Goldman Sachs Moves Kathleen Brown to Midwest Role
Kathleen Brown, who runs the West Coast municipal finance team at Goldman Sachs Group Inc., will move to a newly created post in Chicago after her brother Jerry Brown was elected last month as California’s next governor.
Brown, 65, will become chairman of investment banking for the Midwest, New York-based Goldman Sachs said in an internal memo today. The former California state treasurer, whose brother and father both served as the state’s governor, joined Goldman in 2001. Michael DuVally, a spokesman for the firm, confirmed the contents of the memo, which was signed by David Solomon and John S. Weinberg, co-heads of investment banking.
“Kathleen is taking on this new role because it broadens her client focus,” DuVally said. “Had she continued to work with California municipalities, it might have created the perception of a conflict of interest.”
Goldman Sachs is ninth among underwriters of municipal debt issued this year by California, the biggest issuer of municipal bonds in the U.S., according to data compiled by Bloomberg. Governor Arnold Schwarzenegger, a Republican, leaves office Jan. 3 when Governor-elect Jerry Brown, a Democrat who held the job from 1975 to 1983, is sworn in. Brown defeated former EBay Inc. Chief Executive Officer Meg Whitman, who came under criticism by Democrats for being a former board member at Goldman Sachs.
Bridge Loan
Goldman, the most profitable securities firm in Wall Street history, lent the state $1.5 billion in November as part of a syndicate of six banks. The arrangement provided California with a $6.7 billion bridge loan to help pay bills after a budget impasse left the state short on cash. Goldman Sachs led a group of investment banks on $4.93 billion in bonds sold by the state since Jan. 1, 2009.
J. Timothy “Tim” Romer, 49, a managing director in the West Coast public sector and infrastructure group, will succeed Kathleen Brown as head of the group, DuVally said. Romer, who is based in Los Angeles, joined Goldman Sachs in 2003 after working in public finance at Bank of America Corp. and Merrill Lynch & Co., which is now part of Bank of America.
Brown’s new role will be focused on client relationships and John Gilbertson will continue to run investment banking in the Midwest region, DuVally said.
Brown, who was herself the 1994 Democratic nominee for California governor, reports to James P. “Jim” Esposito, chief operating officer for investment banking, as well as to John Waldron, head of investment-banking services, DuVally said.
To contact the reporter on this story: Christine Harper in New York at charper@bloomberg.net
To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net.
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