Walter P. Blass, the hard-driving chairman of Shearson Lehman Mortgage Corp., has abruptly resigned after nearly eight years in the post.
He was replaced by Paul J. Dart, 32, who had been working in other nits of Shearson Lehman Brothers Holdings.
The sudden shift, announced internally last week, caps a tumultuous 18 months for the Irvine, Calif.-based mortgage unit.
The company, which services some $18 billion of mortgages, was put on the auction block in early 1991 - only to be pulled off this February after a deal to sell it to a consortium of Arab and U.S. investors fell through.
Meanwhile, its servicing business has reportedly been hit hard by prepayments as a result of a wave of refinancings. Early repayments of loans deprive services of expected income and can require writedowns of assets.
Sources said it is unclear what triggered Mr. Blass' resignation, but added that his relations with Shearson Lehman Brothers management became strained during the sales effort. Shearson is a subsidiary of American Express Co.
The |Master Blaster'
Mr. Blass, whose demanding management style earned him the nickname "Master Blaster," denied any hard feelings between himself and Shearson.
"I think the firm has decided it's in its own best interest to get some fresh blood in here," he said in a phone interview, "but these have been totally healthy discussions."
The executive, who is 46, said his only regrets about Shearson are that the mortgage company remained isolated from the rest of the brokerage and that the sales effort stalled. He added that he has been asked to consider a job with the parent organization in New York, but is inclined to remain on the West Coast.
Mr. Blass said he may start his own mortgage business.
Took Change in 1985
He took the reins of the Shearson unit in February 1985, after a stint in the Florida thrift industry. He soon was credited with establishing Shearson Mortgage as a nationwide powerhouse.
At its zenith in 1988, Shearson ranked as the nation's sixth-largest mortgage company, based on servicing. However, it has slipped significantly since then, to No. 12 last year and to No. 16 this year.
Mr. Dart, who was an executive vice president at the Shearson brokerage arm, is little known in the mortgage industry. Since August 1991, he has been working as a senior adviser to John R. Laird, president of Shearson's large brokerage division and of the Boston Co. - the money-management unit that is being sold to Mellon Bank Corp.
Shearson, which also tried to sell the mortgage company in 1989, has been saying recently that it will remain in the mortgage business. Some industry observers, however, speculate that Mr. Dart's mandate is to prepare the unit for eventual sale.
Mr. Dart declined to be interviewed for this article.