At 2 a.m. on a Tuesday in February, Kelly Mathieson drifted off to sleep knowing that her Blackberry, finally quiet after another busy work day, wouldn’t stay silent for long.
"I kept it right here," she says, pointing to her heart. "When an email came in, it would wake me back up."
The revolution that was unfolding in Egypt made sleep secondary to answering messages from colleagues. The country's entire financial system—central bank, treasury and stock exchange—had shut down, and Mathieson's employer, JPMorgan Chase, had billions of dollars invested in the country on behalf of clients. No one knew when the markets would reopen or what to expect when they did.
Mathieson, a managing director in JPMorgan's global custody and clearing business, says that in 21 years with the firm, she has had plenty of assignments involving the assessment and handling of transformational changes. "Some have been bigger and some have been more acute and contained," she says. "But the experience with Egypt falls into the category of crisis."
In late January, several people had set themselves on fire in front of the Egyptian parliament building as a form of extreme protest, touching off an 18-day revolution that would prompt Hosni Mubarak, the country's president for 30 years, to step down.
As with many crises before, company executives called on Mathieson to help contend with potential catastrophe. "One thing Kelly is specifically good at is organizing in a stress scenario," says Mark Trivedi, executive director for global custody and clearing, who reports to Mathieson and speaks with deep admiration for his boss.
Mathieson describes her strategic approach as "organizing things out of disparity" and applies it whenever and wherever she can, down to the list of ebooks on her Kindle. "I like seeing the commonality out of what otherwise looks like confusion. I like drawing themes together from what might be unlinked aspects. And then I really like being able to see tangible results."
As citizens in Egypt called for change—and communication with that country became spotty—Mathieson assembled a team of experts from various disciplines across the organization, including Trivedi from custody.
"Before I knew it there were meetings set up over the weekend," Trivedi says. "Kelly had structured a series of conversations with all of the key people. She got a plan together. We knew exactly when we'd be meeting, we knew what the agenda would be, we knew all of the key hot points and materials we'd need. We had a crisis plan in play long before the other areas of our organization were even contemplating the issue."
For nearly two weeks the team worked around the clock on contingency plans for different risk scenarios, touching base with the bank's custody partner in Cairo whenever a phone line opened up, contacting the central securities depositories, and updating clients.
"What was going to happen when the central bank reopened?" Mathieson says. "Would we be able to handle trades? And what would be the cash implications? Were we going to have considerable increases in deposits, and potential issues with accessing that cash? Given the billions involved, these were significant concerns."
The upheaval wasn't limited to Egypt. Earlier conflicts in Tunisia had set off a chain reaction of civil protests that spread throughout the Middle East, in what later would come to be known as Arab Spring.
Keeping track of it all from a risk perspective was daunting. "During that time period, we were focused on potential emerging issues in several countries in the region—not just Egypt—and managing that was a daily challenge," she says.
What hit hardest was the human element of the protracted conflict.
"You realize there are people who are not seeing their families and they're taking the time to get on the phone with you to talk about how securities settlements are going to happen," Mathieson says. "And it's just a very interesting moment where you need to temper yourself from asking the business questions until after you’ve gotten through the human aspect of it. Remembering to build the time in to do that is something I will take away from the experience that I just haven't come across in other crises yet."
Ultimately, it would take until March for Egypt's financial infrastructure to come back online. Fortunately, it did so without incident, other than a few false starts that had staffers working odd hours on weekends to prepare in vain for market re-openings that inevitably got pushed back.
"We had tremendous transparency," Trivedi says of the firm's planning procedures. "Our business leaders knew on a daily basis what our activity was, what our exposures were, what the action plans were. The clients were not disturbed and we got through the issue."
The best part was that JPMorgan didn't have to fall back on any of the contingencies it put in place. But the exercise was a learning experience that ultimately would improve procedures within the company.
"Through Kelly's leadership, we found a way to isolate the scenarios," Trivedi says, "and identify a new working plan such that in the event of a scenario where we're not quite sure what the issues will be, we have a governing structure, we have an escalation path, and we have the right forums for managing it."
As important as that work is, Mathieson has been at the forefront of something even bigger and farther reaching: the Federal Reserve Bank of New York's Tri-Party Repo Infrastructure Task Force. The tri-party repo market at its height exceeded $2 trillion. The financial crisis revealed a disconcerting amount of systemic risk in the market, prompting the formation of the task force in 2009.
Mathieson was uniquely qualified for the task force role, having taken over JPMorgan's clearing business a month after it lost its biggest client, Lehman Brothers, to bankruptcy.
Named on three pending patents, Mathieson has been involved in the development of sophisticated tools for managing collateral. Her team's innovation in "autosubstitution," for example, lets dealers access collateral held in tri-party repo shells by automatically substituting other eligible collateral, helping firms to eliminate credit exposure intraday.
Another service for customers in that market, the Repo Trade Matching Engine, was launched in April.
"I’m really proud of that work," Mathieson says. The changed approach to tri-party repo is "something that was born out of crisis," she says, "but what’s coming out of that is a market model that will frankly bear no resemblance to that which caused the crisis."
Much is left to be done. Sitting on Mathieson's immaculate desk, in her spacious but sparsely decorated sixth-floor office near Wall Street, are two thick PowerPoint decks full of tri-party repo proposals.
No other paperwork is in sight, just a laptop and Blackberry.
"She is a maven with the Blackberry, a whirlwind of activity," says David Weisbrod, managing director and risk management executive for JPMorgan Treasury and Securities Services, who is also on the task force. "I tease her about that because I’ve never seen anybody as agile with the Blackberry in my life as Kelly."
Mathieson says she likes being able to respond to emails immediately from almost anywhere. Leaving people hanging stresses her out like nothing else.
"She will read decks on her Blackberry and give you detailed feedback on technical terminology," Trivedi says. "She'll find extra spaces in a presentation that she's reading on the two-inch screen." He's constantly baffled by her responsiveness regardless of the hour or her time zone. (Mathieson travels frequently between New York and London for work.)
"We don’t know when she sleeps," Trivedi says. "I'll send her an email at 1:30 in the morning. She'll respond immediately and say, 'Thank you so much, I'll take a look at it.' And at, like, 5 in the morning I'll have a response."
As improbable as it sounds, Mathieson also maintains a life outside of work. Weekends frequently are spent with her parents on Long Island, or with her four younger siblings and her nieces and nephews, who are scattered in different states. When she can, she goes to her house in Maine and relaxes.
Mathieson's home in Maine is in the foothills of the White Mountains, where she can indulge in pastimes such as kayaking and hiking. (Mathieson has climbed Peru's Machu Picchu and California's Mt. Whitney, the highest summit in the contiguous United States.)
Kim Colombi, who has known Mathieson for more than a decade and hiked with her through England and Costa Rica, testifies to her close friend's ability to unwind. "When it comes to her downtime, she's completely free, relaxed and joyful," says Colombi, who met Mathieson while working for JPMorgan as a marketing consultant.
Mathieson acknowledges the paradox in her priorities. "Although I may have the Blackberry surgically attached to my hand, you'd be surprised at how much I can actually shut down over the weekend when I have time."