GreenPoint Promotion May Signal Acquisition Hunt

The promotion of Bharat B. Bhatt to chief operating officer of GreenPoint Financial Corp. is seen as a sign that the thrift may soon go on the acquisition trail.

Analysts said having Mr. Bhatt oversee the company's daily operations will let chairman Thomas S. Johnson focus on GreenPoint's expansion strategy.

"This does free up some time for Mr. Johnson to look," said James Schutz, an analyst at ABN Amro/Chicago Corp.

In an interview last week, Mr. Bhatt said GreenPoint would consider acquisitions but would make no rash decisions.

"The economics of in-market consolidation are quite compelling," he said. "However, there has to be a fit in terms of strategy. We've got discipline and a patient management when it comes to external growth."

GreenPoint specializes in no-documentation lending, making loans to borrowers who cannot easily verify their income but can make larger-than- normal down payments.

Several analysts said it would make sense for GreenPoint to acquire a source of deposits to help fund the national growth of its mortgage division. GreenPoint Mortgage operates in about 30 states, Mr. Bhatt said.

The New York thrift market is rapidly consolidating, but GreenPoint has remained on the sidelines. This month North Fork Bancorp agreed to buy New York Bancorp, the holding company of Home Federal Savings Bank, and Astoria Financial Corp. completed its acquisition of Greater New York Savings Bank.

David S. Dusenbury, an analyst at Credit Suisse First Boston Inc., said GreenPoint's hesitation to join the acquisition frenzyshows it will not pay "crazy multiples." North Fork, for example, is buying New York Bancorp for 4.8 times book value.

Analysts did not rule out any of the New York-area thrifts as potential GreenPoint targets. Mr. Dusenbury said GreenPoint would probably look to buy a smaller thrift such as Flushing Financial Corp. or Roslyn Bancorp.

But James Ackor, an analyst at Tucker Anthony, said GreenPoint would probably prefer to buy a company that is "much larger" than $1 billion of deposits. Long Island Bancorp, Astoria, and Dime Bancorp fit this category.

Sources said regardless of what GreenPoint does on the acquisition front, it would do well with Mr. Bhatt in charge. In his two years as vice chairman, he oversaw the company's finance, risk management, and treasury departments.

"Bharat has done a very good job," Mr. Ackor said. "He has established a reputation for being stringent with cost controls."

Taj S. Bindra, a vice president at Chase Manhattan Mortgage, said Mr. Bhatt also had a big part in developing GreenPoint's mortgage strategy. Mr. Bindra was a senior manager at Price Waterhouse while Mr. Bhatt was chief financial officer of Shawmut National Corp.

Mr. Bhatt was forced out of Shawmut in September 1994. At the time, sources said, Mr. Bhatt was at odds with other Shawmut officials because he thought the company should be sold.

Shawmut agreed to be acquired by Fleet Financial Group just five months later.

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