Jimmy Cayne.
Wikimedia Commons/Camera 1 NYC
Jimmy Cayne, the bridge-playing chief executive who led Bear Stearns until it nearly collapsed in 2008, died Tuesday. He was 87.
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Cayne became a poster child for financial mismanagement when the investment firm he had run since 1993 as Wall Street’s longest-serving CEO, toppled under a heavy debt load and trading losses. It was sold to JPMorgan Chase & Co. in a fire-sale deal backed by the U.S. government.
His death was confirmed by Alison Cayne, his daughter.
He was absent during key stretches in the firm’s final year, golfing or playing competitive bridge, the Wall Street Journal reported and Cayne later confirmed to federal regulators. Under criticism for those absences and the firm’s cratering stock price — and dogged by reports in the Journal that he smoked marijuana recreationally, which he denied — he ceded the CEO job to investment banker Alan Schwartz in January 2008. Two months later, Bear Stearns, hemorrhaging cash, reached a deal to sell itself to JPMorgan, a merger that in the early 2000s Cayne had rejected.
MarketWatch First Take (May 2008): Goodbye, Bear Stearns
MarketWatch First Take (July 2008): Bear CEO Schwartz’s exit good for everyone
The 85-year-old Bear didn’t fold but lost its independence, absorbed into what is now the nation’s biggest bank. The deal turned out to be a headache for JPMorgan, which paid billions of dollars in mortgage-related settlements tied to Bear Stearns and Washington Mutual Inc., its other crisis-era deal. Jamie Dimon, CEO of JPMorgan
JPM,
has said he wouldn’t do it again.
An expanded version of this report appears at WSJ.com.
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