Cityfile: New York's Most Notable and Influential

Kelly Bensimon Reflects | Bruce Wasserstein, the Wall Street titan who died yesterday at the age of 61, was a brilliant man, clearly, and the man who "helped pioneer the hostile takover in the 1980s and reshaped the mergers and acquisitions business into high art," as New York Times reporters Andrew Ross Sorkin and Michael de la Merced put it their excellent Wasserstein obit today. But how did he supposedly teach Kelly Killoren Bensimon of the Real Housewives of New York City to go against the grain and be her own person? We haven't the faintest clue. But we're going to venture to guess that if she can't spell his name correctly, she probably didn't spend much time in a Lazard conference room plotting hostile takeovers either. [Twitter]

Bruce Wasserstein: 1947-2009 | Legendary investment banker Bruce Wasserstein has died, the New York Times and Wall Street Journal are now reporting. The chairman and CEO of Lazard—and the owner of New York magazine—was just 61. [NYT, WSJ]

• Following a similar move by Morgan Stanley last week, Citigroup and Bank of America are raising base salaries for bankers. It's designed to make up for the new limits on annual bonuses (and won't make up for the difference, by any means), so don't expect shouts of joy at either bank today. [WSJ]
• Bank of America has scraped together another $5.9 billion, which means it's now 76 percent of the way toward filling its $33.9 billion capital hole. [WSJ]
• New York State Controller Thomas DiNapoli is cutting ties with 10 hedge fund managers as part of the state's pension corruption investigation. [DB]More

Don Drapkin was once one of Ron Perelman's closest associates. A former lawyer at Skadden, Arps, Drapkin spent 20 years working for Perelman's holding company MacAndrews & Forbes as his chief dealmaker and "strategic thinker." He was so close to Perelman, in fact, that the billionaire mogul once likened him to a brother. Until, that is, Drapkin jumped ship in 2007 and joined Lazard as the firm's vice chairman at the invitation of Lazard chief Bruce Wasserstein. The split seemed uncharacteristically amicable at the time—Perelman announced that Drapkin had "done a terrific job," and he'd "miss him." But the relationship seems to have taken a turn for the worse since then. Perelman just hit Drapkin with a lawsuit.More

• At least six of the 19 largest U.S. banks will require additional capital, according to the results of the stress tests conducted by regulators. [BN] 
• The U.S. economy took a tumble in the first quarter, with gross domestic product dropping at a 6.1 percent annual rate. [BN, WSJ]
• Citigroup has asked the Treasury department for permission to pay bonuses to a number of key employees. No word on how much or to whom. [WSJ]
• Meanwhile, Citi is looking to raise additional capital now that the bank came up short on its recent stress test. [DB]
• Daniel Bouton, the chairman of Societe General, is stepping down. [WSJ]
• Lazard posted a first quarter loss, and says it plans to cut jobs. [Reuters]
• Neel Kashkari's last day at work is Friday. Don't forget to send a gift! [DB]

• More details about President Obama's plans to limit Wall Street pay are emerging. So is plenty of criticism. "I don't think the president should paint everyone with the same brush," says JPMorgan's Jamie Dimon. [BN, WSJ, BN]
• Wells Fargo has scrapped plans to host a employee conference in Las Vegas after the bank was pummeled with criticism. [WSJ]
• A dozen top bankers from Merrill-BofA have defected to Deutsche Bank. [TD]
• Lazard's fourth-quarter profits dropped by 50 percent. [DB]
• Daniel Och is doubling down on his hedge fund, Och-Ziff. [WSJ]
• Both Citigroup and the Mets say they're standing by their stadium plan. [NYP]
• Bloomberg LP is laying off staff. [Clusterstock]
• The House will hear testimony about Bernie Madoff today from Harry Markopolos, the investigator who tried to blow the whistle on him. [NYT]

• Bernie Madoff's brokerage firm, which is now up for sale, probably won't fetch more than $10 million, according to a report drafted by Lazard. The investment bank goes on to point out that Bernard L. Madoff Investment Securities is now a "tarnished" brand. Really, you think? [Bloomberg]
• A report by the Financial Industry Regulatory Authority suggests that Madoff may not have made a single trade on behalf of his investors. [AP]
• Attorney General Andrew Cuomo has issued subpoenas to determine whether money manager Ezra Merkin may have defrauded investors by putting their money in Madoff's hands without their knowledge.  [NYT]
• Meet Frank DiPascali Jr., Bernie's former right-hand who is now under investigation for his role in Madoff's scheme. [Bloomberg]

• President Bush announced a rescue plan for General Motors and Chrysler that will provide $13.4 billion in federal loans. [CNN]
• Jamie Dimon and Bob Rubin will go bonus-less this year. [Reuters]
• Not surprisingly, Credit Suisse's plan to pay out bonuses with "toxic" securities has "elicited livid reactions from senior bankers." [WSJ]
• A former Lehman employee has been charged with insider trading. [CNN]
• One person who will profit from the Madoff mess: Bruce Wasserstein. Lazard has been appointed to sell the trading operations of Madoff's company. [WSJ]
• There are two—yes, two—books already in the works about Madoff. [TBS]

