A group of Abigail Adams National Bancorp shareholders launched a campaign this week to oust chairman and chief executive officer Barbara Davis Blum and three other directors.
In a proxy filed Wednesday with the Securities and Exchange Commission, the group, led by director Marshall T. Reynolds, urges stockholders to replace the four directors with its slate of nominees.
Washington-based Abigail Adams' annual meeting has not yet been scheduled, but if the dissidents can get 50% of the banking company's ownership to consent, they could force the switch.
The dissidents say they have secured 360,000 shares, or 21.8% of the stock outstanding, in support of their candidates.
Bad blood has been brewing between Mr. Reynolds and management since the $128 million-asset company's aborted acquisition of Arlington, Va.-based Ballston Bancorp.
Adams agreed to acquire $80 million-asset Ballston last June for $14 million, a deal Mr. Reynolds voted for at the time. But he changed his mind in October and led a successful campaign to defeat the proposed merger in a general shareholder vote.
Coincidentally, Ballston agreed Wednesday to be acquired by MainStreet BankGroup, Martinsville, Va., for $19.5 million.
After the merger's defeat, Adams sued Mr. Reynolds. Thomas E. Patton, a Washington attorney representing Adams, said the company is suing for damages it claims Mr. Reynolds caused by thwarting the Ballston transaction. He said Adams is still studying Wednesday's filing and does not have a statement.
Mr. Reynolds was out of his office and could not be reached to comment. But in the proxy letter, the group states: "The incumbents have wasted, and, unless removed, will continue to waste, a significant amount of the company's time, money, and resources in litigation ... rather than concentrate on increasing the value of the company's business."
The letter also stressed that this campaign has as much to do with the company's performance as it does recent squabbles.
"It is our belief that the incumbents have tolerated inadequate performance by management and reacted counterproductively to the decision of the company's shareholders to reject the proposed merger with Ballston," the letter said.
Adams' 1997 return on assets was 0.87%, down from 1.16% the year before. And return on equity dropped to 12.89%, from 16.72%.
But Mr. Patton said Mr. Reynolds, not bank management, is to blame for the poor numbers last year.
"The main reason that numbers are down from 1996 is the $1.2 million the bank had to write off due to the failed acquisition that Mr. Reynolds caused," he said.
Not long ago, Mr. Reynolds was Adams' champion. In 1995 he led a group that bought Citicorp's stake in the company, which had been seized years earlier from its bankrupt owners.
The bank was founded by Ms. Blum in 1977 as Womens National Bank. It changed its name in 1986 in tribute to the 18th-century icon of present-day feminists.
