 million in support of Delaware nonprofits focused in job skills, programs, helping small businesses and investing in community projects that revitalize neighborhoods. We are proud of the work we’ve done in Wilmington, and are grateful to our partners for their support and collaboration.

I'll now tune to the Company's performance in 2016. Throughout a period of profound political and economic change around the world, our Company has been steadfast in our dedication of clients, communities and countries we serve, while earning a fair profit for our shareholders. Speaking of our shareholders, I want to thank them for their continued investment in our Company. 2016 was another breakout year for JPMorgan Chase. We earned a record $24.7 billion in net income on revenue of $99.1 billion. We have delivered record results in six of the last seven years, and we hope to continue to deliver in the future.

Overall, our financial results reflect strong underlying performance across the businesses. Taking a deeper look at our franchises, they are strong and market leading. Today, each of our businesses is among the top performance financially and overhead ratios in return equity versus the best in that specific industry. But more important, these businesses gain market share in recent years and then it's only possible when you’re improving customer satisfaction and enhancing your products and services relative to the competition. And each business continues to innovate was customer facing apps through straight through processing, digitized trading services, payment systems and among other things, which will drive growth in the future.

On this foundation, we are very optimistic about our future growth opportunities. We believe the underlying growth of the U.S. and global economy will provide the fuel to drive the future growth of the Company. And we continue to build our business to deliver our clients by doing some very basic things; getting investment bankers and private bankers around the world; any consumer and commercial banking branches in United States and any wholesale branches in new countries overseas. Equally important is using technology and fintech to do a better job of serving clients to grow our businesses with better products and services.

One of the reasons we’re performing well as a Company is we never stopped investing in technology and this should never change. We currently spend $9.5 billion a year in technology firm wide approximately $3 billion is dedicated to new initiatives and approximately several million of $3 billion is for we call fintech or digital or mobile. The reasons we invest so much in technology was; Big Data, digital, machine learning, et cetera, are simple; innovation should benefit customers with better products and services; help everybody by reducing errors and the make the firm more efficient.

As we continue to go for the long term and serve our clients and communities, I'd like to highlight some of the reasons why we remain so proud of this Company. We are and have been strongest and steadfast for our clients in good times and bad, in countries and communities. During the course of 2016, JPMorgan provided credit and raised capital more than $2 trillion for our clients, and we did this throughout the great recession. We believe we've been great corporate citizens and how we treat our employees and care for our clients and our communities.

For example, we compensate our employees well and provide them with extraordinary benefits like full medical and retirement benefits and training. This past year, we announced that we're going to increase our minimum wages mostly for the lower paid 18,000 entry level bank tellers and customer service to between $13.5 and $15 an hour, depending on where they live. We have a diverse workforce. We have more than 243,000 employees globally with over 167,000 in the U.S. Women represents 50% of our employees, and notably, women represent 30% of my direct reports and more than 30% of the Company's senior leadership. And honestly if you're in the press in this room, you should write about that, I think it's quite rare.

We're proud of how we're helping veterans. In 2011, JPMorgan and 10 other companies launched the 100,000 Jobs Missions, which has turned into pledge that create 1 million jobs has already created 350,000 for veterans; JPMorgan alone has hired 8,000 veterans. We've accomplished an extraordinary amount in our Corporate Responsibility efforts; our philanthropic giving was $250 million in 2016, and we also provide support for human capital, collaboration data and management expertise; what we do in Delaware, we do in communities around the world.

I'd like to make a few brief points about regulatory reform. We had a severe financial crisis followed by needed reform and our financial system is now stronger and more resilient than ever. During and since the crisis, we've always supported thoughtful, effective regulation, not simply more or less. We're not looking to throw out the entirety of Dodd-Frank or other rules. It is, however, appropriate to open up the rulebook in the light of day and rework the rules and regulations that don't work well or are unnecessary. We believe the changes can and should be made to preserve the safety and soundness of the financial system, but more importantly, will lead to a more healthy and vibrant economy which benefits all citizens.

I'd like to take a minute talking about the critical issues confronting our country and some public policy considerations that might help all Americans. I've run extensively on these issues in the past and I encourage you to read my Annual Letter to Shareholders that'll give you a more detailed view. I'll start by saying United States is truly an exceptional country with many blessings. But it's clear that something is holding us back, including labor force participation is too low; don't look at the overall number; men 55 -- 25 to 55 participation, now 86% to go back 30 years it was 96%; education is leaving too many behind, 50% of the kids at the inner city schools do not graduate; infrastructure needs planned investment, the last major airport built in United States was 20 years ago; China has built 75 in last 10 years, on average, I am told it takes 10 years to get the permit to build one bridge.

Our corporate tax system is driving capital and brains overseas, and excessive regulation reduced growth and business work formation, particularly for small businesses. To confront these issues, we need the business community and government to come together and collaborate, like you do here in Delaware, to find meaningful solutions and develop thoughtful public policies around education, infrastructure, corporate tax reform and other areas that create economic growth and opportunity for all.

Let me close by thanking our more than 240,000 employees, including our senior management team and our Board of Directors. Our Board of Directors has fully engaged in all the critical matters in the Company from setting the agenda of the board meetings, to reviewing strategy, and to helping to carry the culture and determine CEO compensation and succession planning. And importantly, the Board meets every time without the CEO at the board meeting and the board members are increasingly engaged in regulatory and shareholder affairs. We also have a strong corporate culture that we will continue to fortify and make sure it is an enduring strength of the institution. Personally, I'm honored to work at this Company with just any people. If you could see our people working up close in action, you'd be as proud of them as I am. And I'd like to express all my gratitude to all the employees at JPMorgan Chase.

