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‘Duke’ Chapman led CBOE during years of strong growth

Alger 'Duke' Chapman

Alger "Duke" Chapman

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Updated: March 22, 2013 10:40AM



During the 10 years that Alger “Duke” Chapman headed the Chicago Board Options Exchange, its roster of listed stock options grew from 173 companies to 850.

He led a period of strong growth and was credited with helping the options industry progress after the Black Monday stock market crash of 1987. Today, the CBOE’s option total has grown to 2,600 corporations.

Mr. Chapman, 81, died Monday of heart failure in Little Rock, Ark., where he had retired.

His career in the securities industry spanned more than 50 years, and his easygoing personality saw him through mergers, acquisitions and periods of belt-tightening, as in 1991, when the CBOE — the nation’s largest options exchange — eliminated positions and instituted a hiring freeze.

He worked with Wall Street players including Sandy Weill, the legend behind Citibank; Jim Robinson of American Express, and the late billionaire banker Edmond Safra.

Mr. Chapman, a New Englander with an old Yankee pedigree, started his career with the Securities and Exchange Commission, where he worked as an attorney.

He witnessed a tense episode after the early 1960s bankruptcy of the brokerage Ira Haupt & Co., when the SEC received a call about crowds converging on the firm to demand their securities.

“We had uniformed guards, pistols on their hips,” he said in an interview with Kenneth Durr for an oral history of the SEC. “We got there and made our way through this mob of people. The vault was open. People were walking in and taking certificates and leaving, so we stopped that.”

During the 10 years that Alger “Duke” Chapman headed the Chicago Board Options Exchange, its roster of listed stock options grew from 173 companies to 850.

He led a period of strong growth and was credited with helping the options industry progress after the Black Monday stock market crash of 1987. Today, the CBOE’s option total has grown to 2,600 corporations.

Mr. Chapman, 81, died Monday of heart failure in Little Rock, Ark., where he had retired.

His career in the securities industry spanned more than 50 years, and his easygoing personality saw him through mergers, acquisitions and periods of belt-tightening, as in 1991, when the CBOE — the nation’s largest options exchange — eliminated positions and instituted a hiring freeze.

He worked with Wall Street players including Sandy Weill, the legend behind Citibank; Jim Robinson of American Express, and the late billionaire banker Edmond Safra.

Mr. Chapman, a New Englander with an old Yankee pedigree, started his career with the Securities and Exchange Commission, where he worked as an attorney.

He witnessed a tense episode after the early 1960s bankruptcy of the brokerage Ira Haupt & Co., when the SEC received a call about crowds converging on the firm to demand their securities.

“We had uniformed guards, pistols on their hips,” he said in an interview with Kenneth Durr for an oral history of the SEC. “We got there and made our way through this mob of people. The vault was open. People were walking in and taking certificates and leaving, so we stopped that.”

In 1966, he joined the investment firm of Shearson Hammill. Shearson Hammill merged with Cogan, Berlind, Weill & Levitt, where Mr. Chapman worked with Weill, a Wall Street legend. More business evolution eventually led to a purchase by American Express, creating Shearson/American Express. Ultimately, it became part of Lehman Brothers after Lehman was spun off from American Express in the 1990s.

Mergers mean layoffs, and Mr. Chapman tried to find new jobs for people, said his son, Sam.

“I remember, as a kid, him staying up nights in a row trying to place people in jobs,” he said. “He was really one of the really nice people on Wall Street, not one of the bad guys.”

When American Express acquired his firm, Mr. Chapman became a vice chair of its global private banking network. He traveled the world, meeting some of the world’s wealthiest people, assuring them of Swiss banking privacy to persaude them to do business with the company, he told Durr.

It was a rareified atmosphere, one with “people who didn’t want their recently divorced wives to know where their assets were. There were people who ran foreign governments who wanted some of the money offshore, and usually a lot of it, so it was an interesting business,” he said in the oral history.

Mr. Chapman often relied on his intuition, like when he researched an initial public offering of an Italian shipyard.

After saying goodbye to the prospective client, “He had a funny feeling, and went back the next day,” his son said. “There was a different sign on the shipyard. The whole thing had been a scam to gain entry to the American market.”

Once, during an overseas business trip, Mr. Chapman was offered a taste of warm monkey brain. “It was a high honor,” his son said. “He couldn’t do it.”

