Bernard Kelly
‘Young Turk’ banker with SG Warburg who set up a bank in Monaco and helped to reinvigorate Lazards
BERNARD KELLY, who has died aged 92, was a cosmopolitan merchant banker for Warburgs and Lazards, and later an entrepreneurial financier in his own right.
In the hothouse of City talent that was SG Warburg & Co in the 1960s, Kelly was one of the “young Turks” deployed to execute pioneering Eurobond issues and takeover deals. Driving them forward were the firm’s German émigré founder Siegmund Warburg and co-founder “Uncle” Henry Grunfeld, who demanded meticulous standards and long working hours. A typical success was a $200 million bond issue for the Irish government completed over a weekend, Kelly – unlike competitors in other banks – having been at his desk late on Friday evening to field the call.
Siegmund Warburg himself also demanded total loyalty. One Warburgs director, Ian Fraser, recorded in his memoirs that “when any of us made a mistake, which was often, we would be put in the doghouse. Bernard Kelly… was the young director who was most frequently ‘kennelled’, not so much because of his mistakes but because of his ‘face crimes’. The ‘thought police’ were commanded by Uncle Henry, who would, or so we imagined, report to Siegmund that Kelly… was disloyal and needed to be watched.”
By 1968 this oppressive culture, combined with Warburg’s aversion to succession planning, provoked Fraser, Kelly and others to plot a breakaway that would have created a powerful new firm with capital backing from the Prudential assurance company. But it never came to pass.
Kelly remained with Warburgs until 1975. With a large family to fund he despaired of the Labour Government’s punitive tax rates and decided to move abroad: with Siegmund Warburg’s help he found a new challenge in Monaco, setting up a merchant bank on behalf of Italian and Swiss shareholders.
He and his wife Mirabel became friends of Prince Rainier and Princess Grace, née Kelly, who when asked whether they were related declared: “Oh yes, we’re all one great big happy clan.”
In 1980, Margaret Thatcher’s lower UK taxes persuaded Kelly to return to the City. His friend Fraser, now chairman of Lazard Brothers, invited Kelly to join him as a vice chairman – and between them they injected new zest into a bank so old-fashioned that its directors maintained a policy of never making outgoing telephone calls. Kelly went on to work closely with another Warburg alumnus, the former defence secretary Sir John Nott, who in due course succeeded Fraser.
Retiring from Lazards in 1990, when he reached 60, Kelly never lost his appetite for business, maintaining a portfolio of boardroom roles and private ventures into his ninth decade.
Bernard Noel David George Terence Kelly was born in Brussels on April 23 1930. He was the elder son of Sir David Kelly, a Foreign Office diplomat of Irish descent who as minister at Bern from 1940 to 1942 was instrumental in persuading the Swiss not to assist the Nazis, and was later ambassador to Argentina, Turkey and the Soviet Union.
Bernard’s Belgian-born mother was Marie-noële de Jourda de Vaux – “one of the grandes dames of British diplomacy”, according to her own obituary, and the last descendant of the Comte de Vaux (1705-1788), a prerevolutionary Marshal of France. Bernard’s godmother was Marienoële’s friend, Queen Marie-josé of Italy.
Bernard was educated at Downside and did National Service – in the post-war years when, as he put it, “the army was organised entirely for the amusement of the officer class” – in the 8th Queens Royal Irish Hussars. He then went up to Magdalen College, Oxford, but was sent down after one term having failed a Latin prelim paper. Soon afterwards, he suffered a motorbike accident which required three months’ treatment at Stoke Mandeville hospital.
While recuperating he was offered the chance to take articles with a small firm of solicitors. Once qualified, he moved to the firm of Simmons & Simmons in the City, where in 1963 – despite his protestations that he was “not particularly good with figures” – Siegmund Warburg set out to recruit him.
A fluent raconteur with a slight hint of a continental accent, Kelly always enjoyed being the centre of attention. In later years he was a mentor to many younger financiers through a clutch of non-executive and advisory roles, not least as chairman of Campbell Lutyens, a Mayfair-based investment boutique, and of Nexus, which managed a large portfolio of healthcare properties.
He also dabbled successfully in property, collected art and, perhaps less likely, was a keen urban cyclist. When the shares of Maxwell Communication Corp, in which Kelly had a holding, collapsed in 1991, he cycled to the London home of Kevin Maxwell to shake his fist at the windows.
Bernard Kelly married, in 1952, Mirabel Fitzalan Howard, one of eight children (all with first names beginning with M) of the 3rd Lord Howard of Glossop and his wife Baroness Beaumont. A devout Roman Catholic known for her saintly kindness to the needy, she became Lady Mirabel after her eldest brother Miles inherited the dukedom of Norfolk in 1975.
The family home for many years – accommodating eight children, the widowed Lady Kelly on the top floor and assorted lodgers and strays – was two large semi-detached houses knocked together in Carlyle Square, Chelsea. Lady Mirabel died in 2008; her husband is survived by their seven sons and a daughter.