Sanford I. Weill
From Wikipedia, the free encyclopedia
Sanford I. Weill (born March 16, 1933), commonly known as Sandy Weill is an American banker, financier and philanthropist. He was formerly a chief executive officer and chairman of Citigroup Inc. He served in those positions until October 1, 2003 and April 18, 2006 respectively.
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[edit] Early life
Weill was born in the Bensonhurst section of Brooklyn, New York to two Polish-Jewish immigrants.
Weill's middle initial of "I" is not an abbreviation for anything. Weill said:
- My mother wanted to name me after somebody whose name started with an "I," but she couldn't think of a name she liked. So she gave me the initial with the idea that after I was 21 I could choose whatever middle name I wanted.[1]
In his younger years, he attended P.S. 200 in the Bensonhurst section of Brooklyn. He also attended Peekskill Military Academy in Peekskill, New York, then enrolled at Cornell where he was active in the Air Force ROTC and the Alpha Epsilon Pi Fraternity. Personal problems led to a delay in graduation, which with reductions in military spending quashed his goal to become a pilot. Weill received a Bachelor of Arts degree in Government from Cornell University in 1955 and got his first job on Wall Street: a runner for Bear Stearns.
Weill married his wife, the former Joan Mosher, on June 20, 1955. The couple lives in Greenwich, Connecticut. They have two adult children (Marc Weill, Jessica Weill Bibliowicz) and four grandchildren.
While working at Bear Stearns, Weill was a neighbor of Arthur Carter who was working at Lehman Brothers. In 1956, he became a licensed broker at Bear Stearns. Rather than making phone calls or personal visits to solicit clients, Weill found he was far more comfortable sitting at his desk, poring through companies' financial statements and disclosures made to the U.S. Securities and Exchange Commission. For weeks his only client was his mother, Etta, until Joan persuaded an ex-boyfriend to open a brokerage account.
[edit] Rise of his fortune
In May 1960, Arthur Carter, Roger Berlind, Peter Potoma, and Weill formed Carter, Berlind, Potoma & Weill. In 1962 the firm became Carter, Berlind & Weill after the New York Stock Exchange brought disciplinary proceedings against Potoma. In 1968 the firm became Cogan, Berlind, Weill & Levitt (Marshall Cogan, Arthur Levitt), or CBWL (jokingly, Wall Street called them Corned Beef With Lettuce). Weill served as the firm's Chairman from 1965 to 1984, a period in which it completed over 15 acquisitions to become the country’s second largest securities brokerage firm. The company became CBWL-Hayden, Stone, Inc. in 1970; Hayden Stone, Inc. in 1972; Shearson Hayden Stone in 1974, when it merged with Shearson Hammill & Co.; and Shearson Loeb Rhoades in 1979, when it merged with Loeb Rhoades Hornblower & Co. With capital totalling $250 million, Shearson Loeb Rhoades trailed only Merrill Lynch as the securities brokerage industry's largest firm.
In 1981 Weill sold Shearson Loeb Rhoades to American Express for about $930 million in stock. (Sources differ on the precise figure.) In 1982, he found the National Academy Foundation with the Academy of Finance to educate students that would graduate from High School. Weill began serving as president of American Express Co. in 1983 and as chairman and CEO of American Express's insurance subsidiary, Fireman's Fund Insurance, in 1984. Increasingly nettled by his forced subservience to the chairman of the company, James D. Robinson III, whose ideas about the business conflicted sharply with his, Weill realised that he would never be named CEO. He resigned in August 1985, at the age of 52.
After a failed attempt to become the CEO of BankAmerica Corp. (and "take over" Merrill Lynch, according to a Jamie Dimon interview in 2002), he set his sights a little lower and persuaded Minneapolis-based Control Data Corporation to spin off a troubled subsidiary, Commercial Credit, a consumer finance company. In 1986, with $7 million of his own money invested in the company, Weill took over as CEO of Commercial Credit. After a round of deep cost cuts and reorganisation, the company performed a successful IPO.
In 1987 he acquired Gulf Insurance. The next year, 1988, he paid $1.5 billion for Primerica, the parent company of Smith Barney and the A. L. Williams insurance company. In 1989 he acquired Drexel Burnham Lambert's retail brokerage outlets. In 1992, he paid $722 million to buy a 27 percent share of Travelers Insurance, which had gotten into trouble because of bad real estate investments.
