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April 30, 2002

King of Capital

By Gregory Bresiger

Also in this article

  • King of Capital

Sandy Weill and the Making of Citigroup

by Amey Stone and Mike Brewster

(John Wiley & Sons, New York, 304 pages) $24.95

reviewed by Gregory Bresiger

Sandy Weill beat them all: James Robinson, his former boss at American

Express who helped push him out. John Reed, his former co-chief executive officer at Citigroup, who was to share power with Weill (ha! ha!). Jamie Dimon, his former protege at Shearson and later Citigroup, who clashed with Weill's daughter, a rising star at Citigroup, and consumer group advocates such as Ralph Nader, who didn't like Weill's end run three years ago around the nation's ancient banking laws.

All of these corporate players and gadflies have learned a hard lesson. The demanding Sandy Weill will beat anyone and everyone in a corporate or political alley fight. And even if he loses a match once in a while (as in the case of his unpleasant experience at American Express), he will come back later and win.

That is the central premise of this slender book, which is written by a pair of business journalists. It is neither an official biography nor an authoritative account (Weill apparently didn't cooperate with the authors, who often had to rely on the work of other business journalists).

Military Academy

Nevertheless, despite the book's limitations, the authors tell an interesting story. He is born in 1935 to a Brooklyn businessman who was a dress manufacturer. His father was fined during World War II for violating wartime price controls. Weill, as a young man, attends an upstate military academy and later graduates from Cornell University in upstate New York. He begins on Wall Street in the late 1950s as a runner for Bear Stearns for $150 a month. That's a $150 a month for a man who was going to become a billionaire! That was a low salary even in the 1950s, the authors explain.

By 1960, Weill is on his way. He and three partners begin their own brokerage firm, Carter, Berlind, Potoma & Weill. Three years after starting the firm, Weill takes on a new partner, young Arthur Levitt. Weill borrows money from his mother to help fund his share of the firm. Weill's timing is perfect. The 1960s bull market is about to begin. A pattern is about to be established. Although Weill is only an equal partner, he soon dominates the firm and becomes the top man, pushing out other partners.

Close to 40 years later, Weill will repeat this power to dominate at Citigroup, when he sends John Reed packing. Reed, the authors say, had thought that he and Weill would jointly leave and another person would be found to succeed them.

Weill is neither a Frank Cowperwood nor a Commodore Vanderbilt. He doesn't make outrageous statements telling the public to be damned. He doesn't live the high life with his net worth of $1.6 billion. He doesn't write self-promoting books about the art of the deal, he just makes bigger and bigger deals.