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Kuhn, Loeb & Co.

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Kuhn, Loeb & Co.
Company typePrivate
IndustryInvestment banking
Founded1 January 1867; 159 years ago (1867-01-01) in New York City, United States
FounderAbraham Kuhn, Solomon Loeb
Defunct1977 (1977)
FateMerged with Lehman Brothers to form Lehman Brothers, Kuhn, Loeb Inc.
Headquarters
New York City
,
United States
Key people
Jacob H. Schiff, Otto Kahn, Felix Warburg
ProductsFinancial services, investment banking

Kuhn, Loeb & Co. was a prominent American international investment bank established in 1867 by Abraham Kuhn alongside his brother-in-law Solomon Loeb. Under the leadership of Jacob H. Schiff, who joined in 1885 and was Loeb’s son-in-law, the firm rose to become one of the foremost investment banks during the late 1800s and early 1900s. It played a pivotal role in financing expanding railroads and emerging enterprises such as Western Union and Westinghouse, competing closely with J.P. Morgan & Co.

Following Schiff’s passing in 1920, control transferred to Otto Kahn (deceased 1934) and Felix Warburg (deceased 1937), who upheld the company’s influential status. Nevertheless, after World War II, Kuhn, Loeb encountered difficulties adjusting to an evolving investment banking environment that increasingly favored aggressive, deal-oriented strategies rather than its traditional gentlemanly banking style.

The firm ceased to exist independently in 1977 when it combined with Lehman Brothers, creating Lehman Brothers, Kuhn, Loeb Inc. This merged entity was subsequently purchased by American Express in 1984, resulting in the formation of Shearson Lehman/American Express and the retirement of the Kuhn, Loeb name.

History

Founded in New York City in 1867 by Abraham Kuhn and Solomon Loeb, the company began with $500,000 capital to seize opportunities presented by America’s economic growth. On January 1, 1875, Jacob Schiff joined the firm and eventually steered it to become the second most esteemed investment bank after J.P. Morgan & Co.

Kuhn, Loeb gained prominence during the expansion of U.S. railroads, financing major clients including the Chicago and North Western Railroad (1877), Pennsylvania Railroad (1881), and Chicago, Milwaukee & St. Paul Railroad. Schiff was instrumental in reorganizing Union Pacific in 1897 and supported E. H. Harriman’s takeover attempt for Northern Pacific Railroad in 1901.

The firm also supported industrial pioneers such as Westinghouse, Western Union, and consumer innovator Polaroid Corporation. Its advisory services extended internationally to governments including Austria, Finland, Mexico, and Venezuela.

Serving as a key investment advisor for John D. Rockefeller through Frederick T. Gates, Kuhn, Loeb collaborated on significant railroad investments and consolidations like Chicago meatpacking trusts. The firm partnered with Rockefeller to gain control of Equitable Trust Company in 1911, which ultimately merged into Chase Bank.

Distinguished partners included Otto Kahn, Paul Warburg, Felix Warburg, Mortimer Schiff, Benjamin Buttenwieser, Abraham Wolff, Lewis Strauss, and Sigmund Warburg—the latter founding S.G. Warburg & Co.

Intermarriages among German-Jewish elite families linked Kuhn, Loeb partners with those from firms such as J & W Seligman, Speyer & Co., Goldman Sachs, Lehman Brothers, and M.M. Warburg & Co., fostering strong transatlantic relationships before and after World War II.

After World War II, industry trends toward aggressive underwriting marginalized Kuhn, Loeb’s traditional relationship-based banking approach. The firm avoided direct public securities sales and maintained a relatively small staff despite increasing market pressures.

Confronted with capital constraints in 1977, Kuhn, Loeb merged with Lehman Brothers to form Lehman Brothers, Kuhn, Loeb Inc., leveraging its international standing. Internal disputes continued until Shearson/American Express acquired the firm in 1984, ending the Kuhn Loeb brand after nearly 120 years.

Subsequent consolidations included acquiring E.F. Hutton to create Shearson Lehman Hutton. American Express divested its retail brokerage business in 1993 and spun off Lehman Brothers through a 1994 IPO led by CEO Harvey Golub.

Although no longer operating under its original name, Kuhn Loeb’s influence persists via former executives across Wall Street and Lehman Brothers’ fixed income operations—including benchmarks such as the Government/Credit bond index initially developed by Kuhn Loeb in 1973—that remain respected standards within fixed income markets.

Successor Entities

The firm's mergers played a pivotal role in the formation of successor organizations such as Lehman Brothers Kuhn Loeb, Shearson Lehman Brothers, and eventually Lehman Brothers. Notable mergers include:

