WASHINGTON - Austin V. Koenen, a former industry leader and outspoken proponent of municipal market reforms, died of a sudden heart attack over the weekend in Beijing.
The 56-year-old Koenen, a managing director at Morgan Stanley Dean Witter who had been in China since mid-1996, was the chief executive officer and head of investment banking for China International Capital Corp., a joint venture between his firm and four Far Eastern companies set up to help finance infrastructure development in China.
Koenen was one of several major municipal market players who had shifted gears to focus on business prospects overseas. But he had been in the municipal market in the U.S. for 24 years before that, the last eight of which he served as the head of - or a managing director in - public finance at Morgan Stanley & Co.
Koenen, who was a former chairman of the Public Securities Association, encouraged strong ethical behavior and was vigilant about targeting areas he thought needed reform or improvement in the municipal market. He pushed for curbs on pay-to-play practices and for increased disclosure.
At the same time, he was openly critical of attempts by the Securities and Exchange Commission and the Municipal Securities Rulemaking Board to regulate municipal issuers indirectly through the dealer community. He called for the federal securities laws' Tower Amendment to be repealed to allow the SEC to regulate municipal issuers in the same way the commission regulates corporate issuers.
"He wanted a level playing field," said one Morgan Stanley official. "He would call it like he saw it. He's probably the end of an era, as far as being one of the true champions of this business."
Koenen's death shocked family, friends, and many municipal market participants, including colleagues who had seen him recently and believed he was in excellent health.
"He was one of the giants in the municipal finance and an early proponent of municipal market reform. This is very sad news," said Paul Maco, director of the SEC's Office of Municipal Finance.
"It's a loss of a real pioneering spirit in the business," said John Petersen, president of Government Finance Group Inc., in Arlington, Va. "Austin was both a doer and a critic who retained a lot of objectivity. He never shied away from controversy. He was an activist. He made terrific contributions in areas like disclosure and industry ethics."
"He was somebody who was willing to stand up for what he thought was right for the industry," said R. Fenn Putman, chairman of O'Brien Partners Inc. "He was a proponent of doing business the right way, a proponent of strong ethics. He was prepared to go after troubled spots."
"He was always the consummate professional who kept the industry and the general public as his primary focus," said Jeff Green, general counsel of the Port Authority of New York and New Jersey.
"Austin Koenen personified the highest standards of the municipal bond market," Heather Ruth, the president of The Bond Market Association, said in a statement. "Austin was broadly recognized for his vision, candor, and unimpeachable integrity."
