Former Bear Stearns CEO to leave JPMorgan post

Alan Schwartz, the Bear Stearns chief executive who was forced to sell the investment bank to JPMorgan Chase & Co., will leave the banking company at the end of the summer, according to an internal memo obtained by The Associated Press on Thursday.

Schwartz, who joined Bear Stearns in 1976, became CEO of Bear Stearns in January as the investment bank was struggling through the credit crisis. Speculation about the firm's liquidity caused a run on Bear Stearns, and the government orchestrated its sale to JPMorgan in March.

"With most of the work on the merger integration behind us, Alan will be moving on from the firm at the end of August to pursue other interests," according to a memo that was signed by JPMorgan CEO Jamie Dimon. "Despite the extremely difficult circumstances that brought our firms together, Alan has been a terrific and constructive partner through the process."

With major institutional investors pulling their business from Bear Stearns in droves, Schwartz turned to Dimon for help in bailing out the embattled investment bank. After a weekend of intense negotiations, both agreed to a deal that sold Bear Stearns at a take-over price of $2 per share — a stunning amount considering the stock was worth more than $170 at its peak.

The price was lifted a week later to $10 a share to appease employees and shareholders who faced their savings being wiped out. More than 7,000 Bear Stearns employees were laid off as a result of the takeover.

"While this was not an easy situation for anyone, the JPMorgan team handled everything in their trademark first-class way," Schwartz said in the memo. "I am very proud to have been part of Bear Stearns. It was a special place I know many of us will miss."

The acquisition of Bear Stearns was completed in April, and there was some talk that Dimon would extend a vice chairman position to Schwartz and a key role in its investment banking division. Schwartz had been a major player in media mergers, most recently advising Microsoft Corp. on its hostile takeover moves of Yahoo Inc.

There has been some speculation among analysts that Schwartz would most likely leave the firm and start his own boutique investment banking shop.

Schwartz could not be reached for comment.

Shares of JPMorgan fell 42 cents to $41.15 in late morning trading.

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