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T. Rowe Price's 'muni maven' trades up

THE BALTIMORE SUN

They were looking for someone with a Ph.D. and a strong background in credit analysis. Mary John Miller had neither.

But George J. Collins, who retired as T. Rowe Price Associates' chief executive in 1997, remembers thinking Miller would make a better analyst than any of the other applicants who answered the Baltimore investment firm's ad in The Wall Street Journal in 1983.

A former Capitol Hill staff member and urban planner, Miller had spent years studying public policy and how municipal governments could fix their infrastructure. And T. Rowe Price needed someone who could take a critical look at the municipal bonds that financed such projects.

"They hired me because I convinced them I knew something about municipal bonds - not so much from the financial side of them as the substance of what [a city] is trying to borrow for. Does it makes sense?" recalled Miller, who discovered a love of finance while doing research at the Urban Institute.

Twenty-one years later, Miller, 48, is poised to join a growing number of women who have risen to high-level positions in the historically male-dominated financial industry. In April, she will replace the retiring William T. Reynolds as head of the firm's fixed-income group, an 82-member staff of bond portfolio managers and analysts who oversee $55 billion in assets.

"I think she is one of the most professional people I've ever met and exceedingly intelligent and gifted," Reynolds said in an interview the day Miller's promotion was announced.

It wasn't long ago that women of Wall Street made headlines when they took over for male executives. Today, industry insiders say, it is increasingly commonplace.

Though white men still hold more than two-thirds of the management positions industrywide, women are increasingly occupying corner offices at medium and large firms, according to a survey by the Securities Industry Association.

Between 2001 and 2003, "managing director" positions held by women climbed from 14 percent to 19 percent of the total. Among large firms, women in "executive management" positions climbed sharply, from 14 percent of the total in 2001 to 20 percent in 2003, the survey said.

"What that survey says to me is it's not that unusual anymore," said Kyle Maldiner, chairwoman of the association's diversity committee and a senior vice president at Lehman Brothers Holdings.

Miller, who is married and has two teen-age sons, demurs when asked if she sees herself as a role model for women in the business. When billions of dollars are at stake, gender takes a back seat to portfolio results.

'A green toad'

"You could be a green toad and if you were good [at managing money], this is a company that would recognize that," she said.

Around the office, colleagues say, Miller doesn't play the gender card.

"She would never wear that on her sleeve," said Hugh D. McGuirk, a T. Rowe Price vice president and portfolio manager who works with Miller. "Mary has always been dedicated to her work and I think she has adopted a philosophy that if I do a good job the people around here are going to recognize it."

About 5 feet 4 inches and athletic, Miller occupies an office on the seventh floor of Price's downtown headquarters at 100 E. Pratt St., overlooking Baltimore's Inner Harbor and Light Street. Just down the hall is the firm's bond trading floor, a noisy room crammed with flat-screen computer monitors that glow with the latest financial news from Reuters and Bloomberg.

Despite her move into management, Miller can frequently be found at one of the 36 spots on the trading-room floor, where she monitors bond prices and oversees Price's Tax-Free Income Fund.

She plans to continue managing the fund after she takes over for Reynolds. It keeps her in touch with the market, she says, and helps her to stay in tune with what the other portfolio managers are going through.

And it's never boring, said Miller, who seems to take pleasure in monitoring the Federal Reserve, tracking economic indicators and reading employment reports that would put most people to sleep.

Monitoring the Fed

At a recent early morning strategy meeting, she absorbed detailed economic reports relayed by a team of analysts in the fixed-income group. Seated around an oval table in the team's conference room, the group discussed an impending appearance by Federal Reserve Chairman Alan Greenspan before Congress and everything from retail sales to unemployment statistics.

"I find it intellectually stimulating," Miller said in an earlier interview. "People say, 'Bond market? Don't you want to be in the stock market? That's where the action is.' But I've always liked the sort of mathematical, quantitative nature of the bond market, as well as the credit side."

Miller took an unconventional path on her way to becoming a "muni maven," as she was dubbed by Barron's in a February 2003 cover story about the high-performing municipal bond fund she manages. The daughter of a history professor, she grew up in an academic setting. Her childhood was split between Princeton, N.J., where her father was at the Institute for Advanced Study, and Ithaca, N.Y., where he taught at Cornell University from 1965 to 2002. Miller's mother worked in the rare books collection at Cornell and later taught creative writing at several colleges in New York City.

"Business wasn't something that was really part of our family," Miller said.

