James A. Lebenthal, a pioneer of the municipal bond industry whose radio and television advertisements helped make tax-exempt securities a household name, died Friday in New York City due to complications from a massive heart attack, according to his daughter, Alexandra Lebenthal. He was 86.
The influential bond salesman, who carved a niche on Wall Street for his family-run municipal bond boutique for nearly 50 years, died at New York Hospital with his family at his side, including Ms. Lebenthal, president and chief executive officer of Lebenthal & Co., as well as daughter, Claudia, and son, Jim and his wife Betty.
The innovative businessman, whose family was often referred to as the first family of New York City municipal bonds, is widely credited as the first broker to use the media to sell tax-exempt investments to individual investors. He coined such phrases in his ads as "bonds are my babies" and championed the debt of projects like the World Trade Center.
"Dad loved this industry to his last breath," Ms. Lebenthal said late Friday afternoon. "Infrastructure was on his lips, he was unstoppable when it came to thinking and talking and writing about how to rebuild this country using municipal bonds.
"He was such an inspiration to every person who came in touch with him," she continued. "The muni bond industry and finance industry and everyone who knew him will sorely miss him," his daughter said.
"He was very much a valued member of the firm," she said of her father, who was currently serving as chairman emeritus at Lebenthal. "He still sat in on client meetings and prospect meetings, and he was often the deciding factor for clients to use us, or someone to come to work for us," she said. "He still personified the brand," she added.
The municipal bond market was somber on Friday afternoon as members of the industry — from local traders to presidents of financial regulatory groups were shocked and saddened by his passing.
Dick Larkin, senior credit analyst at H.J. Sims & Co., called Lebenthal "the best spokesman for the industry" and said "there was no one more enthusiastic about the muni bond industry."
He recalled his first official meeting with Lebenthal back in the 1980s when he was scouting Larkin as a potential broker. He said Lebenthal was so proud of his huge library of official statements and disclosure documents.
He also recalled hearing what he termed "one of the best speeches anyone has ever made" at an industry function that detailed the process of water traveling from the Adirondack Mountains to his Manhattan apartment building describing how it was all possible because of municipal bonds.
"He made the municipal bond industry interesting," Larkin said, adding that he first spotted Lebenthal in 1976 riding a New York City subway but was too intimidated by his iconic presence in the industry to approach him.
A trader at Sims' called it "a sad day for munis."
Kenneth E. Bentsen, Jr., president & CEO, SIFMA, said Lebenthal was a legendary figure in the market and "a giant of our industry."
"For many years he was the public face of municipal bonds through his unique marketing campaign with the memorable tagline: 'Built by Bonds,'" Bentsen said.
"We at SIFMA are deeply saddened at this loss. Jim made countless contributions to SIFMA, including serving many years as member of SIFMA's Municipal Executive Committee, and was recognized with a Lifetime Achievement Award by The Bond Market Association, one of SIFMA's predecessor organizations," Bentsen continued. "Our thoughts and prayers go out to Jim's family."
Others share the industry's loss.
"He was a true legend in the market, and will be sorely missed by everyone who knew him," said Michael Ballinger, publisher of The Bond Buyer.
"The industry has lost a legend with the passing of Jim Lebenthal," added MSRB Executive Director Lynnette Kelly. "Jim was the passionate voice of the industry, its cheerleader and biggest advocate. He understood the importance of the muni market and was able to communicate that to everyone-from policymakers to individual investors. He had a twinkle in his eye and a spring in his step, and always had a smile on his face. Jim was also a beacon of integrity and a champion of the industry. Our condolences go out to his family."
Lebenthal began learning the municipal bond business in 1963 at the age of 35 when he joined the family business that his parents, Louis B. Lebenthal and Sayra F. Lebenthal, started in 1925.
He was a leader in the marketing and distribution of municipal bonds to retail investors, and for many years, he was chairman of what later became a renowned municipal bond boutique.
Over the years, Mr. Lebenthal worked to expand, improve, and re-invent the company that, to keep it on the cutting edge of the retail municipal bond industry.
