Five days before New York investment bank Bear Stearns struck an emergency deal to save itself from collapse, NU President Henry Bienen told a Dow Jones Newswires reporter through a spokesman he would not run for re-election to the bank's board of directors.
The bank's sale to JPMorgan Chase & Co. for a bargain price of $2 a share - later increased to $10 - came amid a series of setbacks for Bear Stearns, which had heavy investments in subprime mortgages. Only 15 months ago, Bear Stearns stock traded at a peak of $171 a share. JPMorgan's proposal caused a controversy among some Bear Stearns shareholders and executives who believed the original bid was too low.
Bienen, who has been a member of the Bear Stearns Board of Directors since 2004, will not comment on his relationship with the bank, said Alan Cubbage, Northwestern's vice president for university relations. Representatives for Bear Stearns, the fifth-largest investment bank in the nation, did not return calls or e-mails seeking comment.
Bienen is still a member of the Board of Directors, and according to a press release on Bear Stearns' Web site, "all of the members of the Bear Stearns Board of Directors have indicated that they intend to vote their shares … in favor of the merger."
Bienen is a non-management member on the board and a member of the Audit Committee, which oversees the firm's financial statements and chooses its auditors.
In 2006, he received a total compensation package of $215,000, according to proxy statements filed by Bear Stearns with the Securities and Exchange Commission.
Members of the board who are not full-time Bear Stearns employees, such as Bienen, do not take spots on corporate boards only for the money, said Nell Minow, editor and co-founder of The Corporate Library, a research firm based in Maine that monitors the performance of corporate executives.
"It's very interesting work, very prestigious and has great contacts," she said.
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jp
posted 4/01/08 @ 10:13 PM CST
Powertagged article--it reports no evidence of impropriety. The only claim that can be made is:
(a) The board of directors is at fault [a claim whose only source for this is the another reporter. (Continued…)
jp
posted 4/02/08 @ 1:28 PM CST
Granted, I guess I interpreted the article as being an indictment of Bienen. When I saw the title "NU's link to Bear Stearns" I immediately thought it was attributing blame for the disaster, though I suppose it could be seen as just reporting the fact that Bienen is somehow involved in the Bear Stearns meltdown. (Continued…)
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