The subprime lender Mego Mortgage Corp. has hired a veteran thrift- turnaround specialist to take over from one of its founders, Jeffrey Moore.
William Paul Ralser, 57, will be president and chief operating officer of Mego, succeeding Mr. Moore, 40, who has resigned, the company said Wednesday.
Mr. Ralser came to Mego from Irvine, Calif.-based First Fidelity Bancorp, where he was president and chairman of the board. The thrift had suffered serious losses earlier in the decade because of its exposure in the state's real estate markets.
Before joining First Fidelity he was executive vice president of Countrywide Funding Corp., where he was credited with resuscitating the company's flagging thrift and started an affordable housing division.
"I enjoy righting things that have tipped over," Mr. Ralser said in a telephone interview.
Analysts agree that he has his hands full with Mego Mortgage.
The Atlanta-based lender's stock price collapsed after unexpected loan prepayments due to increased competition forced it to restate its earnings last year.
The capital markets have virtually dried up for specialty finance lenders, a number of which have chosen to put themselves up for sale.
Mr. Ralser said he is optimistic. Turning around Mego Mortgage is "a challenge but not outside my sphere of expertise," he said.
Critics had also said First Fidelity would be impossible to fix, he recalled, but in July it reported second-quarter earnings 275.8% higher than those of a year earlier.
"First Fidelity was federally regulated and had no money," he said.
"Mego Mortgage is not federally regulated and has cash."
Mr. Ralser said that it's too early to specify his plans for Mego.
The company has taken several steps to get back on its feet. Early this summer Mego announced it had executed a successful recapitalization plan, sold off some nonperforming assets, and elected a new chief executive.
On July 6, Mego announced that Champ Meyercord, a former Greenwich Capital Markets senior executive, would be joining the company as chairman and chief executive. Mr. Meyercord was already a Mego director.
And last week Mego reduced its work force significantly, laying off about 70 employees. Mr. Ralser said that was part of the turnaround plan.
"We've sold a large amount of servicing off, and our recent reduction in force was part of that," he said.
Market conditions make it a "tough time for turnarounds," said Christopher Reed, analyst with William Blair & Co.
But Mr. Ralser said Mego is positioned to make a comeback. "We have a clean balance sheet, everything has been dealt with, and we have cash at a critical time in the market," he said.
