Shareholders Dump 'Greedy' Directors FromCU-Convert
CRANFORD, N.J. - (04/12/06) - In an unusual boardroom coup, formercredit union Synergy Financial announced Tuesday that shareholderslast week voted out two of its long-time directors, includingPresident and CEO John Fiore, who had been attacked as 'greedy' byan investor group, the bank's largest shareholders. The two will bereplaced by representatives of PL Capital, an investor group whichowns 9.8% of the former credit union that had waged a heated proxycontest for the board seats over the past month. PL Capital hadcriticized the management and board of Synergy Financial, knownuntil 1999 as Synergy FCU, for insider enrichment at the expense ofoutside shareholders. They noted that Fiore was paid almost $4.5million in stock and cash in the three years since the ex-creditunion went public, and the directors were paid more than $500,000during that time. Fiore is the first credit union-turned-bank CEOto earn more than $1 million a year after converting his creditunion. Directors and top management were paid more than $14 millionsince the credit union-convert went public, compared to just $12million paid to outside stockholders. Richard Lashley, a principalof PL Capital, acknowledged it is unusual for a CEO to be removedfrom the board in a proxy contest, but said he hopes his candidatescan now work closely with the seven other directors. "Hopefully,they can all focus their efforts on enhancing Synergy's financialperformance, improving corporate governance and maximizingshareholder value for the benefit of all of Synergy'sshareholders," he told The Credit Union Journal. Ousted along withFiore was long-time director Phil Scott, while Nancy Davis, anotherlong-time director survived the challenge and was reelected to theboard. The three long-time directors helped engineer the creditunion's conversion to savings bank.