Why did David Frank chuck his job as Chemical Banking Corp.'s mortgage chief? Some observers are pointing to a culture clash.

Chemical, one of the largest players in home loans, announced last week that Mr. Frank was resigning the post just a year after assuming it - to "pursue new challenges."

Mr. Frank, 47, had been a top executive at Margaretten Financial Corp., a freewheeling mortgage bank that Chemical acquired last year. Sources say he soon became uncomfortable with the slower, more deliberate pace of life within a giant bank. In the end, he simply may have been bored.

"You always want somebody running your place who wants to be there," Mr. Frank said in an interview. "While I've been here, I couldn't pursue other things, but found myself wanting to."

Such episodes may become more common as commercial banks seek to digest the dozens of mortgage companies they acquired over the past two years. Many banks have been buying mortgage companies as a way to bolster fee income and forge closer ties to consumers.

Chemical said Mr. Frank was leaving after successfully completing the integration of Margaretten into Chemical's other mortgage operations.

"We thank him, will miss him and wish him well," said an internal memo from Thomas Jacob, Chemical's executive president in charge of national consumer businesses. "The search for a new CEO will begin immediately."

Industry observers weren't surprised by the reports of cultural strains.

"Banks typically try to rein in the mortgage banking companies they acquire, because the cyclicality of the business scares them," said Thomas O'Donnel, a securities analyst at Smith Barney & Co. "It lacks the decorum that banking has."

Some sources said that Mr. Frank felt stifled by the reporting and oversight procedures at Chemical. They said he had not expected the bureaucracy he encountered.

And, as interest rates rose last year, plunging loan volumes brought added pressures. "It's been a difficult year," Mr. Frank said.

Margaretten, long a market leader, prided itself on its entrepreneurial spirit - quickly opening and closing branches, and giving loan officers lots of leeway.

Mr. Frank had been the company's No. 2 executive, under Felix Beck, its legendary chairman. When Chemical acquired Margaretten, Mr. Frank reportedly collected $8 million for his stock and options. And he was put in charge of the combined operations.

At Margaretten, Mr. Frank's dream had been to run the company when Mr. Beck retired, according to a source familiar with the situation.

When Chemical acquired Margaretten, "all it did for David is put his dream off for a little bit. It also gave him the wherewithal to create it," the source said.

The source added that Mr. Frank now would like to purchase a mortgage bank.

Glenn Mouridy, executive vice president and chief financial officer of, said last week that he didn't know whether Mr. Frank had been frustrated.

He said Chemical remains committed to expanding its share of the mortgage market, and that the Margaretten acquisition had been essential to that goal.

The word is that Chemical has a short list of potential replacements for Mr. Frank. Perhaps not surprisingly, Chemical is looking at mortgage bankers who have worked before in a bank or a thrift.

Edward Kulkosky contributed to this report.

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