Much of the discussion following the trading losses at JP Morgan’s chief investment office (CIO) last year has focused on failures of risk management and strategy. Traders and senior management have been lambasted as overconfident, naive or inept. Less attention has been paid to the bank’s bonus scheme – but it has a walk-on role in JP Morgan’s own report into the debacle, published on January 16.
Told in late 2011 to cut risk-weighted assets (RWAs) at the CIO by $30 billion, the unit concluded
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