The Globe and Mail, Sinclair Stewart, 6 July 2007
Bob Kelly, amateur archer, strolls over to a sideboard in his sprawling Manhattan office to provide a lesson in improbability. He picks up a slender, glass-topped display case, inside of which are two arrows, the point of one lodged squarely in the green-fletched nock of another. This feat is known among practitioners as a "Robin Hood," and the odds of pulling it off are about the same as a golfer making consecutive holes-in-one. Or a Nova Scotian kid of average means one day taking the reins of America's oldest bank.
Mr. Kelly, 53, officially stepped into the chief executive officer's chair at Bank of New York Mellon Corp. on Monday, capping an unlikely career trajectory that took him from a consultant's job in his native Halifax, to Toronto-Dominion Bank, and then across the border, where he had increasingly senior stints with First Union Corp., Wachovia Corp., and most recently, Mellon Financial Corp. of Pittsburgh.
In the process, Mr. Kelly has quietly become one of the most influential Canadians in the U.S. financial services industry.
While most of his compatriots were toasting Canada Day on the weekend, Mr. Kelly was hoisting a glass of champagne to celebrate the completion of Mellon's merger with Bank of New York, a deal that creates a $50-billion (U.S.) goliath in the murky world of asset management and custody services.
Custody firms help process and settle trades, acting as the intermediary between buyers and sellers of securities - not the most glamorous part of the financial industry, but the unseen backbone upon which most routine stock transactions rest.
Mr. Kelly, who inherited a photographic memory from his father, a former tax partner with KPMG, ticks off a rapid-fire sketch of the new company: 40,000 employees, 37 countries, $13-billion in annual revenue, $160-billion in balance sheet assets, a mind-bending $18-trillion in assets and custody under administration, and more than $8-trillion in assets under trusteeship.
Impressive as this seems, it's hard to tell whether Mr. Kelly is more excited by the combined clout of Bank of New York Mellon, or the museum-like environs he will now occupy on the corner of Wall Street and Broadway.
In addition to an interest in archery and cycling, Mr. Kelly is an avid history buff, and he's already begun to decorate his corner office with historical bric-a-brac, from a Winston Churchill photograph taken in 1914 to a signed photograph of Orville Wright. Beside the arrow display are several other time-worn trophies, including a seventh edition of Adam Smith's The Wealth of Nations, dating from the 18th century, that he purchased on eBay ("I couldn't afford a first edition").
"It comes back to the basic premise that if you don't understand history, and appreciate it, you'll make the same mistake over again," he said, in between breakfast swigs of a Diet Coke. "I love looking at the roots of issues. And cultural roots are an important part of understanding places you live and people you deal with."
Mr. Kelly may have been here barely a week, but he has already become fast acquainted with the roots of Bank of New York - the first stock traded on the New York Stock Exchange - and relishes his role as part-time tour guide.
A massive oil painting of Alexander Hamilton, the bank's founder and the first Secretary of the Treasury under George Washington, surveys the reception area (Andrew Mellon, the wealthy founder of Mellon Financial, was the 49th Treasury Secretary, Mr. Kelly explains, delighting in the coincidence).
The foyer also boasts Mr. Hamilton's original fold-top desk, his clock, and a miniature model neighbourhood showing his first home, not far from the bank's original site.
In one corner, behind an unassuming little cupboard, is the first loan ever extended to the fledgling U.S. government: a $200,000 note signed by Mr. Hamilton, whose final resting place, under a white-topped mausoleum, is a stone's throw from the bank.
It's hard to imagine a better fit for Mr. Kelly, a consultant who parlayed his computer skills into a job with TD in the early 1980s. He was soon dispatched to London, working on an escalating series of trading floor jobs, before being thrust into the chief financial officer's role and helping to oversee the bank's purchase of U.S. discount brokerage Waterhouse.
But when it became clear that Ed Clark, and not he, had a lock on succeeding Charles Baillie atop the bank, Mr. Kelly resigned, heading to First Union as chief financial officer and helping to orchestrate a takeover of Wachovia.
He spent a few years at the North Carolina company, and pocketed a handful of CFO of The Year awards, before accepting the top job at Mellon early last year - another firm steeped in tradition, but one that had fallen on some difficult times. Investors were agitating amid a slumping stock, and the company had run into regulatory problems. In the span of less than 12 months, he managed to quell shareholder dissent, invigorate the stock price and, oh yeah, announce a transformative merger with Bank of New York.
"I'm a change agent," he shrugs. "I love growth, and I love change. But change is more complicated the higher you get."
The two companies are seen as a complementary fit in a large, but relatively behind-the-scenes facet of the securities industry: custody, servicing and asset management.
The combined firm will also be a dominant player in corporate trust, which is like wealth management, and provide technology support and back office functions for pension funds, banks and a host of other financial companies.
Right now, about 25 per cent of the combined company's revenue comes from outside the United States, but Mr. Kelly foresees a time when this will swell to over half. One of the big growth areas is Europe, where banks have been slower than their North American rivals to outsource their back office functions. That move is afoot now, and the cumbersomely named Bank of New York Mellon is hoping to cash in, perhaps through acquisitions.
So will Mr. Kelly ever return to Canada? That appears unlikely, now that he's in command of a bank that is larger than most of its Canadian peers (including TD). But that doesn't mean he doesn't keep careful tabs on what's going on at home.
As an expat, he said he is "consistently astonished" at the similarities between the business environment in Canada and the United States. He does have a few small words of advice, though.
"Canada really should have one stock exchange, by the way," he said. "And it's too small a country in a rapidly globalizing world to have multiple securities regulators."
