Goldman Exec Knew Tough Times On Wall St, Partner Shot By Hostage-Taker

Wow

The things you find out about Wall Street's finest....

Harvey Schwartz, who will succeed David Viniar as Goldman Chief Financial Officer in January, learned early in his career about tough times on Wall Street.

Bloomberg reports that the 6-foot-4 Rutgers University graduate watched tears stream down the face of a middle-aged colleague as the stock market crashed on Oct. 19, 1987. Two years later, he was working at Citicorp when the bank cut thousands of jobs.

Schwartz wasn’t deterred. After 15 years at Goldman Sachs, most recently as co-head of global securities, he was tapped to replace the longest-serving CFO of any major Wall Street firm. The job will make Schwartz, 48, one of the most visible executives at the fifth-biggest U.S. bank by assets as it cuts costs and grapples with weak economic growth and regulatory changes that pushed first-half revenue to the lowest since 2005.

'Whenever we were in a situation where things were either tough or difficult, and you were looking to see who was around to work on it, Harvey was always there', said Jon Winkelried, co-president of Goldman Sachs when he left in 2009 after 27 years at the firm. 'He doesn’t run from difficulty, it kind of attracts him. That’s a pretty darn good feature to have'.

Following Viniar as CFO would be a challenge at any time. For Schwartz, the task is compounded because Goldman Sachs’s business model is in doubt. The company’s shares, like those of some competitors, trade below liquidation value as investors question whether banks will be able to generate a return on equity, a measure of how well a firm reinvests their money, sufficient to compensate them for the risks they’re taking.

To improve returns, the New York-based bank cut $1.4bn of costs beginning last year and said in July that it’s trimming an additional $500m, mostly from compensation.

Schwartz, twice divorced with a 24-year-old daughter, lives with Annie Hubbard, whom he met in 2003, a year after she was shot helping subdue a hostage-taker at an East Village bar.

Hit the link below to access the complete Bloomberg article:

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