The U.S. subprime mortgage meltdown. The ongoing credit crunch. Volatile markets. The Bush administration’s rethinking of the nation’s regulatory blueprint for financial services companies. Talk of a recession.
Yet, Ryan, 62, seems unfazed by the current economic climate.
“It seems like I attract these things,” says Ryan, who was a principal manager in the 1990s of the savings & loan cleanup, which involved closing roughly 700 insolvent institutions, improving capital bases and selling over $300 billion of assets. “When I was doing the S&L cleanup, it was called a once-in-a-lifetime event, a historic moment. ‘Historic moment’ is an overused term.”
Then, as now, Ryan views the economy in terms of cycles.
As he puts it: “The economy has expanded since the S&L cleanup concluded in 1994 with the exception of a couple of blips in financial markets that didn’t last long. So this is the first sustained downturn we’ve had since. These things run through financial markets. It’s not a surprise.”
In fact, he adds, “It’s interesting for someone like me because I’ve kind of done it before. I’m not being cavalier with my comments. It’s just that you need to keep all this in perspective. When it seems like the sky is falling and the sun will never come up again, it does.”
Ryan, who most recently served as vice chairman of investment banking for financial institutions and governments at JP Morgan Chase, was chosen as SIFMA’s chief executive in January after an exhaustive six-month search. He replaces Marc Lackritz, who retired last year.
At the time, SIFMA chairman Blythe Masters said Ryan’s mix of “hands-on industry and product knowledge, keen command of domestic and global public policy and proven leadership skills” would help establish SIFMA as “the powerful voice” of the securities industry and global financial markets. Ryan started the job in April.
In addition to the external events in play, Ryan takes over SIFMA at a time when the organization’s internal structure faces challenges. Created in late 2006 as a result of the merger of the Securities Industry Association and the Bond Market Association, Ryan says “there’s some additional work required to produce a merged entity that is fully responsive to members’ needs and to essentially earn its reputation every day.”
Ryan, who has been through four mergers himself, said the two predecessor organizations, one that operated top-down, the other bottom-up, failed to assimilate around a shared objective. And, with 100 committees working on various industry projects, there’s been overlap that hasn’t been understood or communicated.
Ryan has been quick to act. A new organizational set-up will be put in place by mid-summer.
Nationally, SIFMA has two prevailing goals: to push for changes in the tax code that would make it more user-friendly for investors, and to be a leader on regulatory reform.
Ryan has called Treasury Secretary Henry Paulson’s controversial regulatory reform plan “thoughtful and sweeping.” He added: “This will be an issue on which we’ll spend time and attention for probably a very long time, whether it’s Paulson’s blueprint or something else. The U.S. regulatory system needs major modification and we would prefer to be bold rather than timid.”
Globally, SIFMA, which represents more than 650 securities firms, banks and asset managers, is pushing for reforms in both the credit rating agency model and in the area of securitized structured products. SIFMA-led task forces will be examining both issues over the coming months.
Ryan, a graduate of Villanova University and American University Law School, brings broad perspective to his new post. Early in his career, he was solicitor of labor at the U.S. Department of Labor, later acting as a partner in the Washington, D.C. law firm Reed, Smith, Shaw & McClay, where he headed the Pension Investment Group.
Prior to joining JP Morgan in 1993, he was director of the Office of Thrift Supervision, responsible for regulating approximately 2,000 thrifts and managing 3,000 employees in 11 states. At JP Morgan, he most recently worked as the senior relationship manager for the firm’s major clients interacting with ministers of finance as well as the chief executive officers and chief financial officers of insurance companies, securities firms, asset managers and hedge funds, among others.
Looking ahead, Ryan is clearly thinking globally.
“From a personal view, my big issues are consolidation in financial services will continue on a global basis, which also means, interestingly, that specialization will grow. As certain institutions merge, they become bigger and they create more and more opportunity for the very focused and very specialized smaller boutique players,” he says. “There’s no doubt the business is globalizing, the regulatory environment is globalizing, the interests of investors are globalizing.”
As for financial advisors, Ryan expects to see more diversity in the ranks.
“It’s very clear to me this is a business that has to look like the overall population. Going forward, you probably will have a more diverse group of financial advisors who will look more like the population they’re serving. When I joined JP Morgan, everyone looked like me and that’s not true anymore,” he adds. “You’re going to see diversity in terms of backgrounds, gender, areas of interest, that’s the way the business is.”
He also expects advisors to become more client-focused as Americans move into self-funded retirement. “I’m 62 and that’s what I want from my FA.”
Freelance writer Ellen Uzelac is based in Chestertown, Md.; the former West Coast bureau chief and national correspondent for The Baltimore Sun, can be reached at firstname.lastname@example.org.