Genesis Financial Partners is trying a new tactic with its latest thrift target - conciliation.
In correspondence, the aggressive California hedge fund, which has been pressuring three other Northeast thrifts to beef up their performance or sell, is lauding the cost-cutting efforts of Lawrence Savings Bank in Massachusetts. As it did with the other thrifts, Genesis, a significant shareholder in Lawrence Savings, urged that it make further revenue- enhancing moves, but it did not suggest that the institution sell.
In a letter to the thrift, Stephen H. Gordon, president of Genesis' general partner Gen Fin Inc., praised the $305 million-asset thrift's progress in cutting expenses and nonperforming assets on its way to realizing a sizable deferred tax asset. The tax benefit at the end of 1994 was $20 million, most of which remains.
Lawrence Savings officials declined to comment on the letter.
Mr. Gordon also wrote that he was "encouraged" by the extensive experience of Lawrence president Paul A. Miller, former chief financial officer of Shawmut National Corp., and praised Mr. Miller for postponing contractual salary increases due him in 1992, 1993, and 1994.
"We would like to reiterate our confidence in you as a leader in this challenging and promising time for our bank," Mr. Gordon wrote. "You have shown a willingness to sacrifice your personal gain for the good of the bank."
Mr. Miller declined to comment.
Mr. Gordon went on to encourage officials to further reduce expenses, while boosting the thrift's "flagging" net interest margin by selling securities and buying higher-yielding loan packages. He also urged a bulk sale of remaining nonperforming assets, even at a discount, noting that any loss could be offset by using the tax benefit.
And he recommended publicizing Lawrence's "compelling" story to analysts and investment bankers to increase investor awareness of the thrift.
The amicable tone of the letter is in marked contrast to the more combative correspondence Genesis has had with two other Massachusetts thrifts, Abington Savings Bank, and Central Co-operative Bank.
In fact, according to documents filed with the Federal Deposit Insurance Corp., Genesis notified $461 million-asset Abington last week that it will submit a shareholder proposal at the April 24 annual meeting calling for the board to maximize shareholder value through a 20% reduction in overhead or a sale of the thrift.
Abington officials say they welcome the chance for shareholders to evaluate the thrift's performance, and president and chief executive James P. McDonough noted that Abington's fourth-quarter profits were up 7% from the same period in 1994.
