Fred O. Gumbel, president and chief executive officer of Vital Processing Services, resigned last week.

Mr. Gumbel, 45, was the first CEO of Vital, a fifty-fifty joint venture formed in 1996 by Visa U.S.A. and Total System Services. Based in Tempe, Ariz., Vital was intended to give banks a stake in the merchant processing business, where they had lost market share to First Data Corp. and other nonbank specialists.

Philip Tomlinson, president of Columbus, Ga.-based Total System, is to be interim president of Vital until a successor to Mr. Gumbel is found.

Vital did not elaborate on a statement that Mr. Gumbel left to "pursue other interests." It added that it is "moving quickly to fill the position with an executive committed to Vital's strategic vision."

Observers said that answering to both Total System and Visa may have been difficult for Mr. Gumbel.

Total is majority-owned by Synovus Financial Corp., a bank holding company, and Visa is an association of thousands of banks.

Earlier in his career Mr. Gumbel worked in credit cards and data processing at Citibank, and he oversaw the card operations of U.S. Bancorp of Minneapolis before it changed its name from First Bank System. Mr. Gumbel was instrumental in building that company's commercial card program.

He came to Vital from Electronic Data Systems Corp.'s electronic commerce division, where he was president, and was considered a strong hire for the upstart processing venture.

"It is always a challenge when you have two masters to answer to," said Stanley Anderson, president of Anderson & Associates, Arvada, Colo. "There is always that tension in the management style and philosophy."

"It would take a masterful politician to balance the wants, needs, and priorities of each group," said Paul Martaus, president of Martaus & Associates, Clearwater, Fla.

One observer, speaking on condition his name not be used, said Mr. Gumbel was better "at managing the big picture" than at keeping morale high among subordinates.

Outsiders like Mr. Anderson gave him credit for Vital's early success, saying he staked out a strong marketing position without competing with client banks for merchant business.

In one of Vital's biggest coups, last year it lured U.S. Bancorp of Minneapolis away from industry leader First Data. The deal brought 30,000 merchants with $5.6 billion in annual charge volume.

Vital's authorization volume increased 15% last year, to $2.77 billion. Clearing and settlement volume rose 38%, to $1.13 billion.

Finding a successor from outside will not be easy because the talent pool is thin and "the industry learning curve is very long," said Liam Carmody, president of Carmody & Bloom Inc., Ridgewood, N.J.

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