WEBVTT - Interview With Kelly Coffey: Masters in Business (Audio) 0:00:03.240 --> 0:00:07.560 This is Masters in Business with Barry Ridholts on Bloomberg Radio. 0:00:08.440 --> 0:00:11.639 We have a very special guest. Uh. It's really kind 0:00:11.680 --> 0:00:17.120 of a fascinating um individual in that I know of 0:00:17.239 --> 0:00:21.840 no other person who is responsible for more assets, no 0:00:21.960 --> 0:00:27.080 other woman who is higher ranking in the world of finance, 0:00:27.520 --> 0:00:31.160 and yet at the same time is not only unknown 0:00:31.200 --> 0:00:37.040 to the investing public in general, is probably fairly unknown 0:00:37.840 --> 0:00:42.839 within the world of financial asset management, meaning people who 0:00:42.920 --> 0:00:47.800 work in finance probably haven't heard of Horror as much 0:00:47.840 --> 0:00:51.559 as they've heard of some some more famous money managers. 0:00:51.560 --> 0:00:54.680 Everybody knows who Jamie Diamond is, He's the CEO of 0:00:54.800 --> 0:00:58.280 JP Morgan, but how many people know who the chief 0:00:58.320 --> 0:01:02.600 executive officer, the c e O of JP Morgan Private 0:01:02.600 --> 0:01:05.800 Bank is. They managed six hundred and fifty billion dollars, 0:01:05.800 --> 0:01:10.240 They're a huge, huge player in the world of asset management, 0:01:10.520 --> 0:01:12.959 and I bet most of you don't know who Kelly 0:01:13.040 --> 0:01:17.080 Coffee is. Well. We spent a delightful hour and change 0:01:17.160 --> 0:01:20.480 chatting about what it's like being a woman on Wall Street, 0:01:21.040 --> 0:01:23.600 what it was like being at a big bank in 0:01:23.600 --> 0:01:27.160 the midst of the financial crisis, and what exactly the 0:01:27.160 --> 0:01:32.640 CEO of JP Morgan Private Bank actually does. I found 0:01:32.640 --> 0:01:37.640 the conversation really quite fascinating, and I expect you will also, so, 0:01:37.720 --> 0:01:44.680 without any further ado, my conversation with Kelly Coffee. This 0:01:44.880 --> 0:01:48.840 is Masters in Business with Barry Ridholts on Bloomberg Radio. 0:01:49.400 --> 0:01:53.040 My special guest this week is Kelly Coffee. She might 0:01:53.080 --> 0:01:56.640 be the most influential woman in finance who you've never 0:01:56.680 --> 0:02:01.520 heard of. She is the CEO of JP Morrigan Private Bank, 0:02:01.880 --> 0:02:05.800 which manages over six hundred and fifty billion dollars in 0:02:05.920 --> 0:02:10.000 client assets. Her background, she has a bachelor's and International 0:02:10.000 --> 0:02:14.080 Affairs and French at Lafayette College, a master's and Fire 0:02:14.120 --> 0:02:17.840 and Service at Georgetown University. She's a member of the 0:02:17.919 --> 0:02:22.000 Global Wealth Management Operating Committee at JP Morgan and also 0:02:22.160 --> 0:02:26.920 executive sponsor for the Asset Management Woman's Network. Kelly Coffee, 0:02:27.040 --> 0:02:29.359 Welcome to Boomberg. Thank you. It's wonderful to be here. 0:02:29.600 --> 0:02:34.080 So you have a really interesting background. Starting you've been 0:02:34.120 --> 0:02:36.239 at JP Morgan for quite a while. You've worked you 0:02:36.280 --> 0:02:38.600 withy through number of departments. But before we get to 0:02:38.680 --> 0:02:41.400 life at JP Morgan, tell us a little bit about 0:02:41.400 --> 0:02:44.520 your background. How did you get into the financial services 0:02:44.919 --> 0:02:48.920 industry with a background in French and foreign service. Uh, 0:02:49.160 --> 0:02:52.720 I think I'm an accidental entrance into this, into this career. 