JP Morgan just announced that it would slash its quarterly dividend to $.05, a move, it says, that will save it $5 billion per year. That’s not chump change at this point. More interesting, perhaps, is that the company says Q1 will be “solidly profitable” and that EPS will come in line with expectations, which are around $.33 per share.
“…Today’s capital action is not directly related to TARP. Our reason for accepting TARP capital still holds — namely to help stabilise the banking system and economy. The decision to retain additional common equity does, however, help position our company to repay TARP as soon as is prudent — and still maintain a strong capital position. Our repayment of TARP will ultimately be worked out in consultation with the U.S. Treasury and other regulators, and in consideration of the best interests of the banking system overall,” Dimon added.
So are shareholders giving up cash so that Dimon & Co. getting out from pay caps?
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