Matt Zames, currently co-head of investment bank's global fixed income unit and head of capital markets, will succeed Drew, said JP Morgan.
JP Morgan is still weighing the fate of Iksil and other traders. Iksil has been suspended from trading and is currently at home in Paris. Achilles Macris, in charge of the London-based desk that placed the trades, and trader Javier Martin-Artajo, a managing director on Macris' team, are also expected to leave.
In London, rumors were spreading that workers in the bank's chief investment office, where the losses occurred, are at risk of dismissal. The bank did not return calls for comment.
Drew's trading strategy was meant to shield the bank from the ongoing European financial crisis, and involved a series of complicated investments in credit derivatives.
The size of the bank's investments rattled investors and analysts earlier this year. In April, Dimon dismissed those concerns in a conference call with analysts. Asked about the London Whale, Dimon said: "It's a complete tempest in a teapot. Every bank has a major portfolio and in those portfolios you make investments to offset exposures. Obviously it is a big portfolio we are a large company."
When he announced the loss on May 10, Dimon called the firm's handling of the situation "flawed, complex, poorly reviewed, poorly executed and poorly monitored."
Despite Drew's departure and the likelihood of more to come, pressure remains on Dimon. Regulators on both sides of the Atlantic are now investigating the losses, shareholders are threatening to sue, and in Washington politicians are calling for new regulations to be tightened, regulations of which Dimon has been a vocal critic.
Regulators are currently drafting the so-called "Volcker rule", which would limit the types of trading banks are allowed to undertake. Over the weekend, U.S. Senator Carl Levin, co-author of the rule, said Wall Street had successfully watered down the rule.
Levin said the enormous loss at JP Morgan was a prime example of why the rule had to be enforced in its original format.
"The issue here is the power of the banks and whether or not we are going to put a cop back on Wall Street," he told NBC's Meet The Press.
"The issue is whether we are going to stick with the law as written, which will prevent us from bailing out banks again."
Intellpuke: You can read this article by Guardian U.S. Business correspondent Dominic Rushe in context here: www.guardian.co.uk/business/2012/may/14/jp-morgan-ina-drew-quits