0:02:52.960 --> 0:02:55.160 My undergrad degree, as you said, in my graduate degrees 0:02:55.160 --> 0:02:57.400 in international affairs. I wanted to study the world and 0:02:57.440 --> 0:03:01.160 how how it worked, and that was always fine fascinating 0:03:01.160 --> 0:03:04.040 to me. My other choice for my undergraduate major would 0:03:04.040 --> 0:03:07.239 have been math, but at eighteen years old, I couldn't 0:03:07.240 --> 0:03:08.720 figure out what I would have done with a math degree, 0:03:08.760 --> 0:03:13.320 so I just studied that um. And so when I 0:03:13.400 --> 0:03:17.679 was coming out of Georgetown, I had a decision to make. 0:03:17.720 --> 0:03:22.440 I could have been interestingly an observer at the European 0:03:22.639 --> 0:03:27.600 Union Integration Talks three pre the the euro and all 0:03:27.639 --> 0:03:29.720 of the things that we're talking about will it become 0:03:29.720 --> 0:03:33.160 dismantled today? And the birth you could go to. I 0:03:33.160 --> 0:03:35.040 could go to the funeral. Let's hope not we're at that, 0:03:35.160 --> 0:03:38.160 we don't go to that funeral, but or go go 0:03:38.240 --> 0:03:40.000 to Wall Street. And I thought, since I didn't do 0:03:40.000 --> 0:03:43.200 an MBA, that I should get just some grounding and finance. 0:03:43.400 --> 0:03:45.400 So I went to JP Morgan because they had a 0:03:45.400 --> 0:03:48.280 great training program. I met some fantastic people, and I 0:03:48.280 --> 0:03:51.480 would do it for a couple of years and years 0:03:51.480 --> 0:03:53.920 ago probably, and now you're running the private bank. So 0:03:54.000 --> 0:03:56.520 you were in a number of different departments, kind of 0:03:56.520 --> 0:03:58.960 work your way through. Tell us about the different divisions 0:03:59.480 --> 0:04:02.880 that you either worked at or rent. I started in 0:04:03.480 --> 0:04:06.320 corporate finance and M and A because it was it 0:04:06.400 --> 0:04:08.200 was what I knew and I thought that would be 0:04:08.800 --> 0:04:10.680 the best part. It was. It was fantastic place for me. 0:04:10.720 --> 0:04:14.040 I loved building models, and pretty quickly in that I 0:04:14.080 --> 0:04:17.120 was asked to move to Argentina for US when Argentina 0:04:17.240 --> 0:04:20.440 was privatizing its industry. So we actually, hopefully we're going 0:04:20.440 --> 0:04:22.520 into that kind of phase of Argentina today with ma 0:04:22.640 --> 0:04:27.480 Cri carry every cycle they did. We've seen the same 0:04:27.520 --> 0:04:29.880 thing in Brazil and Mexico every few years is a 0:04:29.880 --> 0:04:32.680 big regime change. So I went. I went there when 0:04:32.760 --> 0:04:35.760 Menem was president. Cavallo was the finance minister, who was 0:04:35.800 --> 0:04:38.120 a rock star in my eyes, and they had put 0:04:38.120 --> 0:04:40.719 in place something called convertibility. They pegged Paso to the 0:04:40.720 --> 0:04:43.320 dollar one for one, and then we were helping with 0:04:43.320 --> 0:04:47.080 the privatization program. So JP Morgan, together with the French 0:04:47.160 --> 0:04:49.400 and the Italian and a local company called pets comp 0:04:49.400 --> 0:04:52.200 Punk bought the phone company in the north of Argentina, 0:04:52.640 --> 0:04:54.840 and we financed it and then we ultimately took a 0:04:54.920 --> 0:04:57.320 public but I I was pulled down there to work 0:04:57.320 --> 0:04:58.920 on that, and I stayed for about five years. And 0:04:59.240 --> 0:05:04.000 all these were own entities that were spinning out. They 0:05:04.000 --> 0:05:06.880 privatized it, then you helped take it public. Did the 0:05:06.920 --> 0:05:10.000 international affairs French and everything else help with that? Help? 0:05:10.040 --> 0:05:11.640 I mean, of course now I'm fluent in Spanish, I 0:05:11.800 --> 0:05:14.040 spoke French when I went there, But it did I 0:05:14.279 --> 0:05:17.240 think my undergraduate degree and my graduate degree, particular in 0:05:17.240 --> 0:05:19.920 international affairs from Georgetown. It taught you how to take 0:05:20.040 --> 0:05:22.680 really complicated things and distill them down to the essence. 