Legacy of Success | Doug Keyston

Episode Transcript of: Legacy of Success | Doug Keyston

 

Alan
Welcome back. I’m here today with Doug Keyston. And he’s a private wealth client advisor here in the San Francisco Bay Area. Welcome to today’s show.

Doug
Thanks very much Alan.

Alan
Doug. Can you give me your background?

Doug
I happy to do so I’m actually a native Californian. My family’s been in San Francisco for five generations. And I grew up here went to school down in Pebble Beach at Robert Lewis Stevenson school. I then came up and I’ve worked for Bank of America for 20 years and their corporate bank and about a year ago moved over to their wholly owned Trust Company, us trust.

Alan
You know, your family, five generations. Now I understand your families started Keystone brothers. That’s right. And they were making whips and saddles of way back in the 1800s, mid 1800s. They started up.

Doug
That’s right, Alan, out not too long after statehood. In 1868. Kingston brothers was founded in San Francisco by James Kingston.

Alan
And how is that heritage I guess? You know, you know, being with a legacy saddle maker there.

Doug
I found it to advantage I now live in Woodside, which is a very horse oriented community. And the fact that I have that Western Heritage where they started out making whips, eventually got into saddle making. And actually, in the early 1900s, were one of the largest saddle manufacturers on the west coast. So actually, a lot of people have heard of the brand, and some even have Kingston saddles back in their tack rooms,

Alan
whatever spurred your, your grandfather to get it was the grandfather great grandfather.

Doug
Well, yeah, it was five generations ago that actually came over from England. So and as I understand that, there was a very severe economic depression in England. And that’s when perhaps a lot of folks considered leaving and migrating here to America. He hit the East Coast actually stayed in Massachusetts for five years, I believe, during the Civil War, and he was making harnesses to aid in in the war effort. And when things settled down, it was after that, that he migrated to San Francisco via the Panama isthmus.

Alan
So where’s the company today? Are you still involved or what

Doug
the family is not? Houston Brothers is still ongoing, and in a form a company acquired it about a dozen years ago. And until then, it was one of the four or five longest continually operating companies in San Francisco.

Alan
Now, just saying your grandfather was the head of the Pacific Stock Exchange,

Doug
he was actually on three separate occasions, he was one of the largest appear stockbrokers in San Francisco, and had had the pleasure of serving as president of the Pacific Coast Stock Exchange three times,

Alan
You know, that was been, you know, within the house. So I guess it was an exciting times when stocks were merging, and you know, that the economy here was expanding out in the Bay Area. Your was your grandfather involved in real estate too, or

Doug
He was not. But it is funny that through my work now at us trust, I find so many analogs in my own family history, with him being an investment manager to many and a stockbroker, that’s there a lot of parallels with what I’m doing now, in my own career.

Alan
Well, let’s move into your career. So what are some of the different ways individuals can finance real estate?

Doug
There are a variety of them. One we have one thing about us trust is we have we’re $190 billion Trust Company. It’s been around for 150 years. And we have our own platform that can help our clients in very many ways. But we’re also a winder window into the broader capabilities of Bank of America. So we can finance real estate, commercial real estate, residential real estate, in a variety of ways. Currently, especially with the low interest rates, a lot of our clients actually find advantages to using their investments to generate liquidity. We had a client actually in Florida, in a very tough condominium market that wanted to proceed with a project there before the economy locally had had stabilized. And so he actually borrowed via us trust on his artwork, in order to effect and start the project ahead of potential competitors.

Alan
What should people be aware of with respect to credit risk?

Doug
Well, generally, it mirrors the broader domestic and global economy, right. There’s not as much transparency these days, I would suggest as as in the past, so I think we certainly suggest to our clients that they be cautious structure, there are opportunities to withstand a downside scenarios. And so while there are a lot of opportunities these days, I think, given the recent difficulties that the economy and the banking industry went through financing structures tend to be toward the conservative side.

Alan
When visiting here today with Doug Keyston, he’s a private wealth client advisor for the alternate, ultra high net worth clients here in the San Francisco Bay Area. Doug, we need to take a quick break. And we’ll be right back after these messages. And when we get back I want to get into succession planning with what that’s about today, okay.

Alan
I’m visiting here today day with Doug Keyston. He’s a private wealth planning advisor here in the San Francisco Bay Area. And Doug, it was said that a couple years ago, Deloitte had written a paper, a white paper on the transition of the baby boomers from the workforce into retirement. And they said that starting in 2010, in over the next 15 years, 80% of the workforce, basically represent the baby boomer generation will be retiring, which is going to create, you know a paradigm shift to this economy and that we live in today. So now you you focus in on succession planning with with your position there.

