Title: Senior Vice President, Chief Investment Officer, People’s United Bank
Experience: 31 years
As an undergrad at Villanova, John Traynor didn’t anticipate he would one day be in the investment management business, but once he got into portfolio management at Lehman Brothers’ training program, he said, “This is it.” In a funny twist of fate, Traynor, who grew up in Smithtown, New York, recalled that the very first bank where he opened up a Christmas club account at the age of 9 was later bought by People’s United, the bank he joined as chief investment officer in 2011. When he isn’t building out People’s United’s wealth management division, he likes to spend his days rowing.
Q: Can you talk about the new developments on your side of the bank?
A: Well, the private banking aspect of it is incredible. I really focus on the asset side of an individual’s balance sheet, but we can now focus on the liability side. A lot of our clients are small business people, where the dividing line between their personal assets and their business assets is generally fairly gray; we need to be able to look at both sides of that, so the private banking addition has been fantastic.
Then in the Boston office, we have two equity styles that we manage internally. Our core product is a high confidence portfolio, but in the Boston office we actually manage our equity income plus, which is a high income equity strategy and it’s been great for our clients in this marketplace. They’re getting income from their portfolios and everyone knows bond rates have declined dramatically, so they’re able to augment their income with the equity portfolio and that’s run right here in this office.
So there are only two strategies that we manage internally, the high confidence and equity income, but we have another whole group. When I joined in 2011, I set up four investment committees: asset allocation, the equity team that manages those two strategies, our fixed income team that manages three distinct strategies, and the fourth group is what we call our solutions group. That’s where we take a look at all of the outside solutions, whether it’s individual securities, mutual funds, ETFs, and they take a look at all of those and create our best ideas. We call it our People’s United’s preferred investment options. They take a look at all of those options so we can have a portfolio that has high confidence with all mutual funds and ETFs, or it could be completely run by outside managers and we’re quarterbacking that, acting more as the family’s chief investment officer.
Q: Where do you find most of your client base?
A: We really work very closely with the clients of our commercial lenders. That’s really the link between them. Our commercial lenders really establish the relationship with the local business person. I travel all over New England and I can tell you, the businesses run the gamut, from small mom-and-pops to very large corporations. The commercial lender establishes the initial relationship and then they’ll bring in one of our wealth management partners. It might be an investment manager, or it might be a trust officer, but they’ll introduce them to say, “Are there things that we can do to help you?”
Q: The Baby Boom generation is beginning to enter retirement now; what does that mean for your line of work?
A: By and large, most people haven’t saved enough, and the risk that they have is not that they have that pool of assets – for the most part, that’s usually pretty healthy – it’s the longevity risk. By our estimates, and a bunch of other firms have said, most people, if you take a look at what their standard of living is, they’re going to outlive their assets. We come in and say, you may have been budgeting at 10 percent return on the equity market, our forecast is closer to 5 or 6 percent, so you need to either cut back on some of those expenses or perhaps you need to start saving a little more, adding to your income, making that shift from the high confidence portfolio to the equity income portfolio, so getting a little more income.
For the Baby Boomers in general, there are some that have saved quite a bit and are in great shape, but if you take a look at the vast majority of the Baby Boomers, our message to them is: you need to rethink your spending patterns, spend a little less, save a little more. It’s a big shift.
Traynor’s Top Five Restaurants After A Great Row:
- Brasserie Jo – Boston, Massachusetts
- Saugatuck Rowing Club – Westport, Connecticut
- Hen of the Wood – Burlington, Vermont
- Street & Co. – Portland, Maine
- Devon Seafood Grill – Philadelphia, Pennsylvania