Business

Recruiter joins bank's CEO search

Wachovia Corp. has tapped a recruiting firm to assist its search for a new chief executive as speculation mounts about who will replace Ken Thompson as the leader of the nation's No. 4 bank by assets.

Sources said the Charlotte bank had chosen global search firm Spencer Stuart, one of a few top-flight recruiters vying for the high-profile assignment. The firm and a Wachovia spokeswoman declined comment.

Spencer Stuart's U.S. chairman, Tom Neff, has been involved in a number of high-level CEO searches that have landed outside candidates as well as virtual insiders. In 2005, he placed 3M Co. CEO Jim McNerney at Boeing Co. and helped return John Mack to Morgan Stanley & Co., where he was one of the firm's best-know alumni.

Recruiters estimate the search could take between six weeks and six months. Executive recruiter Cynthia Carlson, principal with Charlotte-based Campbell/Carlson, said Wachovia could move quickly because there are only so many qualified candidates to run a bank of its size.

“A search at this level is almost easier than at lower levels,” she said. “There are only a handful of likely candidates.”

The search committee likely will be vetting executives for crisis management skills, overall leadership and cultural fit, Carlson said.

Wachovia's board ousted Thompson last week amid burgeoning loan losses and a rash of regulatory and financial missteps. Chairman and interim chief executive Lanty Smith is leading a four-member search committee composed of fellow directors.

Smith has said the bank will consider internal and external candidates. He has provided no timeline but has said the board will move with “alacrity.”

Analysts and recruiters are betting the company will choose an outsider because the bank did not immediately name a current executive as CEO. A fresh leader also would not be tainted by any past miscues and could help re-establish the company's credibility with investors.

In recruiting and banking circles, a host of names are being kicked around.

Former Wachovia chief financial officer Bob Kelly, now CEO at Bank of New York Mellon Corp., is a favorite but has denied interest. On Thursday, Bank of New York also announced that he is set to add the chairman title next month. Kelly's current CFO, Bruce Van Saun, is another possibility. He declined comment through a spokesman.

Other intriguing possibilities are alumni of rival Bank of America Corp. Al de Molina, now CEO at GMAC Financial Services, has declined comment through a spokesman. Gene Taylor, who recently joined hedge fund manager Fortress Investment Group, could not be reached for comment.

Another name is Michael Neal, chief executive of General Electric Co.'s commercial finance unit. Through a spokesman, he said he's not interested and happy at GE.

Wachovia's top internal candidates are Ben Jenkins, who is serving as interim chief operating officer, and David Carroll, head of capital management. Jenkins, at age 64, is likely not seen as a long-term replacement, while Carroll, 51, could be seen as too green. Both also are closely tied to Thompson in the eyes of investors.

Charlotte and North Carolina should be less worried about an outsider in the corner office than the possibility of a more tumultuous takeover by another bank, said Lissa Broome, professor of banking law at UNC Chapel Hill's law school. In an era of cost-cutting, a newcomer CEO would be unlikely to uproot the bank's extensive infrastructure in Charlotte, she said.

In today's workplace, it's less likely that Wachovia will only have insiders in top positions and keep them for decades, she said. “It's no longer just a state player,” she said. “It's a national player. Having different points of view might be a good thing.”

Meanwhile, employees remain unnerved by the turnover. Many are grieving the loss of Thompson because he embodied a caring attitude and strong values, said one employee, who did not want her name used.

Smith, the interim replacement, is largely an unknown to most of the rank-and-file, although he is a longtime board member. In the past week, he has made a presentation to employees via the company's internal TV network. The company is also asking for employee feedback through an internal Web site.

“You want to see the company do well, and don't want to say anything negative,” the employee said. “But it has been a blow.”

Wachovia Corp. has tapped a recruiting firm to assist its search for a new chief executive as speculation mounts about who will replace Ken Thompson as the leader of the nation's No. 4 bank by assets.

Sources said the Charlotte bank had chosen global search firm Spencer Stuart, one of a few top-flight recruiters vying for the high-profile assignment. The firm and a Wachovia spokeswoman declined comment.

Spencer Stuart's U.S. chairman, Tom Neff, has been involved in a number of high-level CEO searches that have landed outside candidates as well as virtual insiders. In 2005, he placed 3M Co. CEO Jim McNerney at Boeing Co. and helped return John Mack to Morgan Stanley & Co., where he was one of the firm's best-know alumni.

Recruiters estimate the search could take between six weeks and six months. Executive recruiter Cynthia Carlson, principal with Charlotte-based Campbell/Carlson, said Wachovia could move quickly because there are only so many qualified candidates to run a bank of its size.

“A search at this level is almost easier than at lower levels,” she said. “There are only a handful of likely candidates.”

The search committee likely will be vetting executives for crisis management skills, overall leadership and cultural fit, Carlson said.

Wachovia's board ousted Thompson last week amid burgeoning loan losses and a rash of regulatory and financial missteps. Chairman and interim chief executive Lanty Smith is leading a four-member search committee composed of fellow directors.

Smith has said the bank will consider internal and external candidates. He has provided no timeline but has said the board will move with “alacrity.”

Analysts and recruiters are betting the company will choose an outsider because the bank did not immediately name a current executive as CEO. A fresh leader also would not be tainted by any past miscues and could help re-establish the company's credibility with investors.

In recruiting and banking circles, a host of names are being kicked around.

Former Wachovia chief financial officer Bob Kelly, now CEO at Bank of New York Mellon Corp., is a favorite but has denied interest. On Thursday, Bank of New York also announced that he is set to add the chairman title next month. Kelly's current CFO, Bruce Van Saun, is another possibility. He declined comment through a spokesman.

Other intriguing possibilities are alumni of rival Bank of America Corp. Al de Molina, now CEO at GMAC Financial Services, has declined comment through a spokesman. Gene Taylor, who recently joined hedge fund manager Fortress Investment Group, could not be reached for comment.

Another name is Michael Neal, chief executive of General Electric Co.'s commercial finance unit. Through a spokesman, he said he's not interested and happy at GE.

Wachovia's top internal candidates are Ben Jenkins, who is serving as interim chief operating officer, and David Carroll, head of capital management. Jenkins, at age 64, is likely not seen as a long-term replacement, while Carroll, 51, could be seen as too green. Both also are closely tied to Thompson in the eyes of investors.

Charlotte and North Carolina should be less worried about an outsider in the corner office than the possibility of a more tumultuous takeover by another bank, said Lissa Broome, professor of banking law at UNC Chapel Hill's law school. In an era of cost-cutting, a newcomer CEO would be unlikely to uproot the bank's extensive infrastructure in Charlotte, she said.

In today's workplace, it's less likely that Wachovia will only have insiders in top positions and keep them for decades, she said. “It's no longer just a state player,” she said. “It's a national player. Having different points of view might be a good thing.”

Meanwhile, employees remain unnerved by the turnover. Many are grieving the loss of Thompson because he embodied a caring attitude and strong values, said one employee, who did not want her name used.

Smith, the interim replacement, is largely an unknown to most of the rank-and-file, although he is a longtime board member. In the past week, he has made a presentation to employees via the company's internal TV network. The company is also asking for employee feedback through an internal Web site.

“You want to see the company do well, and don't want to say anything negative,” the employee said. “But it has been a blow.”

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