The large investor group at Altabancorp is preparing to vote against several members of the American Fork, Utah, company's board.
Members of the Gunther family, who collectively hold a 31% stake in the $3.4 billion-asset company, claimed in a recent regulatory filing that some directors have been liquidating large amounts of stock, while others have never accumulated significant positions.
The family members said in the filing that they will look to unseat certain directors, though they did not identify any specific member of the board.
A lack of meaningful stock ownership “demonstrates both a lack of commitment to the organization and a lack of common interest with shareholders who have made substantial financial commitments to Altabancorp’s success,” the Gunthers said.
Altabancorp’s directors responded Tuesday with a letter stating that they “respect the rights of all shareholders, including the Gunther family,” adding that “we have the right board and leadership in place to continue to take actions that will position the company to be the best place to bank, work, and invest.”
“We have taken decisive actions over the last three years to put Altabancorp on a firm course for success and to continue to generate value for all our stakeholders,” President and CEO Len Williams said in the company’s response.
Both sides can point to numbers that support their positions.
Though Altabancorp's directors owned 3.1 million shares a year ago, based on a proxy statement filed last April, more than half of the shares were held by three members of the Gunther family who have since resigned and are spearheading the family’s challenge.
The board can point to a solid bottom line. Net income fell by just 1.8% in 2020 from a year earlier, to $43.5 million. The comapny had a 1.52% return on assets and a 12.44% return on equity.
Banks with $3 billion to $5 billion of assets had an average ROA of 1.18% and an average ROE of 10.92% last year, according to data compiled by the Federal Deposit Insurance Corp.
The Gunthers, in their letter, painted a bleak picture of morale inside Altabancorp. Without offering details, they said there had been an “unusually” high level of turnover that included “some of the company’s most productive loan officers.” They expressed concern that more employees could leave.
The family, whose involvement in Altabancorp goes back to 1952, is
“Our decisions come only after extensive but unsuccessful and frustrating attempts at persuading Altabancorp’s directors to address our concerns," the family said.
