All the credit goes to our CEO, Jamie Dimon who emerged as the most powerful financier of our times.
Here is the exerpts of the artile in New York Times
High in a Park Avenue skyscraper (Building opp. to where I work..proud to be morganite.. :D), within a maze of soft rugs and wood-paneled walls, James Dimon sits just footsteps from the mahogany roll-top desk of J.Pierpont Morgan, the feared lord of the House of Morgan and the most powerful financier of his time.
Mr. Dimon’s race to cut a deal for Bear began around 6 p.m. last Thursday, when Alan D. Schwartz, Bear’s chief executive, called with startling news: Bear had been driven to the brink of bankruptcy by what amounted to a bank run.
Mr. Dimon quickly dispatched his investment banking co-heads, Steven D. Black and William Winters, to assemble a team for a possible takeover. By Friday, JPMorgan was plotting how to assess Bear, particularly the risky mortgage-related assets that had led to crippling losses.
“Jamie was driving the process. It was an extraordinary thing to watch,” said a senior executive involved in the deal.
By 8 a.m. Saturday, about 40 bankers were huddled in the boardroom of the eighth-floor executive suite at JPMorgan’s headquarters, which served as a makeshift war room. Under the command of Mr. Black and Mr. Winters, the group divided into teams, each charged with assessing an aspect of Bear, and began heading across the street to Bear’s headquarters to scour the books. More than 200 bankers ultimately joined in this task.
By Saturday evening, the JPMorgan bankers believed they were so close to a deal that they began drawing up a presentation to investors. The expected price per share was in the double digits, roughly half Bear Stearns’s closing price of $30 on Friday.
But the bankers could not agree on how to value Bear’s holdings of complex mortgage securities. Back on the eighth floor at JPMorgan, Mr. Dimon and his lieutenants paced from room to room, trying to keep up with the latest information.
With so much uncertainty hanging over Bear’s portfolio, the JPMorgan bankers decided to ask federal officials to explore ways to limit the bank’s risk. Among the options was having the Fed guarantee billions of dollars’ worth of Bear securities — an unprecedented step for the central bank.
On Sunday morning, JPMorgan threatened to walk away from the deal because executives felt they would be taking on too much risk. Mr. Dimon and his team wanted to give federal officials time to explore other options, according to a person close to the deal. “You have to have a margin for error so if you are wrong, you are not jeopardizing the company,” Mr. Dimon said.
A Bush administration official said the government was not concerned about the fate of a single bank but about the stability of the financial markets. Indeed, this official said, Bear Stearns was “anything but too big to fail.” But its failure would have had huge repercussions for the stability of the broader markets, and that was why the Fed acted with administration support.
Soon the bankers and policy makers were racing to strike a deal before markets in Asia opened for trading on Monday, fearing markets might plunge if Bear failed to find a buyer. But by 3 p.m., there was still no agreement, but they were heading toward a federal guarantee.
With hope that a deal would be reached, JPMorgan executives began briefing credit ratings companies and Mr. Dimon talked to his board. Just after 7 p.m., with less than an hour to go before Asian markets opened, the two sides reached an agreement.
Mr. Dimon was quick to dispense credit to his top bankers, as well as to Mr. Paulson and Mr. Geithner. “Same with the team at Bear Stearns,” he added. “God knows what pressure they had to be under.”
“This is the first time someone has stepped up and offered to solve a problem, even if it will cost Bear Stearns dearly. And making a few bucks on the leadership is in the Morgan tradition as well.”
Mr. Dimon, for his part, said on Monday that he was looking forward to getting some rest.
“There are two types of not getting sleep,” he said. “There is not getting sleep because there is a lot of work. The other is because you can’t sleep. I had a little of both.”
NY Times Article
Wall Street Journal
"Proud to be a Morganite"
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