Hours after Chemical Banking Corp. announced last week that it had given up its external search for a mortgage chief in favor of appointing insider Thomas Jacob, a hot rumor began to circulate.

The story: John Robbins, former chief executive of American Residential and a top candidate for the Chemical job, had been dropped at the last moment. As a consolation, the rumor goes, Mr. Robbins was allowed to keep a seven-figure signing bonus.

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