Corporate Leaders

Goldman’s former SE Asia chairman Tim Leissner departs

Jennifer Hughes
Goldman's former SE Asia chairman leaves

Tim Leissner, Goldman Sachs' Southeast Asia linchpin, has left the bank, which is struggling to distance itself from the scandal surrounding Malaysia's prime minister and 1MDB, the country's troubled state investment fund.

The move by Mr Leissner, the driving force behind Goldman's involvement in a series of controversial bond deals for the fund, had been widely tipped after he moved to Los Angeles at the end of 2015, and took personal leave from the US bank in January.

Mr Leissner's wife, model and entrepreneur Kimora Lee Simmons, is building a fashion business in Los Angeles and the banker's increasingly prolonged stays in the city over the past two years were causing friction within Goldman, people close to the bank have said.

Mr Leissner spent more than a decade of his 18-year career with the bank in Asia, taking a series of jobs in Singapore and Hong Kong and ultimately being named chairman of the bank's Southeast Asia division in July 2014.

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His close relationships with power brokers in Kuala Lumpur, including Malaysia's prime minister, Najib Razak, who chairs 1MDB's advisory board, produced what one close observer has described as a "golden period" for Goldman.

Ms Simmons, whom Mr Leissner met on a flight between Hong Kong and Kuala Lumpur, has tweeted pictures of herself with Mr Najib's wife, Rosmah, whom she described as "my friend".

Mr Najib is still fighting to extricate himself from a donations scandal alleged to be linked to 1MDB, which itself struggling under a heavy debt burden.

Mr Najib's critics allege that more than $680m paid into his personal bank account was linked to 1MDB, but last month Malaysia's attorney-general said the prime minister had no case to answer. Both Mr Najib and 1MDB deny they are guilty of any crimes.

Signage for 1Malaysia Development Bhd. (1MDB) is displayed at the site of the Tun Razak Exchange (TRX) project in Kuala Lumpur, Malaysia.
Timeline: The twists and turns in the tale of 1MDB

Goldman earned unusually large fees underwriting a series of bonds in 2012 and 2013 for the investment fund. The biggest deal was worth $3bn and earned the bank $300m — a fee many times the standard rate.

The bank said the high payout was due to the risk it took since it bought the hastily arranged and unrated bonds for $2.7bn and profited by reselling them to investors at a higher price over the following months.

Goldman on Wednesday confirmed that Mr Leissner had left, but declined to comment further.

Underlining the importance of Mr Leissner's connections to his role in the bank, Goldman has no plans to appoint a new Southeast Asian chairman — a title that has more of an emeritus status than an operational function. Mr Leissner has not been accused of any wrongdoing.

Since the scandal surrounding 1MDB has deepened, Goldman has struggled to win new business in Malaysia, slipping down league tables after years of ranking as the most prominent international bank.