Q&A: Former UAL, Texaco CEO steps in at JP Morgan
What does an ex-airline and oil executive know about banks?
More than you might think.
Glenn Tilton, the former chief executive of both United Airlines parent UAL Corp. and oil company Texaco, was named chairman of JPMorgan Chase & Co.'s Midwest business and a member of its executive committee on Monday. Tilton replaces William (Bill) Daley, who took over as White House Chief of Staff in January.
Following in the footsteps of someone as well-connected as Daley would be difficult for many people. But Tilton brings with him decades of influence in Washington, strong business ties across the Midwest and a deep understanding of the regulatory process. He's also a veteran of Congressional inquiry, having testified before Congress many times during his four decade-long year career in the oil and airline industries. With banks still under a regulatory microscope over their role in the mortgage mess and the financial crisis, Tilton's experience will come in handy. Some of JPMorgan's businesses remain under investigation by state attorneys general or federal regulators like the Securities and Exchange Commission.
The 63-year-old Tilton also brings deep relationships with Midwest businesses. Most had ties to Chicago-based UAL, which Tilton ran from 2002 until last year. And Tilton, like most former CEOs, is no stranger to bank dealings. He leaned heavily on financing from JPMorgan and Citibank as he worked through a $23 billion restructuring of United Airlines. That effort began with a bankruptcy filing in 2002 and ended in a merger with Continental Airlines last year. Before taking the helm at UAL, Tilton spent 32 years with Texaco, eventually becoming CEO. His first job: servicing gas stations in the Washington, D.C. area. His tenure as at Texaco ended when the company merged with Chevron in 2001.
Below are excerpts, edited for clarity, from a conversation with Tilton his first day on the job.
Q: How does your experience in the oil and airline business translate into a job as a Midwest banker working for the second-largest U.S. bank?
A: I was a client of a whole suite of bank products. At the airline we used a bank to run our credit card program and also for the United restructuring. I was also involved in two mergers that involved strong participation of investment banks. That gave me a unique client perspective, which will come in handy.
Q: JP Morgan officials say your substantial reputation in Washington, D.C. and strong Chicago relationships are a plus. Tell me about those ties.
A: I was in the oil and gas business from 1970 onward. I first testified before Congress when I was 38 years old. So I have developed relationships in Washington that are deep. I have a good bit of experience in the dialogue around complexities of the oil and airline industries, something that the financial services industry can appreciate.
Q: How will your connections in the Midwest benefit the bank?
A: Having just been the CEO of the largest single employer in the city of Chicago, I have worked with businesses here and have the experience of working with governments here. The relationship between businesses and host states and cities should be symbiotic. As businesses emerge from the recession, the relationship with mayors and governors will be even more important in terms of creating broad-based employment.
Q: Do you have an example of that from your time at UAL?
A: One thing that I made sure was non-negotiable in the merger with Continental was that the company had to remain in Chicago, something that was extremely important to this city.
Q: How did you end up at JP Morgan?
A: Bill Daley was a good friend of mine and also a colleague — (we are both) on the board of Abbot Laboratories — so I had a perspective on the position. I also knew Jamie (Dimon) and his team way back from his days (as CEO) at Bank One. Chase was the lead bank in the merger of UAL and Continental. I left my position at UAL after the merger just as Daley was leaving for the White House, so it was all quite serendipitous.