DEPOSITION OF ROSEMARY STEWART VOL. I

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please.

MR. MURPHY: Could you repeat the question,

(The portion requested was read by the

court reporter.)

MR. MURPHY : Can you ask those questions

separately?

When you say feud or argument, I wish

you would explain a little more completely what you mean, just to clarify the question. You have asked two questions as it now stands.

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Did you have any impression

that there was a feud going between the Keating
interests and anybody at the Bank Board in San
Francisco?

NR. MURPHY : I'm going to object that it
calls for speculation.

THE WITNESS : At the time that Mr. Benkel sade the regulatory proposal that's discussed in this December 24th article, which was a few days STICKLEY & SCHUTZMAN, INC.

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DEPOSITION OF ROSEMARY STEWART VOL. I

before that article, I became aware inmediately
after that that this was a highly controversial
matter, and that it was highly controversial
because of the effect of the Gray proposal on
Lincoln.

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Keating or his interests, did you also perceive

the same type of feeling?

MR. MURPHY: I am going to object and ask
for the record by understanding when you say,
"the same type of feeling," we are talking about
questions that took place a couple of hours ago.
2. (BY MR. GALLAGHER) Well, as of
December 31st, 1986, how would you characterize
Chairman Gray's attitude towards Henkel?

- THE WITNESS: Very, he was very unhappy

that Mr. Henkel was on the board. By the end of

December, I knew that he was attempting to

collect information about Mr. Henkel and his

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links to Lincoln and his effects on Lincoln, and

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I think at the time, in an effort to get rid of

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Mr. Henkel.

Q. (BY MR. GALLAGHER) Was there personal

Q. (BY MR. GALLAGHER) On Mr. Gray's part toward Mr. Henkel is really what I'm talking about.

A. I don't know. My own personal discussions with Ed Gray were very few on this subject. It was more observing his demeanor.

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a secondhand basis, after Mr. Henkel proposed the
rule, I was told that folks were scurrying to
collect information about the volume of loans
that Mr. Henkel had from Lincoln and about the
effect that this proposal would have had on
Lincoln.

-8. Can you tell me who told you that, Ms.

Stewart?

A. Dorothy Nichols from the General

Counsel's office.

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And I believe al Sauzynski was

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the one who told me that we were trying to find

out how many other institutions this might have

affected.

Q.

In that same time frame, the end of December 1986, did you have any information as to

Mr. Gray's attitude towards Keating or his

interests?

A. No, just indirectly through the same thing that I told about Mr. Henkel's proposal. Q. Who was told to collect the info, can you tell me that?

A. I have a vague recollection that that was one of the things al Sauzyanski was doing, collecting other institutions besides Lincoln that this might have affected.

Q. Did anybody tell you that they had heard that Gray wanted Henkel out of there, specifically said that?

A. Mr. Henkel told me that, but that was his conclusion. I don't remember anyone else telling me that.

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benefit Lincoln.

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before he announced his resignation.

me that, he told me his own version of why he

introduced the rule, and that it was not to

And he told me that it was clear that the people in the Chairman's office wanted this to cause him not to get confirmed. And at the point that we talked, I believe he was still telling me he was going to go through with the confirmation hearings, and he would tell his story at the time.

Q. Did he tell you anything about his understanding of the relationship between Keating

and Gray?

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