0:05:23.080 --> 0:05:25.320 And there's an analytical part of that. It's not all 0:05:25.800 --> 0:05:27.440 not all of that is numbers. And I think it 0:05:27.480 --> 0:05:30.159 did help me, particularly when we were negotiating and you 0:05:30.240 --> 0:05:33.960 had the French, the Italians, the Argentine and the Americans 0:05:34.080 --> 0:05:36.960 US trying to agree on something in a consortium as 0:05:37.040 --> 0:05:39.560 joint owners. I think it served me well. And some 0:05:39.680 --> 0:05:41.960 of those met everybody speaking English. I'm assuming in those 0:05:42.000 --> 0:05:44.240 meetings everybody spoke English in those meetings. Of course I 0:05:44.320 --> 0:05:46.920 became fluent in Spanish. But yeah, we you know a 0:05:46.920 --> 0:05:49.400 lot of those. A lot of that business is done 0:05:49.440 --> 0:05:52.320 in English. Uh. And it was interesting even though and 0:05:52.680 --> 0:05:55.600 even in Argentina are English. We would have held the 0:05:55.680 --> 0:05:58.840 meetings in Spanish verbally, but all of our presentation materials 0:05:58.839 --> 0:06:01.080 were in English, but just been because we're in an 0:06:01.080 --> 0:06:03.839 American bank. How long were you down in Argentina? About 0:06:03.880 --> 0:06:08.560 five years? Right? It's really lovely. It's beautiful so and 0:06:08.600 --> 0:06:11.840 I hope it becomes really prosperous now with that they 0:06:11.920 --> 0:06:16.240 have of tremendous resources and raw materials and commodities. It 0:06:16.320 --> 0:06:19.159 just seems that every few years they seem to slip 0:06:19.160 --> 0:06:20.919 off the tracks and it takes a long time to 0:06:20.920 --> 0:06:25.960 get back on on pace. And hopefully I'm also slaves 0:06:26.000 --> 0:06:28.040 to the comality market. You have a huge run up 0:06:28.080 --> 0:06:30.200 cause by China, and then the run back down and 0:06:30.240 --> 0:06:33.160 suddenly they're out over their skis. And it seems that 0:06:33.839 --> 0:06:36.680 nobody seems to learn from the cycle. Hey, kamalities are booming, 0:06:36.760 --> 0:06:39.359 let's let's you know, build this, sell that, and all 0:06:39.400 --> 0:06:41.400 of a sudden it goes the other way and what 0:06:41.480 --> 0:06:44.279 a surprise. Yeah. I think Argentina they do have enough 0:06:44.320 --> 0:06:46.960 of a of a market internally, and and if the 0:06:46.960 --> 0:06:49.279 government does this right, I think it can work beyond that. Sem. 0:06:49.400 --> 0:06:51.839 So let's bring you back to UH New York and 0:06:51.880 --> 0:06:55.239 the private bank. What's the difference between the private bank 0:06:55.360 --> 0:06:59.000 and a regular bank. The private bank is actually a 0:06:59.040 --> 0:07:02.599 microcosm of the higher firm because when need think about 0:07:02.640 --> 0:07:06.000 who we do business with, it's it's it's extremely wealthy 0:07:06.040 --> 0:07:08.680 clients who probably they might be business owners, they might 0:07:08.720 --> 0:07:11.640 do entrepreneurs a number of different ways they got there, 0:07:11.960 --> 0:07:14.520 and they need us for banking, they need us for credit, 0:07:14.600 --> 0:07:16.920 they need us for investment advice. They also need us 0:07:17.000 --> 0:07:19.600 to help sell their businesses sometimes help them think about 0:07:19.640 --> 0:07:22.200 I p O. So there's not a part of JP 0:07:22.320 --> 0:07:25.600 Morgan that my business doesn't plug into to make sure 0:07:25.640 --> 0:07:27.520 I'm getting the best of JP women for each of 0:07:27.520 --> 0:07:29.840 those clients. So it is really like a bank. We 0:07:29.960 --> 0:07:32.680 have just steered very hard net worth individuals. It is 0:07:32.800 --> 0:07:35.040 it is, I mean, JP Morgan serves the whole spectrum 0:07:35.280 --> 0:07:37.960 right between Chase and we. We we coordinate very closely 0:07:38.720 --> 0:07:41.320 with that. And the idea is to basically say, this 0:07:41.400 --> 0:07:43.200 is the client, this is what they need, which is 0:07:43.240 --> 0:07:46.080 not only delineated by their balance sheet. By the way, 0:07:46.160 --> 0:07:48.760 as you know, very it's it's really what what do 0:07:48.840 --> 0:07:50.760 they what do they need advice on? And then let's 0:07:50.800 --> 0:07:52.880 make sure we're getting that right advice to them the 0:07:52.880 --> 0:07:55.800 way they want it. I'm Barry rid Helps. You're listening 0:07:55.840 --> 0:07:59.120 to Masters in Business on Bloomberg Radio. My special guest 0:07:59.120 --> 0:08:02.880 today is Kelly