Doug
I do in fact, us trust advisors, many of our clients on that topic, Alan,

Alan
so how are we approaching succession planning today?

Doug
Well, first, I, I’ve become aware of certain interesting statistics, their us trust did a study and found that over half the business owners actually had no succession plan in place. So it is an area that’s ripe for improvement. Ironically, the business owners spend a great deal of time building value creating value. And they work very hard at that. It appears given those statistics that they spend less effort on making sure that through succession planning, whether it occurs suddenly or in a more planned, timely manner, that there’s not value destruction that that occurs attendant with that.

Alan
So I’m coming to you today seeing deck I got a business, I didn’t have a clue what to do. Advise me,

doug
right. And one nice thing Alan about the US trust model is I’m a private client advisor with us trust, and I work with a team of specialists. So whereas we have a very broad, perhaps the broadest platform in the country, in terms of the services that we deliver to our clients to manage their family wealth and their intergenerational planning, that the breadth of that platform gives us a lot of specialized expertise. And this area was succession planning is where we have individuals that focus on that as a core competency. So we can bring in those specialists to advise each individual or family trust philanthropy, on ways they can move forward and make sure that any wealth transfers that occur are done optimally.

Alan
This should have a succession plan

Doug
of really anyone with sizable assets. And ironically, as I mentioned to you, a lot of folks do not those of those that tend to are younger, which I find completely ironic. The statistics I’ve seen Alan, those age 67 or older, a lot of those folks do not have a succession plan. And I would suggest I take care of myself, I have a good diet. But I still would not bet that at that age, something might not occur to me suddenly. And as I mentioned, a lot of folks spend tremendous time and resources building the value. And and really a succession plan is to is to some extent, an insurance policy on preserving that and transferring it as effectively as possible over time.

Alan
What type of clientele do you deal with?

Doug
With us trust we can meet a variety of clients needs, our strategic clients tend to have a net worth of $10 million and above, but really us trust can help anyone with half a million dollars of investable out assets are more.

Alan
So you finding in today’s world, with all the volatility of the markets, people having more anxiety out there

Doug
I am. And I view my job as helping people. And I help them because we all face that situation where we’re tied up with our data, the things that press our daily schedules, building businesses, building companies, and we’re, we’re managing charitable endeavors. And what we can do is take care of the core wealth management needs for our clients and investing needs, and really help them on it with specialized expertise, whereas they may not have the time to devote to it themselves.

Alan
Do you look at your role really is helping people have a peace of mind? Yes, I do that they do. I’m visiting here today with Doug Kingston. He’s a private wealth advisor, client advisor, here in the San Francisco Bay Area. Doug, I want to take a quick break. And after we get back, let’s talk about stock markets in today’s volatile environment, and maybe some ways that we can plan our future. Okay, we’ll be right back after these messages.

Alan
Welcome back! I’m here today with Doug Keyston. He’s a private wealth advisor with the Bank of America here in Silicon, San Francisco Bay Area. And before the break, we’re talking about succession planning. But I’d like to move over into the topic of retirement investing in retirement strategies. First, what is asset allocation? When I hear that you need to have asset allocation to your investment portfolio? What does that mean?

Doug
Right, it can vary Allen for each client, especially depending on their their worth and their risk profile. But it’s basically implementing a diversification strategy with their assets to ensure that they optimize returns against any given risk

Alan
level. Why do I need to diversify,

Doug
one to achieve the highest risk adjusted returns that are that that can can be achieved. And it’s also I, since I came out of a risk background myself with Bank of America and have moved into us trust, I certainly bring that as legacy with me. And so asset allocation through the diversification, especially in today’s uncertain times, with all the global uncertainties, especially at a macro level, it’s very important to be diversified. And to make sure that there is no one area where you can achieve, you know, sizable losses.

Alan
What should be people be thinking about today in the retirement accounts?

Doug
Oh, one asset allocation, as you mentioned, but really planning early, and making sure time is on their side in order to accumulate wealth and compound over time to ensure that they meet their retirement objectives.

Alan
Is there a different strategy at different ages for asset allocation? Oh, absolutely.

Doug
And it can link a little bit to personality type. But generally, the older one is, the more cautious and conservative one should be with the investments in the asset allocation profile, because there’s less time for them to earn it back before the time when they may need it.

Alan
So I’m looking at retirement. Let’s say that I’m in my late 60s, I get three years out for retirement. Are there concerns that you as an advisor would have today with the volatility in today’s market together with the fact that you’re going to have a lot of people transitioning from the workforce at the same time?

