A Capital Question
Can capitalism regroup and bring some dynamism back to the U.S. economy? If so, would that depend on banks lending more?
Maybe, and yes — but constraints on lending are preventing banks from doing their part. Those were the conclusions of a featured panel Wednesday at The New York Forum, a new conference modeled after the World Economic Forum in Davos.
Panelist and Citigroup Inc. Chief Executive Vikram Pandit pointed out more than once that the demand side of the lending equation has hampered loan activity. But he also allowed this: "It's hard for banks to go out there and lend when you don't know what the capital requirements are going to be."
As to when the new requirements will be decided upon, Pandit's guess was as good as anyone's. "We'd all like to get there sooner rather than later, but I think we've got to be realistic," said Pandit, who was joined in the session by the Nobel Prize-winning economist Edmund Phelps, Columbia Business School Dean Glenn Hubbard, the risk consultant Leo Tilman of L.M. Tilman & Co. and Richard Robb, CEO of the investment firm Christofferson Robb & Co.
"It's going to take some time."
Mayoral Support
At the same forum, Michael Bloomberg proved himself a strong advocate for the bank industry. The mayor of New York City, who built his fortune selling data and media to financial services companies, warned Washington that yielding to populist demands to inflict punitive measures against banks would imperil the broader economy.
"If the whole pressure on banks is to reduce their risk-taking, then it flies in the face of [creating loans for] middle America," Bloomberg said. "You can't have it both ways."
Locals Rally
Richard Anthony's unexpected illness and indefinite leave from Synovus Financial Corp. is having an impact on the local community, too.
The Greater Columbus Chamber of Commerce in Georgia said it is temporarily replacing the Synovus chief executive as its chairman to give him more time to receive treatment for a serious blood vessel condition. Russ Carreker, a past chair and local business leader, is taking over on an interim basis.
"We will certainly miss Richard for the time being but we also know that he will be back," said Mike Gaymon, the chamber's president and CEO. "He's been involved with our organization for several years."
As chairman, Anthony had been attending weekly meetings with Gaymon and other chamber staff and present at key events despite the challenges his own company faces. He was five months into a one-year chairmanship before announcing his medical leave.
A Key Pickup
Michael Lynch, a longtime Goldman Sachs Group Inc. veteran, has been named vice chairman of JPMorgan Chase & Co.'s investment banking arm.
Lynch worked in Goldman's investment banking division from 1976 to 2005 and became a partner in 1986. He was most recently with GSC Group, a registered investment adviser. Lynch, who ran Goldman's investment banking business in Latin America in the early '90s, is joining JPMorgan Chase as it looks to broaden its reach overseas.
His predecessor as vice chairman, Hamish Buckland, left the company late last year.
Now Batting …
Speaking of JPMorgan Chase … Michael Cavanagh, whom the New York company switched this week from chief financial officer to head its treasury and securities services unit, described the move in baseball terms.
"You're playing for the Yankees and it doesn't matter if it's shortstop or third base," he said. "I'm a lucky guy."
His was part of a three-person lineup shuffle that moved Heidi Miller from treasury services chief to president of international operations, and Doug Braunstein from head of investment banking in the Americas to Cavanagh's former job of CFO.
Retirement Plan
Dowd Ritter has resurfaced since retiring as chairman and CEO of Regions Financial Corp. in March.
Alabama Gov. Bob Riley on Thursday appointed Ritter to the board of the state's prepaid tuition program. Pact, which stands for Prepaid Affordable College Tuition, is a program created in April by state lawmakers.