Coffee. She is the CEO of JP 0:08:03.040 --> 0:08:07.080 Morgan's Private Bank, which manages about six d and fifty 0:08:07.120 --> 0:08:10.520 billion dollars in client assets. And one of the things 0:08:10.520 --> 0:08:13.960 that stood out to me on your bio is that 0:08:14.040 --> 0:08:18.480 you lead the investment banks Woman's network. And one of 0:08:18.560 --> 0:08:21.080 the things that I've tried to do with this show 0:08:21.200 --> 0:08:24.360 is bring more women on. And it's not easy. It 0:08:24.480 --> 0:08:27.920 is very much a male dominated industry. When I look 0:08:28.000 --> 0:08:32.280 to bring people on who are female, it's harder to 0:08:32.320 --> 0:08:35.719 find them, the fewer and further between. Why is that? 0:08:36.080 --> 0:08:38.600 It's a good question. One of my colleagues always refers 0:08:38.640 --> 0:08:42.080 to me as the spotted owl because but but I 0:08:42.080 --> 0:08:44.679 actually think at Jpmarren, we have a pretty incredible group 0:08:44.720 --> 0:08:47.360 of people. You know, I I don't I don't know 0:08:47.360 --> 0:08:51.600 that I can put pinpoint what exactly is is the issue? Um, 0:08:52.280 --> 0:08:54.800 you know, I think that we've done I think what 0:08:54.880 --> 0:08:58.920 it takes to actually help women advance. First of all, 0:08:58.920 --> 0:09:01.120 they have to be interested, and then second of all, 0:09:01.120 --> 0:09:04.559 they have to have advocates. And and we've we've done 0:09:04.559 --> 0:09:06.440 a number of different things. I have, whether it's at 0:09:06.440 --> 0:09:08.960 the investment bank, in the Women's network, or in my 0:09:09.040 --> 0:09:12.120 current business now where I sit and talk to women. 0:09:12.160 --> 0:09:14.800 There are some who come into my office and I'll 0:09:15.040 --> 0:09:16.679 I'll say I want to give them a promotion and 0:09:16.679 --> 0:09:19.160 give them a bigger job, and their first response to 0:09:19.160 --> 0:09:21.240 me sometimes as well, I'm not sure I'm ready for that. 0:09:22.080 --> 0:09:24.000 And you would never get that same sort of response 0:09:24.040 --> 0:09:26.240 from a guy. They would They would fake it till 0:09:26.280 --> 0:09:28.840 they make it as the old old expression, and that's 0:09:28.880 --> 0:09:32.040 a male attitude. So women sometimes need a little bit 0:09:32.040 --> 0:09:34.480 of a push to say, you know what, be ambitious, 0:09:34.480 --> 0:09:36.640 you can do this, You'll figure it out. I wouldn't 0:09:36.640 --> 0:09:38.120 be offering it to you if I didn't think you 0:09:38.160 --> 0:09:39.800 could do it, and I couldn't help you do it, 0:09:40.040 --> 0:09:43.120 And so there's an element of that. So we previously 0:09:43.160 --> 0:09:46.040 interviewed Michelle Myers is one of the up and coming 0:09:46.040 --> 0:09:50.480 economists again on the Bank America Merrill Lynch platform, and 0:09:50.559 --> 0:09:52.920 one of the questions one of the comments she said 0:09:52.960 --> 0:09:56.000 that I thought was so interesting. The lack of women 0:09:56.040 --> 0:09:58.800 at the top of the industry is a challenge for 0:09:58.840 --> 0:10:01.839 the young women coming up in financed today. Agree with that, 0:10:02.480 --> 0:10:05.520 And the way she probably meant that is when you 0:10:05.559 --> 0:10:07.560 want to think about how you can do things, most 0:10:07.600 --> 0:10:10.480 people need to see somebody who's succeeded to do that 0:10:10.720 --> 0:10:13.040 no career path that you've witnessed. Oh you can do this, 0:10:13.080 --> 0:10:16.160 and they want to see that you're you're still you're 0:10:16.200 --> 0:10:19.920 still basically hacking away through the underbrush, through the wilderness. Yeah, 0:10:19.920 --> 0:10:22.200 and I think there's some truth to that I have found. 