Bramble redraws First Md. lineup

August 03, 1994|By David Conn | David Conn,Sun Staff Writer

First Maryland Bancorp unveiled an overhaul of its executive ranks yesterday, the first step in a campaign by its new chief executive to improve stagnant profits at the state's second-largest banking company.

The changes, announced by President and Chief Executive Officer Frank P. Bramble Sr., amount to a reorganized team of starting players, including a handful of recruits from Mr. Bramble's former employer, and a new corporate structure mirroring the one he created at MNC Financial Inc.

Among the priorities at the parent of First National Bank of Maryland are to increase profits by cutting operating costs, to expand retail lending, and to enhance First Maryland's presence in the Washington area, Mr. Bramble said.

"We are a company that performs well, but I think we can perform better," he said. Mr. Bramble resigned as chief executive of MNC last year after its takeover by NationsBank Corp.

The new management team includes a far greater number of executives reporting directly to Mr. Bramble; a few new positions, such as senior vice president for "continuous improvement"; and a dose of talent from Mr. Bramble's old company and First Maryland's biggest rival, NationsBank Corp.

This year, for the first time in a decade, first- and second-quarter earnings at the company, with $10 billion in assets, failed to match the prior year's numbers, though gains from the sale of securities in 1993 inflated that year's earnings. Without last year's one-time gains, earnings were up 4 percent in the first half of this year.

Mr. Bramble has a long list of suggested improvements to consider. The consultant firm of Deloitte and Touche finished a seven-month study of First Maryland's operations last week, an effort the company calls its "re-engineering" project. The study recommended what Mr. Bramble described as "fine-tuning" of practically all operations.

The new executive structure represents the first major change initiated by Mr. Bramble, who joined First Maryland in April, after former CEO Charles W. Cole Jr. retired.

Mr. Cole had only five executive vice presidents reporting directly to him, two of whom retired a month ago: Joseph E. Peters, who headed retail banking, and William T. Murray III, who ran the trust department and some technical support services.

The new management structure calls for 13 officers to report to Mr. Bramble. Most were already at First Maryland.

Four of the bankers worked for Mr. Bramble at MNC and were officially hired yesterday. Those are:

* Walter R. Fatzinger Jr., First Maryland's new executive vice president for Washington-area banking and the trust department.

* Jeffrey D. Maddox, executive vice president for Maryland banking.

* Jerome W. Evans, executive vice president and chief administrative officer.

* Thomas D. Fitzsimmons, senior vice president for long-range planning.

Michael Riley, who helped coordinate top management's community and nonprofit activities at MNC, has also joined First Maryland and will do the same work for Mr. Bramble and First Maryland Chairman Jeremiah E. Casey.

Mr. Bramble said the large number of departments reporting to him makes more sense than the previous hierarchy, which required far more levels of communication. The 14-member management team, which includes a controller who won't report directly to the chief executive, will meet with Mr. Bramble at least once a week to "plan, organize and control all the significant activities in our company," according to a memo sent to all employees yesterday.

"I think you need all the major disciplines of a company at hand so you can deal with all the issues," Mr. Bramble said.

The new structure is common among both service companies and manufacturers, said Edward E. Furash, chairman and CEO of Furash & Co., a financial institutions consulting firm in Washington.

It makes particular sense for banking companies, he said, because a flattened management structure, with more authority spread among line officers, can bring a company closer to its customers. Since a bank offers essentially a commodity service, the culture it presents to the customer is one of the only ways it can differentiate itself, Mr. Furash said.

Further, "by removing layers of management you also remove layers of cost," he said. "Usually you wipe out entire layers of command."

Still, Mr. Bramble said the new structure is not permanent. Within a few years he plans to appoint a chief operating officer who will supervise all the revenue and profit-related centers of the company, such as retail and commercial banking, trust, marketing and lending oversight.

"You may recall at MNC I did the same thing," Mr. Bramble said. "I hadn't appointed one [a chief operating officer] by the time we sold out to NationsBank."

He also split MNC into Washington and Baltimore area divisions, which mirrors the new structure at First Maryland.

Among the company's priorities now, Mr. Bramble said, are building up its presence in Washington, where it has a small bank subsidiary, the First National Bank of Maryland, D.C., and 28 branches in the Maryland suburbs.

First Maryland also needs to improve its retail lending business, which "is not as strong" as the corporate side, Mr. Bramble said. Expect more advertising of retail products, and more aggressive selling by branch employees, he said.

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