Peter E. Raskind, the chairman and chief executive of National City Corp., who orchestrated the agreement last month to sell his troubled company to PNC Financial Services Group Inc., said Monday that he will step down in December, when the deal is expected to close.
On Oct. 24, when the deal was announced, the two companies said Mr. Raskind would become a vice chairman once PNC completed the purchase and would help guide the integration. On Monday, National City said that Mr. Raskind has now opted to leave once the deal closes.
In a press release, Mr. Raskind, 51, gave no reason, saying only that it had been "an honor and a privilege to lead" the Cleveland company and that, as Nat City "looks to the future with PNC, I am confident that our employees will continue to meet and exceed the needs of our customers as part of a financial services powerhouse." Mr. Raskind and Nat City would not comment beyond the release. Brian Goerke, a spokesman for the $146 billion-asset PNC, said: "We respect Peter's decision and wish him well in his future endeavors."
Analysts said Mr. Raskind's decision was not that surprising. "I think if he had stayed on his tenure would have been very short and limited strictly to the integration," Nancy A. Bush, the president of NAB Research LLC, said in an interview Monday.
On a call with analysts last month to discuss the merger, PNC chairman and chief executive James E. Rohr was asked whether he envisioned a long-term executive role for Mr. Raskind, who was not on the call. "I think we have to wait and see," Mr. Rohr said. Analysts said Mr. Raskind's absence from the call signaled that he was not fully on board with the deal.
The $150 billion-asset Nat City announced the transaction after posting its fifth-straight quarterly loss, and after months of seeing its shares beaten down. PNC is acquiring Ohio's largest bank for $2.23 a share, or about $5.2 billion of stock.
For most of this year, Mr. Raskind worked aggressively to cut costs and wind down bad mortgages to prepare Nat City for a future as a stand-alone company. He also emphasized that it remained well-capitalized, with a Tier 1 capital ratio of 11%.
Federal regulators, however, were skeptical about its long-term profit outlook and pushed for a sale. "Peter was not happy about it, clearly. He was defeated, essentially," said a source with knowledge of the situation who declined to be identified.
PNC said it not only won the Treasury Department's approval to participate in its Capital Purchase Program but also would be awarded its share and Nat City's share of capital from the Treasury, $7.7 billion. This effectively told Wall Street that Nat City had been shut out of the program.