Legal Business

Flight to quality as big-spending JPMorgan signs entire Magic Circle to EMEA panel

Flight to quality as big-spending JPMorgan signs entire Magic Circle to EMEA panel

Several London-headquartered law firms, including the entire Magic Circle, have won places on JPMorgan Chase’s panel for Europe, the Middle East and Africa (EMEA) following a review.

The review was finalised last year when prominent UK finance counsel Piers Le Marchant served as EMEA general counsel (GC) and the bank was understood to have requested firms consider taking fee cuts of at least 2% to qualify.

One of the most lucrative legal clients in the world, the investment banking giant has awarded places to Slaughter and May, Allen & Overy (A&O), Clifford Chance (CC), Linklaters, Freshfields Bruckhaus Deringer, CMS Cameron McKenna, Eversheds and Norton Rose Fulbright (NRF).

Freshfields has led for the bank on Forex-related probes, while CC advised the bank last summer alongside Deutsche Bank and Standard Chartered on the $500m African sovereign Eurobond issue by Gabon.

Several City firms known to have previously acted for the bank in Europe, including Ashurst, Simmons & Simmons and Herbert Smith Freehills, are not on the current roster.

Firms that work closely with JPMorgan, which reported firmwide global legal expenses of $3bn and $2.9bn in 2015 and 2014 respectively, are signed up to the bank’s overall external counsel policy on fees, which includes a centralised process involving the in-house legal team closely negotiating standard rates.

EMEA GC John Tribolati (pictured), who succeeded Le Marchant in the role last May, said: ‘[The policy] brings consistency to our arrangements and often better suits individual circumstances and projects, particularly if the nature of the work is very chunky in the short term.’

The bank has provided a windfall of transactional, regulatory and compliance instructions for law firms. Major corporate work in 2015 included JPMorgan advising on Anheuser-Busch InBev’s $117bn mega-merger with brewer SABMiller, as well as Royal Dutch Shell’s $81.5bn takeover of BG Group.

Tribolati would not confirm which US advisers sat on the EMEA panel, though firms known to frequently receive instructions on European mandates include Davis Polk & Wardwell, Shearman & Sterling, Mayer Brown and White & Case.

Other major bank panel news of late included The Royal Bank of Scotland’s recent review, which saw CC, Linklaters and A&O win appointments to its roster for the next three years.

sarah.downey@legalease.co.uk

Read more about JPMorgan Chase’s John Tribolati in his client profile here.

Legal Business

Flight to quality as big-spending JPMorgan signs entire Magic Circle to EMEA panel

Flight to quality as big-spending JPMorgan signs entire Magic Circle to EMEA panel

CMS, Eversheds and NRF also picked as Ashurst, Simmons and HSF miss out

Several London-headquartered law firms, including the entire Magic Circle, have won places on JPMorgan Chase’s panel for Europe, the Middle East and Africa (EMEA) following a review.

Legal Business

Client profile: John Tribolati, JPMorgan Chase

Client profile: John Tribolati, JPMorgan Chase

The investment bank’s EMEA GC on tackling the growth of global regulation and avoiding potholes along the way.

There’s a school of thought that says ‘never go back’ to a former lover or job. But having spent eight years at JPMorgan Chase & Co in the 1990s, a phone call from the investment bank’s ‘very persuasive’ general counsel (GC) Stacey Friedman in 2015 made John Tribolati’s decision to return to his old shop very easy. ‘It was an opportunity to have my own gig,’ he says.

Legal Business

In-house: JP Morgan appoints a new GC as Cutler takes on vice-chairman role

In-house: JP Morgan appoints a new GC as Cutler takes on vice-chairman role

JP Morgan Chase will appoint its current corporate and investment general counsel (GC) Stacey Friedman as GC early next year as incumbent Stephen Cutler takes on the vice chairman role.

Friedman, who was previously a litigation partner at Sullivan & Cromwell, joined JP Morgan three years ago. The bank was a client of Friedman and during her time at Sullivan, she worked for it on litigation and investigations including its acquisition of Washington Mutual assets from the FDIC, which then led to Sullivan becoming lead counsel on all of JP Morgan’s mortgage-backed securities work.

