In November, when Roger E. Birk moves into his new, full-time role with the Federal National Mortgage Association, he will become the organization's fifth president and chief operating officer in six years -- a track record that's prompted questions about a revolving door at Fannie Mae.
Birk, former chairman and chief executive officer of Merrill Lynch Corp., is replacing Frank V. Cahouet, who resigned from Fannie Mae after only nine months on the job to head Mellon Bank Corp. in Pittsburgh.
"All the former presidents left Fannie Mae for very different and good reasons," said David O. Maxwell, chairman and chief executive officer of Fannie Mae. "Robert J. Mylod went to head Michigan National Corp., James E. Murray was an attorney with Fannie Mae for 10 years and wanted to enter private practice, and Mark J. Riedy is now president of the J.E. Roberts Co."
Maxwell concedes that presidents coming and going can be tiring, "but each has significantly contributed to rebuilding this company."
Fannie Mae is a publicly traded, congressionally chartered company that purchases home mortgages from lending institutions and repackages them into securities for sale to investors.
Since 1981, Maxwell has been restructuring the company's portfolio to insulate it from the effects of interest rate swings.
He has emphasized the securitization of mortgages, which passes some of the risk of high interest rates on to investors. He has increased fees charged to lending institutions and has created a Fannie Mae subsidiary to simplify deposit and clearing functions for mortgage-backed securities.
"Cahouet's resignation was unexpected," said Maxwell, "but after Roger Birk said he was interested in the position, I never considered anyone else."
Birk volunteered for the job when Maxwell called to tell him about Cahouet's resignation.
Maxwell and Birk have known one another since 1981, when Merrill Lynch worked with Fannie Mae on various business projects. Birk joined Fannie Mae's board in 1985, soon after he resigned from Merrill Lynch.
"I wanted to see the world a different way," said Birk when asked why he volunteered for the position. Birk has been chairman of the International Securities Clearing Corp., a subsidiary of the national Security Clearing Corp., for the past two years. He will remain on that board through 1987.
"In essence, financing is financing," said Birk. But Fannie Mae is different "because it is restricted by its federal charter to providing a secondary market for mortgage loans. It has to serve the housing market at no cost to the taxpayer and make a profit for its stockholders at the same time."
Fannie Mae is meeting its mission by attracting more investors with different kinds of mortgage-backed securities. For example, interest-only and principal-only instruments allow the interest and principal of a security to be traded separately. Fannie Mae will soon offer Real Estate Investment Conduits, which is a type of Collateralized Mortgage Obligation (CMO) security. CMOs divide a security's pay-back amounts into different classes, some of which pay off sooner than others.
In the short run, Birk will be responsible for the day-to-day operations of Fannie Mae. In the long run, he said, his task will be "to keep the recovery going -- we have a mandate from Congress to be self-sufficient -- and to assess the role of Fannie Mae in a changing market. We have big players that were not there five or 10 years ago."
Neither Birk nor Maxwell see a need to restructure the present management team. The company recently promoted G. William Knight, president and general manager of Fannie Mae Software Systems, to senior vice president.
This was not an unusual move, Maxwell said. "I have total confidence in Roger Birk," said Maxwell. "He is highly respected, has a spotless reputation for integrity and a good sense of humor.
"It is important to be able to put your feet up to talk about things at the end of the day. I can do that with him," said Maxwell.
The National Forest Products Association named Steve Lovett vice president of the International Trade Council.
BANKING, FINANCIAL SERVICES
Kenneth L. Crovo has been appointed president and chief executive officer of the Bank of Loudoun. He is the former regional executive officer of the Virginia Commercial Banking Group in Northern Virginia.
Citizen's Savings Bank F.S.B. elected E. Lee Beard executive vice president, chief financial officer and treasurer; Patricia Abrams and C. Rick Carder IV vice presidents; and Sally Bolger, Janice DeMare, Katherine M. Rankin, Michael G. Schaefer and Carol M. Wittsack assistant vice presidents.
Sovran Bank named Richard B. Worthington II regional executive officer/commercial in Northern Virginia. Sovran Bank/D.C. National promoted James Read to senior vice president of real estate lending; Sheldon Stewart to senior vice president of operations and control division; Dorothy Smedley to senior vice president of the Strategic Planning and Human Resources division; and Linda B. Johnson to first vice president of financial services.
Vincent F. Callahan III and Marysue Wechsler joined the financial planning firm of Investment Planning Services Inc. in Fairfax.
Radiation Systems, a manufacturer of satellite communications antenna systems in Sterling, elected Raymon A. Heaton vice president of operations for the SatCom Technologies division.
Reese Communications Companies, an international public affairs and marketing firm based in Arlington, appointed Mary Beth Bloomberg, Janet Leete Madigan and Roxane Previty senior account executives.
Michelle A. Ward has been named research manager for Kidsnet, a clearinghouse for children's radio and television programs in the District.
COMPUTER, HIGH TECHNOLOGY
Atlantic Research Corp. elected Robert L. Kirk to its board of directors. Kirk is president and chief operating officer of Allied-Signal Aerospace Co.
E. Gary Clark, current president of Verdix Corp., has also been named chief executive officer.
Joseph Rolleck, former Eastern regional district manager for Honeywell Inc., has been named Washington branch manager for Eastern Business Machines.
Leonard Kurtzman has been promoted from assistant controller to controller for VM Software Inc.
Automated Digital Systems Inc. promoted Richard H. Wynn director of marketing; Lee Weinstein director of sales, and Jan Piwowarczyk dealer service manager.
The U.S. Department of Transportation named Michael J. Olsen deputy assistant assisstanct secretary for public affairs.
Health Innovations Inc. in Herndon named Anna C. Willis director of corporate sales.
Dental Benefit Providers named Nancy Anderson Lary director of management information systems.
Kaiser Permanente Health Care named Heidi R. Cunningham quality assurance manager. She will develop a quality assurance program for the Mid-Atlantic states.
HOTEL, FOOD SERVICES
Embassy Suites Hotel in the District named Gregory Stafford general manager and Bridgette Deas director of sales.
Steven J. Witthohn has been named general manager of the Luxury Budget Inn-Dulles/Reston.
Waverly Press Inc. promoted E. Philip Hanlon to vice president of domestic marketing for its publishing division, Williams and Wilkins. Robert F. Bounds, former treasurer for Waverly Press, will take Hanlon's position as corporate controller.
Union Life Insurance Co. appointed James A. Embersit assistant vice president of investments.
C. Christopher Sandquist has been appointed general manager of the Northern Virginia agency of Prudential Insurance Co. in Alexandria.
Comptex Associates Inc., a nonprofit job training and referral organization, appointed Dr. Herman Young volunteer coordinator.
The Wilderness Society in the District named Syndey J. Butler vice president of conservation.
Susan Severtson has been named president of Chadwyck-Healey after serving as executive vice president for the past seven months.
RJO Enterprises appointed Karen Kiefer manager of contracts for RJO's information systems division.
The Kamber Group appointed Maria DeQuatro senior associate; Terri Sahli and Pete Stafford account executives; and Jerry Goverman comptroller.
The architecture firm of Sheridan, Behm, Eustice and Associates Ltd. of Arlington named Leslie A. Tribble an associate.