When Donald A. McMullen Jr. looked at his career options last winter, banking wasn't one of them.

After all, he had jumped to a top mutual fund company, American Capital Management and Research, after 13 years in banking, and had attained the rank of president.

"I really wasn't looking for a position with a bank," he said. "I thought that most banks worked at a snail's pace, and couldn't get decisions made."

Enter First Union Corp., and its chairman, Edward E. Crutchfield Jr., who, after a flurry of meetings with Mr. McMullen, offered him the chance to run First Union Capital Management Group.

The arrangement gave Mr. McMullen oversight of the $77 billion-asset banking company's proprietary mutual funds, its trust and private banking operations, and a staff of 2,700, including more than 2,000 brokers and investment sales representatives.

"It was clear to me that these people weren't just talking the talk," Mr. McMullen said. "I was sure that if they were behind something, then it would get done."

Now eight months into the job, Mr. McMullen is popping First Union's investment business into fifth gear. The banking company has hired a new head for its wealth management group, and is redoubling its efforts to expand sales of the proprietary Evergreen Funds beyond bank branches.

First Union has expanded its marketing of the funds to include public- sector retirement plans, and is hiring a squad of wholesalers - 10 so far - to drum up business from financial planners and broker-dealers.

Already the banking company has commitments from more than 300 outside vendors, including some with other banks, Mr. McMullen said in a recent interview at First Union headquarters in Charlotte, N.C.

Mr. McMullen appeared optimistic that the agreements will translate into increased sales, but in a characteristically cautious tone that reflects his banking background, he added, "I don't count my chickens before they're hatched."

Some observers say it is a mix of aggressive tactics and calculation that made Mr. McMullen a sought-after candidate for the post at First Union.

A self-professed workaholic, Mr. McMullen arrives in his office at the crack of dawn and leaves as night falls. He drives eight miles from a rented apartment on the outskirts of Charlotte as his search for a permanent home in this fast-growing city continues.

On a typical day he'll pore over the progress reports from the myriad divisions that he oversees, and try to meet as many of his employees as possible.

"The only thing he hasn't done around here is change the Coke machine," said William M. Ennis 2d, senior vice president and director of the Evergreen Funds.

When Mr. McMullen slips into his chair to look over the previous week's sales figures, he looks every bit the banker - and rightly so.

The 46-year-old executive started his career at Mellon Bank Corp. in 1972. He quickly rose through the ranks and in 1978 he took over the Pittsburgh-based banking company's trust operations.

By 1985, he was helping Mellon launch its proprietary Laurel Funds. And shortly afterward, he developed a cash management product that Mellon pitted against Merrill Lynch & Co.'s popular CMA account. Ironically, one of the product's first takers was the president of First Union's North Carolina bank unit, he said.

In 1987, Mr. McMullen joined American Capital and set about polishing the mutual fund company's image, which at the time was suffering because of a "service problem that was second to none," he said.

Mr. McMullen left American Capital last January, shortly after it was acquired by another mutual fund company, Van Kampen Merritt. Industry observers said the acquisition had diluted some of his authority at the company, but Mr. McMullen would only say that he "thought it was a good time for a change."

And one of the first things he did after taking his place at First Union was to dust off the banking company's own cash management account and put it on the front burner.

The product has been around since 1985, and until last fall, investment representatives had opened about 45,000 accounts. In the past nine months, the banking company has almost doubled that figure.

"I'm not saying we're going to replace a Merrill Lynch, but we have to recognize that there are people out there that need and want these services and we should be out there providing them," Mr. McMullen said.

The banking company is planning to launch a proprietary fixed annuity by yearend, and should have a variable annuity by early next year that will use the Evergreen Funds as its principal investment, he said.

First Union is also taking its first steps into the insurance business, Mr. McMullen said, though he would not reveal much about the company's plans. He did say that 150 representatives have been licensed to sell life insurance, and there are plans for another 650 to be licensed.

Some staff members say Mr. McMullen has raised the level of dedication of those who work for him, and mobilized much of his work force to do better.

"What Don brings to the mix is an aptitude and a willingness to do things swiftly," said Mr. Ennis, also a former fund executive.

Mr. Ennis, who joined First Union more than a year ago from Colonial Mutual Funds, is responsible for managing the Evergreen Funds. His mission is to build them from the current $9.4 billion to $25 billion by yearend 1996, and $50 billion by 2000.

"We're not going to get there without acquisitions," Mr. McMullen said. "We're going to continue to look for prospects that are strategic and fill a niche."

Mr. McMullen is applying that same strategy to filling positions within his growing capital management division. Just as he was picked from the outside, Mr. McMullen now hires people away from rival companies such as Edward D. Jones & Co., Putnam Investments, and even NationsBank Corp.

"If you are going to be in this business, then you should hire the best," he said. "We don't want to be the best 'bank-run mutual fund.' We want to be the best fund company, period."

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