Friedman will report to Cutler as his deputy until she takes up her new role at the beginning of next year. As GC, Friedman will also join the bank’s operating committee.

Cutler, who has served as GC and executive vice president at JP Morgan since 2007, joined the bank from the Washington office of Wilmer Cutler Pickering Hale and Dorr where he was both partner and co-chairman of the securities department from 2005. As vice chairman, Cutler will act as a senior adviser to JP Morgan’s chairman and chief executive James Dimon, other executives and the board of directors while continuing to provide advice on more complex legal issues.

Last year, JP Morgan recruited Nomura’s Piers Le Marchant as its new general counsel for Europe, the Middle East and Africa (EMEA), following the retirement of longstanding regional GC Karen Linney.

kathryn.mccann@legalease.co.uk

Legal Business

Significant hires: KWM lands JP Morgan’s Asia-Pacific vice chairman

Significant hires: KWM lands JP Morgan’s Asia-Pacific vice chairman

Eager to convince Western investment banks, hedge funds and private equity houses that it has the lawyers to handle the most complex mandates in Asia, Hong Kong-headquartered King & Wood Mallesons has hired JP Morgan’s Zili Shao as co-chairman of its China management committee.

Shao’s arrival provides a major boost to the firm’s hopes of winning more high-value finance and M&A work and is designed to send a strong message to the investment banks after a record year for M&A in China. According to accountants PwC, China M&A hit record levels in 2014, both in terms of the number of deals (6,899) and their total value ($407bn).

Wang Ling, China managing partner of KWM, said Shao ‘will play a key role in the globalization of the firm’.

Shao leaves JP Morgan after five years at the bank, having arrived as China chairman before being named Asia-Pacific vice chairman in April 2014. Shao oversaw JP Morgan’s China expansion, including the formation of a domestic securities venture, the purchase of stakes in a trust and a guarantee company, and the establishment of a locally incorporated bank.

‘His breadth of experience across the legal and corporate sector and deep knowledge of the region provides him with the ability to help lead KWM through its next stage of development in China, and to help to integrate the China practice into the global KWM firm,’ said Stuart Fuller, KWM’s global managing partner.

Prior to his time at JP Morgan, Shao held posts as Linklaters Greater China managing partner before being promoted to Asia managing partner in a 12 year stint at the Magic Circle law firm. He has also been a partner at legacy Australian firm Mallesons Stephen Jaques, which merged with King & Wood in 2013. As a lawyer, he specialised in China-related M&A and corporate restructuring.

tom.moore@legalease.co.uk

Legal Business

JP Morgan

JP Morgan
  • General counsel: Stephen Cutler.
  • EMEA general counsel: John Tribolati.
  • Team headcount: 115 lawyers in London.

JP Morgan remains one of the most coveted and lucrative legal clients in the world. From transactional, regulatory and compliance instructions, and a legal expense bill that totalled more than $1.1bn in the fourth quarter of 2014 alone as a result of major government probes, law firms are chomping at the bit for business. But aside from size, JP Morgan’s legal team has long been admired for its technical polish and pragmatic approach.

JP Morgan’s strategic investment in its legal function was evident with the hire of Piers Le Marchant from Nomura last April as its EMEA GC.

Le Marchant has moved into the role of global head of compliance for corporate and investment banking, with JP Morgan last month recruiting prominent Goldman Sachs counsel John Tribolati as its new regional legal head.

Tribolati has moved to one of the world’s largest investment houses at a time when JP Morgan faces intense scrutiny from regulators. In 2013 it paid out nearly $20bn in settlements to regulators, while in 2014 the bank was one of a dozen facing a global investigation into whether traders colluded to manipulate the estimated $5.3trn-a-day Forex market.

Major corporate work last year saw JP Morgan club together with Barclays and Morgan Stanley to arrange £6.6bn in loans for BSkyB to take full control of Sky Italia and Sky Deutschland, while its work on Liberty Global’s purchase of Germany’s third-largest cable TV operator KBW from EQT was cited by market commentators as one of the most innovative acquisition financings in recent years.

The EMEA team is described by Allen & Overy finance partner Sally Onions as ‘not just focused on deal management but is also interested in shaping the future of the market’.