Now, I'd like to hand off to Lee Raymond, our lead director who'll make some additional remarks. Lee.

Lee Raymond

Good morning. Thank you, Jamie. On behalf of my colleagues on the Board, I'd like to thank our fellow shareholders for participating in today's meeting. For those of you who are employee shareholders, thank you for the work you do every day for this fine Company. Jamie has spoken to you about the performance of the Company. We continue to serve our clients and customers well and in a manner that supports sustained shareholder value.

As the lead director, I thought it would be useful to comment on the work of the Board and some of the matters that have been especially important to us since we met last year. I will touch on five topics; first, board composition, refreshment and leadership; second, to continue the importance of our culture; third, senior management succession planning; fourth, our approach to compensation; and last, oversight of the firm's strategy.

Each year, we focus on board composition, considering the appropriate balance of board refreshment and experience. As part of these efforts, since we last met, we elected a new member to the board, Todd Combs. Mr. Combs has joined the board in September of 2016. He is an investment officer at Berkshire Hathaway. Todd brings the board extensive experience in finance and risk management. We have added Todd to the Directors' Risk Policy Committee and the Public Responsibility committee.

At today's meeting, shareholders will the opportunity to elect Mr. Combs for a full year term. With his election, we have 11 independent directors, five of whom have joined the board since May of 2011. I believe this reflects our board's commitment to refreshments and our ongoing consideration of succession. We have also considered refreshments in the review of our board committee.

Here too, it is our intention to maintain the balance of experience and fresh perspective. In line with this, this year we named new chair to the Risk Committee and to the Audit Committee, Linda Bammann and James Bell, respectively. In addition, we added new members to those committees as well as the Public Responsibility Committee.

With respect to our leadership structure, we continue to believe the board should annually determine the structure that is best for the firm and its shareholders, recognizing the needs of the firm may change over time. When we reviewed whether the role of Chairman should be a non-executive position or combined with that of the CEO, we carefully considered a variety of factors related to the firm's performance, including the Board’s ability to provide independent oversight of the management; the people in the roles and the views of all of the shareholders. We determine that maintaining the combined roles of Chairman and CEO, together with the strong lead independent director, continues to provide the appropriate leadership and oversight of the firm.

In addition to issues of corporate governance, this year the Board continued their focus on the importance of a strong healthy culture. We know that a sound culture requires a stead fast commitment, and we have made reinforcing a strong sense of personal accountability and ownership, one of the firm's strategic priorities for 2017. The Board provides direct oversight of the firm's culture and conduct program. And as directors, we participate in formal and informal events throughout the year that allow us to add our voice to the importance of a strong culture in the firm.

Succession planning also remains the top priority for the Board. The Board reviews the succession plans for each member of the operating committee, including the CEO. In particular, with respect to the CEO, it is one of the Board's highest priorities and most important jobs to plan for succession. Every year, the compensation and management development committee reviews its succession plans for the CEO, followed by Board discussion, led by me, the Lead Independent Director. It is the Board's job to prepare for the long term plans changes, as well as short term unexpected events.

Another matter of great performance pretty importance to the Board is the development and the assessment of the compensation plan. Our compensation plan is based on the belief that our long term success as a premier financial services firm depends in large major on the talents of each one of our employees. The proper alignment of compensation with performance and culture is a key to sustain shareholder value. In 2016, we introduced a new performance based incentive program that was well received by the shareholders. In fact, 92% of you supported the plan in 2016. In conversations with many shareholders since then, we hear continued support for the performance based incentive program and our balanced approach to compensation which align executive compensation and shareholder value.

The Board also oversees the firm's strategic planning. We continue to believe our business model enhances long term shareholder value, while the mix of products and services we offer around the globe is driven by the clients. The customers and the communities we serve the diversification and scale of our operating model, greatly benefits the shareholders. Of course, the firm continues to adapt in response to the changing banking and regulatory landscape. This has mostly taken the form of innovation, particularly in the payments and markets businesses. Even with these changes, everything we see supports our current business model.

In conclusion, let me note that the Board continues to consider and benefit from your feedback. We are committed to delivering long term performance for our shareholders, and benefiting the communities in which we do business. And we believe management is well prepared to meet the evolving changes. In the coming months, we will consider the feedback received at this meeting on each of the proposals, as well as today's votes and how we can enhance the Board’s effectiveness. We deeply appreciate the continued support of the shareholders for the Company.

This concludes my report, Jamie.

Stacey Friedman

Thank you, Lee. Thank you, Jamie. It's now time to turn to the proposals that are in the proxy statement. I'll introduce the management proposals first and then invite the shareholder proponents to introduce their proposals. After all proposals have been introduced, we’ll have a general Q&A. So I will ask people to hold their questions until then.

So on the management proposals, as you move all of the management proposals assets forth in the proxy statement, these are; first, the election of the 12 nominees listed in our proxy statement as directors; second, an advisory resolution to approve executive compensation; third, ratification of the independent registered public accounting firm PricewaterhouseCoopers; and fourth, an advisory vote on the frequency of advisory resolution to approve executive compensation.

