Sandy Weill still packs a PR punch. The pride of Brooklyn, who once epitomized Wall Street’s gambling casino mentality, today called for the break-up of big banks. That’s quite a turnaround. It's a road to Damascus moment for Weill.
More than anybody else, Weill is credited with the creation of the financial supermarket. Starting a financial career as a broker at Bear Stearns, Weill formed Carter, Berlind, Potoma & Weill, which over the years and more than 15 acquisitions later, evolved into the rough and tumble Shearson Loeb Rhodes, the No. 2 broker after Merrill Lynch.
In 1981, Weill sold Shearson to then white-shoe American Express Co., and became corporate president and chairman of its Fireman’s Fund Insurance Co. Sandy left AmexCo in 1985 after a fall-out with CEO Jim Robinson.
The rest is history. Weill acquired Control Data’s Commercial Credit consumer lending operation and used that as a platform to acquire Gulf Insurance, Smith Barney’s parent Primerica, A.L. Williams insurance, Drexel Burnham Lambert’s retail network, Shearson from AmexCo, Travelers Corp., Aetna Life’s property/casualty unit and Salomon Inc. That hodgepodge was consolidated under the Travelers umbrella.
In 1998, Sandy engineered the blockbuster $76B merger of Travelers with Citicorp, where he ultimately knocked Citi CEO John Reed off the top perch. That deal triggered the demise of Glass-Steagall Act, the law separating banking and insurance. According to Wikipedia, Weill kept a wood etching of himself with the words “The Shatterer of Glass-Steagall” in his office.
The Shatterer today called for the return of Glass-Steagall. He told CNBC’s Squawk Box: "What we should probably do is go and split up investment banking from banking, have banks be deposit takers, have banks make commercial loans and real estate loans, have banks do something that’s not going to risk the taxpayer dollars, that’s not too big to fail.”
Sandy now emerges as a poster boy of the Occupy Wall Street crowd.
Will Republicans in Congress hear his message?