In particular, legal counsel Liz Tippins, a former Allen & Overy lawyer, is described as ‘very pragmatic and efficient in her approach’ and ‘interested in wider market developments’, while other notable names include executive director and assistant GC, Emma Smith, an employment law specialist who joined from Old Square Chambers in September; and dual-qualified Simone Paul, also executive director and assistant GC, who serves in the derivatives legal department. Paul also previously served as investment compliance manager at Citibank followed by a six-year run at State Street Bank’s global markets legal department. The team also includes high-profile associate GC Tim Hailes.

Legal Business

In-house reshuffle: JPMorgan hires Goldman Sachs’ John Tribolati as new EMEA general counsel

In-house reshuffle: JPMorgan hires Goldman Sachs’ John Tribolati as new EMEA general counsel

US banking giant JPMorgan Chase continues its strategic expansion of its legal function, and has recruited Goldman Sachs heavyweight counsel John Tribolati as its new EMEA general counsel (GC). Tribolati succeeds Piers Le Marchant, who has now been appointed as global head of compliance for corporate and investment banking.

A former lawyer at Cleary Gottlieb Steen & Hamilton, Tribolati joined Goldman Sachs as executive director in Tokyo in 2001 from JP Morgan’s Asia Pacific offering where he was managing director and head of legal & compliance. A year later, he moved to Goldman’s London office to co-head the derivatives legal team. He has undertaken multiple management roles at the bank including acting as EMEA deputy GC, co-leading the EMEA securities division legal team, and having oversight of the EMEA investment management division, investment banking division, and principal and loan finance legal practice areas.

His move to JP Morgan Chase follows the bank’s recruitment of Piers Le Marchant in April from Japanese-based investment bank Nomura. Le Marchant, one of the most prominent UK counsel in finance, was hired as JP Morgan Chase’s EMEA GC to replace longstanding head Karen Linney who retired last year.

For Goldman Sachs, Tribolati’s move constitutes another signifcant departure in the legal team, having lost its European head and co-head of restructuring Andrew Wilkinson to Weil, Gotshal & Manges in April 2014.

Before his move into banking Wilkinson was a prominent insolvency lawyer, having led the restructuring group at Clifford Chance and pioneered a ground-breaking and highly lucrative bondholder-focused practice at the London branch of Cadwalader, Wickersham & Taft from 1997 to 2007.

sarah.downey@legalease.co.uk

Legal Business

In-House: JPMorgan Chase & Co General Counsel sells $2.58 million-worth of shares

In-House: JPMorgan Chase & Co General Counsel sells $2.58 million-worth of shares

Despite not having made it into the latest top 100 salary-based compensation rankings of US general counsel (GCs), the earning power of GCs based on stocks has again come to the fore after JPMorgan Chase & Co’s GC Stephen Cutler sold off 43,997 shares priced at $58.74, making Cutler $2.58m.

The move follows a similar transaction earlier this year by Cutler, in which he netted $2.41m after selling 43,997 of shares.

Cutler has overseen JPMorgan’s legal team during a turbulent time which saw large legal expenses of US$9.2bn in Q3, contributing to a loss of $400m for that quarter and a $13 billion settlement over mortgage-backed securities in November.

At the time of the bank’s Q3 results, Jamie Dimon, chairman and chief executive highlighted the issue: ‘While we had strong underlying performance across the businesses, unfortunately, the quarter was marred by large legal expense.’

Dimon added: ‘We continuously evaluate our legal reserves, but in this highly charged and unpredictable environment, with escalating demands and penalties from multiple government agencies, we thought it was prudent to significantly strengthen them.’

So far in 2014, the bank’s settlements include a $614 million agreement covering submitting false claims for US government guarantees.

Michael.west@legalease.co.uk

Legal Business

Filling one of Europe’s top legal jobs – JP Morgan hires Nomura’s Piers Le Marchant as new EMEA general counsel

Filling one of Europe’s top legal jobs – JP Morgan hires Nomura’s Piers Le Marchant as new EMEA general counsel

It’s often said that the finance industry has been in retreat since the 2008 banking crisis but there is no doubt that US giant JP Morgan Chase remains one of the most lucrative and coveted legal clients in the world.

