Boston's financial staff work from home during lockdown

  • World
  • Friday, 19 Apr 2013

(Reuters) - Larry Peruzzi, who runs a trading desk at a small institutional broker in Boston, came into his office at 7:45 a.m. on Friday and told his two-person early morning crew to leave immediately and prepare to work from home.

The city was not yet under virtual lockdown, but police had shot a suspect in the Boston Marathon bombing overnight and a manhunt for the second suspect was under way. On Peruzzi's drive in, "The highway was just packed, and crawling," he told Reuters by telephone.

"It was just eerie. There is low cloud cover so you can't see the tops of the building and electronic message boards are flashing directions and amber alerts. I'm looking out the window and a military helicopter is flying by."

Some of the largest U.S. financial companies asked employees in Boston to work from home on Friday, disrupting the biggest centre for U.S. mutual fund management and depressing trading activity in some markets.

Fidelity Investments, which manages $1.7 trillion (1.1 trillion pounds) of U.S. investment assets and is the second-biggest mutual fund company, told employees to work from home. Other large financial firms, including Bank of America Corp, Citigroup Inc, JPMorgan Chase & Co and Manulife Financial Corp's John Hancock unit, also asked Boston employees to work remotely.

Loomis Sayles, which manages $191 billion, had about 50 percent of its staff in the office. Many of the firm's traders and portfolio managers had arrived before authorities widened the travel restrictions, said Dan Fuss, vice chairman and senior portfolio manager.

"All the traders and portfolio managers that need to be here are here, so we did not have to activate our remote site," Fuss said. "We've got every single desk manned, so we are fine."

Other firms reported similar staffing on trading desks.

Fuss said he left work at around 2:40 p.m. to avoid difficulties getting home. The Boston Police Department said earlier on Friday that they were allowing people to leave their office buildings to go home, but encouraging them to stay inside once home. Some workers were told that they ought to go home.

"We were told that the city would prefer employers to send people home rather than stay in the buildings," said Kathleen Gaffney, co-director of investment grade fixed income at fund manager Eaton Vance.

Gaffney left around noon and drove a colleague home. She worked from home after that.

"Amazing what you can do with technology," she said.

The impact of Boston's disruption on markets was not outsized, strategists and analysts said. In the stock market, volume was slightly above average, helped by the fact that options were expiring.

Still, the change in routine weighed on trading volume in many markets, which were already relatively slow because of the lack of economic data. About 20 percent of the nearly $15 trillion of U.S. mutual funds and exchange-traded funds are managed out of Boston, according to Lipper.

"A lot of folks in Boston are out of the market, and anyone not in Boston is stuck watching the TV trying to find out what's going on there," said Brad Bechtel, managing director at Faros Trading, a foreign exchange brokerage based in Stamford, Connecticut.


Friday was a test of the emergency plans that many firms put into place after the September 11, 2001, attacks.

Asset manager MFS Investment Management, whose Boston headquarters on Huntington Avenue near the Prudential Centre houses more than 1,000 employees, had performed its semi-annual test of its work-from-home plan on Monday, the day of the bombing.

"It worked fine," said company spokesman John Reilly.

Traders were encouraged to work at MFS' business recovery facility in a suburb about 25 miles (40 km) outside of the city because it is harder for many of them to do their jobs from home, Reilly said. The company manages about $348 billion.

At many firms, however, several people had made it to work earlier in the morning.

A Financial Industry Regulatory Authority spokeswoman said only a very small number of Boston employees were onsite Friday morning, and its building closed at noon.

The industry-funded regulator has contacted all securities firms in the area and will work with them to ensure continuity of their business operations, she added.

Financial firms in Boston were not the only ones asking employees to stay at home. Lawyers who work in the Boston offices of firms including Dechert LLP, McDermott Will & Emery and Goodwin Procter LLP were working remotely.

Electronic medical record provider Athenahealth Inc, whose Watertown office is located on the same street where police are camped out, instructed its 1,000 employees to work from home, said spokeswoman Holly Spring. The company is conducting all of its business through its Belfast, Maine, Birmingham and Chennai offices.

The Cambridge office of EMC Corp, a global technology company, was closed on Friday, a local employee said. Employees in the areas locked down by the Boston police were given the option of working from home.

(Reporting by Svea Herbst in Boston, and Jennifer Ablan, Jed Horowitz, Angela Moon, David Randall, Lauren Young, Terry Baynes, Casey Sullivan, Suzanne Barlyn, Steven C. Johnson and Ashley Lau in New York; Writing by Dan Wilchins; Editing by Paritosh Bansal, Kenneth Barry and Mohamad Zargham)

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