Mr. Chapman was recruited for the post at the options exchange, a place that felt rambunctiously different from the New York Stock Exchange, he told Durr. When he was introduced at the CBOE, he recalled, “All of a sudden, these guys think they are at a football game: ‘Duke! Duke! Duke!’ ”

“I used to bring people who were in town from the various congressional people and brought [U.S. Sen. From New York] Bill Bradley to the floor. All of a sudden they had him in that pit, they started going ‘Dollar Bill! Dollar Bill!’” he told Durr.

“Duke’s leadership at the helm of CBOE helped shape CBOE’s success,” said William J. Brodsky, chair and CEO of the options exchange. “He recognized the need for options education and the inevitability of electronic markets, and initiated plans to develop each.”

After retiring from the exchange, Mr. Chapman worked for an international banking company, ABN AMRO. He retired in 2004.

He was born in Portland, Maine, and grew up in Albany and Bronxville, N.Y. He went to Albany Academy prep school, Williams College and Columbia University Law School.

When he retired, he told his wife Beatrice, who he always referred to as “my bride,” that she should pick where they would live, because she had always followed him during his career, their son said. She chose her hometown of Little Rock.

A gifted athlete, Mr. Chapman played baseball and football when he was in school. He also enjoyed skiing and golf.

In addition to his wife, Mr. Chapman is survived by his sons, Alger, Andrew, Henry and Sam, who is married to Chicago Sun-Times sex-education columnist Laura Berman; his sisters, Carol Whitehouse and Hilda Dugan, and five grandchildren.

After the spring thaw, his ashes are to be scattered in a family plot in Bethel, Maine, a town his ancestors helped found.

Contributing: David RoederMergers mean layoffs, and Mr. Chapman tried to find new jobs for people , said his son, Sam.

“I remember, as a kid, him staying up nights in a row trying to place people in jobs,” he said. “He was really one of the really nice people on Wall Street, not one of the bad guys.”

When American Express acquired his firm, Mr. Chapman became a vice chair of its global private banking network. He traveled the world, meeting some of the world’s wealthiest people, assuring them of Swiss banking privacy to persaude them to do business with the company, he told Durr.

It was a rarified atmosphere, one with “people who didn’t want their recently divorced wives to know where their assets were. There were people who ran foreign governments who wanted some of the money offshore, and usually a lot of it, so it was an interesting business,” he said in the oral history.

Mr. Chapman often relied on his intuition, like when he researched an initial public offering of an Italian shipyard.

After saying goodbye to the prospective client, “He had a funny feeling, and went back the next day,” his son said. “There was a different sign on the shipyard. The whole thing had been a scam to gain entry to the American market.”

Once, during an overseas business trip, Mr. Chapman was offered a taste of warm monkey brain. “It was a high honor,” his son said. “He couldn’t do it.”

Mr. Chapman was recruited for the post at the options exchange, a place that felt rambunctiously different from the New York Stock Exchange, he told Durr. When he was introduced at the CBOE, he recalled, “All of a sudden, these guys think they are at a football game: ‘Duke! Duke! Duke!’ ”

“I used to bring people who were in town from the various congressional people and brought [U.S. Sen. From New York] Bill Bradley to the floor. All of a sudden they had him in that pit, they started going ‘Dollar Bill! Dollar Bill!’ ” he told Durr.

“Duke’s leadership at the helm of CBOE helped shape CBOE’s success,” said William J. Brodsky, chair and CEO of the options exchange. “He recognized the need for options education and the inevitability of electronic markets, and initiated plans to develop each.”

After retiring from the exchange, Mr. Chapman worked for an international banking company, ABN AMRO. He retired in 2004.

He was born in Portland, Maine, and grew up in Albany and Bronxville, N.Y. He went to Albany Academy prep school, Williams College and Columbia University Law School.

When he retired, he told his wife Beatrice, who he always referred to as “my bride,” that she should pick where they would live, because she had always followed him during his career, their son said. She chose her hometown of Little Rock.

A gifted athlete, Mr. Chapman played baseball and football when he was in school. He also enjoyed skiing and golf.

In addition to his wife, Mr. Chapman is survived by his sons, Alger, Andrew, Henry and Sam, who is married to Chicago Sun-Times sex-education columnist Laura Berman; his sisters, Carol Whitehouse and Hilda Dugan, and five grandchildren.

After the spring thaw, his ashes are to be scattered in a family plot in Bethel, Maine, a town his ancestors helped found.

Contributing: David Roeder



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