;
Bob Kelly, amateur archer, strolls over to a sideboard in his sprawling Manhattan office to provide a lesson in improbability. He picks up a slender, glass-topped display case, inside of which are two arrows, the point of one lodged squarely in the green-fletched nock of another. This feat is known among practitioners as a "Robin Hood," and the odds of pulling it off are about the same as a golfer making consecutive holes-in-one. Or a Nova Scotian kid of average means one day taking the reins of America's oldest bank.
Mr. Kelly, 53, officially stepped into the chief executive officer's chair at Bank of New York Mellon Corp. on Monday, capping an unlikely career trajectory that took him from a consultant's job in his native Halifax, to Toronto-Dominion Bank, and then across the border, where he had increasingly senior stints with First Union Corp., Wachovia Corp., and most recently, Mellon Financial Corp. of Pittsburgh.
In the process, Mr. Kelly has quietly become one of the most influential Canadians in the U.S. financial services industry.
While most of his compatriots were toasting Canada Day on the weekend, Mr. Kelly was hoisting a glass of champagne to celebrate the completion of Mellon's merger with Bank of New York, a deal that creates a $50-billion (U.S.) goliath in the murky world of asset management and custody services.
Custody firms help process and settle trades, acting as the intermediary between buyers and sellers of securities - not the most glamorous part of the financial industry, but the unseen backbone upon which most routine stock transactions rest.
Mr. Kelly, who inherited a photographic memory from his father, a former tax partner with KPMG, ticks off a rapid-fire sketch of the new company: 40,000 employees, 37 countries, $13-billion in annual revenue, $160-billion in balance sheet assets, a mind-bending $18-trillion in assets and custody under administration, and more than $8-trillion in assets under trusteeship.
Impressive as this seems, it's hard to tell whether Mr. Kelly is more excited by the combined clout of Bank of New York Mellon, or the museum-like environs he will now occupy on the corner of Wall Street and Broadway.
In addition to an interest in archery and cycling, Mr. Kelly is an avid history buff, and he's already begun to decorate his corner office with historical bric-a-brac, from a Winston Churchill photograph taken in 1914 to a signed photograph of Orville Wright. Beside the arrow display are several other time-worn trophies, including a seventh edition of Adam Smith's The Wealth of Nations, dating from the 18th century, that he purchased on eBay ("I couldn't afford a first edition").
"It comes back to the basic premise that if you don't understand history, and appreciate it, you'll make the same mistake over again," he said, in between breakfast swigs of a Diet Coke. "I love looking at the roots of issues. And cultural roots are an important part of understanding places you live and people you deal with."
Mr. Kelly may have been here barely a week, but he has already become fast acquainted with the roots of Bank of New York - the first stock traded on the New York Stock Exchange - and relishes his role as part-time tour guide.
A massive oil painting of Alexander Hamilton, the bank's founder and the first Secretary of the Treasury under George Washington, surveys the reception area (Andrew Mellon, the wealthy founder of Mellon Financial, was the 49th Treasury Secretary, Mr. Kelly explains, delighting in the coincidence).
The foyer also boasts Mr. Hamilton's original fold-top desk, his clock, and a miniature model neighbourhood showing his first home, not far from the bank's original site.
In one corner, behind an unassuming little cupboard, is the first loan ever extended to the fledgling U.S. government: a $200,000 note signed by Mr. Hamilton, whose final resting place, under a white-topped mausoleum, is a stone's throw from the bank.
It's hard to imagine a better fit for Mr. Kelly, a consultant who parlayed his computer skills into a job with TD in the early 1980s. He was soon dispatched to London, working on an escalating series of trading floor jobs, before being thrust into the chief financial officer's role and helping to oversee the bank's purchase of U.S. discount brokerage Waterhouse.
But when it became clear that Ed Clark, and not he, had a lock on succeeding Charles Baillie atop the bank, Mr. Kelly resigned, heading to First Union as chief financial officer and helping to orchestrate a takeover of Wachovia.
He spent a few years at the North Carolina company, and pocketed a handful of CFO of The Year awards, before accepting the top job at Mellon early last year - another firm steeped in tradition, but one that had fallen on some difficult times. Investors were agitating amid a slumping stock, and the company had run into regulatory problems. In the span of less than 12 months, he managed to quell shareholder dissent, invigorate the stock price and, oh yeah, announce a transformative merger with Bank of New York.
"I'm a change agent," he shrugs. "I love growth, and I love change. But change is more complicated the higher you get."
The two companies are seen as a complementary fit in a large, but relatively behind-the-scenes facet of the securities industry: custody, servicing and asset management.
The combined firm will also be a dominant player in corporate trust, which is like wealth management, and provide technology support and back office functions for pension funds, banks and a host of other financial companies.
Right now, about 25 per cent of the combined company's revenue comes from outside the United States, but Mr. Kelly foresees a time when this will swell to over half. One of the big growth areas is Europe, where banks have been slower than their North American rivals to outsource their back office functions. That move is afoot now, and the cumbersomely named Bank of New York Mellon is hoping to cash in, perhaps through acquisitions.
So will Mr. Kelly ever return to Canada? That appears unlikely, now that he's in command of a bank that is larger than most of its Canadian peers (including TD). But that doesn't mean he doesn't keep careful tabs on what's going on at home.
As an expat, he said he is "consistently astonished" at the similarities between the business environment in Canada and the United States. He does have a few small words of advice, though.
"Canada really should have one stock exchange, by the way," he said. "And it's too small a country in a rapidly globalizing world to have multiple securities regulators."
