10 Years Later: How Columbia Business School Weathered The Financial Meltdown

It started with rumors…like everything else on Wall Street. By the time those whispers had reached Morningside Heights, they had swelled into a roar.

It was a Monday in the middle of March, 2008. That night, Columbia Business School was holding an event, “A Day In the Life of An Investment Banker.”

22 firms were slated to appear at the extravaganza.

21 showed up.


A few days earlier, a teetering Bear Stearns had been swallowed by JP Morgan for pennies on the dollar. In a fell swoop, a Wall Street staple had vanished. Suddenly, the realities of toxic debt and moral hazard were sinking in. It was a wake-up call for Wall Street, a sign that the party was winding down…and the bill was coming due.

At Columbia Business School, it was a call to action. Back then, nearly 56% of its full-time MBA graduates entered financial services (the record was just a couple of percentage points higher in 2002 at 58%). The dean, Glenn Hubbard, had served as Chairman of the Council of Economic Advisers for two years under President George W. Bush. No business school was more plugged into Wall Street than CBS – and no school was more vulnerable to the fluctuations inherent to finance.

In 2008, ten of the top 12 employers of Columbia’s newly minted MBAs were financial service firms. Lehman Brothers, then the third largest recruiter of Columbia MBAs after only McKinsey & Co. and Goldman Sachs, made offers to 21 graduates. One of the top five employers of MBAs globally, Lehman would ultimately go bust. Some MBAs who accepted jobs on Wall Street would see those lucrative offers get clawed back. Other newly hired MBAs at some financial firms would ultimately be sent packing.

The school would never see financial hires match or exceed the school’s 2008 total. Ten years later in 2018, only three of the top dozen employers of Columbia MBAs–Goldman Sachs, J.P. Morgan Chase and Citi–would be in financial services. The percentage of MBA graduates entering what had been Columbia’s dominant industry had plummeted by nearly 25 percentage points from 55.6% to a record low of 32.2% of the class. For the first time ever, consulting actually hired more of the school’s MBAs than the financial sector (see At Columbia, Consulting Overtakes Finance As The No. 1 Career Choice).


Regina Resnick, now a senior associate dean and senior managing director of the Career Management Center, remembers the crisis well. Huddled with Dean Hubbard after Bear Stearns’ implosion, they decided that the administration would step out and provide some perspective and reassurance. Even more, they decided they needed the help of their alums to weather the storm.

This strategy, enacted in the wake of Bear Stearns’ fire sale and accelerated after Lehman Brothers’ demise on Sept. 15 in 2008, could serve as a template for crisis management. It is a story of how Columbia Business School leveraged existing networks and resources to ride out the uncertainty, never giving into fear and capitalizing on opportunities hidden within the chaos.

Early in 2008, the warning signs were hard to miss. Citigroup and Morgan Stanley were writing down assets. Goldman Sachs had even taken a hit on its stock price. Still, there was a certain calm, as firms maneuvered to avoid taking direct and lethal blows. They weren’t the only ones fretting about the clouds on the horizon. At Columbia Business School, Hubbard and Resnick decided to focus on what the MBA program did best: educate.

Regina Resnick, Senior Associate Dean and Senior Managing Director of the Career Management Center

They began by scheduling a Town Hall, where Hubbard spoke on underlying market trends, along with their long-term implications. For her part, Resnick outlined the school’s strategy for supporting students and alumni working in the financial sector. It was a way, Resnick says, to ease the anxiety and bring the community together.


“We’d had to hope for the best and prepare for the worst approach already,” Resnick notes in an interview with P&Q. “On the day I spoke to students, my business development team was already reaching out to recruiters and firms. We knew they were going through a lot of difficulties. It was just to let them know – not to be overly intrusive – that we were available to also provide support…We have deep relationships within the financial services sector, so it wasn’t like we were making new friends during the crisis.”

With the school so dependent on financial services, CBS had already been casting a wider net for companies from a variety of sectors, even before Bear Stearns’ collapse. But it was too little, too late. After the Town Hall, Resnick’s team began compiling resume books of students who’d lost their offers as Wall Street reeled. From there, they worked the phones with alumni and recruiting heads alike. The school tapped into its deep alumni base, which included a senior Bear Stearns recruiter who’d been absorbed into JP Morgan.

“I believe all the offers were honored, so there was a lot of relationship management that was helpful there,” Resnick adds. “It was also helpful that these Lehman hires were top of the class, so other firms were interested too. In the end, we were in better shape than I would’ve imagined.”


One of those students was Shayan Hussain, a 2009 grad. He had already accepted a media and telecom banking summer internship with Bear Stearns. Now a managing director at Blackrock, Hussain received the news of his employer’s implosion when he was meeting with business leaders in Dubai as part of a school-sponsored excursion. Initially, he took the news in stride, he says, believing he could figure it out when he returned to the states.

Soon enough, Hussain felt the effects first-hand. Looking back, he credits the meltdown with giving him a head start on what was actually transpiring so he could confront the unknown. Even more, he adds, the situation reinforced the significance of community and the value of a network.

“Like anyone, you’re freaking out about what’s happening,” he concedes in an interview with P&Q. “It was totally unprecedented. At the same time, we were all in the same boat together. We realized that it is going to be tough to get a job after graduation. It was a very different market than when we entered school. We commiserated together knowing we were facing a big challenge – and we also banded together to help each other.”

Classmates weren’t the only ones looking out for Hussain. “The career center – I can’t say enough about those guys,” he adds. “They identified the people who were affected by the whole Bear Stearns collapse and put a task force together and focused on us. They started making calls to different institutions to see what we could get. It was due to their effort that I did get an internship that summer.”


Six months after Bear Stearns crashed, the next wave crested. In September, Lehman Brothers filed for bankruptcy protection, sending shock waves across the financial sector. On cable news, viewers watched as the masters of the universe streamed out into the street, boxes in hand, confusedly milling about as they grappled with their loss. Over the next two months – in an election year, no less – the news became surreal as if it had been pulled out of some dystopic saga. Bank of America took over Merrill Lynch, while the U.S. government bought an 80% stake in AIG, the world’s largest insurer. Goldman Sachs and Morgan Stanley were transformed into bank holding companies seemingly overnight. The U.S. Congress earmarked $700 billion dollar rescue package – rewarded by investors with a near 800 point drop in the stock market. On top of that, the contagion spread beyond finance, as the Feds worked feverishly to prop up the automotive industry.

Not surprisingly, Resnick was mesmerized by the fury being unleashed a few miles away. She, like the rest of the Columbia community, understood that this time was different. “I remember it unfolding like 911,” she says, “not fully comprehending or grasping the human toll. During Bear Stearns and then Lehman, I knew there were harbingers. It wasn’t like we were blind, but the acceleration and degree (of the collapse) was pretty remarkable.”

The news hit home for Resnick, a Wharton grad who’d taken on her role at Columbia in 2001. Before moving into career services, Resnick had been a partner in an advertising firm, where she headed their Merrill Lynch account – “the bedrock of Wall Street” as she called the firm. She knew people there, just as she had known so many “amazingly talented” graduates who’d entered finance during her decade at Columbia. Such connections, admittedly, took an emotional toll on Resnick.

“While there were people who were bad actors [in finance], there were a lot of people who lived lives of integrity. They were thoughtful, worked really hard, and were exceptional graduates from our schools. I really worried what this meant for them. More broadly, there were also people who’d been wronged by the decision-making on a lot of different levels. You worry for people on the subprime mortgages and those who were far less fortunate, to begin with, and really got hurt with this.”

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