Frank V. Cahouet, the former Crocker National chairman who lost his job when Wells Fargo bought the San Francisco banking company earlier this year, has been nominated to be president and chief operating officer of the Federal National Mortgage Assn. (Fannie Mae).
Cahouet has a reputation in California banking circles as a tough, cost-conscious executive who was brought in by Crocker in 1984 to help stem a flood of red ink. He had previously spent 24 years at Los Angeles-based Security Pacific National Bank.
David O. Maxwell, Fannie Mae chairman and chief executive, announced the Cahouet nomination Monday.
The corporation's board of directors is expected to approve the appointment at its regular meeting Sept. 16.
Cahouet, 54, who also will be given a seat on the Fannie Mae board of directors, will succeed Mark J. Riedy, who resigned in July after serving 18 months in the corporation's presidency.
Fannie Mae, a congressionally chartered, shareholder-owned corporation, is the nation's largest supplier of conventional mortgage funds, with $100 billion in assets. Its shares are traded on the New York Stock Exchange.
"Frank Cahouet is recognized as one of the most able, creative and successful financial executives in the country today," Maxwell said. "I am delighted by the prospect of adding his extraordinary management skills and experience to Fannie Mae."
Since the Wells Fargo-Crocker merger was announced in February, Cahouet's name has surfaced in speculation about a number of top posts in American banking. Because of his success in turning Crocker's 1984 losses of $324 million into a $38-million profit in 1985, he was seen as a turnaround specialist and a candidate for the top job at BankAmerica or a number of troubled Texas bank holding companies.
Cahouet, in an interview on Monday, said: "There were some very interesting opportunities that were presented to me." He declined to name the banks, however, saying that it would be "embarrassing."
He said that although he was accepting the No. 2 position at Fannie Mae, he is in a "good slot" should Maxwell, 56, retire or move to another job.
He declined to disclose his salary but said: "I obviously didn't come here for nothing."
Crocker was paying him about $500,000 a year, and his separation package will bring him close to $2 million during the next three years.
Before joining Crocker, Cahouet was vice chairman and chief financial officer at Security Pacific. In his career there, he helped diversify the bank into venture capital, mortgage banking, pension fund management, consumer and commercial finance, leasing and investment banking.
A native of Boston, Cahouet graduated from Harvard with a degree in history. He received his master's degree from the University of Pennsylvania's Wharton School.