Mortgage Chief At Norwest Quits After Two Months

The chief executive officer of Norwest Mortgage is leaving the giant lender just two months after his appointment, underscoring a surge of management turnover in the home loan field.

Minneapolis-based Norwest Corp. said Thursday that Mark Korell had resigned from the mortgage unit for "personal and business reasons." The company would not elaborate, and Mr. Korell declined to comment.

Norwest Mortgage, the nation's largest originator and servicer of home loans, joins several other top mortgage lenders undergoing management shifts. The companies, all much bigger than lenders of the past, are struggling to find the right people and the right organizational structures.

"These companies are growing to such a size that they are dealing with issues they never have before," said Mark Springer, president of M.H. Springer & Associates, a Woodland Hills, Calif., executive search firm.

Norwest Mortgage, which processes monthly payments on some $215 billion of home loans, has been striving to increase its customers' use of other Norwest Corp. products. To that end, the unit's previous CEO, Mark Oman, was elevated earlier this year to the new post of chairman and to senior vice president of the parent company. And Mr. Korell was put in charge of day-to-day management of the unit.

Some observers said Mr. Korell, who joined Norwest in 1995 after leading the mortgage unit of General Motors Acceptance Corp., chafed at the more buttoned-down culture of a banking company. Though renowned for his expertise in mortgage banking, he never quite fit in at Norwest, according to some people at the company

"They brought in someone from the outside and it created a lot of disagreement," said Mr. Springer.

Les Biller, president of Norwest Corp., said simply: "We respect Mark's decision and thank him for the contributions he made to Norwest Mortgage over the last two years."

Signs of management turnover are everywhere in the mortgage industry. Of the 10 top companies in servicing, seven have different CEOs than they did three years ago. And one-the mortgage unit of Fleet Financial Group-has gone through three CEOs in that time.

The changes come amid unprecedented growth by the leading mortgage companies. Ten years ago, no companies serviced as much as $50 billion of loans. Today, six service more than $100 billion, and Norwest has passed the $200 billion mark.

The servicers say they are reaping handsome economies of scale as they get bigger and bigger. But the increased heft clearly presents managerial challenges.

At Norwest, Mr. Oman will again take up the CEO duties, at least temporarily. The long-term plan is still unclear.

Some observers said the moves could prove a setback to effort to cross- sell other Norwest products. But Norwest and its supporters said the company enjoys a deep management bench and will proceed with the strategy.

"For Norwest, this is one resignation among an army of people," said a Wall Street mortgage trader.

So far, Norwest has been successful at selling mortgage customers on other products-a process that has eluded many other banks.

"A fairly large percentage of their customers start out as mortgage customers," said George Bicher, an analyst with Alex. Brown & Sons Inc.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER