Friday 28 October 2016

JPMorgan's legendary rainmaker Jimmy Lee dies

Published 18/06/2015 | 07:49

Jimmy Lee, vice chairman of JPMorgan Chase, arrives at the Sun Valley Inn in Sun Valley, Idaho, in this file photo taken July 8, 2009. REUTERS/Rick Wilking/Files
Jimmy Lee, vice chairman of JPMorgan Chase, arrives at the Sun Valley Inn in Sun Valley, Idaho, in this file photo taken July 8, 2009. REUTERS/Rick Wilking/Files

Jimmy Lee, one of JPMorgan Chase & Co's most important dealmakers, died on Wednesday, the bank's chief executive said in a statement. He was 62.

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Lee was one of the first bankers to break up big corporate loans into small pieces to sell to other banks, an innovation that helped fuel the leveraged buyout boom of the 1980s.

He was a rising executive at Chemical Bank and the banks it merged with, taking increasingly senior positions until 2000, when he was sidelined as head of investment banking at what was then Chase Manhattan.

Lee started instead focusing on winning deals of all kinds —advising companies on buying rivals and selling themselves, and on raising money. He played a key role in the merger of United Airlines and Continental Airlines to form United Continental Holdings, the takeover of Wall Street Journal publisher Dow Jones by News Corp, and the initial public offering of Chinese e-commerce company Alibaba Group Holding .

Clients praised his relentlessness and his willingness to fight for better prices for customers. On the initial public offering for General Motors Co in 2010, he pushed to make sure the shares sold at a higher price than originally planned, said Dan Akerson, vice chairman of private equity firm Carlyle Group CG.N and the former CEO of GM.

"He was street smart, savvy, never overplayed his hand, but he’d push it," Akerson told Reuters in an interview.

Lee had planned to be at a JPMorgan dinner on Wednesday night for clients of the bank - in particular, directors of companies that use the bank, a person familiar with the matter said.

The banker felt short of breath while running on a treadmill at home on Wednesday morning, according to a person briefed on the matter who requested not to be identified because of the sensitivity of the matter.

The sudden death surprised colleagues who were working with Lee as recently as this week.

"We're in total shock," said one senior JPMorgan banker.

Lee's father died at the age of 47 from a heart attack. The younger Lee was just 11 years old at the time, according to a 2000 profile in Forbes.

Lee started his career with Chemical Bank in 1975, where he began selling pieces of loans to other banks, helping to pioneer what is now known as the "syndicated loan" market.

"He saw the power of the market," said a person close to Lee.

Over time, Lee built a junk bond business, a private equity advisory group, and a merger advisory group.

"Jimmy was a master of his craft, but he was so much more – he was an incomparable force of nature," Jamie Dimon, JPMorgan's chief executive, said in the statement.

Lee was fiercely loyal to JPMorgan. In 2012, when the London Whale derivatives trading fiasco was bleeding billions of dollars from JPMorgan's results, Lee arranged to have New England Patriots quarterback Tom Brady call Dimon and remind the CEO that even Super Bowl champs have bad days, according to a 2012 story in Vanity Fair.

Private equity firm Blackstone (BX.N) tried to hire Lee away in the early part of last decade, but failed in the end, Blackstone chairman and chief executive Steve Schwarzman told TheStreet in 2009.

"We were quite close at that time to a deal. But he's been extremely loyal to JPMorgan over the years," Schwarzman said.


Lee's clients viewed him as a gatekeeper to the hundreds of billions of dollars that JPMorgan lends out as well as money from bond investors.

In a statement Henry Kravis, co-chief executive of private equity firm KKR & Co LP (KKR.N), praised Lee for "constantly finding new financing sources."

Kravis added, "He built lasting relationships unlike almost any banker I have ever known."

Sheryl Sandberg, chief operating officer of Facebook Inc FB.N, posted on her company's website that Lee "believed in us long before many others did – when we were a small company with little revenue he told us and anyone else who would listen how much potential he thought Facebook had."

Other clients agreed about Lee's drive to do deals.

"He was eternally optimistic that a deal could be done when he started one," Jack Welch, former Chairman and Chief Executive of General Electric Co, (GE.N) told Reuters.

Lee was a legendary rainmaker, but like a classic old-line banker, he cared about risk on the loans he was making, because JPMorgan would suffer when loans went bad. Enrico Dallavecchia, a former senior risk executive at JPMorgan, recalled meetings with Lee in the 1990s to decide whether the bank should make big loans.

"He was ahead of his time in terms of understanding risk," Dallavecchia said. "If he felt that the returns were not high enough for the risk, he would turn down a deal, even if people underneath him were telling him to do it," he added.

Lee lived in Darien, Connecticut, and is survived by his wife, Beth, and three children, Lexi, Jamie and Izzy.

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