In an unusual move, Norwest Corp. has put its chief insurance executive in charge of a new unit that will handle both insurance and investment product sales.
Officials at the $77.8 billion-asset bank confirmed it has named Timothy J. King, president of Norwest Insurance Inc. for the last three years, to head the new operation. Mr. King, who has yet to receive a new title, will continue to report to Daniel Saklad, executive vice president of North Central Community Banking.
Mr. King beat out John S. McCune, president of the Norwest Investment Services Inc. broker-dealer subsidiary, for the top investment products sales job. Under the reorganization, Mr. McCune, a 27-year Norwest veteran, will now report to Mr. King and oversee all of the unit's sales representatives.
According to Mr. Saklad, the moves "further heighten the commitment we have at Norwest to the insurance and investment businesses." The new division combines Norwest's 300 investment representatives with the bank's 22 life insurance agents.
Minneapolis-based Norwest is the latest bank to develop a cohesive approach to selling insurance and other brokerage products. But while others, including KeyCorp and Great Western Financial Corp., are just beginning to bring their insurance and brokerage units under one roof, Norwest has taken the next step of actually melding the two operations.
Insurance company executives said Mr. King's promotion marked the first time a bank's insurance sales chief was put in charge of its top brokerage official.
"Usually banks put the insurance head under brokerage, and insurance sales start suffering," explained Gary Warden, vice president, financial institutions marketing, at Commercial Union Life Insurance Company of America, Quincy, Mass.
Indeed, one vendor who hawks insurance products to Norwest said the bank's investment representatives were "up in arms" that Mr. McCune didn't get the top post.
As described by Mr. Saklad, Mr. McCune's new job is to act as Norwest's national sales manager. He will oversee the brokers, but not the back- office operations. Such executives typically do not report directly to the highest ranks of management.
Any notion that Mr. McCune was demoted is "absolutely, emphatically not true," Mr. Saklad said.
Mr. King joined Norwest in 1992 to assist with mergers and acquisitions in the bank's Western Community Group .
Mr. McCune joined Norwest in 1969 in Omaha, where he worked in the credit analysis and correspondent banking departments. In 1977, he became manager of the bond department, which later became the brokerage unit.
Neither Mr. McCune nor Mr. King could be reached for comment.
Mr. Saklad said putting Mr. King above Mr. McCune in the hierarchy was not a signal that insurance sales are more important than brokerage. He said both executives were placed in positions that best suited their skills.
"Tim and John work extremely well together, personally and professionally," Mr. Saklad said. He said Mr. King has strong "operational skills" as well as knowledge of "computer technology."
He described Mr. McCune as a "talented sales manager."
"I wanted him to spend a lot more of his time dealing in-depth with the sales force and making sure we execute superbly at point of sale," he said.
Mr. Saklad said he chose to blend the two programs to better offer a variety of investment and insurance products to customers over one sale.
Currently, customers are put off when they get numerous sales calls from brokers and insurance agents who are obviously not working in tandem, Mr. Saklad said.