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The broker army The PaineWebber Group is currently the fourth-largest retail broker in the country. The firm employs over 18,000 people in 307 offices in all 50 states and around the world, including an army of 7118 brokers. PaineWebber provides a range of products and services in private client brokerage, investment banking, real estate, institutional equity, fixed income, and asset management (with $60 billion under its management). The company has more than 2.5 million customers, including a variety of state and local governments. A recent revival William Paine and Wallace Webber opened their brokerage house in Boston in 1879. Before the end of the century, the company had joined the New York Stock Exchange and opened its first branch office. In the 1960s, the company began to move onto the national stage by moving its offices to New York, acquiring other houses throughout the U.S., and opening offices overseas. After the stock market crash of 1987, PaineWebber consolidated, shedding some of the more exotic businesses that it had acquired over its years of growth, including a venture capital arm in 1988, and its commercial paper operation in 1987. Though PaineWebber's ill-advised loan to bankrupt Federated Department Stores in 1988 dogged the firm for years, a capital infusion from the insurance company Yasuda (which at one point held an 18 percent equity stake in PaineWebber) provided a much-needed jolt, as did the revival of the stock market in the early 1990s. Building an I-bank In 1994, PaineWebber purchased Kidder Peabody, General Electric's investment banking concern (GE now owns 22 percent of PaineWebber). However, establishing a major presence on Wall Street has proved to be more difficult than PaineWebber had expected. Although the firm is perennially among the leaders in municipal bond underwriting - in 1998, the firm ranked No. 2 to Salomon Smith Barney - it usually finishes just outside the top 10 in stock underwriting. The firm is an attractive choice as a co-manager because its strong retail force can be used to sell offerings to individual investors, but has had difficulty winning lead manager spots. In 1999, hoping to build off of its municipal bond underwriting strength, the firm took a major step into the municipal derivatives market, hiring away two derivatives traders from J.P. Morgan. The firm has also continued to aggressively build its position in the municipal market, adding 16 professionals in the first four months of 1999. PaineWebber has also been building its asset management business, which is run through its modest subsidiary, Mitchell Hutchins Asset Management. Though of middling size, Mitchell is growing rapidly. Sales of mutual funds through Mitchell increased 71 percent from 1997 to 1998. PaineWebber officials have indicated that they may seek an acquisition of another mutual fund company to build off its success. In March 1999, the firm launched an asset management joint venture in Japan with Yasuda Mutual Life Insurance. Merger negotiations The consolidation in the financial services industry has spawned talk of mergers and acquisitions. In the summer of 1998, PaineWebber was reportedly negotiating with Prudential Securities about a merger that would have propelled both groups into the top ranks of several I-banking categories, namely municipal bond underwriting, mortgage- and asset-backed securities, and real estate investment trusts (REITs). Later that summer, PaineWebber was reportedly approached by German giant Dresdner Bank, which was considering buying the firm for as much as $10 billion. We can dot-com too In June 1999, PaineWebber announced that it would begin offering online trading later that year, joining other major brokerages such as Merrill Lynch and Prudential Securities. However, the firm maintains that it will not seek to compete with the cut-rate prices of discount brokerages online. Going Swiss In July 2000 the Swiss banking group UBS AG offered to buy PaineWebber Group Inc. for $10.8 billion in a half-stock, half-cash deal. The takeover came at a time when the , focusing only on retail brokerage, faced increasing competition from online trading; the acquisition by the Swiss bank joins the brokerage to UBS's commercial and investment banking businesses in 50 countries. Subject to shareholder approval, the PaineWebber will become part of the UBS Warburg unit in November 2000.
Entry-level employees at PaineWebber are hired into one of three groups: Investment Executives, Information Systems, and General Employment. Investment Executives (brokers) come from a wide variety of backgrounds; communication and problem-solving skills are crucial to these positions. The company offers new employees in this area a challenging education program designed to give them the skills they will need to succeed. Information Systems careers include positions at the company's data center as well as in the development of its technical system. The remainder of the positions at PaineWebber fall under General Employment. Each of these three groups has its own mailing, fax, and e-mail addresses, which are all available on the company's web site, www.painewebber.com. While PaineWebber has opportunities throughout the U.S., the majority of its employees begin in either its New York headquarters or its Weekhawken, NJ, office facilities. MBAs have the option to join as associates in investment banking, public finance, or real estate.
Everything to everyone While PaineWebber would like to be all things to all people, potential employees are cautioned that "PaineWebber is a brokerage firm first and an investment bank second." Still, we hear that the firm is committed to the company's goal of "growing and establishing a presence as a premier bank on Wall Street." According to one veteran banker: "PaineWebber definitely offers a better [banking] lifestyle than at other firms. The atmosphere is collegial and the hours, while long at times, were much better than at other firms." While life at PaineWebber is "challenging," "demanding," and "rewarding" as any in the industry, the corporate culture is said to be much less "stuffy" and "overbearing" than that at many of its competitors. Employees in real estate praise the firm's top executives for "being so approachable," and employees generally say that "PaineWebber, despite its size, has a small business feel." Says one insider who served a stint as a summer associate with PaineWebber in New York while in business school: "It was a very good experience. I had exposure to VPs constantly. Exposure to [managing directors] was limited to special meetings, three to five during the summer." At this Wall Street firm, "dress is businesslike, no particular guidelines for women, but men are expected to wear suits. Friday is a casual day." However, an insider informs us that "the firm will soon go to business casual every day." Employees in New York and New Jersey say "there are fitness centers here, and if you live in New York City, you can take the ferry free to PaineWebber at Lincoln Harbor (in Weehawken, NJ) if you work there. Otherwise in car-clogged New Jersey "the commute is a nightmare." At PaineWebber, "women and minorities are treated very well, and women constitute a good portion of management. Complaints regarding harassment and discrimination are handled very seriously." While employees think the firm is "relatively liberal - I see some long-haired and multi-earringed employees," and "sensitive, for a place on the Street," "the culture is fragmented and people tend to keep to their own divisions." As for the experience thousands of PaineWebber employees have with the firm's retail side, brokers tend to "work 50-hour weeks including Saturdays, though usually by choice." Brokers "can make over six figures in as little as five years, thought the first few years are usually quite lean, since you're putting together your client list."
Human Resources
Retail brokerage;Bond trading;Mutual funds;Research services;Investment banking;Insurance;Asset management
E*Trade;Merrill Lynch;Morgan Stanley Dean Witter;Salomon Smith Barney;Prudential Securities; More Company Profiles For more career information, go to Vault.com ©2000, Vault.com Inc
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