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JPMorgan directors Cote and Fuller step down

NEW YORK JPMorgan Chase & Co. (JPM) on Friday said two directors who served on the bank's risk policy committee at the time of its $6 billion "London whale" trading loss are stepping down from the board.

America's largest bank said David Cote and Ellen Futter have retired, and it plans to name replacements later this year.

Commenting on their resignations, Dieter Waizenegger, executive director of the CtW Investment Group, said, "Futter's and Cote's resignation is a good first step. We hope that the Board will now completely overhaul how it manages risk and actively seek shareholder input on new directors given the strong vote of no confidence at the annual meeting."

Cote, the chairman and CEO of industrial conglomerate Honeywell Inc., and Futter, the president of the American Museum of Natural History, were both re-elected to new terms this year, but they were targeted by activist investors and received diminished support from shareholders.

Futter has been on the board for 16 years, and Cote has been on the board for five years. They served on the risk policy committee when the bank suffered the surprise trading loss.

Cote and Futter were both re-elected with less than 60 percent approval from shareholders at the company's annual meeting in May. So was James Crown, who runs a privately owned investment company and also sat on the risk policy committee. The company's other eight directors were re-elected with support of more than 90 percent.

Lee Raymond, the No. 2 director on the board behind Chairman and CEO Jamie Dimon, said in May that JPMorgan would continue to evaluate the makeup of the board.

The trading loss is nicknamed the "London Whale" for the location of the responsible trader and its size. The trader made the outsized bets on complex debt securities that went wrong. JPMorgan first disclosed the losses in May 2012, estimating them at $2 billion. Two months later, it disclosed that the loss would be about $6 billion. The company said traders may have tried to conceal the losses.

JPMorgan said it closed the division responsible for the mistake.

Shares of JPMorgan Chase fell 43 cents, to $55.94, in the early afternoon after trading as high as $56.56 earlier in the day. That matched its highest level since August 2000, according to FactSet.

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