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Banks Have Grown Too Large to Manage, Cowen's Cohen Says

Feb. 1 (Bloomberg) -- Banks including Citigroup Inc., JPMorgan Chase & Co. and Bank of America Corp. have grown too large, according to Peter Cohen, chief executive officer of Cowen Group Inc.

“Are the big banks too big?” Cohen, former chairman of Shearson Lehman Hutton Inc., said today in an interview with Bloomberg Television’s Stephanie Ruhle. “I think they are. There are too many people, there’s too much going on and you can’t possible know about it.”

Cohen, a protege of former Citigroup Inc. CEO Sandy Weill, was head of Shearson Lehman in the 1980s. He left the company after losing a bidding war for RJR Nabisco Inc., which was bought out by KKR & Co. in 1989 for a then-record $30 billion, according to Bryan Burrough and John Helyar’s book “Barbarians at the Gate.”

The largest U.S. banks are big enough that regulators would bail them out again in a crisis, Cohen said. Lehman filed for bankruptcy in 2008 amid the collapse of the U.S. housing market.

“Sure, they are too big to fail,” Cohen said. “We could never afford to let, in my opinion, Citi, JPMorgan, Bank of America implode. It would be catastrophic. It would make Lehman look like kindergarten.”

Cowen, an investment-banking, trading and asset-management firm, has seen its stock drop 55 percent since 2009 to $2.66 at 10:02 a.m. in New York. The firm lost $14.5 million in the first nine months of 2012 and posted losses in each of the previous five years, according to data compiled by Bloomberg.

“We have to evolve into something different, which we are working very hard at doing,” Cohen said. “We have very strong asset-management business. We are very active in investing our own capital.”

To contact the reporter on this story: Zeke Faux in New York at

To contact the editor responsible for this story: David Scheer at

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