Chairman of ailing Continental Bank
David G. Taylor took over at Continental Illinois Bank in 1984 as the largest financial institution between the East and West coasts teetered on the brink of collapse.
Seen as a steady leader who kept the bank going through its darkest days, his tenure as chairman and chief executive was nonetheless brief. Federal regulators stepped in with a $4.5-billion bailout plan deemed necessary because Continental was “too big to fail.”
Taylor, 79, died of complications from Parkinson’s disease Feb. 23 at his home in Rancho Mirage, said his wife, Robyne.
He spent 27 years at Continental, where his father, Frank, had been an executive before him. The younger Taylor made his name in the bond and money market departments and was the bank’s treasurer and vice chairman before moving into the chief executive’s suite.
Continental got into trouble with a series of bad loans in oil and energy, chief among them loans taken over from Penn Square Bank of Oklahoma City, which collapsed in the summer of 1982.
The toxic loans decimated Continental’s bottom line and led to fears of a disastrous run on the bank by depositors. A vice president, John Lytle, later went to prison for taking kickbacks and defrauding the bank of $2.25 million.
With the bank foundering, Taylor took over in March 1984. He and President Edward S. Bottum set about persuading depositors that Continental could remain solvent while frantically searching for a merger partner.
His promotion was well-received within the bank, and his low-key style brought a measure of calm to an anxious situation.
“He was very smooth,” said J. Andrew Spindler, who was Taylor’s executive assistant and is now chief executive of Financial Services Volunteer Corps. “When other people got flustered or upset as the crisis grew, David was always the voice of calm, the voice of reassurance.”
Continental’s problems shook the entire financial industry, and rumors of the bank’s demise devastated what remained of investor confidence and led federal regulators to step in. The size of the bailout was considered huge at the time.
“It may seem minor today, but I lived through it. That was a major crisis,” Spindler said. “Nobody had seen a bank go through that in any of our professional careers.”
New management was brought in, and Taylor was replaced by legendary oil executive John Swearingen, staying on briefly as vice chairman. Continental weathered the crisis, and in 1994 was acquired by BankAmerica.
After leaving Continental, Taylor worked as vice chairman of Irving Trust Co. for three years and then joined Chemical Bank as head of its global securities and foreign exchange group in London.
Both of those banks changed management as a result of mergers or acquisitions, a fact Taylor could later laugh about with stories punctuated with the line: “And guess who got the job? The other guy,” his wife said.
“He was very humble and unpretentious,” she said “He did not dwell on the Continental situation at all.”
Born July 29, 1929, in Charlevoix, Mich., and raised in Chicago, Taylor had a bachelor’s degree from Denison University in Ohio and a master’s in business administration from Northwestern University.
He served in the Navy for three years before joining Continental.
In 2005, Taylor self-published “Bajan’s Tale,” a book recounting how he and his wife had befriended a stray dog on the beach in Barbados and returned with it to Chicago.
“That, he felt, was his best accomplishment,” she said with a laugh.
Taylor’s first two marriages ended in divorce. In addition to his third wife, he is also survived by two children, David and Amy.
Services will be held in April in Rancho Mirage.
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