Jamie Dimon’s been able to find Wall Street jobs for about half the payroll being axed when his JPMorgan Chase takes over crippled Bear Stearns next month.
Dimon gave a progress report yesterday on his acquisition of Bear Stearns in a federally forced shotgun marriage at a bargain $10 a share, or about $2.4 billion.
After the deal closes in three weeks, Bear Stearns will produce about $1 billion in profits to the merged banks in 2009, Dimon said.
However, he warned that a “recession just started” and could hammer the economy with a deep and extended slowdown.
In that case, Dimon predicted that JPMorgan’s consumer lending businesses would see losses double to $900 million by year’s end, primarily from credit cards and home-equity lending.
Dimon believes the bank may have to bolster its loan-loss reserves.
In the current quarter, Dimon said subprime mortgage losses could rise to between $200 million and $250 million, with prime mortgages generating about $100 million in losses.
Credit-card losses could swell to 5 percent in the second quarter, and as much as 6 percent next year.
Dimon said JPMorgan has found positions for 40 percent of Bear’s 14,000 employees, and helped place another 1,500 in jobs outside the company, for a total of about 7,100 people.
JPMorgan plans to eliminate about 1 million square feet of New York office space when it takes over Bear Stearns and moves in most of its investment banking operations into 4.1 million square feet at Bear’s headquarters at 383 Madison Ave.