JPMorgan staff have so far been relatively unscathed by the credit crunch. That, however, might just be about to change.

Jamie Dimon, the JPMorgan Chase CEO, has been widely credited with navigating his ship well through the recent difficulties in the financial markets. Tighter risk management and stronger expense management has enabled JPMorgan to ride the US subprime lending storm, deliver relatively good profits and retaining most of its investment banking staff on its payroll.

Reuters reported Wednesday, however, that Dimon could be getting ready to cut up to 4,000 from the investment bank headcount - up to 2,000 as a result of the credit crunch and current economic slowdown, and possibly another 2,000 who will lose their jobs to Bear Stearns staff when the Bear bankers officially come aboard in the coming weeks. The news agency's unnamed sources 'familiar with the situation' claim that of the 6,000 jobs JPMorgan has offered to Bear staff, around half overlap with existing JPMorgan employees.

Speaking at the UBS Financial Services Conference in New York this week, Dimon said that his bank would need to take a charge of around $9bn (half as much again as expected) to sort out Bear's balance sheet. The charge will, however, be more than offset by Bear's capital, which as at the end of February stood at $11.5bn. The Financial Times says that Dimon puts the higher charge down to bigger losses sustained by Bear and a higher bad debt total. Bear is, however, expected to add $1bn to JPMorgan Chase's profits from 2009.

Finally, Bear shareholders will no doubt be glad to know that, in addition to those $1bn in earnings, the purchase of Bear will save JPMorgan billions as it no longer needs to build a new HQ building in Lower Manhattan. Dimon said: 'This (obtaining Bear's Madison Avenue HQ) stops us from having to basically spend $3bn to build an investment banking headquarters downtown'. Not bad for shelling out just $1.2bn, Jamie!

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