Transcript for complete interview. - Voices of September 11th

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Interview with John Duffy, chairman & CEO of KBW Conducted by Mary Fetchet parked the car close to Herald Square and got on the subway actually at 34 th street to go south. Train pulled in – trains were still operating at this point – it’s probably quarter after nine at the latest. I got on a train, pulled into the station, waited about five minutes and then there was an announcement on the train that all train service was being suspended. Got off the train, walked up back the stairs, wasn’t really quite sure what I was going to do, whether walking downtown was a viable option. It’s four miles, I was thinking it’d take me, you know, the better part of an hour, and I noticed a church to my right and I thought maybe the first thing I should do was go in and say a prayer because it was clear that there were going to be already numerous fatalities. I went in, said a prayer, and then came out and walked back to, I guess it would have been sixth avenue and I had a very clear view of the trade center and decided I was going to walk downtown because I really didn’t know what else to do, and literally walked about a block when the first tower went down. You know at this point I really didn’t know what to think, what to do. I walked over to a hotel across the street from Madison Square Garden, cell phone service was out and you know it’s not as easy to find a landline as it used to be, but I did find a hotel by Madison Square Garden that had a phone bank lobby. There was a waiting line of people on them but I eventually called my house. My wife and one of my daughters was home. They were asking me which tower had gone down; they were watching it on TV; they weren’t quite sure if it was the South or the North Tower. They asked me which tower had the radio antenna on it. At this point my mind was racing I couldn’t even remember if that was our tower or the other tower. After talking with them on the phone I kind of decided it probably made more sense for me to get home than to try to get down to the Trade Center. I went back, retrieved my car, got on the west side of the highway, which probably proved to be a mistake time-wise because at one point they had closed the highway because of all the emergency service vehicles coming in and what not, so I probably got stuck for about an hour on the west side of the highway going home, and I think I probably got back to my house in Westchester about one o’clock. You know initially kind of dealing with the family issues, I had one daughter who had just started college up in Rhode Island, we were trying to contact her, the daughter who was home was leaving for college the next day to go to California. Our youngest son was up in school in Vermont, trying to get in touch with him, so basically spent the afternoon – besides watching the TV trying to figure out what had happened – touching base with our family members, because it was obvious to us that Chris was at work, besides all the other employees, our son Christopher. Eventually I think late that day, I touched base with Tom Michaud and Andy Senchak and started to get some initial reports in terms of who we thought we had lost and who we were able to account for, who had been in touch, so that was how I spent that day. [Mary]: You’re sort of in a different situation in that you ran the company, lost your son, lost your colleagues, and had to respond to your family, respond to the company, which is a big job, so on a lot of levels it was both personal and professional. How did you manage juggling all that [John]: In terms of how I managed the personal issues, dealing with the loss of a son and an awful lot of friends, the focus in terms of what needed to be done from the firm’s perspective or my professional responsibilities, both Andy Senchak and Tom Michaud who fortunately were two other senior members of the firm, had survived. I think both Andy and Tom realized that I
Interview with John Duffy, chairman & CEO of KBW Conducted by Mary Fetchet probably wasn’t in the best frame of mind to be able to focus on some of the firm stuff while I was very interested, we were still trying to get a handle on, was our son gone, so I would say for a few days, 9/11 was on a Tuesday, the exchange closed for the balance of the week. So that took some of the pressure off that first week in terms of what had to be done. It was more, we were trying to asses definitively who we had lost, what the firm’s financial position was in terms of exposure, in terms of trading positions that we may have had. Obviously besides losing 67 people, we lost the majority of the firm’s records because everything – that was headquarters – so in terms of any kind of financial information, that was clearly all gone. We had backup systems and what not but it was going to take us days to figure out from those backup systems exactly where we stood. So we spent the balance of that first week, and Tom and Andy were the ones who really deserve the credit in terms of pulling the surviving employees together, devising a game plan, where they should report to work the following week. It was kind of a day by day proposition when the exchange was going to open for business. They decided to remain shut the balance of the week so we had until the following Monday. So by that point, we had located space for the employees to go to, at least on a temporary basis. Some of that was some of our other offices, and some of it was space that other firms like Wachtell, Lipton and BNP Bank had offered to us during the course of that first week. It was kind of figuring out where the survivors were going to go when they were ready to come back to work and secondly with that trying to figure out really what our financial status was. By the end of that first week, we were pretty convinced that we had enough capital to go on. Many of the employees that we lost owned stock in the firm and the shareholder’s agreement was that when an employee left the firm or passed away, the stock was sold back to the firm. We had about a 160 million in capital and we determined about 40 million of it was owed to the families of the people we lost. We still felt with the remaining capital we had enough to stay in business. The question was, where was the business going to be Because we certainly didn’t have any permanent location at that point in time. So I think that first week was making the determination, A) that we could stay in business, and then B) trying to figure out where we were going to temporarily locate the employees. Once we got that done, then it was spend a little bit more time thinking about, you know, what are our priorities in terms of what needed to be done to really get back in business. So that was a process that frankly took several weeks, but the initial steps were really put in place the following week and we had a service for my son, Christopher, the second Saturday after 9/11. I want to say it was something like September twenty-second or -third. In the following week, even though the first week or two I’d been on phone contact with Andy and Tom and other people on a semi-regular basis at least, it really wasn’t until we’d had the service for Christopher that I felt any closure on that personal issue that I really felt that I could suit up again and go back to the work. Tom and Andy again they deserve the bulk of the credit for what was done the first two weeks. [Mary]: I wonder if the work was helpful to you John. I know for myself personally having a direction, and helping people… If you want to stop for a bit too, I came prepared. [John]: No. Returning to work was helpful to me, I’ve used the words therapeutic and almost cathartic, and I think our instinct after 9/11 was that we didn’t want that to be the last day in the firm’s history so we knew we wanted to rebuild it. We felt that would really be a testimony to the people that we lost. I didn’t appreciate how important that would be until I actually got
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Transcript for complete interview. - Voices of September 11th

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