In 1993 he reacquired his old Shearson brokerage (now Shearson Lehman) from American Express for $1.2 billion. By the end of the year, he had completely taken over Travelers Corp in a $4 billion stock deal and officially began calling his corporation Travelers Group Inc. In 1996 he added to his holdings, at a cost of $4 billion, the property and casualty operations of Aetna Life & Casualty. In September 1997 Weill acquired Salomon Inc., the parent company of Salomon Brothers Inc. for over $9 billion in stock.
In April 1998 Travelers Group announced an agreement to undertake the $76 billion merger between Travelers and Citicorp, and the merger was completed on October 8, 1998. The possibility remained that the merger would run into problems connected with federal law. Ever since the Glass-Steagall Act banking and insurance businesses had been kept separate. Weill and Reed bet that Congress would soon pass legislation overturning those regulations, which Weill and Reed and many other businesspeople considered obsolete. To speed up the process, they recruited ex-President Gerald Ford (Republican) to the Board of Directors and Robert Rubin (Secretary of Treasury during Democratic Clinton Administration) whom Weill was close to. With both Democrats and Republican on their side, the law was taken down in less than 2 years. (Many European countries, for instance, had already torn down the firewall between banking and insurance.) During a two-to-five-year grace period allowed by law, Citigroup could conduct business in its merged form; should that period have elapsed without a change in the law, Citigroup would have had to spin off its insurance businesses.
In 2001, Sanford I. Weill became a Class A Director of the Federal Reserve Bank of New York. Class A Directors are Board Members who are elected by Member Banks (of the Federal Reserve System) to represent the interests of Member Banks. (See article on Federal Reserve Bank Board Membership).
In 2002 the company was hit by the wave of "scandals" that followed the stock market downturn of 2002. Chuck Prince replaced Mr. Weill as the CEO of Citigroup on October 1, 2003.
In 2003 Citigroup repurchased $300 million worth of shares from Mr. Weill. It was reported among the $1.967 billion of "treasury stock acquired" in the Citigroup consolidated statement of changes in stockholders' equity.
[edit] Philanthropies
He is a billionaire, with a net worth estimated to be $1.9 billion by Forbes Magazine (2007). As of April 2006 he held 16,518,365 shares of Citigroup, Inc. and another 3,109,173 unexercised options.
He served as a Cornell Trustee for many years, and in 1998 he endowed Cornell's medical school, now known as the Joan and Sanford I. Weill Medical College and Graduate School of Medical Sciences.
In May of 2003, he received the Baruch Medal for Business and Civic Leadership, presented by Baruch College for his work in public education and his accomplishments in business.
He is also currently the Chairman of the Carnegie Hall Board of Directors and is an avid champion of classical music in the United States.
In September 2006, Joan and Sanford Weill Hall was dedicated at the University of Michigan. The building is home to the Gerald R. Ford School of Public Policy. Weill donated $5 million towards the construction of the building and an additional $3 million to endow the position of the dean of the school.
In June of 2007, he endowed Cornell's Life Science Technology building, which was named for him. As chairman of the Board of Overseers of Weill Cornell Medical College and an emeritus member of the Board of Trustees of Cornell University, Mr. Weill orchestrated a $400 million donation to Cornell, of which he and his wife personally contributed $250 million. [2]
[edit] References
[edit] External links
[edit] Biographies
[edit] Articles
- HW Wilson: Today's Profile - 1999
- The Banker: "Is Sandy losing focus?," September 2, 2002.
- Knowledge at Wharton
- Norris, Floyd. "Citigroup's Climb to Riches, One Merger at a Time with Sanford I. Weill," New York Times, July 17, 2003.
- Wharton Journal: "Sandy Weill Sits Down With the WJ," September 22, 2003.
- "Sandy's Story," TIME, March 24, 2003.
- USA Today Q&A
[edit] Videos
[edit] Books
- Langley, Monica. Tearing Down the Walls ISBN 0-7432-4726-4, The Free Press, New York, 2004 (WSJ Books Review, Simonsays.com excerpt of Chapter 1: "Crashing the Gates")
- Barnes & Noble.com - King of Capital: Sandy Weill and the Making of Citigroup - May 2002
| Preceded by John S. Reed |
Chairman of Citigroup 1998-2000 (Co-Chairman) 2000-2006 (sole Chairman) |
Succeeded by Charles Prince |