♦ Merrill Lynch CEO John Thain is tangling with the bank's board over a $10 million annual bonus he says he deserves for "saving" the firm and selling it to Bank of America. [Reuters]
♦ Ken Griffin's Citadel is closing up shop in Tokyo. [Bloomberg]
♦ UBS may be planning to shed another 4,500 jobs. [DB]
♦ Sam Zell's Tribune Co. has retained Lazard to assist the company with a possible bankruptcy filing. [WSJ]
♦ The outlook is increasingly grim for Wesley Edens' Fortress Investment Group: Shares have gone down more than 90 percent this year. [NYP]
♦ Plenty of problems also face Leon Black and his Apollo Management. [NYT]
♦ But it's been a good year for hedge fund manager Jim Chanos, despite the whole Ashley Dupre thing. [NYM]
♦ Stocks are expected to gain big today with the news of an auto bailout. [CNN]

William Cohan, the banker-turned-author who published The Last Tycoons: The Secret History of Lazard Freres & Co. last year, has a few details on just how much Bruce Wasserstein's investment banking firm is making off the bankruptcy of Lehman Brothers. For advising Bryan Marsal, the turnaround guru who is now running what's left of Lehman, Lazard is collecting $400,000 a month for the next two years (and then $150,000 a month thereafter). But there's more: Lazard is also getting a $5 million fee for the week's worth of work it did in September advising Lehman on the sale of its headquarters at 750 Seventh Avenue to Barclays. Wasserstein is also expected to receive another $5 million for its efforts to sell Lehman's investment-management businesses, including Neuberger Berman. And there's good reason to assume that Wasserstein is sitting back right now smiling at his current circumstances, says Cohan:More

Bruce Puts the Kibosh on Christmas | Bruce Wasserstein might be looking better than ever these days, but Lazard employees won't get to admire Bruce's new visage in the warm glow of Christmas: The firm has cancelled its holiday party! [Dealbreaker]

We hadn't seen Bruce Wasserstein—billionaire financier, Lazard chairman, owner of New York magazine—for quite some time until he made this appearance yesterday at a breakfast for Fortune. We're very happy to see he appears to be keeping up New York's "Best Doctors" issue: The new Bruce is trimmer, his skin looks is taut and smooth, and those unsightly bags under his eyes have completely vanished. We don't know who deserves the credit for this impressive transformation (Sherrell? Dan? Pat?), but whoever it is, please know that we fully approve of Bruce 2.0!

• Dwight Anderson's Ospraie Management is shutting down its flagship fund after a 27 percent loss in August in the commodities market. [WSJ]
• Coke is making its second-largest acquisition in history with the purchase of a Chinese juice company for $2.4 billion. [WSJ]
• HSBC is rumored to be another party taking a look at an investment in Lehman Bros. [Dealbook]
• A handful of top Lazard insiders are selling stock. [WallStFolly]
• Abu Dhabi will be putting more cash to work in Hollywood. [NYT]
• European consumer spending, investment, and exports all declined in the second quarter. [Bloomberg]
• Between layoffs and employee departures, the outlook isn't especially bright Motorola. [WSJ]
• United Airlines is dropping a plan to charge for meals on overseas flights after "candid feedback from customers." [Bloomberg]
  

• CVS has agreed to buy Longs Drug Stores for about $2.7 billion. [Bloomberg]
• Two out of every three corporations in the U.S. paid no federal income taxes from 1998 through 2005. [NYT]
• H&R Block is selling its brokerage business to Ameriprise Financial. [Dealbook]
• The pizza chain Uno will have its credit rating cut to default if it misses a bond payment due this week. [Bloomberg]
• Leon Black and Bruce Wasserstein are teaming up: Apollo and Lazard will form a partnership to do private equity deals in Europe. [Dealbook]
• A Goldman Sachs-led consortium has agreed to pay $1.5 billion for a portfolio of existing private equity investments. [WSJ]
• Former HBC chief Chris Albrecht is leaving his position with Teddy Forstmann's IMG. [Nikki Finke]

• The market turmoil hasn't hurt Bruce Wasserstein. Lazard reported a 5 percent gain in profits during the second quarter. [Dealbook]
• John Grayken's Lone Star Funds will spend $6.7 billion acquiring mortgage-backed assets from Merrill Lynch. [WSJ]
• Comcast reported a 7.5 percent increase in second-quarter earnings. [WSJ]
• Starbucks plans another round of cutbacks, including more than 1,000 job cuts. [NYT]
• Nicole Arnaboldi is the new head of DLJ Merchant Banking Partners. [Bloomberg]
• Beleaguered real estate developer Harry Macklowe is selling another property. He'll offload 527 Madison Avenue for $260 million. [NYP]
• More bad news for the Hamptons real estate market. [NYSun]