Fourth-quarter earnings hit a record, up about 11%, and the stock has been performing better than the Standard & Poor's bank stock index since September. That's when a restructuring was announced.

But now, just when things are going well, Gillespie announces he is retiring at the young age of 56. A KeyCorp spokesman says Gillespie long had been saying he wanted to retire early, and pointed out that other Key CEOs had retired at 63. But that's a long way from 56.

According to the 1999 proxy statement, if Gillespie terminates his employment with Key for "good reason" other than voluntary resignation, he would receive full pay until his 65th birthday. "Good reason" would include being demoted or removed either as CEO or chairman, or if his compensation or participation in benefits plans were reduced, or if his responsibilities or authority were reduced.

Until the fourth quarter of 2000, KeyCorp had not been performing well, despite major restructurings in 1995 and 1996. The most recent one, which is not yet completed, seems to have gained credibility with investors, but Gillespie is not the executive responsible for it.

Rather, Henry L. Meyer 3rd, who had been president and chief operating officer, is. And it is the 50-year-old Meyer, a veteran of the bank, who has been named to succeed Gillespie as KeyCorp's top executive. The current restructuring is among the most severe, and the American Banker quoted analysts as saying last September that the expected job cuts "could extend to chairman and chief executive officer."

In any case, the outlook for Meyer is propitious as he starts from what appears to be a solid base. But that doesn't mean the going's going to be easy.


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