JPMorgan Chase’s head of home lending, Frank Bisignano, announced yesterday that “Dave Lowman and I have decided he will leave the firm” following a military lending fiasco in which the bank was found guilty not just of over-charging active-duty military personnel, but also improperly foreclosing on them and on other borrowers[1]. The lender recently announced that it will not only keep rates low for military members and work closely with them on loan modifications when necessary (including offering principal reductions and interest rates as low as 1 percent), but that it will also donate 1,000 homes to military members and veterans[2]. You can read full coverage of that announcement here.
JPMorgan Chase’s mortgage unit has posted around $3.3 billion in losses in the first quarter of this year alone. The lender is blaming disorganization during Lowman’s tenure for many of the military foreclosure errors[3]. Jamie Dimon, JPMorgan’s CEO, began the process of moving Lowman out in February when he assigned Bisignano to take Lowman’s place and then apologized publicly for the errors at the company’s annual shareholder meeting, where he also announced that the bank would forgive all loans associated with active-duty foreclosures. Lowman was also chastised by Congress last year for the lending division’s “refusal to cooperate with borrowers and modify mortgages.”
Do you think that Lowman’s exit indicates a change in JPMorgan policy?
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[1] http://www.bloomberg.com/news/2011-06-14/jpmorgan-ousts-mortgage-chief-david-lowman-after-lapses-over-foreclosures.html
[2] http://rejournalonline.com/jpmorgan-chase-hopes-to-mend-relationship-with-military/853458/
[3] http://economictimes.indiatimes.com/news/international-business/jpmorgan-dismisses-mortgage-head-david-lowman/articleshow/8855069.cms