I have just finished watching Dick Fuld, the chairman and chief executive of Lehman Brothers (RIP), testifying to a US House of Representatives committee on the collapse of his investment bank. The House members picked a dramatic time for the hearing: global stock markets were falling as he spoke.
Testifying in front of politicians after something goes badly wrong at your business, and hurts investors and others, is a thankless task. The best you can hope for is to get out in one piece, having been suitably contrite and humble without admitting to wrongdoing or incompetence.
On this measure, I thought Mr Fuld did well.
I and others have criticised his failure to do more in the last months at Lehman to save the investment bank. But I thought he put on a decent defence of his actions and endured his dressing-down for earning so much money during the good times on Wall Street with as much aplomb as could be expected.
He took responsibility for what had happened and did not lose his temper even when he was being fiercely criticised. Yet he also managed to defend his actions and not to admit every charge that was thrown at him.
Mr Fuld also managed to get the politicians on the back foot by making quite clear just how much he has been scarred by the bank’s failure. In his most open piece of testimony near the end, he said:
“Not that anybody on this committee cares about this but I wake up every single night thinking what could I have done differently, in certain conversations what could I have said . . . I can look right at you and say this is a pain that will stay with me the rest of my life.”
Having said that, Mr Fuld cannot expect much mercy from the House oversight committee in its report. Americans are incensed at having to foot the bill for a $700bn bail-out when Wall Street executives paid themselves so much and Mr Fuld admitted to having gained $350m in compensation since 2000.