0:10:22.640 --> 0:10:25.800 When I first ran our derivatives marketing group, I remember 0:10:25.880 --> 0:10:28.000 coming in and there were very few women in the group, 0:10:28.040 --> 0:10:29.400 and a couple of them that were in the group 0:10:29.440 --> 0:10:33.640 I knew probably shouldn't be uh, And what I did 0:10:33.880 --> 0:10:37.120 was actually make it a conscious effort to sit down 0:10:37.120 --> 0:10:39.080 and think about who can we pull in and enlist 0:10:39.200 --> 0:10:41.000 the men, the great men that worked for me. I 0:10:41.040 --> 0:10:43.079 turned to one of them jokingly said today, you're either 0:10:43.080 --> 0:10:44.720 going to learn a lot about shoes or you're gonna 0:10:44.720 --> 0:10:47.160 help me recruit some really amazing women to work with us. 0:10:47.440 --> 0:10:49.000 And he did. He said, I'm going to do that, 0:10:49.040 --> 0:10:51.320 and when I shifted to run something else, we were 0:10:51.320 --> 0:10:54.720 over female. I found that if you got to critical mass, 0:10:54.920 --> 0:10:56.920 it took care of itself. It becomes self sustaining at 0:10:56.960 --> 0:10:59.200 that point. And I think at JP Morman we've seen 0:10:59.280 --> 0:11:01.719 that a bit because if you look at our if 0:11:01.720 --> 0:11:03.800 you look at our organization, you have Marri Edos wh 0:11:03.840 --> 0:11:06.960 runs asset management, our CFO Marian Lake as a rock star, 0:11:07.160 --> 0:11:11.480 Our chief marketing officer Kristin Lemcow is incredible. Uh, Aaron 0:11:11.559 --> 0:11:14.040 Hill runs all of the branches are branch network, and 0:11:14.080 --> 0:11:16.600 so we have some women in really visible, big jobs 0:11:17.360 --> 0:11:20.600 that I think give people that who need that there 0:11:20.679 --> 0:11:22.160 is a track to get there, and I can do 0:11:22.200 --> 0:11:24.360 it while still having kids and having a life and 0:11:24.360 --> 0:11:26.200 all the other things that are important. I think that 0:11:26.320 --> 0:11:29.440 is what is helpful. There's a lot of academic research 0:11:29.480 --> 0:11:32.760 out there that says, if you're an investor and you're 0:11:32.800 --> 0:11:34.400 a woman, the odds are that you're going to have 0:11:34.480 --> 0:11:37.440 a better return because you don't suffer from what we 0:11:37.559 --> 0:11:41.480 jokingly refer to as testosterone poisoning. Any truth to that 0:11:41.559 --> 0:11:45.160 in the real world, I don't know. I I think 0:11:45.200 --> 0:11:47.960 I've seen that research. I think it's interesting I can 0:11:48.120 --> 0:11:51.400 say that in general, and this is obviously a gross generalization, 0:11:51.720 --> 0:11:55.040 women tend to be calmer in their reactions to things. 0:11:55.120 --> 0:11:58.200 And I know with myself when something's going you know, 0:11:58.200 --> 0:11:59.840 when the market's going crazy, when we have to make 0:11:59.840 --> 0:12:01.920 it a decision, I get incredibly calm because that's the 0:12:01.960 --> 0:12:03.840 way I need to think and process to make the 0:12:03.920 --> 0:12:06.680 decision um And I think that's not always the case 0:12:06.760 --> 0:12:09.160 with with some of the male counterparts in the past. 0:12:09.200 --> 0:12:11.280 So you know, maybe you make better decisions when you're 0:12:11.400 --> 0:12:14.600 when you're calm. Well, it certainly reflects in in that 0:12:14.679 --> 0:12:17.920 academic data on on performance, although if you read all 0:12:17.920 --> 0:12:22.160 those studies there's always footnotes says relatively small sample set. 0:12:22.240 --> 0:12:24.439 I know, you know, you need a few thousands managers 0:12:24.480 --> 0:12:28.280 in order to be able to to draining real conclusions. So, 0:12:28.760 --> 0:12:32.080 since you've joined the industry and progressed up the ladder 0:12:32.080 --> 0:12:36.439 at JP Morgan, what has changed within the industry for better? 0:12:37.320 --> 0:12:39.559 A lot has changed within the industry for better? I mean, 0:12:40.000 --> 0:12:42.080 do you mean specifically for women? Are just generally no, 0:12:42.160 --> 0:12:44.599 I mean generally generally civily for women? Okay, Well, I 0:12:44.600 --> 0:12:46.199 would say I was just just a general point that 0:12:46.240 --> 0:12:48.240 I think is also very positive for women. Just think 0:12:48.240 --> 0:12:50.520 about the use of technology today versus when we started. 