Sally Jewell, President Obama’s nominee for secretary of the interior, is known mostly as CEO of Seattle’s Recreational Equipment Inc. But for about 20 years she was a banker, a profession in which she made a name for herself in a dramatic way.
Back in the early 1980s, I was a business reporter at the Post-Intelligencer. In 1983, I co-authored, with John Snell, a series on the collapse of Seattle-First National Bank. Seafirst fell in 1982 because of loans to natural-gas drillers in Texas and Oklahoma, principally through loans bought from the one-branch Penn Square Bank in Oklahoma City. Seafirst’s insolvency led to its acquisition by BankAmerica, which is how there came to be Bank of America branches in Washington.
In the early 80s, Jewell worked at the No. 2 bank in the state, Rainier Bank. Rainier had hired Jewell, who had been an engineer for Mobil Oil, to advise the bank on whether it should get involved in the “oil patch” in a big way, as Seafirst had. Seafirst seemed to be making a lot of money.
Philip Zweig’s book on the Penn Square debacle, “Belly Up,” tagged Jewell for “her tendency to ask a lot of questions” – pointed, uncomfortable questions the Seafirst people hadn’t asked.
Seattle author Robert Spector, who wrote “Banking Without Boundaries: the Story of Security Pacific Bank of Washington,” recalls that Jewell advised the bank to steer clear of the oil-and-gas play. That’s not easy advice when your competitor is reporting fat earnings from it. At the time, Jewell was not even 30 years old in a bank run by a very strong-willed CEO, Robert Truex, who would have loved to beat Seafirst at its own game.
Jewell addressed the Rainier board of directors. Recalls Spector: “They decided to go with her — and she was right. That was a watershed moment in Sally’s career.”
Rainier was bought in 1987 by Security Pacific, and Security Pacific was bought in 1992 by BankAmerica, so in the end the Seafirst and Rainier branches around here had the same name on them. The difference was that the Rainier shareholders got paid.