A. Jay Meyerson, who built KeyCorp's consumer finance business and then abruptly resigned in October 1997, has landed a job as a consultant with the accounting firm KPMG in New York.

At Cleveland-based KeyCorp, Mr. Meyerson, 52, engineered the acquisition of two large subprime lenders, Auto Finance Group of Chicago and Champion Mortgage Co. of Parsippany, N.J.

Mr. Meyerson had been consulting until mid-January, when he took the KPMG post as director and senior member of the financial services practice.

Mr. Meyerson resigned from KeyCorp just months after it agreed to pay $200 million for Champion, a home equity lender for people with poor credit. He insisted that the parting was amicable and that he wanted to do other things.

"I really felt as thought I had built a very strategic part of the company," Mr. Meyerson said. "I was at a peak of my career curve."

KeyCorp spokesman William Murschel said that when Mr. Meyerson left, the company "was looking at what areas of consumer finance it wanted to build and what areas it wanted to scale back."

Though Mr. Myerson said he does not want to be known as "Mr. Subprime," he will continue to advise companies interested in entering or expanding in the subprime loan business, including purchase mortgages and home equity loans.

The subprime industry is still unstable, he said, and this presents a buying opportunity for companies interested in entering the market.

As evidence that big banks are still keen on getting a piece of the market Mr. Meyerson cited First Union Corp.'s acquisition of Money Store Inc. last year and U.S. Bancorp's taking an equity position in the subprime mortgage lender New Century Financial Corp. of Irvine, Calif., .

He warned, however, of several important "management and cultural challenges" banks face if they're going to buy a small specialty firm.

"These companies tend to be very entrepreneurial and not bureaucratic," he said. "Large banking organizations are the opposite."

"The cultures don't mix very well. There has to be a balance between oversight and management control without stagnating or suffocating the specialty finance firm," Mr. Meyerson said.

He said the smaller finance companies that got in trouble had flawed practices in a variety of areas, including originations, loan funding, pricing, loan collections, and securitization. A more conservative approach can make the subprime business viable for banks, Mr. Meyerson said.

In addition to subprime lending, Mr. Meyerson advises on general retail banking strategy, profitability of products, credit management, and business model design. One focus is how to serve consumer finance customers on the Internet.

Mr. Meyerson still lives in Cleveland and commutes to New York. In addition to his seven years at KeyCorp, he spent 19 years at Wells Fargo & Co., mostly in the consumer credit group.

At KeyCorp he spent three years building its consumer finance business, which was called Key Bank USA. About 10% of the company's loan portfolio consisted of subprime loans, he said. But the acquisitions were building the subprime business. That business came to a halt when Mr. Meyerson resigned in October 1997. Mr. Meyerson said Champion had been ahead of its plan for profitability.

Mr. Murschel, the spokesman, said KeyCorp has de-emphasized auto lending in favor of home equity lending. The company, however, never intended to be a big subprime lender, he said.

Analyst Michael Mayo of Credit Suisse First Boston said KeyCorp began to shy from consumer finance when the losses began to mount. Its scaling back on the auto lending side is evidence of this, but "in the scheme of things, Champion looks good," the analyst said.

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