NatWest Begins Regrouping To Get Back into the Black
NEW YORK -- National Westminster Bancorp. has divided its operations along business lines, forming separate wholesale and retail divisions.
The change is the first major move by John Tugwell, chairman of the $22 billion-asset National Westminster, since his arrival in April with a mandate to return the ailing company to profitability.
Mr. Tugwell was sent by Natwest's London-based parent, National Westminster Bank PLC, to replace William T. Knowles after the U.S. unit showed a loss of $352.4 million for 1990 and a $190.9 million deficit for the first quarter of this year.
New Team in Place
Heading the new wholesale division is Paul C. Kreuch Jr., who was also named Thursday as president and chief executive of National Westminster Bank USA. Mr. Kreuch, 53, replaces Brendan Dugan, who resigned in April.
In charge of the new retail division is Douglas O'Brien, 52, who is also is president and chief executive of National Westminster Bank NJ, the bank's New Jersey unit.
The bank has been hit hard by the economic recession and is struggling to deal with mounting nonperforming real estate and commercial loans.
Building a U.S. Regional
The New York and New Jersey units were acquired over the last decade as part of a drive by National Westminster, Britain's second-biggest bank, to build a U.S. regional bank.
Mr. Kreuch said the realignment would help National Westminster eliminate duplication and coordinate operations at its different units.
"What we now have is a structure that allows one guy to knead the dough," Mr. Kreuch said.
He added that the move would also help National Westminster market a broader range of services to individual customers.
A Broader Objective
"We don't want to sell a customer a lockbox just to peddle lockboxes," he said. "What we're aiming for is a broader relationship that includes lending, cash management, treasury activities, and other products."
Mr. Kreuch previously headed wholesale banking for National Westminster in New Jersey.
Red Ink for a While
Mr. O'Brien joined National Westminster from Midlantic National Banks. He came to Midlantic from Bankers Trust Corp.
Analysts noted that restructuring along lines of business is similar to strategies adopted by many U.S. banks.
They added that while the move should help National Westminster cut costs and improve coordination, black ink is unlikely until next year.
PHOTO : Paul C. Kreuch Jr. Heads wholesale division