0:12:50.920 --> 0:12:53.760 When I started and I was covering Latin America, not 0:12:53.840 --> 0:12:55.480 only did I have to finish my model, but I 0:12:55.520 --> 0:12:58.200 actually had to face it to the client overnight and 0:12:58.240 --> 0:13:00.240 it would cut off at least ten times. I had 0:13:00.280 --> 0:13:02.480 at least another hour or two in my schedule at 0:13:02.480 --> 0:13:05.839 the office to fax it. And because a two clock, 0:13:05.880 --> 0:13:07.520 three o'clock in the morning, Who's gonna do that for you? 0:13:07.760 --> 0:13:10.280 When you think about what BlackBerry did for us and 0:13:10.320 --> 0:13:13.440 now iPhones, where I can be anywhere and responding to 0:13:13.440 --> 0:13:14.760 what I need, I think it gave people a lot 0:13:14.800 --> 0:13:18.000 more flexibility. And I think that, along with some of 0:13:18.000 --> 0:13:21.800 the technology, just even the way those companies have operated 0:13:21.840 --> 0:13:24.679 has even made our industry much more fluid. I mean, 0:13:25.800 --> 0:13:27.559 we're on the radio, but you see I'm in a 0:13:27.600 --> 0:13:30.040 bright blue dress today with boots. When I started at 0:13:30.080 --> 0:13:34.520 JP Morgan, I never would have worn anything like this 0:13:34.800 --> 0:13:42.000 because colorful in boots or dude suits. Women didn't wear 0:13:42.040 --> 0:13:49.200 pants really gerald shoes and a blazer, and years ago 0:13:49.240 --> 0:13:52.560 that was unthinkable. Also, I think that's I and I 0:13:52.600 --> 0:13:55.640 think that's somewhat superficial, But I think it manifests itself 0:13:55.640 --> 0:13:58.200 in terms of our openness to who is in the 0:13:58.400 --> 0:14:01.439 who is in the organization, women moving along. I think 0:14:01.440 --> 0:14:04.559 that's all part of the same. There's much more opportunity 0:14:04.600 --> 0:14:08.040 to express your personality in our industry than there was 0:14:08.120 --> 0:14:11.280 when I started. You know, you mentioned technology, how much 0:14:11.360 --> 0:14:15.000 doesn't make a difference that so much communication is being 0:14:15.000 --> 0:14:19.040 done by email or instant message. We're big slack users. 0:14:19.400 --> 0:14:21.920 So who's on the other side of the communication You 0:14:22.000 --> 0:14:24.600 may not even know their gender, or their race or 0:14:24.640 --> 0:14:28.280 anything else like that. Does that technology change make a 0:14:28.280 --> 0:14:32.000 difference or is it It's already adopted and pass that. 0:14:32.960 --> 0:14:34.960 I think it's adopted. I guess what I would say 0:14:34.960 --> 0:14:39.320 about technologies. I love the flexibility it it affords us. 0:14:39.720 --> 0:14:42.680 I don't love that so much is done on chat 0:14:42.880 --> 0:14:46.080 and on email, honestly, because I do think and you 0:14:46.360 --> 0:14:49.240 I'm sure you've seen this, somebody can misinterpret an email 0:14:49.240 --> 0:14:53.840 that you very easily, very easily written word to There's 0:14:53.880 --> 0:14:57.640 also less of a self editing process. I've worked with 0:14:57.680 --> 0:15:02.640 people in the past who I've seen since horrific emails 0:15:02.680 --> 0:15:05.240 that had they turned it into a formal memo, it 0:15:05.400 --> 0:15:07.800 never would have No one would hit that send button. 0:15:07.800 --> 0:15:10.840 It would be there'd be a little more circumspection about 0:15:10.840 --> 0:15:14.120 it rather than blah blah blah sends. And and that's 0:15:14.120 --> 0:15:16.680 the problem with two instant communication or pick up the 0:15:16.680 --> 0:15:19.000 phone call and and so when I shifted, you know, 0:15:19.040 --> 0:15:21.280 everybody in ours to use blackberries, and we were all 0:15:21.360 --> 0:15:24.240 really good with our thumbs typing with blackberries, and we've 0:15:24.280 --> 0:15:27.400 now shifted to iPhones. There are a good group of 0:15:27.400 --> 0:15:29.880 people that still like the BlackBerry. But I made the 0:15:29.880 --> 0:15:32.080 shift to iPhones even though I'm not very good at 0:15:32.120 --> 0:15:34.800 typing on it, because I figured shorter emails are better 0:15:34.840 --> 0:15:36.240 and I'm much more likely to just pick up the 0:15:36.280 --> 0:15:38.120 phone and call a person instead of drafting an email. 