by Christopher Menkin
Jeffrey M. "Jeff" Peek, age 66, being hired as executive vice chairman of global corporate and investment banking at Bank of America, which bought Merrill Lynch during the financial crisis, is quite unique in the financial world. He is perhaps best known as president and chief operating officer who was later promoted to CEO and chairman of CIT. He was hired July, 2003, following Al Gamper who successfully was able to get back the company from Tyco and Dennis Kozlowski*. Peek is given credit with building up the company, as well as leading the company out of bankruptcy. In 2008, he called "CIT an underdog" and later cut 1,000 employees. Before that he rose to the level of executive vice president of Merrill Lynch & Co., and served as head of Investment Banking and president of Merrill Lynch Investment Managers. Many believe he was in line to become chairman.
It is ironic that CIT is now led by John A. Thain, age 59, who was the last chairman and chief executive officer of Merrill Lynch before its merger with Bank of America. Thain was brought to Merrill Lynch in 2007 to save the company, according to American Banker. Wikipedia.org reports, "Upon joining Merrill Lynch, Thain received a $15 million signing bonus. The firm announced that Thain would receive at least $50 million a year and could be paid as much as $120 million a year, based on the company's stock price." (1) Today his net worth is reported $300 million. (2) 2014 his total compensations was $8,827,148 (3). Peek is reported to have a $40 million plus net worth, according to richregister.com.
CIT waits to rebound, basically tied to its $3.4 billion deal for OneWest Bank with 73 branches in Los Angeles and Southern California, the year's largest bank deal. Leasing News has written about the intense pressure from community groups, who believe community involvement will be effected. Thain believes the OneWest transaction will be completed in the middle of this year, perhaps before it finally takes over management in August of Direct Capital, Portsmouth, New Hampshire, a small ticket lessor with reportedly has over $500 million in assets with 250 employees (although many senior and key individuals have left the company). The management change over may give CIT the opportunity to redesign the management structure and tie in better with corporate marketing.
At a hearing in Los Angeles, California, earlier this year, Thain said the planned OneWest buyout would be good for poor neighborhoods and pledged that the bank would provide $5 billion in loans, philanthropy and additional support over four years to low-income areas.
According to the Los Angeles Times, OneWest Chief Executive Joseph Otting "...said the deal would create a 'hometown bank' big enough to compete with megabanks based elsewhere.
"He said OneWest would ramp up small-business lending, appoint minority representatives to an advisory board and provide funds for nonprofits and smaller banks to make small-dollar loans in poor areas.
"Gilbert Vasquez, chairman of the Los Angeles Latino Chamber of Commerce, said he supported the merger not only because Otting pledged to help nonprofits but because he believed OneWest would follow through on promises to increase lending to minority businesses and to put a Latino on the bank's board of directors.
"'We think OneWest can be a trend-setter,' said Vasquez, head of a downtown Los Angeles accounting firm. 'We think they can be a model for the other banks'."
* CIT's Dennis Kozlowski's Path from Infamy to Obscurity
- John Thain is Still in the Gamehttp://www.americanbanker.com/news/national-regional/john-thain-is-still-in-the-game-1073209-1.html
John Thain Net Worth
Total Compensation 2014
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.