What It Takes: Lessons in the Pursuit of Excellence

by Stephen A. Schwarzman

Even with TARP now going ahead, the largest banks were still under enormous strain. JPMorgan cut our revolving line of credit by half. I could not believe it. We had worked together so successfully for so long on tens of billions of dollars’ worth of transactions. Jimmy Lee said he knew nothing about it. So I called Jamie Dimon, the CEO. “Things are tough,” said Jamie. “We’re still leaving you with credit.” I reminded him of our long relationship. “We’re part of you guys. And we’re a terrific credit. We’ve got $4 billion in cash.” “Yeah, I know,” said Jamie. “If you weren’t a good credit, we’d pull it all.” Citi was a different story. We deposited $800 million with them shortly after TARP passed, gave them some underwriting work and let them into one of our private equity deals. In our view, there was no way Citi could fail. Governments and corporations used its Global Transactions Service to pay their employees and move money. Without Citi, money would stop moving around the world. Shortly after we made our deposit, Vikram Pandit, Citi’s CEO, came to see me. Citi was under huge pressure, and Vikram joked that perhaps we should switch jobs. Running Blackstone looked a whole lot easier than running Citi. But in seriousness, he said that he was grateful for our show of support and asked if there was anything he could do. I told him what JPMorgan had done and asked if Citi would take its place. Vikram didn’t hesitate. We had supported him in a moment of difficulty, and he was...