The management shake-up at Keycorp continued on Thursday as the Albany, N.Y.-based company confirmed it had forced out Hans F. Harjo, 54, as chairman and chief executive of its Washington State subsidiary.

Mr. Harjo's removal came just days after Keycorp's chief banking officer, James Waterston, resigned under pressure. The company said both departures were requested by Victor J. Riley, Keycorp's chairman and chief executive.

Keycorp plans to replace Mr. Harjo with Deborah L. Bevier, 42, who is chief executive of Key Bank USA, a mail-order unit that sells money market instruments, certificates of deposit, and individual retirement account investments.

Mr. Harjo's ouster, which occurred Tuesday after a meeting with Mr. Riley in Tacoma, was first reported Thursday in the Seattle Post-Intelligencer.

A Keycorp spokesman said Mr. Riley was "disappointed" with the performance of Keycorp's rapidly growing Tacoma-based unit. He also was said to be upset over the company's image as an impersonal intruder from out of state.

Image Problem Cited

Mr. Harjo, who less than a week ago became president of the Washington Bankers Association, could not be reached for comment. But local observers said he may be a scapegoat for Keycorp's image problem, which they attribute to its long-distance attempt to impose its banking culture.

Key Bank of Washington has grown explosively in the past year. It bought Puget Sound Bancorp, the largest independent bank company in Washington, and picked up 48 local branches of the former Security Pacific Corp. Key Bank is now the state's second largest, with $8 billion of assets.

Despite some consolidation glitches, the bank posted a healthy return on assets of 1.24% in the first quarter. But Mr. Riley believed financial results "could have been better" the Keycorp spokesman said.

Mr. Harjo, a native of Norway, was CEO of Seattle-based First Northwest Bancorp, when Keycorp bought it in 1987. He became president of Key Bank Washington and was promoted to chief executive in 1989.

Mr. Waterston, 52, resigned Monday. He said it was clear he would not succeed Mr. Riley, who turns 62 in August.

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