JPMorgan Chase & Co. CFO Marianne Lake took on an expanded and prominent role at the banking giant's annual investor day in New York this week, adding to speculation that she is in line to become the first woman chief executive of a major U.S. banking company.
In past years, the executives leading each of JPMorgan's units addressed investors with presentations. At this year's investor day, held Feb. 27, the bank shortened the agenda and tasked Lake with providing highlights for all of the business lines.
Lake, long a high-profile figure at JPMorgan, has recently garnered added attention as a potential successor to Chairman and CEO Jamie Dimon.
JPMorgan CFO Marianne Lake
The company in January said Dimon would relinquish the title of president, and it named Daniel Pinto and Gordon Smith co-presidents and co-COOs, effective Jan. 30. Pinto also is chief executive of the corporate and investment bank, and Smith also is head of consumer and community banking.
At first blush, observers said, the promotions to become Dimon's top lieutenants appeared to put Pinto and Smith in position to compete for the bank's top job — and that may well prove the case should Dimon need to step down in the near future.
But JPMorgan also announced in January that Dimon intends to stay on as chief executive for five more years. Based on that timeline, Pinto and Smith could be too close to retirement themselves for JPMorgan to tap either as CEO, observers said. Pinto will be 60 in five years and Smith will be 64, according to information provided by the company. Dimon will be 66.
Lawrence White, a professor at New York University's Stern School of Business and a long-time observer of big U.S. banks, said in an interview that the boards of large, complex firms usually appoint CEOs with an aim of them serving for several years before reaching retirement around 65. That is why big-bank CEOs are often in their late 40s to mid-50s when they step into top jobs.
Dimon was 49 when he became CEO of JPMorgan. The heads of the other big-four commercial banks — Bank of America Corp., Citigroup Inc. and Wells Fargo & Co. — were in their early to mid-50s.
That may explain why, in announcing the promotions of Pinto and Smith, JPMorgan also cited younger executives as leaders in the company's talent pool, noting that they "have played progressively more significant roles partnering across the firm in helping manage the company."
Those executives are Mary Erdoes, age 50, CEO of asset and wealth management; Doug Petno, 52, CEO of the commercial bank; and Lake, 48. As heads of two large units that generate robust profits, both Erdoes and Petno are widely considered potential future CEOs.
JPMorgan Chairman and CEO Jamie Dimon
But, given Dimon's career horizon and Lake's status as the youngest among the company's leadership team, speculation simmered in recent weeks that Lake is now a likely CEO candidate, perhaps the most likely. The Wall Street Journal, citing people familiar with JPMorgan's board, earlier this month reported that the January moves made Lake a top contender to become Dimon's successor. Her lead role at the investor day amplified this, some observers said.
"It certainly could suggest she is a serious candidate," Gary Townsend, a JPMorgan investor and GBT Capital Management founder, said in an interview.
That she would become the first woman CEO of a U.S. megabank could also be a feather in her cap, he said, as JPMorgan and other big companies are working to further diversify their leadership ranks away from predominantly white men.
To be sure, as Townsend noted, five years is a long stretch before Dimon retires, and much could change in that time. He said the next significant indicator of Lake's possible ascension would be if she were rotated out of the finance chief position and into a job leading one of the major business units. This would round out her experience — much of her nearly 20-year career at JPMorgan has been in finance roles — and indicate that Dimon and the board are grooming her for bigger things down the road, he said.
NYU's White agreed. "Any large bank with several big businesses like JPMorgan typically likes to rotate its rising stars to give them leadership experience with multiple aspects of the company," he said. "You need that broad knowledge so that, if you are CEO, you not only understand the various pieces of the pie, but you know the people, know who can help you lead, know the context for why things are set up the way they are."