After earning a degree in government from Cornell, Miller went to work in 1977 for then- Rep. Robert A. Young, a Missouri Democrat who sat on the House Public Works Committee. As a committee staff person, Miller played a role in the development of mammoth public works bills aimed at rebuilding the nation's infrastructure.

The late 1970s were a turbulent time for many of America's largest cities, which were mired in fiscal crises and struggling with crumbling infrastructure. The nationwide focus on rebuilding inspired Miller to pursue a second degree in city planning at the University of North Carolina at Chapel Hill.

"I thought, 'What I'm going to do is end up working for a city government and figure out how they can reinvest in themselves," Miller said.

How to pay for it

After earning her degree, she took a research job at the Urban Institute, a Washington think tank. Federal grants enabled Miller to study infrastructure problems in Boston and Oakland, Calif., among other cities.

In the process, she became focused on the one thing that concerns every city trying to rebuild: how to pay for it.

As she delved further into municipal finance, Miller realized she enjoyed the financial side of city planning more than the public policy side. At that point, she began to contemplate a career on Wall Street, where the public debt that is used to finance city streets and other projects is bought and sold on the open market.

T. Rowe Price initially hired her as an analyst, trading on her knowledge of how cities work and how public projects are put together. But by the late 1980s, she was trading bonds and managing portfolios. After piling up years of successful returns, she took over the municipal bond division in 1996.

Industry analysts describe her investing style as deliberate. She's not one to make bold bets in a volatile market, but she produces consistent results.

All but one of Price's 15 municipal bond funds rate four or five stars - the highest rating - from Morningstar, an independent fund tracking firm based in Chicago.

"I would describe her as having a very steady hand," said Scott Berry, a Morningstar mutual fund analyst who has followed Miller's funds. "She doesn't take big risks on interest rates, and the funds have returned consistently solid returns under her watch."

Colleagues describe her as skilled and analytical. She's tough on the job, but fair and warmhearted in her relationships with staff, they say. When it comes to buying bonds from sellers, Miller is rarely content to settle for whatever terms are offered, co-workers said. Staff members often turn to her for help in closing deals during difficult negotiations.

"She can be very tough, and I would not want to be on the other side if she's backed into a corner, because I've seen the Street back her into a corner a number of times and the Street has always gotten the worst of it," said McGuirk, the T. Rowe Price portfolio manager.

She is described by many as competitive, but in a way that inspires respect rather than fear or intimidation. That intensity carries over into her outside interests, which include tennis, running and music.

Fort McHenry run

For years, she organized a group of Price staff members to play tennis at the Cross Keys Tennis Club. A player since high school, she doesn't let her small frame become a liability.

"She does not hold back and doesn't want you to, either," McGuirk said.

On summer mornings, Miller and others from the fixed-income group often run from downtown to Fort McHenry and back.

"She definitely loves to run," said Constantine "Dino" Mallas, a fund manager in the fixed income group. "You can see the change in how much the distance she is running keeps increasing."

Miller is self-deprecating when it comes to talking about her music and athletic pursuits. She describes herself as a slow runner, a bad tennis player and an amateur pianist.

"They're more things where I'm competing with myself as opposed to with the market or the world," she said.

Her musical tastes tend toward contemporary tunes and Bach, which she likes for its mathematical structure - not unlike the bond market.

"Sometimes when I'm working on a problem and I play the piano for a while, the problem will sort of work itself out," she said.

'I'm just lucky'

Miller likely will be faced with difficult strategy decisions in the year ahead. Many analysts expect the bond market to enter a more volatile phase as the economy rebounds and Federal Reserve policy-makers consider raising interest rates as a hedge against inflation. The dollar's fall against the euro and other foreign currencies is another wild card.

For Miller, a challenging market is part of what makes the job interesting.

"When you think about the playing field, it's absolutely fascinating," she said. "What is the Fed going to do? What is Japan going to do about their currency? Are they going to continue buying [U.S.] Treasuries and supporting the market or are they going to walk away?"

It's not just about analyzing a string of numbers, Miller said. There are bigger public policy issues at play, and the script is never the same.

"I get up every day and think, 'I'm just lucky to have this job.' "

Mary John Miller

Age: 48

Company: T. Rowe Price Assoc.

New title: Vice president and director, fixed income

Previous title: Assistant director, fixed income

Assets under management: $55 billion

Year hired: 1983

Previous experience: Researcher, Urban Institute, Washington

Resident: Baltimore

Family: Married, two sons

Education: Bachelor's degree in government, Cornell University, Ithaca, N.Y.; master's degree in city and regional planning, University of North Carolina, Chapel Hill.

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