Yet the core business remained brokering municipal bonds to its well-regarded retail client base in the New York metropolitan area.
The firm became a symbol in the industry under the stewardship of Mr. Lebenthal, who, in 1994, shortly before he handed the reins to his daughter Alexandra, the firm established a successful asset management arm with three funds, a New York state, a New Jersey, and a taxable municipal fund, as well as individual accounts.
In honor of its 75th anniversary, the firm held a gala celebration at the Museum of the City of New York, where deputy mayor Joseph J. Lhota presented a proclamation from Mayor Rudolph W. Giuliani declaring Nov. 14, 2000 as Lebenthal & Co. Day.
Lhota said the firm, through Lebenthal's advertising, "turned the term municipal bond into a household word."
The proclamation also recognized Lebenthal's work during New York City's financial crisis in the 1970s to make known the risks to investors should the city default on its bonds.
Lebenthal "compiled 160,000 individual bond-owner letters into a report given to the U.S. Senate committee that considered a bail-out of New York City ... making certain that the federal government knew that a default would affect thousands of individuals," the proclamation stated.
In 2002, Lebenthal was honored by the National Federation of Municipal Analysts with the group's Career Achievement Award for his leadership in the market and his passion and dedication to both the municipal bond industry and New York City.
The father and daughter duo re-entered public finance in Oct. 2006, taking charge of the broker-dealer arm of Israel Discount Bank of New York, aptly calling it Alexandra & James Inc.
The idea surfaced after the Lebenthal brand ceased to exist in 2001 following its sale to MONY Group, a diversified financial services firm that owns Hartford-based Advest Group Inc. The $25 million merger sought to combine the brokerage businesses of Lebenthal and Advest and expand their financial planning services, and represented the latest instance of consolidation in the municipal market.
Feeling the expansion of the family's business was unfinished, the Lebenthals partnered in the venture to keep the firm's stellar name and reputation alive.
She became president and chief executive and Lebenthal's role as creative director helped establish the brand in the minds of issuers, investors, and other market participants.
When Advest was subsequently purchased by Merrill, Lynch & Co. in 2005, they decided to drop the Lebenthal name from its corporate umbrella.
"How they could desecrate that great name — that jewel on the crown of the municipal skyline — is beyond me," Mr. Lebenthal was quoted as saying in The Bond Buyer in a May 2006 interview.
Mr. Lebenthal pioneered the growth of the firm's wealth management business since taking its reigns, and saw Alexandra & James Inc. as a way to rebuild a new broker-dealer business based on its strong reputation in municipal retail sales and distribution.
Mr. Lebenthal added author to his resume when he penned the autobiography, "Confessions of a Municipal Bond Salesman," published in April 2006 by Wiley.
In a chapter entitled "Lebenthal, You Know the Name," Lebenthal explained his wish to reinvent financial advertising and "make municipal bonds the newest, must-have creation for the masses, like margarine and frozen TV dinners."
The end product was a series of bold advertisements in both print and television, some loudly declaring municipal bonds to be the second safest investment in America.
In more recent years, he wrote a blog called www.crazyaboutnewyork.com, which is a collection of short video essays about everyday life in New York. A resident of Manhattan, Lebenthal also maintained a residence in Pawling, N.Y., was a longtime board member of the Museum of New York, and was extremely involved in Princeton University, his alma mater.
He was a "Jim of all trades," working as an ad executive, a correspondent for the Times magazine, a talk-show writer, and even did a brief stint in the U.S. Army.
He was even nominated for an Oscar for his short film "T is for Tumbleweed," and more recently starred in a one man show about his life, and continued to work for many years on his love of film.
"My career has come full circle, really," Lebenthal said in the 2006 Bond Buyer article. "And you know what? I wouldn't have it any other way."
Funeral services will be Friday at 11:30 a.m. at Frank E. Campbell Funeral Chapel, 1076 Madison Avenue at 81st St.
Visiting hours will be Thursday from 2-5 p.m. and 7-9 p.m.
In lieu of flowers, the family suggests donations be made to the Museum of the City of New York.
Washington Bureau Chief Lynn Hume contributed to this article.