0:15:38.240 --> 0:15:39.760 It's a little bit more of a pain for me 0:15:39.840 --> 0:15:41.320 to do it on an iPhone. I think that's a 0:15:41.320 --> 0:15:44.280 good thing. I'm Barry Ridhults. You're listening to Masters in 0:15:44.320 --> 0:15:48.040 Business on Bloomberg Radio. My guest today is Kelly Coffee. 0:15:48.360 --> 0:15:52.360 She is chief executive officer of JP Morgan Private Bank, 0:15:53.160 --> 0:15:56.760 part of JP Morgan Chase, which runs the private bank 0:15:56.840 --> 0:16:01.320 runs over six d and fifty billion dollars in client assets. 0:16:02.080 --> 0:16:06.080 You were at JP Morgan during the eighth nine collapse. 0:16:06.840 --> 0:16:10.480 That had to be quite a interesting couple of months. 0:16:10.760 --> 0:16:13.000 What was it like at the back front row seat? Yes, 0:16:14.040 --> 0:16:16.280 it was interesting is a good way to say it. 0:16:16.360 --> 0:16:20.400 I think it was like always, it was always being 0:16:20.480 --> 0:16:22.920 tense and on and kind of ready for the next 0:16:22.920 --> 0:16:24.320 punch and where it was going to come from. I 0:16:24.320 --> 0:16:26.800 think one of my most vivid memories. I have a 0:16:26.880 --> 0:16:28.840 lot of vivid memories. One of my most vivid memories 0:16:28.840 --> 0:16:30.760 is the fact that you would walk onto our trading 0:16:30.800 --> 0:16:33.320 floor on a Saturday or Sunday and it looked exactly 0:16:33.360 --> 0:16:35.600 like it did Monday through Friday. Really, why was that? 0:16:35.680 --> 0:16:37.960 Because you don't know what was happening the weekend, and 0:16:38.560 --> 0:16:40.800 you know, I remember, you know the night that the 0:16:40.840 --> 0:16:43.040 weekend that we bought bear Sterns, you know, having that 0:16:43.200 --> 0:16:45.840 that conversation on Sunday night, like I need everybody in 0:16:45.840 --> 0:16:47.920 a six am, We're going We ran their risk. From 0:16:48.000 --> 0:16:50.040 day one, I had to walk into the building and 0:16:50.120 --> 0:16:52.480 figure out who worked for me and what they were doing, 0:16:52.520 --> 0:16:55.880 and make sure I was running derivatives marketing. Then make 0:16:55.920 --> 0:16:58.640 sure that no trade was put on around Wound without 0:16:58.720 --> 0:17:01.200 my approval. And it was it was moving quickly, and 0:17:01.200 --> 0:17:04.160 then the weekend Lehman failed. When when that was happening, 0:17:04.160 --> 0:17:07.199 it was it was extraordinary complex because not only you know, 0:17:07.200 --> 0:17:09.200 we have collateral posted to one another, so you knew 0:17:09.240 --> 0:17:11.359 what that was, but you had to actually think about 0:17:11.359 --> 0:17:12.880 what was going to happen in the markets and how 0:17:12.880 --> 0:17:15.680 that impacted your derivatives position and therefore what trades you 0:17:15.760 --> 0:17:18.800 might have to do when the market opened, and and 0:17:19.040 --> 0:17:21.720 you were just constantly running scenarios to make sure we 0:17:21.720 --> 0:17:24.560 were ready for that. It was extraordinary, it really, it 0:17:24.640 --> 0:17:26.400 really was. There was a lot of second level thinking 0:17:26.440 --> 0:17:28.600 where it's not here's what's going to happen now, how 0:17:28.600 --> 0:17:30.960 it's going to affect other things that might be based 0:17:30.960 --> 0:17:33.880 on something else, and at a certain point that decision 0:17:33.920 --> 0:17:37.520 tree becomes completely unmanageable. But just for the next morning, 0:17:37.560 --> 0:17:39.119 you had at least have a sense of what was 0:17:39.160 --> 0:17:41.280 going on. Clients were looking to us for a lot 0:17:41.320 --> 0:17:43.000 of advice on what was going on in the market, 0:17:43.040 --> 0:17:44.719 so you were really trying to take it all in 0:17:44.760 --> 0:17:48.680 and and it really was scenario analysis. The the takeover 0:17:48.760 --> 0:17:52.960 