Fleet Financial Group is poised to hire two of the mortgage industry's most seasoned veterans to revitalize its large but languishing home loan unit.

Executives close to the discussions say Fleet Mortgage is in negotiations with Mark Korell, former chief executive of Norwest Mortgage, and Joe Bryant, executive vice president of Long Island Savings Bank.

They would become chief executive officer and executive vice president, respectively, of the Columbia, S.C., unit of Boston-based Fleet. The CEO post has been vacant since Richard A. Mirro left in December, after a five- month stint, to join Dime Bancorp.

The appointments could be announced this month, the sources said. Neither Mr. Korell nor Mr. Bryant was available to confirm the talks, and a spokesman for Fleet Financial would not comment.

The two high-powered executives might help to reverse a tide of defections and disappointing results at Fleet Mortgage, which ranked fourth in both home loan originations and servicing last year.

But analysts said hiring new leadership would be only the first step for Fleet Mortgage.

"Fleet hasn't had a problem finding people," said George Bicher, an analyst with Alex. Brown & Sons. "They've had a problem keeping them."

Instability in the top ranks has hobbled Fleet's efforts to wring profits out of its $120 billion servicing portfolio, observers said. For instance, the bank has lagged its rivals in technology investments. Such investments are seen as vital because they enable lenders to manage more loans more efficiently with fewer people.

"Fleet has been behind the curve in upgrading its servicing systems. That has been the problem area," said Sandra J. Flannigan, an analyst who follows Fleet for Merrill Lynch & Co.

Last year, Fleet Mortgage reported net income of $69 million, down from $86 million in 1995. The company, which originated $22.5 billion last year, had initially estimated 1996 net income would be $100 million. The mortgage unit's contribution to the holding company's net income slipped from 8.3% in 1995 to 6.1% in 1996.

The hirings could help quell doubts about Fleet's commitment to the mortgage business, observers said.

"Both men are very well-known and powerful individuals in the industry. Surely they would not be coming in to close a shop up," said Hilary Renz, senior vice president of Cohane Rafferty Securities, a mortgage investment banking firm in Harrison, N.Y.

Fleet Mortgage's senior ranks are relatively bare, with Michael Torke, as president, overseeing day-to-day operations of the Columbia, S.C., lender. Mr. Torke was promoted from vice president of strategic planning in January after Mr. Mirro left. Mr. Mirro's exit capped nearly a dozen high- level departures in three years.

Mr. Korell and Mr. Bryant are friends as well as business associates, and each is at a point in his career where Fleet might prove a welcome challenge, observers said.

Mr. Korell was with Norwest, the industry's largest lender, for two years, and spent a month as chief executive before departing in late May for what the company termed professional and private reasons. Before joining Norwest, Mr. Korell headed the lending unit of General Motors Acceptance Corp.

Mr. Bryant has been with Long Island Savings since 1993. Before that he held senior mortgage positions at Prudential Insurance Company of America, GE Capital Corp., and Travelers Cos. He is recovering from back surgery and does not plan to return to the Melville, N.Y., thrift, according to associates.

Long Island Savings Bank would not comment.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.