E.J. Burke grew up in Buffalo, New York. He was the sixth of seven children, with five older sisters. Perhaps this is good preparation for a bank boardroom. It certainly couldn't hurt. [paragraph] Burke has been moving up the ladder at KeyBank in Cleveland for the last 13 years--ever since he sold his mortgage company (National Realty Funding [NRF]) to the bank. [paragraph] Today his official title is executive vice president-group head, KeyBank Real Estate Capital. A 35-year career in banking and real estate lending suggests certain uncommonly good people skills--he counts competitors, past business partners and clients among his many friends. Being part of a family of seven kids might nurture those skills. One can imagine him playing well in the sandbox. [paragraph] Being taught by Jesuits in high school and college also might count for something in understanding his disciplined approach to problem solving and his devotion to ethics and the common good. It certainly helps explain why he took all those philosophy courses in college and why his favorite course of all was logic. But it was banking that grabbed the interest of the young E.J. Burke at Boston College back in the late 1970s. [paragraph] Burke followed his calling and today runs all of commercial real estate for KeyBank. KeyBank is the fourth-largest named commercial mortgage-backed securities (CMBS) servicer in the United States and the fourth-largest commercial servicer overall. Its also the fourth-largest bank loan syndicator of commercial real estate loans in the country. It's the country's 19th-largest commercial bank overall.
KeyBank Real Estate Capital is also a big agency multifamily lender doing business with Fannie Mae, Freddie Mac and the Federal Housing Administration (FHA).
Burke says one of the keys to his management style is he tends to be a calming influence and likes to lead fact-based discussions to solve business challenges. People who spend the most time with him say he has a unique knack for quickly putting his finger on a problem, thoroughly doing his homework, gathering all significant information and seeing very clearly where business trends are going. And he does it faster than anyone they've ever seen.
"It's a unique skill set," says Marty O'Connor, executive vice president, loan servicing and asset management, at KeyBank, who has worked with Burke for 20 years. He also has a great ability to see the future and to grow a business, O'Connor says.
And one more thing, says O'Connor: "He's a stickler for expense management"--a comment he says will draw a smile from Burke.
Those traits will all come in handy as he takes on the job of chairman of the Mortgage Bankers Association (MBA) this month. When it comes time to work with lawmakers and regulators to hash out fine details about restructuring the secondary mortgage market and impose sensible regulation to restore trust in credit markets, having calm, fact-based discussions will be a very good thing. (We should probably all thank the Jesuits, his logic professor and the five older sisters at the end of the day as E.J. Burke guides the policy discussion in the months ahead.)
Finding a career
Burke's dad was a lawyer and he thought that might be his future path as well. Until in his junior year at Boston College he took a money and banking course and found it "fascinating." He realized he didn't want to be a lawyer and was looking around for another way to make a living. After taking the course, he decided he wanted to be a commercial banker with the idea of lending to businesses. He recalls, "I had no intention of being a real estate lender."
The idea of lending to other businesses as a commercial banker sounded appealing, and he admitted to knowing nothing about real estate at the time. But through a "series of coincidences," his career took him way out west and to a career that centered on--you guessed it--real estate.
After graduating with a Bachelor of Science degree in economics from Boston College in 1978, Burke moved to Oklahoma and took a job as a trainee with the First National Bank and Trust Company of Oklahoma City in credit training.
After the training ended, he recalls, his boss said to him, "E.J., you need to go to the fifth floor, to Real Estate. That's where we need some help.' And that would have been in early 1980. And I've been in real estate finance ever since then."
The bank's holding company owned a mortgage company that did both residential and commercial mortgage banking. Ron McCord, CMB (who would become MBA chairman in 1997) recruited Burke to come over to the mortgage company. From 1983 to 1985, he was engaged in income property mortgage banking, which largely involved being a correspondent that placed commercial mortgage loans with life insurance companies.
Learning about market busts
When Burke joined the bank in Oklahoma, the region was in the midst of an oil boom that peaked around 1983. During the boom, whole towns were springing up overnight, especially in western Oklahoma, he says.
But sometime in 1985, he recalls, "the bottom fell out of the energy market" and the price of oil dropped to $10 per barrel. And the price of natural gas plummeted as well. "So, literally, overnight the economy crashed," he says.
That's when the bank called him back and put him in charge of problem real estate. His bank divided itself into a good bank and a bad bank, and Burke was put in charge of commercial real estate for the bad bank during 1985 and 1986.
He says, "It was a very difficult time, but I learned a lot."
It was during this time that a whole series of banks tied to the oil economy in Texas, Oklahoma, Louisiana and New Mexico all failed. Burke's bank also did not survive the downturn and it ended up failing in 1986.
Burke met his wife, Martha, in 1979 at the First National Bank and Trust Company of Oklahoma City, where she was an oil and gas lender from 1980 to 1986. For both of them, it was their first job out of college. Martha grew up in Stillwater, and did her undergraduate work at Oklahoma State University (which explains why she roots for Rickie Fowler, the golfer).
But when the oil business tanked and things started going bad for the bank, both Martha and E.J. at first said, "We're not going to jump ship."
But a banker in Kansas City had been recruiting Burke even before his bank failed and stepped it up once...