Doug
Absolutely. We look at the macro themes. And one nice thing about us trust is we have what we call our top of the house thought leadership. And these are very seasoned investors with excellent track records that look at the macro themes, both in the US domestic economy and globally as well. And from those they provide our portfolio managers with timely information on the areas to best invest to achieve the highest risk adjusted returns. And of course, that translates the benefit of our clients. We always provide that as, as a benefit and perspective to our clients. But ultimately, we customize our investing for each client based on their own own needs, and risk profiles.

Alan
How often should a person be adjusting their portfolio? It depends

Doug
on the complexity of it and the the positioning of it. But generally, we’re talking to our clients at least three to four times a year in the ordinary course. And then when the secular change or large events might occur, it could be more frequently.

Alan
So give me an example a person getting ready for retirement, what type of investment strategy would they be employing?

Doug
It depends a little bit on their objectives. In other words, what’s the situation with where they’re living? Now? You know, their children? Where are they at that stage in their life? And perhaps where are they moving or planning? Where will their domicile be for retirement, but based on a variety of needs, we look at their situation holistically. And one nice thing I talked about our team approach it at us trust, we have wealth strategist that will actually model based on our client’s assumptions, MonteCarlo simulations, that’s a description of a variety of complex models that that that will produce a range of potential outcomes for our clients, so that through a dialogue, we can find a way to best accomplish their objectives.

Alan
What’s a realistic return that people should be looking at in today’s market?

Doug
Oh, there’s a tough question. Because it does relate so much to their portfolio, the whether they’re conservative, and if they’re late in life, perhaps are conservative about maintaining their principal rather than risking it. So it can definitely range depending on the types of investments from anywhere from, you know, three, four, or 5%, up to as high as you know, 12 15%, depending on how they orient their information, their investments and how they choose which segments they choose to invest in. Again, we talked about our asset allocation and the diversification. So we may achieve a variety of those returns that ended up in a blended return for our clients.

Alan
Now, I understand that in your position, you been involved with some ranch and timberland?

Doug
Yes, that’s right. That’s one of the things that was a big draw. For me personally to us, trust us trust has a specialty Asset Management Group. And we will go out and acquire and manage for our clients. Generally, our wealthier clients, farmland, ranch land, Timberland, oil and gas properties, commercial properties, and even private businesses. For example, Alan, we’re the largest fiduciary manager of farmland in the United States. So we have something on the order of a $12 billion portfolio of that, of those kinds of assets for our clients. And again, we’ll buy or sell or help them manage them. And it’s something that especially these days, our clients are finding increasingly interesting.

Alan
You find that in today’s world that having hard assets is better.

Doug
Yes, some of our clients really are drawn to that. Yes, that’s precisely the case.

Alan
It seems as time goes on to to have that tangible piece of property is more comforting.

Doug
Yes. And in the case of timberland, it’s always hard to know, but one could, one could certainly make a case that given that homebuilding is an early recovering, recovery phase is perhaps good timing, you know, and to consider a timberland investment,

Alan
think how does one reach you?

Doug
I can be reached a variety of ways. I’m with us, trust us, ustrust.com My name is Douglas Keyston. I have a a my own webpage that is part of the US trust site. And then my my phone number is 650-849-2193. My email address Alan is Douglas.Keyston@ustrust.com

Alan
That again, joint having you on today’s show. Thank you. We’ll be right back after these messages.

 

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These transcripts may not represent exactly what was said, as they are software generated and occasionally edited for concision and clarity.

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About Doug Keyston

Doug Keyston is a Senior Vice President and Private Client Advisor with U.S. Trust®. He leads a team of advisors supporting the needs of ultra high net worth individuals and families.

Prior to joining U.S. Trust in 2012, Doug was a Credit Risk Executive in the Specialized Industries Group at Bank of America Merrill Lynch. He was responsible for the Gaming & Leisure and the Sports industry segments globally. Doug previously managed the Bank’s lodging portfolio globally.

Doug has deep experience working with senior corporate leaders and business owners and is well versed in corporate, commercial and real estate financing. Before Bank of America, Doug was with Allgemeine Treuhand, AG, a Swiss partner of Arthur Young and Co.

He was also with Century Capital where he managed office leasing and was a senior leader at First National Bank of Chicago specializing in corporate real estate lending. He also worked for The Krausz Companies where he focused on real estate development, management and financing.

Doug is adept at asset allocation and estate planning. At U.S. Trust , he provides highly customized and personalized private wealth management services designed to meet the needs of clients by helping them navigate the complexities of managing wealth.

A life-long Californian and native of the San Francisco area, Doug serves on the board of the San Mateo County Historical Association and holds a Bachelor’s degree in Economics from UCLA.