Ex-State Treasurer, Would-be Governor Now Climbing Corporate Ladder
Kathleen Brown’s late father Pat was governor of California. Her older brother Jerry was, too, and now he’s mayor of Oakland. But when she gets together with Jerry these days, Kathleen Brown boasts about having the higher title.
“I tell my brother, I’ll call you mayor if you call me president,” she said.
This month marks Kathleen Brown’s first anniversary as the president of Bank of America’s Private Bank West, which constitutes one-third of the nation’s largest bank catering to high-net-worth individuals.
Brown’s Los Angeles-based operation covers California, Washington, Oregon and Idaho, as well as the international private bank. On the BofA organization chart, she is now just three rungs below Charlotte, N.C.-based chairman and CEO Hugh McColl.
Brown, the former Democratic state treasurer of California, joined BofA in 1995 as a senior VP and managing director in the investment services group after her unsuccessful gubernatorial campaign against Pete Wilson. At the time, a lot of observers assumed it was just another case of a major corporation hiring a high-profile ex-politician to serve as a figurehead and maybe to open a few doors, but certainly not to become an actual manager.
But that’s precisely what has happened, as Brown, 54, has risen up the BofA corporate ladder. Persons inside the bank insist she is the real deal.
“She’s a bright star in the corporate constellation. She understands corporate finance on a large scale that many CEOs haven’t had the experience of,” said Brown lieutenant Michael Davis, the senior VP in charge of the private bank’s Newport Beach office, which covers Orange County, San Diego and the Inland Empire. “She’s an effective dealmaker an effective corporate executive. She is a key member in the company’s future.”
“She is innovative in achieving results for our clients, customers, communities and shareholders,” said Kenneth Lewis, Bank of America’s president and COO.
Brown is one of three presidents of BofA’s private bank. The other two are William C. Helms, president of Private Bank East, and David W. Fisher, president of Trusts, Investments and Banking. Together, they oversee $124 billion in assets under management, $20 billion in loans outstanding, $12.5 billion in deposits and 4,000 employees. Brown said her Private Bank West generates about a third of those assets, but she intends to increase that to about half.
It’s a big responsibility, but Brown has handled big responsibilities before. As California’s state treasurer from 1991 to 1994, she managed an awful lot of money, too , a $26 billion short-term investment fund and all of California’s outstanding debt. She also sat on the boards of two of the state’s pension funds and had 263 employees.
Brown said her current work is “fundamentally the same” as what she did when she was state treasurer.
“It is politics, fundraising and service. Only the politics are now corporate politics. The fundraising was for the state, for schools, universities, roads and sewer systems. Now I raise funds for shareholders and I raise funds for my clients for their portfolios. One is ROI and the other is different. In both cases, I was building something.”
In fact, bank insiders say Brown’s experience in politics and public finance have proven to be big plusses at BofA. Her experience in running a large organization, her ability to “think outside the box” and the big-picture perspective she brings to internal corporate matters distinguishes her from most of her colleagues, they say.
From her start at BofA in business development Brown moved to head of national sales of investment management products, a position she held for two years. In November 1997 she was named president of the Private Bank of Southern California. Then in January 1999, following BofA’s merger with NationsBank, she was elevated to her current title.
(Besides marking a personal achievement for Brown, her new duties also constituted a subtle shift in prestige from San Francisco, the former headquarters of BofA, to Los Angeles, where Brown operates. Bank insiders have said that increasing autonomy for Southern California operations is one of the hallmarks of the post-merger BofA.)
“Some people think politicians don’t have any transferable skills,” observed Curt Pringle, the former Republican state assemblyman from Garden Grove and Assembly Speaker. “But she went into the job of state treasurer with some skills, and came out with more. I have a lot of respect for her.”
(Pringle is celebrating his own one-year anniversary, as head of Irvine-based consulting firm Curt Pringle & Associates. He started with himself as the only employee and now has four.)
Bank of America has the largest private bank in the nation with a 22.7% market share, according to Private Asset Management. No.2 is The Northern Trust Co. with $73.4 billion in assets, a 13.9% market share, No. 3 is J.P. Morgan with $72 billion in assets, a 13.7% market share. The market shares for the rest of the field, 65 firms in all, narrow down dramatically from there, with the average assets under management at $8.1 billion per company.
Brown works long hours and travels frequently, but the mother of five and grandmother of four has few qualms about her job, her position or her workload.
“I am pretty happy with what I am doing. It’s more of a passion than just work. I have a genetic defect that causes me to work at the things about which I am passionate. If I am not passionate about it, it is hard for me to give to it.”
As for moving up in the company, there isn’t much room left. Brown reports to Bob Shell the head of the asset management group, who reports to COO Lewis, who reports to CEO McColl.
Brown recalls her campaign for governor as “a gift from the people of California,” but not something she plans to do again.
“It was tough, it was challenging, it was one of the most rewarding experiences and one of the best growth experiences,” she said, adding, “I have no interest to get into politics.”
She was more evasive when asked whether she would like to be the CEO of Bank of America some day. Brown chuckled and changed the subject. n