I am now going to ask the shareholder proponents to introduce their proposals. Proponents we do ask that you limit your time to three minutes, and can find your comments to the subject of the matter of the proposal being presented to be sure that all proponents have an opportunity to present. We have a clock in the front with lights, the light turn yellow after two minutes and red after three. There’s two standing podiums, thank you. If you just proceed to the microphone nearest to you. We do ask the others to allow the shareholder proposals to be presented and wait until the general Q&A to proceed to the microphone with other comments. The proposal five was submitted by Mr. John Sheridan, we’ve been advised Jack Hoffman will present the proposal. Mr. Hoffman, why don’t you go ahead?

Unidentified Company Representative

Thank you. Proposal five for Board chairman, sponsored by John Shevident of Redondo Beach, California. Shareholders request our Board of Directors to adopt as policy and amend our government documents as necessary; to require the Chair to the Board of Directors whether possible; to be an independent member of the Board, the Board will have discretions that’s based in this policy for next CEO transition implemented does not violate any existing agreement.

If the Board determines our chair who is independent reflect as no longer independent, the Board will select a new chair who satisfies the requirements of the policy within a reasonable amount of time. Comprised to this policy is way that no independent directors available and going to serve as chair. This proposal requests all the necessary steps to be taken to accomplish the above. Senator David Vitter of the Senate Banking Committee said that Wells Fargo was too big to fail and too big to manage. It is possible that JPMorgan is too big to be managed by one person and hence this proposal. Our Board of Directors has elected to provide a rigorous independent oversight of management but Chairman is also the CEO, as of the case with JPMorgan.

Having a Board chairman who is independent of management is attractive that will promote greater management accountability to shareholders and lead to a more objective evaluation of management. A number institutional investors said that a strong objective Board leader can best provide the necessary oversight of management. Thus, the California Public Employees Retirement Systems’ Global Principals of Accountable Corporate Governance recommends that a company's board should be chaired by independent director as of the council of institutional investors. An independent director serving as chairman can help insure the functioning of an effective board. Please vote to enhance the shareholder value.

Stacey Friedman

Thank you. We oppose the resolution for, and our reasons for doing so appear on page 84 of the proxy statement. I will now turn to proposal number six for vesting for government service. This was submitted by the AFL-CIO Reserve Fund. We've been advised that Mr. Robert McGarrah will present the proposal. Mr. McGarrah, go ahead.

Unidentified Company Representative

Thank you very much. Mr. Dimon, members of the Board and fellow shareholders, I'm Robert McGarrah, I'm Counsel at the AFL-CIO's Office of Investment. And proposal six, I'll just briefly restate it. A request to Board of Directors to adapt a policy prohibiting the vesting of equity based awards for senior executives due to a voluntary resignation to inter-government service, which some people call and we've referred to it here, as a Government Service Golden Parachute.

This policy we asked should be implemented, so as not to violate existing contractual obligations or the terms of any compensation or benefit plan that's currently in existence on the date the proposal is adapted. And should apply only to equity awards or planned amendments that shareholders approve after the date of this 2017 meeting.

Now, our Company provides its senior executives with vesting of equity based awards after their voluntary resignation of employment to pursue a career in government service. And frankly, at a time like this and many of us are very familiar with the current doings in Washington and they're not necessarily admired throughout the country or the world. We're in a situation where ethics in government and the standards for government are critical. I brought it with me because I've been reading it myself, and I commend to all of you this is Ron Chernow's biography of George Washington. He also did the biography of Alexander Hamilton, that I'm sure many of you -- if you haven't seen the play, you know the book. And he makes the point in here repeatedly that George Washington was critically aware of the appearance of any conflict of interest and in fact during the entire revolutionary war he only took compensation -- reimbursement for his expenses. And he was constantly concerned about the appearance of conflicts and building trust. And that's something, frankly, in our government and we know from this past election has been start to lacking and continued to be sort of be lacking.

Now, I'm not trying to impugn the integrity of any JPMorgan Chase employee, and I think that as we agree and the Board's opposition statement makes this clear that government service is one of the highest callings and we want to encourage people to enter government service. But the appearance is well known in Washington, it's well known around the country. When you have people coming into government and get additional compensation, it doesn't look well to the public it doesn't build trust in government. And frankly, good people should be willing to serve in government just as many of our greatest leaders have, because they believe in this country and they want to stand for what the principles that frankly our founding fathers stood for, which is integrity and public service.

You don’t need additional compensation or be paid additional funds to do it. Shareholders are concerned about retaining good people and when they're here at JPMorgan Chase, we want to see that they get excellent compensation. And Mr. Dimon you made that point and we agree and I applaud you, very proud to see that lower income employees are going to get significant pay raise, which is critical. But when you go into government service, you go into government service because you believe in this country and the integrity of the service itself. And just as President Washington set that standard, we think that that's a good standard and JPMorgan Chase is the great company and it should hold the standards. So we urge your support for this proposal.

Stacey Friedman

Thank you. We oppose this resolution for the reasons that appear on page 86 of our proxy statement. I will now turn to proposal number seven, the callback amendment. It was submitted by Mr. Kenneth Steiner. Mr. Hoffman, I believe you're presenting that as well.

Unidentified Company Representative

Shareholders urge our Board of Directors to amend the general callback policy to provide that a substantial portion of annual total compensation of executive officers identified by the Board shall be deferred and be forfeited in part or in hold at the discretion of Board to help satisfy any monetary penalty associated with any violation of law regardless of any determined responsibility by any individual officer; and if this annual deferred compensation be paid to the officers no sooner than 10 years after the absence of any monetary penalty; and that any forfeiture and relevant circumstances to be reported to shareholders. These amendments should operate prospectively and be implemented in a way that does not violate any contract, compensation plan, law or regulation.

