High-level Wachovia exec is leaving
Chief Risk Officer Don Truslow is bank's latest high-level manager to announce departure.
08/01/2008 12:00 AM
08/01/2008 7:00 AM
Another high-level Wachovia Corp. executive is leaving as new chief executive Bob Steel forges his own management team.
The Charlotte bank on Thursday said Chief Risk Officer Don Truslow, 50, plans to retire once a successor is named. A Wachovia spokeswoman declined to comment on the reason for his departure. The bank has been beset by massive loan losses in its mortgage portfolio as well as writedowns in its corporate and investment bank.
Truslow, charged with monitoring the quality of loans and other bets made by the bank, has often been the one to outline these troubles to investors and analysts. During the bank's second-quarter earnings call last week, he faced questions about the accuracy of the bank's projections for the housing market after it once again detailed rising losses.
“It's a very dynamic market and like everybody else, we will adjust as things unfold, but we think what we've got is a very realistic outlook,” he said.
Analysts have expected the departure of leaders tainted by the company's travails during the credit crunch that began a year ago. Wachovia shares climbed about 1 percent Thursday to $17.27 but are down about 55 percent for the year.
Wachovia last week said Chief Financial Officer Tom Wurtz was exiting after a replacement is found. Analysts have also speculated about the futures of corporate and investment banking head Steve Cummings, capital management head David Carroll and Vice Chairman Ben Jenkins.
The company's board ousted CEO Ken Thompson in June and six weeks later hired Steel, a former U.S. Treasury Department official and Goldman Sachs Group Inc. executive. He's charged with reviving a company wrestling with an ill-timed expansion into the mortgage business at the peak of the housing boom in 2006.
In a statement, Steel thanked Truslow for his service to the company. “Don is highly respected throughout the company and the industry for his strong leadership, his excellent collaboration and his high ethical standards,” he said.
Truslow said in a statement that Wachovia continues to have strong “core businesses,” adding Steel's leadership will serve the company well. He joined then Winston-Salem-based Wachovia in 1980 and has held leadership positions in finance, risk management and corporate banking.
Perhaps Steel's most important hire will be CFO, the bank's top number cruncher and a key spokesman for the company on Wall Street. He's likely to seek a candidate with retail banking experience or tap a former colleague from Goldman Sachs or the Treasury Department, analysts say.
“We suspect an outside candidate will be preferable – someone with no ties to (Wachovia's) culture or existing problems who can come in and be totally objective,” Sandler O'Neill + Partners analyst Kevin Fitzsimmons said in a research note.
One of the names circulating as a possible replacement already lives in Charlotte. Chris Marshall stepped down as CFO of Fifth Third Bancorp in May after joining the Cincinnati-based bank in 2006 from Bank of America Corp. He and his family kept their home in Charlotte. Marshall, who declined comment, is now doing advisory work for private-equity firms.
Another name cited by analysts is William Demchak, vice chairman of Pittsburgh-based PNC Financial Services Group Inc. A PNC spokesman declined comment.
Steel could call on his Goldman Sachs or U.S. Treasury ties, Fitzsimmons wrote in his note. The new CEO also might want someone with a commercial banking pedigree to offset his lack of experience in that area, he said.
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