of Bear Sterns happened fairly rapidly, and Bear wasn't in 0:17:53.160 --> 0:17:58.560 terrible um shape, and if I recall correctly, you JP 0:17:58.680 --> 0:18:01.560 Morgan was the big his counterparty to Bear, so you 0:18:01.640 --> 0:18:04.719 really understood their book better than anybody else, well as 0:18:04.760 --> 0:18:06.399 well as you can from the outside. I guess it 0:18:06.440 --> 0:18:08.159 was very quick. It was a Thursday night to Sunday 0:18:08.320 --> 0:18:11.760 night announcement. That's what A twenty nine billion dollar take 0:18:11.840 --> 0:18:13.880 over something along those lines. Huge. And the other thing 0:18:13.880 --> 0:18:15.919 I think that was extraordinary about it because Jamie has 0:18:15.960 --> 0:18:18.320 told the story I know a number of times where 0:18:18.359 --> 0:18:22.560 you know he got that diamond Jamie Diamond, right, Okay, 0:18:22.600 --> 0:18:24.960 he had that call Thursday night. It was his birthday 0:18:25.280 --> 0:18:29.800 dinner and Uma hearing about that and uh it was 0:18:29.840 --> 0:18:31.760 all Schwarts that called him and said we have an issue. 0:18:32.240 --> 0:18:34.560 And he called, you know, the head of our investment 0:18:34.640 --> 0:18:36.399 in A couple of people. People got out. It was 0:18:36.400 --> 0:18:41.000 eleven o'clock. People got best back into the office right 0:18:41.040 --> 0:18:42.880 over to Bear Sterns to figure out and they worked 0:18:42.880 --> 0:18:45.400 all night to make sure Bear could open the next 0:18:45.480 --> 0:18:47.320 day and then through the weekend to see what we 0:18:47.320 --> 0:18:49.280 could do for longer term. It was I think what 0:18:49.359 --> 0:18:52.000 the I'm not sure how many other institutions, if there's 0:18:52.000 --> 0:18:54.280 any other institution, could have pilled that off terms of 0:18:54.280 --> 0:18:56.359 the amount of analysis that we had to do to 0:18:56.440 --> 0:18:59.080 be able to step in and run that right from Monday, 0:18:59.119 --> 0:19:01.520 I was incredibly proud of everybody. It was a tough time, 0:19:01.800 --> 0:19:04.639 but exciting in a way too. At the time, I 0:19:04.720 --> 0:19:08.760 was critical of the deal from the FED perspective, but 0:19:09.280 --> 0:19:13.240 objectively looking at it from a corporate perspective, I thought 0:19:13.280 --> 0:19:16.720 Jamie Diamond pulled off one of the greatest acquisitions of 0:19:16.760 --> 0:19:20.760 all time, essentially with his little risk as humanly possible 0:19:20.800 --> 0:19:24.679 for that much of that size, large risky bank, with 0:19:24.760 --> 0:19:27.600 the FED banking backing it up, and or eventually all 0:19:28.800 --> 0:19:30.520 but yeah, but when you look at all the main 0:19:30.640 --> 0:19:33.080 lane one, two, and three that were unwound, these were 0:19:33.119 --> 0:19:37.359 the derivative positions of of Bear at the time. It 0:19:37.480 --> 0:19:42.000 really was fairly break even that that unwind wasn't wasn't horrific. 0:19:42.400 --> 0:19:44.800 And I think people from the outside we're looking and saying, 0:19:44.800 --> 0:19:47.960 oh my god, this is potentially tens of billions of dollars. 0:19:48.000 --> 0:19:50.200 It was essentially flat by the time they were done. 0:19:50.240 --> 0:19:51.960 I don't know. I think I think if you go 0:19:52.040 --> 0:19:54.040 back and you factor in all the fines that we've 0:19:54.080 --> 0:19:57.439 paid as a result of that acquisition. You trace a 0:19:57.440 --> 0:20:00.520 lot of the fines back to that acquisition, particularly in 0:20:00.520 --> 0:20:04.119 the mortgage space um and they were second, they were 0:20:04.160 --> 0:20:11.360 the second largest mortgage and interesting that nobody was able 0:20:11.400 --> 0:20:14.400 to do the same thing with Lehman Brothers. I know, well, yeah, 0:20:14.440 --> 0:20:17.040 that really was interesting. I didn't think at the time 0:20:17.080 --> 0:20:18.480 that they were going to let that go, but it 0:20:18.480 --> 0:20:21.000 became apparent. I remember that weekend very well, series of 0:20:21.000 --> 0:20:23.239