President, William Dudley of the New York Federal Reserve outlined the utility of what he call the performance bond. In the case of a large fund, the senior management would forfeit their performance bond. And each individual’s ability to realize their deferred debt compensation would depend not only on their own behavior but also on the behavior of their colleagues. This would create a strong incentive for individuals to monitor the actions of their colleagues and to call attention to any issues. Importantly, individuals would not be able to opt out of the firm as a way of escaping the problem. If a person knew something is amiss and decided to leave the firm, their deferred debt compensation would still be at risk. The statute of limitations under the FIRREA is 10 years, meaning that annual deferral period should be 10 years. Please vote to protect shareholder value.

Stacey Friedman

Thank you. We oppose these resolution and our reasons for doing so appear on page 88 of the proxy statement. The next proposal is number eight, gender pay equity, who is submitted by Ms. Rainer Yingling Judd, and we've been advised that Eileen Drury will present the proposal.

Unidentified Company Representative

Good morning, Mr. Chairman, members of the board and fellow shareholders. I’m Eileen Drury, and I am here to move proposal number eight filed by Arjuna Capital, on behalf of our client, Rainer Yingling Judd. Specifically, we are asking the Board to publish a report on the Company’s policies and goals to reduce the gender pay gap. The median income for a woman working full time in United States is reported to be 79% of that of her male counterparts. And forecast indicates that at the current rate of change, women will not reach parity until 2059.

Of note, the gap for African-American and Latino women is wider at 60% and 55% respectively. Gender pay disparity is not only one of the biggest social justice issues of our time, it poses a risk to Company’s performance, brand and investor return. The issue is particularly salient to the finance industry, which struggles to attract and retain female talent. In fact, women executives are 20% to 30% more likely to leave a finance career than any other. Female financial advisors are reported to face the widest pay gap of any occupation making only $0.61 for the dollar. And while JPMorgan has not reported its pay gap, Payscale reports the Company has a mean paygap of 13% or $10,471 that gap yawns wider for top range earners at 15% or $16,838.

Research indicates gender diverse teams are more productive, innovative and drive better results. Clearly, a failure to attract and retain qualified female employees is detrimental to JPMorgan's ability to innovate and compete. JPMorgan has disclosed that 54% of our Company's workforce is female. Yet only 30% of our leadership is made up of women. Our Company is best served by a proactive approach to address the structural biases, including pay and equities that prevent women from entering and staying in the field and moving into positions of leadership.

Given the material business risks, gender inequality presents, investors expect transparent honest disclosers and quantitative goals. Employees expect a new level of structural support that at its root causes and empowers sound negotiation promotion and ultimately equal pay. Implementing the proposal would represent a proactive step towards closing the gender pay gap. We believe JPMorgan would benefit from taking a leadership position on this issue along with financial services peers, Schroders and Virgin Money, as well as many other S&P 500 peers. Research indicates attracting and retaining diverse teams yield strong financial performance benefits.

Thank you for your consideration.

Stacey Friedman

Thank you. We do oppose this resolution. The reasons for doing so appear on Page 91 of the proxy statement. Proposal number nine is how it was accounted it was submitted by Ms. Mercy Rome and the Equality Network Foundation. And we’ve been advised either Sister Nora Nash, or Mr. McGarrah. Sister, why don’t you go ahead and present the proposal?

Unidentified Company Representative

Good morning Chairman of the Board, Board members, fellow shareholders, employees and anybody who is here today, and welcome. Thank you. I'm Sister Nora Nash, the Sisters of St. Francis of Philadelphia. And I stand on behalf of the investor voice of Seattle to move proposal number nine, which requests for simple majority vote on shareholder sponsors items. A simple majority voting standard only counts vote for and against an item. It provides democratic peer and accurate picture of the intent to stockholders who are both informed and decided, but does not count to stay votes of those who define to express an opinion. A simple majority is how JPMorgan elects Board members. It does not presume to divine the will of voters who purposely abstain. It allows the Company to choose who wins and who loses from counting ascensions.

We object to the Company policies because they had officially depressed the appearance of support for shareholder concerns relative to the Director of Elections. They are unnecessary because shareholder items are non-binding and they are confusing and inconsistent since they treat management director vote more favorably than shareholder items. In contrast, the simple majority standards proposed by item number nine provides shareholders with better information about both outcomes allows more accurate communication between stockholders and board, and eliminates the second class treatment of shareholder items relative to management's Board’s election. Therefore, please join us in asking JPMorgan to adapt the simple methodology of voting standard for shareholder sponsored proposals. Thank you.

Stacey Friedman

Thank you. We oppose this resolution. The reasons for doing so appear on page 94 of the proxy statement. The final proposal, is proposal 10, the special shareholders meeting. It was submitted by Mr. William Steiner. Mr. Hoffman, you were going to present this proposal?

Unidentified Company Representative

Yes.

Stacey Friedman

Thank you.

Unidentified Company Representative

Results. Shareholders ask our Board to take the steps necessary to amend our dialogs and each appropriate governing document to give holders in the aggregate of 10% of our outstanding common stock, the power to call a special shareowner meeting. This proposal does not impact our Board's current power to call a special meeting. Dozens of Fortune 500 companies allowed 10% of shares to call a special meeting. Special meetings allow shareowners to vote on important matters, such as electing new directors that can arrive between annual meetings. Shareowner input on the timing of the shareowner meetings is especially important when events unfold quickly, and issues may become new by the next annual meeting.

