A pair of acquisition-minded investors has moved in on a Grand Rapids- based holding company, and Michigan may lose another of its home-grown thrifts.
Richard J. Nelson and Peter T. Kross, general partners in LaSalle Financial Partners LP, have acquired a 6.7% stake in Bank West Financial Corp., a $147 million-asset company, and made it clear they want to influence management decisions.
While the pair wouldn't say whether they have called for Bank West's sale, they have a history of buying significant stakes in midwestern thrifts and then pushing for a sale.
"Consolidation in the banking industry is why we do this," said Mr. Nelson, who has requested a seat on Bank West's board. "We look for good franchises that are undervalued."
If Mr. Nelson and Mr. Kross are able to convince Bank West to sell, they would again benefit from the rapid consolidation in the Michigan thrift industry. The investors held stakes in Great Lakes Bancorp and SJS Bancorp when those Michigan thrifts were sold last year.
The state's three largest thrifts also have been acquired by out-of- state or foreign institutions since 1995.
Mr. Nelson, as well as other industry watchers, believes more consolidation is to come. Aside from LaSalle Financial Partners' interest in Bank West, Ottawa Financial Corp., Holland, Mich., also has investors pushing for a sale.
But selling out now is not Bank West's intention, said Paul W. Sydloski, the company's president and chief executive. He said Bank West is in the third year of a five-year plan that doesn't include a sale. "Our plan is to grow," he said, "and that plan is in place right now."
Should Bank West be sold, it would make a nice addition to a larger thrift's holdings, said Michael M. Moran, senior bank analyst at Roney & Co. in Detroit. He described Bank West, which has a solid franchise in the Grand Rapids market, as "well-run."
"A lot of credit goes to Paul Sydloski," said Mr. Moran. "He has a more sophisticated financial strategy that you usually only see at the larger institutions. He's trying to manage earnings to bring the returns the market expects."
While Mr. Moran advised Bank West to sell if the right offer comes along, he said it might also be wise to remain independent and scoop up market share lost by other institutions after they are acquired.