General Partners

  • Abraham Kuhn (1867–1887)
  • Solomon Loeb^ (1867–1899)
  • Samuel Wolff (1867–1872)
  • Samuel Kuhn (1868–1869)
  • Jacob Netter (1867–1869)
  • Jacob H. Schiff^ (1875–1920)
  • Abraham Wolff (1875–1900)
  • Michael Gernsheim (1875–1881)
  • Lewis S. Wolff (1884–1891)
  • James Loeb (1894–1901)
  • Louis A. Heinsheimer (1894–1909)
  • Felix M. Warburg (1897–1937)
  • Otto H. Kahn^ (1897–1934)
  • Mortimer L. Schiff (1900–1931)
  • Paul M. Warburg (1903–1914)
  • Jerome J. Hanauer** (1912–1932)
  • Gordon Leith (London) (1927–1930)
  • George W. Bovenizer (1929–1961)
  • Lewis L. Strauss (1929–1946)
  • Sir William Wiseman, Bart. (1929–1960)
  • John M. Schiff^ (1931 – ?)
  • Frederick M. Warburg (1931 – ?)
  • Gilbert W. Kahn (1931 – ?)
  • Benjamin J. Buttenwieser (1932–1949)
  • Hugh Knowlton (1932 – ?)
  • Elisha Walker (1933–1950)
  • Percy M. Stewart (1941 – ?)
  • Robert F. Brown (1941 – ?)
  • Robert E. Walker (1949–1958)
  • J. Emerson Thors (1949 – ?)
  • J. Richardson Dilworth (1952–1958)
  • Jonas C. Andersen (1955–1956)
  • Sir Siegmund G. Warburg (London) (1956–1964)
  • David T. Miralia (1957 – ?)
  • Kenneth N. Hall (1956 – ?)
  • Henry Necarsulmer (1956–1977)
  • Charles J. Ely (1956 – ?)
  • Bernard Einhorn (1965–1967)
  • Nathaniel Samuels^ (1955–1974)
  • Morris H. Wright
  • John M. Leonard
  • Alvin E. Friedman (1962 – ?)
  • John S. Guest (1962 – ?)
  • Jerome S. Katzin (1962–1977)
  • John T. Monzani (1962 – ?)
  • H. Spottswood White (1962 – ?)
  • Thomas E. Dewey Jr. (1966–1975)
  • Andre Istel (1964–1966)
  • Harvey M. Krueger^ (1965–1977)
  • Anthony M. Lund
  • William H. Todd
  • Yves-Andres Istel (1966 – ?)
  • John K. Libby (1967–1977)
  • James H. Manges (1967 – ?)
  • David T. Schiff (1967 – ?)
  • Sydney S. Netreba (1968 – ?)
  • Sidney J. Sauerhaft (1968 – ?)
  • Joseph F. Schwartz (1968 – ?)
  • John Barry Ryan III (1969 - )
  • Edgar R. Koerner (1969 – ?)
  • Archie E. Albright (1969 – ?)
  • Mark C. Feer (1969–1977)
  • W. Richard Bingham (1970 – ?)
  • James A. Favia (1970 – ?)
  • William M. Kearns Jr. (1970 – ?)
  • Norman W. Stewart (1970 – ?)
  • Clifford W. Michel (1972 – ?)
  • Robert M. Shepard (1973–1977)

** First partner outside family.
^ Denotes previous managing partner.

Summary of Partnership

Firm Clients

  • [ [American Smelting and Refining Company|ASARCO]]
  • [ [Anheuser-Busch]]
  • [ [Automatic Data Processing, Inc.|ADP]]
  • [ [Bank Leumi]]
  • [ [Bayer]]
  • [ [Bethlehem Steel]]
  • [ [CIT Group]]
  • [ [Chemical Bank]]
  • [ [The Church of Jesus Christ of Latter-Day Saints]]
  • [ [The Dreyfus Corporation]]
  • [ [Eastern Air Lines]]
  • [ [Endicott Johnson Corporation]]
  • [ [Erie Lackawanna Railway]]
  • [ [European Coal and Steel Community]]
  • [ [Ford Foundation]]
  • [ [The Great Atlantic and Pacific Tea Company]]
  • [ [ITT Corporation]]
  • [ [Israel Discount Bank]]
  • [ [Kingdom of Denmark]]
  • [ [Kingdom of Norway]]
  • [ [Ericsson], Sweden]
  • [ [Metromedia]]
  • [ [Metropolis of Tokyo, Japan]]
  • [ [Power Authority of the State of New York]]
  • [ [RKO]]
  • [ [Republic Aviation]]
  • [ [Republic of Austria]]
  • [ [Republic of Finland]]
  • [ [Republic of Peru]]
  • [ [Republic of the Philippines]]
  • [ [Republic of Venezuela]]
  • [ [Reynolds Metals Company]]
  • [ [Rockwell Manufacturing Company]]
  • [ [Rockwell-Standard Corp.]]
  • [ [Southern Pacific Transportation Company]]
  • [ [Stouffer's]]
  • [ [Uniroyal]]
  • [ [Mexico] ]
  • [ [Wagner Electric Corporation]]
  • [ [Western Union Telegraph Company]]
  • [ [Westinghouse Electric Corporation]]

Operating Entities

  • Kuhn, Loeb & Co. Incorporated
  • Kuhn, Loeb Asia Limited
  • Kuhn, Loeb Government Securities Incorporated
  • Kuhn, Loeb International Limited

Office Locations

Throughout its history, Kuhn, Loeb & Co. maintained offices at several prominent New York City sites:

  • 31 Nassau Street (1867)
  • 30 Nassau Street (1884)
  • 27 Pine Street (1894)
  • 52 William Street (1903)
  • 30 Wall Street (1955)
  • 40 Wall Street
  • 55 Water Street (operating as Lehman Brothers Kuhn Loeb)

Legal Counsel for Kuhn, Loeb & Co.

Books

  • Auletta, Ken. Greed and Glory on Wall Street: The Fall of the House of Lehman. Random House, 1985
  • Birmingham, Stephen. Our Crowd: The Great Jewish Families of New York. Pocket Books, 1977
  • Chernow, Ron. The Warburgs. Random House, 1993
  • Collins, Theresa M. Otto Kahn: Art, Money & Modern Time. University of North Carolina Press, 2002
  • Kuhn, Loeb & Co. Kuhn, Loeb & Co.: A Century of Investment Banking. Privately printed, 1967
  • Kuhn, Loeb & Co. Kuhn Loeb & Co.: Investment Banking Through Four Generations. Privately printed, 1955
  • Strauss, Lewis L. Men and Decisions. Doubleday, 1961
  • Williams, Iain Cameron. The KAHNS of Fifth Avenue, iwp publishing, 2022
  • Gower, Adam. Jacob Schiff and the Art of Risk, Palgrave Macmillan, 2018

Articles

External links

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