This is important because there could be 15 months or more between annual meetings. This proposal is more important because GMI analysts that JPMorgan was involved in regulatory and legal actions that included a payment of $13 million to resolve charges regarding the overstatement of quality of mortgages to investors, a settlement of charges related to the manipulations of foreign exchange benchmark rates, the payment of $920 million in fines and some charges relating to trade losses that were not properly reported to the Board in a timely manner, allegations of manipulations of benchmark LIBOR lending rates, data and privacy breaches, anti-competitive behavior and improper credit card collection practices. Please vote to enhance shareholder value.

Stacey Friedman

Thank you. We oppose this resolution. The reasons for doing so appear on page 95 of the proxy. That completes the introduction of the shareholder proposals. And as I said before, our reasons for opposing them are set forth in the proxy statement. So we will now turn to agenda item three, which is the general discussion. We’re ready for any general questions or comments from the shareholders after which we will close the poles and present the preliminary vote results. There are two standing microphones. If you wish to address the meeting, please come up to microphone now. Take your place in line. When addressing the meeting, please state your name, whether or not you are a shareholder. As a reminder, we ask that you limit your comments to three minutes each turn at the microphone to allow everybody an opportunity to speak. There will be a total time limit of 10 minutes on any topic. Please direct your questions to Mr. Dimon.

Question-and-Answer Session

Q - Tom McCaney

Good morning Mr., Chairman, Board members and fellow shareholders. My name is Tom McCaney, and I am here today on the proxy of Walden Asset Management. This company as a whole own 100,080,920 shares with JPMorgan Chase. Walden is a long term holder of JPMorgan stock and has been involved in numerous dialogues with Company on a range of environmental, social and governance issues. The statement on behalf of Walden’s, Tim Smith reads, on behalf of Walden and group of investors who engage the company this year, we want to thank JPMorgan Chase for its openness to serious discussion with the shareholders.

This year, group of investors engaged with the company and filed a shareholder resolution raising questions about the proxy voting record of the investment management side of the bank. JPMorgan Chase has consistently voted against virtually all shareholder resolutions on environmental and social issues, even though they did vote for a number of governance related resolutions to companies. Walden believes that the bank had not adequately assessed the way in which issues like climate change and poor diversity records by companies we invested in could harm the shareholder value of our portfolios. Thus, they ask for a review of our proxy voting decision making.

We appreciate the many forward steps the bank took in reviewing its proxy voting policies and practices, and the fact that our new thinking was published on their Web site. Investors are hopeful that the investment divisions’ approach is bringing a new openness to evaluating resolutions on important issues that affect shareholder value. In addition, our bank has a deep understanding on issues like climate change and as published background papers and thoughtful statements on the business risk, resulting from climate change. We believe these statements will have a positive influence on thinking as proxies are voted. Thank you for working to find a win-win solution lead by your Corporate Secretary, Mollie Richardson and her associate Linda Scott. We look forward to continuing the dialogue.

Jamie Dimon

Thank you.

Unidentified Analyst

Good morning. My name is [Anna Mariar Tila]. And I am rising to oppose the resolution to approve executive compensation, and this is why. We're living through a moment in history where the forces of hate, racism and white supremacy are inevitably in display and empower at the federal level. This season we're currently under an administration that has the xenophobia and anti-immigrant ideology at the center of its political program and its economic program. For immigrant families like my known, this is the moment of unspeakable terror, real fear, I see it every day. I hear it every day and I feel it every day. Just in the last three months, the Trump administration has tried to put in place a Muslim ban; it has stepped up the tension for deportations of people who have no criminal record, including young people who were granted protections from deportations by the previous administration; it has promised to build the wall along the Mexico border to expand the private detention, prisons and facilities, which are places where families, including babies, are housed in jails; and it has promised to deport between 2 million and 3 million people by putting in place a deportation force. But the reality is that the President cannot do this, he cannot implement his agenda without your help Mr. Dimon.

Under your leadership, JPMorgan Chase has become one of the main financers of debt for private prison companies and immigration detention corporations, GEO group and CoreCivic; you have enabled their growth and use them to profit handsomely from the expansion of immigration enforcements and to end the criminalization infrastructure like Dales. So, just to be totally clear, under these administrations you stand to profit from the separation of families and the pain of communities of color across the country. Because the fact is that the anti-immigrant agenda is not just an ideological agenda, it is an economic program. Institutions like yours that directly invest and hold the debt for prison companies and companies that bid on the wall and that bid on the creation of the jails, actually stand to profit, they’re actual beneficiaries from an ideology of hate. And unless you distance yourself from the Trump anti-immigrant agenda and unless you stop enabling the expansion of this business, you're profiting from hate.

You were recently quoted saying that the Trump economic agenda is the right agenda. Is it? When we look back at these moments in history, we will have to answer to our kids and our grand kids; what did we do to stop hate from taking root? What did we do to protect people most under attack in these moments? This is the moment that demands from leaders across all sectors, including leaders in this sector, real moral clarity-real moral clarity. So I have a question for you Mr. Dimon. Are you willing to stand on the right side of history in these moments? Are you willing to issue a clear statement, not what you wrote in your letter, but a clear statement that denounces the Trump anti-immigrant agenda anti-Muslim agenda? Are you willing to seize all financing of private prison detention centers and private jails? I would like to hear an answer from you, thank you.

