The financial market meltdown of September 2008 was a career-ender for some Wall Street bankers, but for Karen Peetz and her team at BNY Mellon, it was the opportunity of a lifetime.
Peetz, who had been head of BNY Mellon's financial markets and treasury services group for three months, was on vacation that fateful week of Sept. 15, when Lehman Brothers failed, a leading money-market mutual fund "broke the buck," and AIG collapsed into the government's arms.
Unable to relax, Peetz cut her trip short and returned to her New York office, partly to calm her troops, but also to assess how BNY Mellon could help with the ensuing government rescue effort. BNY Mellon is a custody bank, after all, and it's one of the best in the business at managing money. It didn't hurt that the bank was far healthier and more stable than many of its peers.
Though "everyone was really down in the dumps," Peetz recalls, "it was very clear to me that, in the morass, there was a huge role for us to play."
The bank's global corporate trust division, one of six units Peetz oversees, won the bidding to administer the Troubled Asset Relief Program, beating out roughly 70 other firms. It was later tapped to administer two other programs designed to unlock the credit markets - the Federal Reserve's Term Asset-Backed Securities Loan Facility and the Treasury's Public-Private Investment Program. (It's worth noting that the bank's broker-dealer services unit, which also reports to Peetz, played a critical role at the height of the crisis by helping distressed Wall Street firms gain access to liquidity.)
Peetz says BNY Mellon's role in administering TARP has been "soup-to-nuts" - from moving money from Treasury to banks, to keeping track of how the funds are being used to running auctions for warrants when banks repaying TARP funds can't agree with Treasury on price.
The opportunity to play an integral role in the government rescue ranks among the most rewarding experiences of her career, says Peetz. And she's especially proud that her team's work with Treasury and the Fed has since led to similar assignments with "some very large governments outside of the U.S.," which she would not name.
Peetz was promoted from CEO of the bank's global corporate trust unit to her current post in June 2008, reporting directly to BNY Mellon chairman and CEO Bob Kelly. She runs a group that employs some 10,000 people worldwide, accounts for about one-third of BNY Mellon's roughly $13 billion of annual revenue and contributes even more to the bottom line.
Kelly says it was Peetz's talent for growing existing business lines while simultaneously integrating acquired businesses and achieving better-than-expected cost savings that earned her the promotion. Plus, he says, she is "really client-focused," a skilled developer of talent, and thinks globally, "which is what you've got to do in our business, because over one-third of our revenue comes from outside the U.S."
One of Peetz's key initiatives has been fostering more collaboration between business units. So far, they have identified six meaningful cross-selling opportunities to generate new revenue, including the trading of carbon credits.
Peetz continues to chair the bank's Women's Initiatives Network, which she founded five years ago to promote the advancement of women in the company, and keeps teaching leadership classes.
Still, with the additional duties and longer hours, something had to give. In a US Banker profile a year ago, Peetz listed "remodeling houses" as her favorite pastime. This year? "I haven't done any of those," she says.