Karen Peetz, vice chairman at BNY Mellon, is one of three women on the executive committee at the New York-based asset management and securities services firm. Appointed in September 2010, she joined the bank in 1998 to run the domestic corporate trust business after 16 years with JPMorgan.
Peetz, 55, oversees 16,000 employees around the world, and has been heavily involved in BNY Mellon's administration of the U.S. government's Troubled Asset Relief Program, which provided bailout funds to banks to resolve the credit crisis. She also led a deal in 2006 that exchanged BNY Mellon's retail banking operation for part of JPMorgan's corporate trust business.
FINS spoke with Peetz about the benefit of international experience, working your way up the ladder and what she looks for in new hires.
JS: Tell me about BNY Mellon's role in administering TARP. How did it get chosen?
KP: It originally came out as a request from the government to help auction off bad assets. We had some unique platform technology capabilities to do that so we proposed it. We were among 70 submissions. What ended up happening was [Treasury] Secretary Hank Paulson recognized that the dollar amount was too small with that auction process. Price certainty was not the best thing for the market. The program switched to a direct investment into various banks. So we switched from running an auction to being the agent for the Treasury for TARP. We've run almost all U.S. programs that are dedicated to shoring up the financial system.
JS: Is the bank still involved now that many firms have paid back their TARP funds?
KP: We continue to be involved. For example, we are involved with the small business association program that was announced a couple months ago. We hired hundreds of people for TARP and for these subsequent activities. We transferred a lot of talent. We have an open approach to where their skills fit.
JS: Carbon credit trading was an initiative BNY Mellon supported. Now that the government has cooled its enthusiasm for it, does it still exist?
KP: We still have that platform. We don't think it will be as successful, but it will be quite attractive to a number of parties. Cap and trade notwithstanding, it's still a platform we're behind. We have several different prospects. It doesn't take that many folks to do.
JS: Where did you go to undergraduate and graduate school?
KP: I did my undergraduate at Penn State because my father had gone there. It turned out to be a great place to go. Being able to make it in such a big venue was good training for New York City. I studied sociology and psychology. My graduate degree was from John Hopkins in organizational behavior. It had a lot to do with managing change at organizations, discovering what makes people tick.
JS: Did that help with the JPMorgan deal?
KP: That business was two times larger than the BNY business. There were more of them than there were of us. We had to be able to say 'okay, well this is the scenario, what is it that we need to do to bring it on board?' We had to fit two cultures together with lots of experience.
JS: How did you segue into banking after Johns Hopkins?
KP: I worked at the same time I did my degree. I went to Hopkins at night and taught consumer math to low-income environment juniors and seniors in high school. Most didn't know fractions or multiplications. The whole concept was teaching them math skills related to life skills.
After I finished my degree, I very briefly worked at Chemical Bank, JPMorgan's predecessor, for about six months in HR. I was able to segue into a sales position at the bank.
I started in sales of cash management products. At the time, the thing to do was be credit-trained, which really meant how to lend money.
I got my business training with a seven-month program that taught accounting, finance and economics. There was intense case study. Are we going to get the money back? How do you asses a company for credit worthiness?
Then I lent money for a relatively brief time. Because I had the sales experience, my mentor told me to go back into the cash management world, but as a manager. He said I would go farther quicker.
My first time, I managed 10 people, then 40 people, then 200 people. I did that for 12 years, and then another mentor said, "Well all of this is great, but you need to run a business. You need profit and loss experience." He was a sponsor more than a mentor; he moved me into corporate trust at JPMorgan and I ran a part of the domestic business. Then the same person enabled me to go to London and run the international piece of the business.
JS: How long did you spend in London?
KP: Two years. When I came back, the job of my dreams was not waiting at JPMorgan. BNY Mellon called and were particularly interested in my international experience. The other factor was that I had requisite experience at a company as large as JPMorgan that really was such a critical business for BNY. What we do is securities servicing and asset management.
I joined in 1998. To be at a company where the business I was interested in is a large part was a big motivation. I got my boss's job at JPMorgan at BNY Mellon.
JS: What were your responsibilities?
KP: I was first the business manager for corporate trust. Then I was asked to take treasury services. When we were ready to do the asset swap, I was asked to go back to corporate trust and run that integration. There was a benefit because I knew many of the people at JPMorgan we were dealing with. About two and a half years ago, I was asked to take on six businesses. Then I was asked to take on Pershing [the bank's clearing house for broker-dealers]. Then I was named vice chairman.
JS: What factors into your hiring decisions?
KP: Chemistry does mean a lot. What I try to look at is would I like this person on my team. Can I imagine them adding to the team? I look at what deficiencies we have and ask how could this person plug one of those?
JS: How important is it for women to network to get ahead?
KP: Many times women don't network effectively; they're all about getting the job done. We've created a network [at BNY] where it makes it easy to plug into the company. We do a lot of things like lunches and education courses and we have a mentoring program.
JS: You had several mentors and sponsors who helped you get to where you are today. How did you cultivate those relationships?
KP: High potential people tend to be picked out earlier by sponsors than they realize. Some of it happens and you're not even aware of it. If it isn't happening for you, it's because the sponsors tend to be saved for those folks who have been identified. You can ask for mentors, though, particularly if you respect somebody. At our company we're very open about having mentoring relationships if employees just ask for input and help. I mentor 20 different people. Of course, if you hook your wagon to the right mentor, they can turn into a sponsor.
Write to Julie Steinberg