Unidentified Analyst

My name is [Tina Garcia] and also I'm an organizer at [indiscernible]. I read this letter to behalf of my friend, [Melissa Noels] who was in jail at detention center in CoreCivic, after recent company that you've financed. I'm transgender Latin immigrant, and last year I joined other immigrant in a rally in front of JPMorgan Chase to demand that they change their ways. As the bank finance for prison and immigrant detention companies, your bank is part of the system that put me in prison for 183 days interval provisions. After being detained at CoreCivic’s detention center in Elizabeth, New Jersey for more than six months, I regained my freedom just a week ago. I wasn’t same because I had to defend myself from someone who attacked me, because I'm a transwomen. In detention center, I was sexually assault three times and mistreated. I did my best to protect the terrible condition, including going three days strict to fight for my rights, by preventing immigration at detention centers like the one where I were, in jail, so not in this country. No one shall suffer what I suffered, and no reputable bank show feelings company’s operations facilities. I ask if you change your ways immediately. Anything less will mean that you are continuing to be a banker of hate.

Stacey Friedman

Thank you. We're just going to alternate Sister Nora.

Unidentified Analyst

Thank you, Mr. Chairman I rise really as to raise a very important question as a member of the Interfaith Center on Corporate Responsibility. I'm not sure if many of you are familiar with that organization. We have done a lot of really good work with JPMorgan Chase, and we commend JPMorgan Chase for the tremendous work they have done in Detroit and in many other areas, and right here in Delaware. The Interfaith Center on Corporate Responsibility is composed of approximately 350 to 400 faith-based investors with billions of dollars that are held among all the shareholders. And we are familiar with Mr. Dimon and the work of this corporation. But we raised an important issue today and that is regarding the active campaign to eliminate the filing of shareholder resolution.

The attack on shareholder resolutions is embodied in the financial choice act, which will soon be before the house for a vote. One point of the act specifically seeks to eliminate the rights of shareholders to file resolutions, stating that an investor would need to own 1% of a Company stock to file the resolution. We figured it out, if I was to file a resolution with Apple, I need 7 billion. With JPMorgan Chase, I would need at least 3 billion that is an intentionally planned impossibility. But the attack on shareholder resolutions is also led by the business roundtable, which Mr. Dimon is chair of.

We are concerned about the BRT and why the BRT a prestigious business organization composed of leading CEOs would go to such efforts to eliminate the shareholder right when there are only approximately 900 resolutions voted on each year. And many of these have been getting expanded votes in favor in the 30% to 70% range. Many of the sponsors are major pension funds or other long term institutional investors. These are not special interest groups. But investors with joint long term stakes in companies who are urging changes that affect shareholder value. Resolutions to JP Morgan Chase as far back as 2003, ask the bank to lessen the risk by incorporating environmental social concerns into its leading, the bank did so in recent years. We ask the bank to a do business standards review and publish a report on a root causes, the bank agreed. I can attest that the meaningful dialogs we have had with JP Morgan Chase, in short, the resolution process is often helpful if it is only occasionally a pain in the neck for the bank. We ask JP Morgan Chase to call on the BRT where you have great influence to end this attack on shareholder resolutions. Thank you.

Unidentified Analyst

My name is Maria Morsi, and I am an educator in New Jersey. So I stand opposition to the resolution regarding CEO compensation neither Mr. Jamie Dimon not anyone, any CEO should make a profit of the suffering or a black and brown communities. JPMorgan is a major financier of CoreCivic. It's a private prison industry leader. One of the detentions is actually located in my home town of Elizabeth, New Jersey where I teach two of my former students, Sandra and Paula who are 19 and 21, are currently being detained there. I visit them often. There are more than 300 immigrants who are currently being detained at CoreCivic and Elizabeth, and there’re I am sure, tens of thousands were being detained at CoreCivic throughout the country.

JPMorgan is financing a project that is targeting people of color. Trump’s agenda, as we know, is going to further incentives to build more private prisons and detain more immigrants and people of color. Mr. Dimon, you currently sit on Trump's business counsel and you will help advice him on new business decisions. Will you step down from his counsel?

Jamie Dimon

No.

Unidentified Analyst

Great. We’ll keep fighting back.

Stacey Friedman

Thank you. Do we have another question over here? Just a point of order, we are trying to limit any topic to 10 minutes, so we’ve had three private persons. If you guys want to coordinate, we probably have time for one more on this. But if you’ll introduce yourself, state whether you are a shareholder and go ahead with your comments.

Unidentified Analyst

My name is Hillary Kline. I am a proxy here to speak against the resolution about executive pay, similarly. I do believe that executive compensation should be tied to some sense of social responsibility. A few weeks ago, a new Web site, which is called, BackersofHate.org, identified JPMorgan Chase along with a number of other major American corporations as corporate backers of hate because these companies -- because of these companies’ complicity with President Trump's anti-immigrants, hateful and divisive agenda. I would like to be briefer, because I would really like Maria as the last person to speak on this. So I’ll skip through much of what I was going to say is fairly repetitive of what with what you heard from the previous speakers. I would just say that personally my family came to this country decades ago, generations ago, as refugees from genocide in Eastern Europe. The only reason I am here today is that my family tree survived the holocaust, but because American welcomed refugees and immigrants. And I believe that the values that we stand for, the value that this Company should stand for, are welcoming immigrants and refugees today. And that financing the immigration detention centers is not actually good for business, I believe that yes, we stand to profit from the more people who are locked up. But I believe that we are hurting the JPMorgan brand when we don’t stand with the history of American values. So I'll leave it at that and can I [multiple speakers] I am going to turn that for Maria.