As such there will be plenty of interest among City law firms at the news that JP Morgan has recruited Nomura’s Piers Le Marchant as its new general counsel for Europe, the Middle East and Africa (EMEA), replacing longstanding regional GC Karen Linney who retired this month.

Le Marchant, one of the most prominent UK counsel in finance, served as general counsel and head of legal & compliance for the EMEA region at Nomura. He joined the institution in November 2008 after spending 18 years at Lehman Brothers when the Japanese-based investment house acquired much of Lehman’s European investment banking division. Prior to his departure from the now-defunct bank, he served as its European legal director.

He joins one of the world’s largest investment houses at a time when JP Morgan is facing intense scrutiny from regulators. JP Morgan paid out nearly $20bn in settlements with regulators during 2013.

However, the bank – which employs more than 250,000 staff worldwide – came through the banking crisis relatively unscathed in comparison to its peers.

Linney herself was one of the most high profile bank general counsel in Europe. Ranked in the Legal Business GC Power List 2013, Linney made the transition in-house early in her career, after working at Clifford Chance. She became managing director and associate GC for JPMorgan Chase in 2001, before her appointment as EMEA investment bank GC in 2008. She stepped into the role as GC EMEA in 2012.

Linney last year told Legal Business: ‘We will always pick the best firm for the task but, despite what they sometimes seem to think, we try to be fair about allocating work.’

European advisers for JP Morgan have included Allen & Overy, Ashurst, Clifford Chance, Davis Polk & Wardwell, Freshfields Bruckhaus Deringer, Herbert Smith Freehills, Linklaters, Mayer Brown, Simmons & Simmons, Simpson Thacher & Bartlett and White & Case.

sarah.downey@legalease.co.uk

Legal Business

Regulatory squeeze – JP Morgan sees rare loss after setting aside $9.2bn in legal fees

Regulatory squeeze – JP Morgan sees rare loss after setting aside $9.2bn in legal fees

As if any reminder was needed of the impact that increased regulation and the continuing fallout from the financial crisis is having on the banking community JP Morgan on Friday (11 October) reported a $380m third quarter loss after setting aside $9.2bn to cover its legal fees.

The results are the first quarterly loss for the bank in eight years, with chairman and CEO Jamie Dimon claiming that its ‘strong underlying performance’ this term was ‘marred by large legal expense.’

JP Morgan last reported a quarterly loss in 2004, also as a result of legal expenses, in that case related to WorldCom and Enron.

The latest results follow a sustained period of turbulence for the New York-based bank including litigation and government investigations into a wide range of issues such as the $6bn losses from its derivatives trader Bruno Iksil, more widely known as the ‘London Whale’, sales of mortgage securities, commodities trading and credit card debt collections.

However, much of the liabilities arise out of the rescue of Bear and WaMu and the US government is perceived to have tightened its stance on pursuing the misdeeds of those banks.

Dimon added: ‘We continuously evaluate our legal reserves, but in this highly charged and unpredictable environment, with escalating demands and penalties from multiple government agencies, we thought it was prudent to significantly strengthen them. While we expect our litigation costs should abate and normalize over time, they may continue to be volatile over the next several quarters.’

The announcement follows the departure in August of Michael Coyne, JP Morgan’s co-head of litigation responsible for all of the bank’s litigation and government investigations, who left the bank for San Francisco lender UnionBanCal Corp.

Nonetheless, banks including JP Morgan have been ramping up their internal litigation and compliance capability – last year former Sullivan & Cromwell litigator Stacey Friedman joined to head up a legal team as general counsel of the corporate and investment bank division and the bank is reported to be rapidly bulking up its compliance function. However, once investigations develop they are often extremely labour intensive and their ‘break the bank’ nature often means only the best, most expensive firms are used.

US firms to have assisted JP Morgan with regulatory work include Sullivan & Cromwell and Paul, Weiss, Rifkind, Wharton & Garrison, while Magic Circle firm Freshfields Bruckhaus Deringer is acting against the former supervisor of trader Bruno Iksil over the $6bn losses incurred by the bank.

sarah.downey@legalease.co.uk