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H. Rodgin Cohen at epicenter of Fannie Mae-Freddie Mac crisis

By A. James Memmott

September 8, 2008 at 11:09am

H. Rodgin Cohen may not be well known away from Wall Street, but he would seem to be the first person called in times of bank failure, acquisitions or mergers.

Consequently, it’s no surprise that Cohen, the chairman of Sullivan & Cromwell, a powerhouse law firm, took part in the recent talks between the U.S. Department of the Treasury and mortgage giants Freddie Mac and Fannie Mae.

Cohen represented Fannie Mae and Daniel H. Mudd, its CEO, when he met last week with Treasury Secretary Henry Paulson. Ben Bernanke, the Federal Reserve chairman, also attended.

On Sunday, Paulson announced the government takeover of both Freddie Mac and Fannie Mae.

Both companies have been hard hit by a wave of mortgage foreclosures, and the government is going to send much-needed capital their way.

As part of the deal, Mudd and Richard F. Syron, his counterpart at Freddie Mac, leave their posts, though they will remain for a while as advisers. Herbert M. Allison Jr., the former chairman of TIAA-CREF, will replace Mudd. David M. Moffett, a senior adviser with the Carlyle Group and a former vice chairman of US Bancorp, takes over for Syron at Freddie Mac.

Cohen, a native of West Virginia, came to this crisis with more than three decades of experience in high-stakes financial showdowns.

A graduate of Harvard Law School and a veteran of the U.S. Army, he joined Sullivan & Cromwell in 1970 and became a partner in 1977.

Over the years, Cohen’s efforts have “fundamentally altered the banking landscape,” according to CFO Magazine.

He helped do this in part by discovering a legal loophole that allowed banks to expand beyond state lines and thereby change the industry.

Cohen has also been involved in a steady stream of bank acquisitions, including the joining of Chase Manhattan and Chemical Bank and the merger of Norwest and Wells Fargo.

Cohen has likewise been a key player in rescue efforts involving failed banks.

He helped in the aftermath of the 1974 collapse of Franklin National Bank, and he represented the struggling Continental Illinois Bank in its 1984 negotiations with the Federal Deposit Insurance Corporation.

Recently, Cohen was a key player in the talks that led to the fire-sale acquisition of Bear Stearns Companies by JP Morgan Chase & Co.

Cohen was also involved in the resolution of the 1980 Iran hostage crisis, helping obtain through the release of frozen Iran bank deposits the money that was necessary to free the hostages.

“When the phone call came saying the hostages had landed, it was the most exhilarating feeling I’ve experienced,” he later told The New York Times.

Cohen reportedly has a less-is-more style that works well at the conference table.

“He has a quiet sense of authority in a boardroom,” Hamid Biglari of Citigroup told The Financial Times. “He speaks infrequently. He is not one to dominate a conversation by holding forth. But when he does speak, everyone listens very carefully.”

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