Unidentified Analyst

My name is Maria, and I'll be brief. I’ll try and stick to the time. I am here to oppose the executive pay resolution. In this moment, when our community is under attack, it's critical for us to raise our voice. I want to say to all corporations that in this moment, this critical movement, you’re either with us or you’re with Trump. JP Morgan Chase is financing corporations that are detaining our people and making our community suffer. And you are drawing closer to the administration of Trump even contributing to his inauguration. This is not okay. This shows that you are backers of hate and we will not allow this to continue. So I would like to ask Mr. Dimon, are you willing to separate yourself from Trump and stop doing business with the immigration detention centers? Thank you.

Unidentified Analyst

I just wanted to add really quickly that since we have one more minute, the backers of hate Web site is only been live for a couple of weeks. In those first few weeks, about 4,000 people have already used the Web site to send messages to you Mr. Dimon, pleading with you to distance yourself from these hateful policies of human suffering. Hundreds and hundreds of the people who have written messages not in any prompting from the Web site, are loyal JPMorgan customers and have threatened to pull their business if you do not distance yourself from these Trump’s policies and agenda hate. So those messages have been forwarded to you and the director, and the Board of Directors and we do wait a response. Thank you.

Stacey Friedman

Thank you for keeping to the time.

Jamie Dimon

I just would like to say that JPMorgan Chase has always supported Mexico; we believe in free and fair trade with Mexico; we believe in great neighbors of the United States of America. And if you at the history of JPMorgan, we worked quite well with Hispanics, Hispanic groups, et cetera. And number two, we’ve always supported LGBT rights and we continue to do that. And number three, we will look into these funny and these prisons that you’re talking about. I am not sure we completely agree with you. And number four, because you are on Trump’s -- the advisory group, he is the President of United States. I believe he is the pilot flying our airplane. We’re trying to help. I would try to help any President of the United States to become a patriot. And we do not -- this does not mean we agree with all the policies that administration comes up with.

Stacey Friedman

Thank you. Are there other topics? Different topic?

Unidentified Analyst

My name is Andy Morrisons, I'm from the New Economy Project, an organizational shareholder. I've a question and I want to say we oppose the CEO pay proposal.

Jamie Dimon

You guys are starting to hurt my feelings.

Unidentified Analyst

Well, Mr. Dimon, you earn $28 million a year, and the time I have allotted to speak, you’ll earn well over $100 just listening to me. And that's more than a lot of your lowest wage workers…

Jamie Dimon

I hope it's worth it.

Unidentified Analyst

For an entire day's work, it is not a lasting matter. Now, there's some important reforms introduced around CEO pay and Dodd-Frank, and I also want to talk about -- which is under attack by the way in Congress and by the administration. And I want to talk now about Chase's efforts also to undermine another piece of Dodd-Frank, which is the Consumer Financial Protection Bureau. And Mr. Dimon, in your 2011 Letter to Shareholders, you told us that if the CFPB does its job well, the agency will benefit American consumers in the system. Since then the CFPB has returned $12 billion to 29 million Americans ripped off by predatory and abusive financial services companies; that is clearly a job well done. The CFPB has introduced much needed accountability, transparency and regulatory standards into the financial services marketplace. Why then is Chase bankrolling the CFPB's destruction by supporting efforts in Congress that got the agency? Chase in fact has been the number one campaign contributor to Congressman Jeb Hensarling, who seems to have made it his life's work to obliterate the highly successful CFPB. His Financial Choice Act, more aptly the wrong choice act, would roll back to CFPB's core authority to stop unfair deceptive and abusive action practices.

I would note that the CFPB used the same authority in 2015 to crack down on Chase when it found the bank was engaged in deceptive debt sales and collections practices that were harming hundreds of thousands of people and perpetuating industry that systematically exploits low income people and people of color. As a shareholder, we appreciated the CFPB's intervention here as it uncovered a major deficiency in the bank's internal controls. I think all shareholders would agree banks and other financial services company should operate lawfully and treat people fairly. The CFPB exists to ensure they do just that. Will Chase commit today to stop bank growing attacks by Congressman Hensarling and others to eviscerate the Consumer Financial Protection Bureau and other key parts of Dodd-Frank, such as the shareholder -- the CEO pay disclosure, that the SEC will be doing? Thank you very much. And particularly about the CFPB lease up, those attacks, stop supporting those attacks on the CFPB.

Stacey Friedman

Thank you. Could we have the next question?

Jamie Dimon

We're not attacking the CFPB…

Unidentified Analyst

In that you're supporting the chief attacker and Congressman Jeb Hensarling, the largest contributor in his entire career. And he's made it very clear that he intends on completely obliterating the CFPB taking away its independence…

Jamie Dimon

He's made it clear, he wants to reform it.

Unidentified Analyst

He wants to take away the key parts that make it effective, which is its independence…

Stacey Friedman

Sir, thank you for your comments.

Unidentified Analyst

So, I'm technically here on behalf of Mr. Parkin today. But I've a question regarding the environmental and social risk management policies. Although, JPMorgan Chase expects clients to secure the free, prior and informed consent of indigenous peoples, so I think it's currently lending to three companies behind the infamous Dakota Access Pipeline. And in case you've been living under a rock for the past year, the impacted Dakota tribes never consented to the pipeline. In fact, there is so little consent that over 200 native nations gathered for an entire year to protect the only source of drinking water for the Standing Rock’s tribe and 17 million people downstream. And I don't know if you drink water, but indigenous people are human like all of us, and can’t survive three days without it.

