James Outland has stepped down as president of Magic Line automated teller machine network, Michigan's largest electronic funds transfer company.

Magic Line is the nation's seventh-largest electronic banking network in terms of installed terminals. It boasts approximately 4,500 ATMs and 4,000 point-of-sale terminals.

The network is in the process of combining its operations with those of NBD Bancorp, the Detroit-based institution that agreed in March to merge its ATMs and transaction processing capabilities into Magic Line's.

Magic Line is also a central player in an unfolding drama in the Midwest, where 14 of the region's largest financial institutions recently agreed to discuss consolidating their electronic banking operations into a single concern that would operate under the name Electronic Transaction Inc.

|Conflict' over Consolidation

Mr. Outland, who had been president and chief executive officer of Magic Line since it was formed in 1979. reportedly stepped down from his post over differences regarding what role Magic Line would play in ETI.

"I had heard that he was not in favor of' the type of consolidated network being discussed by the Midwest bankers, said Sean Kennedy, president of the Electronic Funds Transfer Association, based in Reston, Va.

"The fact that the leading participants in Magic Line were involved in the [Midwest network] meeting logically put him in conflict with some pretty powerful forces."

Mr. Outland could not be reached for comment, and Magic Line executives declined to comment on the reasons behind Mr. Outland's resignation.

However, Daniel Roma, the network's chief financial officer and highest ranking executive, indicated that it might be some time before a replacement for Mr. Outland is found.

"We are in the throes of merger talks, and the board is very busy discussing the deal," said Mr. Roma. "The other two vice presidents and myself have been commanded to focus on this merger, which we've been doing."

Mr. Roma declined to estimate how long it would be before the network decides whether to replace Mr. Outland.

At the very least, Magic Line is likely to put off such a decision until the network's role in the Midwest venture becomes clear.

It is possible that he will not be replaced at all. Observers noted that the joint venture that results from the Midwest talks might not require Magic Line to have someone at the helm.

Talks Continue

Meanwhile, the merger talks - which include First National Bank of Chicago, NBD Bancorp, Huntington Bancshares and Norwest Corp. - are progressing, according to participants.

But many industry insiders say they believe that a few of the participants will begin to drop out of the talks over the summer.

"Trying to get 14 people to agree on anything is tough," said one person involved in the merger talks.

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