Looking back: Five years laterKeefe, Bruyette & Woods rebuilds by taking care of employees first

Published 8 September 2006

Financial services company assisted victims’ families with funeral arrangements and 9/11 compensation fund; money raised to pay insurance and tuition bills; since 9/11, company has doubled in size, more willing to take risks

For Wall Street CEO John Duffy, rebuilding his company after 9/11 meant doing much more than finding new office space and reconnecting with clients. His first priority was to reach out to the families of the sixty-seven employees of Keefe, Bruyette & Woods (KBW) that died in the attacks. In the months following the attacks, KBW assigned employees to act as “shepherds” for family members, helping them make funeral arrangements and file 9/11 compensation and insurance claims. The firm also established the KBW Family Fund to pay indurance premiums and send children to college: for four days KBW donated its profit on every trade and encouraged other firms to run their trades through KBW. The effort raised $16 million.

These efforts paid off by restoring surviving employees’ faith in the company’s mission. “We thought that if we could rebuild it,” Duffy recalled, “that [KBW] could be a support mechanism-that it would make us feel good again.” Business was slow at first and morale was low. New employees “walked in eggshells.” The financial sector eventually roared back, and by that point the firm had coalesced around Duffy and what he believes is a more aggressive and risky business approach. 9/11, he says, made him more willing to take chances. The efforts have paid off. Company revenue increased from $185 million in 2001 to $308 million in 2006, and the number of employees has doubled to 430. Five of its anlaysts were rated “Best of the Street” this year by the Wall Street Journal.

On the coming fifth year anniversary of the attacks, employees will gather for a memorial service in Central Park. They may also take the day off work if they like—a sign that the wounds are not yet healed, neither for the employees or the management. “We aren’t taking victory laps,” said Thomas Michaud, KBW’s vice chairman and president. “But taking care of the families and rebuilding the firm were some of the most important things we could do. And we are satisfied with the way it turned out.”

-read more in Kit Roane’s USNews report