There was so little consent from indigenous people that JPMorgan Chase's client had public and private law enforcement deploy chemical weapons, impact ammunitions, explosive grenades, firehoses, sound cannons and dogs to repress the non-consenting indigenous people. The pipeline just sprung an 80 gallon lake in South Dakota last week, and it isn't even fully operational yet. Chase's client has no emergency plan in place, no emergency equipment, no protocols, nothing. Why? Because corporations like Chase with bogus human rights; indigenous rights and risk policies like yours and greedy executives like you; are willing to place profits over people as long as your grandparents rest undisturbed in their grave; as long as you're not the ones bathing children in oil; as long as it's not your sisters getting raped and human trafficked in oil fields. We put our bodies on the line not just for our children but your children too.

I'm here today to deliver this letter to you on behalf of more than 20 indigenous rights and environmental organizations. But before that, I want the CEO of JPMorgan Chase, Mr. Dimon and the Board, to look me in the eye, human-to-human and answer me, will JPMorgan Chase continue to finance the repression of indigenous people and the destruction of all our grandchildren's planet by financing the Keystone XL and other non-consensual pipelines or will indigenous people and our allies have to launch a global divestment campaign to hold you and other banks accountable to basic standards of human rights and indigenous rights. Yes or no?

Stacey Friedman

We probably have time for another question.

Unidentified Analyst

I'm on a complete different topic. Thank you. Mr. Dimon, my name is Tom McCaney. What is your position on the repeal of the Dodd-Frank Act and who is asking for the rollback of the Dodd-Frank? Also what do you think is the best regulation or formula to preserve the safety and soundness of what you often refer to as the best and deepest capital markets in the world?

Jamie Dimon

So we have never asked whether repeal of Dodd-Frank, though post sale pointed out. We do think after eight years of constant rule making it’s time to look at what we've done in the open light of day and make it better than this today to the benefit of all Americans. I would tell you and I bring it by my chairman’s letter and all the people here, some of these rules and regulations are hurting lower income people, first time buyers, immigrants. And I think that they should do it for the vibrancy of the country, but that won’t damage safety and soundness at all. And we made some very specific recommendations around that.

Unidentified Analyst

Mr. Chairman, Board of Directors and fellow shareholders, my name is Jeremy Davis and I am from near Des Moines, Iowa. I'm here today on behalf of the nation’s pig farmers and the National Pork Producers Council, which is also a shareholder. We want to thank the staff, management and Board of Director of JPMorgan's continued efforts in supporting our family pork producers to strong banking and financing efforts, which you’ve done very well. I want to thank the shareholders who know our nation’s pig farmers have many improvements in animal care, responsible use of animal health products, in particular, antibiotics and production practices.

Pork producers like JPMorgan Chase are committed to continuous improvement. We hope JPMorgan Chase will always remain diligent in consideration of requirements on production practices and their impact on the supply chain and family farmers. We certainly want to work with you and appreciate your efforts. There is much information to learn about our industry at porkcares.org. Like JP Morgan Chase, our family pork producers are clearly committed to building strong communities and improving our local, state and national economy. I hope you all join me and thanking the staff and management of JPMorgan Chase for their continued banking and finance efforts in support of family farming and agriculture in the United States. Thank you.

Stacey Friedman

Thank you. So that concludes our discussion period. Please submit your remaining ballots and proxies, if you have a ballot you want to hold up, someone will come and collect it. I declare the polls closed at 11:06 AM. We’ve concluded the formal portion of our meeting. I’ll now read the preliminary vote results that were received immediately prior to the meeting. The final voting results will be reported on a Form 8-K to the SEC along with the minutes of the meeting. With respect to the election of the directors, all directors were elected and each director received a majority of the votes cast or in against. No director received less than 96% of the votes cast.

With the respect to the other proposals today, the results are read will be the percentage voted for each proposal based on shares marked for against an abstain, I am going to ask you as the point of order to come down from the podium. Number two, the vote for the approval of the advisory resolutions who approved executive compensation was 92.3%. And number three, the vote for ratification of our independent registered public accountant was 97.84%. And number four, the advisory results on the frequency that advisory resolutions to approve executive compensation was one year with 94.9%. The vote for approval on number five of the independent Board Chairman was 33.8% for. And number six, the vote for the proposal regarding vesting the government service was 26.8% for. And number seven, the vote for the proposal regarding call back amendment was 3.9% for. And number eight, the vote for proposal regarding gender equity was 15.114%. And number nine, the vote for the proposals regarding haw votes are counted was 8.6% for. And the number 10, the vote for the proposal regarding a special shareholder meeting was 42.3% for.

Jamie, would you like to say few last words.

Jamie Dimon

We greatly appreciate the views of all of our shareholder and how thoughtful they were in engaging us in this process. The entire Board takes this feedback seriously and we’ll corporate their input and how we govern the Company. We’ll continue to build towards investing class in every single way.

Stacey Friedman

I think that’s concludes the meeting. Would you like to adjourn the meeting?

Jamie Dimon

Yes. This concludes the business before the meeting. We appreciate your attendance. The meeting is adjourned. Thank you.

Stacey Friedman

Thank you.

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