Jeffrey C. Keil, president of Republic New York Corp. and one of the U.S. banking industry's most senior executives, unexpectedly resigned Thursday.

Mr. Keil, 53, has spent 25 years at Republic, a $47 billion-asset institution founded by the secretive Lebanese-born financier Edmond Safra. In a new venture, Mr. Keil will invest in the financial sector in Israel, with Republic possibly acting as a partner.

Mr. Keil was unavailable to comment, and a spokesman for Republic declined to elaborate on the brief statement announcing that he would leave.

But in a recent interview with American Banker, Mr. Keil expressed concern that Republic's traditional deposit-driven retail banking business was not growing. At the same time, he noted, competition for retail savings from nonbanks, like insurance companies and securities firms, was increasing.

Mr. Keil will remain at Republic until the end of September and will also remain on the bank's board of directors. Republic has not named a successor, and analysts predicted a selection would probably take several months.

As one of the top-ranking officers of the bank alongside Walter H. Weiner, chairman and chief executive officer, Mr. Keil was instrumental in arranging a series of acquisitions that helped turn Republic into a leading consumer and commercial bank in the New York City metropolitan region.

More recently, he helped launch an ambitious effort to add a fourth, U.S. private banking leg to Republic's three main operations - retail, institutional, and international private banking. The intention was to make the bank a significant fund manager. As of April, it had $5 billion of assets under management for domestic U.S. customers; it has set a target of $10 billion for the year 2000.

Republic also set up a securities unit, Republic New York Securities Corp., that initially expanded rapidly into exotic hedge funds but subsequently retrenched to more mundane retail brokerage activities.

Analysts said that, despite the key role Mr. Keil played as a strategist, his departure is not likely to disrupt daily operations.

In a bulletin released Thursday, Keefe, Bruyette & Woods Inc. analyst Marni Pont noted that Mr. Keil was part of an eight-person executive management team at Republic "but was not especially involved in the day-to- day activities of running the bank."

Keefe Bruyette added that it would not change its earnings forecasts of $6.90 a share in 1996 and $7.60 a share for 1997. Similarly, Merrill Lynch & Co. reiterated its medium-term "buy" rating on the bank.

"His departure is a loss for the company, but I don't think it signals any major change in direction," said Cheryl Swaim, an analyst at Oppenheimer & Co. "He had a good opportunity and decided to take it, and the fact that he's remaining on board shows it was an amicable resignation."

Republic, one of the most strongly capitalized banks in the country, has always pursued a cautious policy that has avoided significant losses but has done little to excite investors.

The bank currently trades at around 8.3 times estimated 1997 earnings per share, compared with a 9.3 industry multiple, according to Keefe Bruyette, and has consistently produced lower than average, though steady, returns.

Analysts noted that at least part of the reason for low interest among investors is that Mr. Safra owns nearly 30% of the holding company stock and that potential shareholders would have little influence over management's strategic priorities.

Mr. Keil, who has long had a philanthropic interest in Israel, will organize Keil Investment Partners with the advice of Lazard Freres & Co., the Paris-based investment bank. In a statement, Mr. Safra said Republic is considering investing in Mr. Keil's venture with Eurafrance, a Lazard affiliate.

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