Ex-Mellon CEO: Bank better before takeover
Perched high above Downtown Pittsburgh on the 27th floor of BNY Mellon Center, retired Mellon Financial CEO Marty McGuinn lamented that the storied institution was no longer headquartered in the town where it was born nearly 150 years ago.
“I was never going to sell Mellon,” insisted Mr. McGuinn, who ran the bank from 1999 until February 2006, just before it was acquired by Bank of New York in 2007 under his successor Robert Kelly.
“Mellon could have done very well on its own,” Mr. McGuinn said. “It would have grown more and rewarded shareholders better. And it would still be based in Pittsburgh.”
Still, for some Pittsburghers, Mr. McGuinn is seen as the man who got the takeover ball rolling.
Early in his tenure, he sold off Mellon’s iconic branch banking business — including
nearly 120 offices in the Pittsburgh region — to Rhode Island-based Citizens Bank so Mellon could focus on the bank’s faster-growing, fee-based trust and money management units. The 2001 sale of those retail operations, a move later copied by Bank of New York, made the two custodial institutions a great fit.
Mr. McGuinn said he has no regrets about divesting Mellon’s traditional banking business, contending the move made the institution stronger.
“What we did was narrowed our strategic position and built on the strengths we had, which were investment management and investment servicing,” he said during an interview this week.
These days, Mr. McGuinn — who turned 74 in September and says his health is good — is focusing on a number of charitable and community endeavors. They include chairing the board of the Carnegie Museum of Art, serving as vice chair of the Pittsburgh Promise and serving in his 27th year on the board of Pittsburgh health system UPMC.
He said he misses the intellectual stimulation since retiring recently from several corporate boards, but is learning to enjoy more leisure time and more opportunities to play golf and travel. He recently spent time in Ireland, took his first trip to Israel and traveled with his granddaughter to Paris and London for her 13th birthday.
A resident of Shadyside since moving from New York City to join Mellon as general counsel in 1981, Mr. McGuinn said he was delighted to see Pittsburgh doing well in a number of areas, pointing to a wave of apartment development and the arrival of high-tech firms such as Google and Uber, which help attract more young people to the city.
He said his favorite aspect of Pittsburgh is that it offers big-city amenities with a small-town feel.
“You have the sports teams and businesses and restaurants and so forth. But you also have the friendliness and the small-town atmosphere, which is a nice combination.”
In the banking industry, Mr. McGuinn said he believes a pickup in mergers among small- and mid-sized banks will continue as they try to survive by spreading escalating regulatory costs over a bigger base.
As for the economy, he said it is time for the Federal Reserve to raise interest rates.
“It’s a mistake for the Fed to keep rates so low for so long,” he said. “They’ve got to start moving them up, slowly,” now that the economy is growing.
“It’s really hard to sustain retirees and pension funds with those kinds of [low] rates,” he said.
Mr. McGuinn said he wasn’t looking forward to voting in the presidential election next month, calling the choice between Donald Trump and Hillary Clinton “scary.”
“I don’t like either of them,” he said. “I think [voting] is an important obligation. But I really hate to vote for either of them.”