More Big-Name Bankers Going Back To School, In A Way
Market turmoil, increased regulation lead some bankers into academia.
April 3, 2009
Forget Rodney Dangerfield. Lately, it's investment bankers who have been leaving Wall Street to go back to school.
On March 19, the University of California System announced that Peter Taylor, most recently the head of West Coast public finance at Barclays Capital, would assume the newly created position of chief financial officer and executive vice president. Taylor starts on Monday, and came to Barclays via its acquisition of certain Lehman Brothers assets last year.
One week before, Lehigh University tapped John Chrin, co-head of the financial institutions group at JPMorgan Chase, as global financial services executive-in-residence. Chrin, who will end his 16-year tenure at JPMorgan in June and worked on the firm's acquisitions of Bear, Stearns & Co. and Bank One, will teach classes in Lehigh's College of Business and Economics, help build and develop Lehigh's corporate relationships, and serve as a fellow at the university's Financial Services Laboratory research center. Chrin will start his new position in August, when his son John will begin his senior year at Lehigh.
On Jan. 21, Johns Hopkins University announced that former Treasury Secretary Henry Paulson Jr. agreed to become a distinguished visiting scholar at the Paul H. Nitze School of Advanced International Studies. He arrived on Jan. 29 and also serves as a fellow at the school's Bernard Schwartz Forum on Constructive Capitalism. Paulson, of course, spent 32 years at Goldman, Sachs & Co., most recently as chairman and chief executive officer, prior to his July 2006 appointment as Treasury Secretary.
In addition, Yale University named Merrill Lynch & Co.'s former president and chief operating officer Gregory Fleming, who left the firm shortly after the its acquisition by Bank of America (a deal he spearheaded), as senior research scholar at Yale Law School. Fleming is also a distinguished visiting fellow at Yale Law School's Center for the Study of Corporate Law, where he teaches classes and conducts research on the global financial crisis.
So what's behind the trend? "Based on my experiences advising senior professionals on Wall Street, there comes a point in their careers when they want to give back in some significant way, such as running a charitable foundation or entering academia," says Maureen Brille, a managing director at recruitment firm Westwood Partners. "They typically think about doing something philanthropic a little later in their careers. Because Wall Street is in such disarray and the work/life/compensation balance has been permanently altered, people are reassessing their lives and goals and are now saying, 'Why should I wait?'"
Paul R. Brown, dean of Lehigh's College of Business and Economics, who hired Chrin, agrees. "Many of the individuals in the industry have recognized that, structurally, it will be completely different from what they've ever experienced, and they're questioning whether they want to be part of this systemic change," Brown says.
For Taylor, it was the right time to leave investment banking. "I've had a great run in investment banking and I like the people at Barclays and their commitment to the business very much, but I reached that point in my life where I just turned 50 and my kids are in college, so the transition is easier to do now rather than five or 10 years ago," he says. "The turmoil of the past year has been very stressful and this is an opportunity to start fresh on something that's a big challenge, but one I can sink my teeth into and be emotionally committed to."
Taylor's new role somewhat resembles the one he is leaving behind. "My goal is to help the UC System find ways to reinvest as much as possible into the student franchise and help accomplish that mission. As investment bankers, we're hired by issuers to represent their best interests and try to put together cost-effective borrowing on their behalf, so the goals are similar."
In his new position, he will continue to talk to the same types of parties he did as an investment banker, such as credit analysts and buy-side professionals. "In some ways, the easiest part of the transition is continuing to chat with them about financial matters on behalf of one client, in this case the UC System, as opposed to several clients as an investment banker."
Taylor does not have any immediate plans to teach classes at a UC school, though he would be eager to assist if given the opportunity. He is a third-generation University of California graduate, having earned an undergraduate degree from UCLA. Taylor's oldest child is a student at Stanford University, and his youngest, a high school senior, is still deciding between a UC school and another institution.
Other recent high-profile investment banking appointments in academia also involved alumni returning to their former stomping grounds. Chrin earned a bachelor of arts degree in economics and a bachelor of science degree in industrial engineering from Lehigh in 1985 and 1986, respectively. He serves on the College of Business and Economics' board of advisers and delivered a talk as the keynote speaker for the Lehigh MBA Annual Alumni Day in October. Fleming graduated from Yale Law School with a J.D. in 1988.
Edward Forst, who stepped down as Goldman's global head of investment management to join Harvard University as an executive vice president last summer, received his A.B. from Harvard in 1982. Frank Yeary, Citigroup's former global head of M&A, joined his alma mater, UC-Berkeley, as vice chancellor last year (see related story). Richard Marin, the former chairman and CEO of asset management at Bear Stearns, landed at Cornell University, from which he has two degrees, as a senior visiting lecturer and executive-in-residence in asset management at the Johnson School. Robert Kaplan left Goldman (where he had been vice chairman in charge of investment banking and investment management) to join his alma mater, Harvard Business School, as a professor of management practice in 2005. Paulson did not graduate from Johns Hopkins, having received his bachelor's degree from Dartmouth College and his MBA from Harvard.
Chrin, Fleming, Yeary, and Paulson were unavailable for comment.
Chrin won't be the last investment banker to join the Lehigh faculty. Brown says he is in negotiations to hire one or two investment banking professionals next year, and other business school deans are involved in similar efforts. "There is a real window to bring this talent to the classroom."
(c) 2009 Investment Dealers' Digest and SourceMedia, Inc. All Rights Reserved.
Find out more information about people mentioned in this article from our People Database:
Greg Fleming
Maureen Brille
Frank Yeary
Ed Forst
For more information on related topics, visit the following:
