In the face of mounting pressure from Wall Street to rein in expenses, BankAtlantic Bancorp Inc. said it would reduce its 2007 marketing spending by about 22%, or $7.8 million.
Though the Fort Lauderdale, Fla., company said it would continue its aggressive branch building in Florida, Jarret S. Levan, the chief executive of the company's BankAtlantic Bank, said in a conference call with analysts Thursday that now "is the time to start focusing on our expense discipline.
"We have commenced some initiatives to look at our operating expenses but without any degradation of the customer service strategies and the platform that we've developed over the years," he said.
Mr. Levan did not cite specifics, but analysts were pleased anyway. Laurie Hunsicker of Friedman Billings Ramsey & Co. Inc. in Arlington, Va., upgraded BankAtlantic's stock to "market perform" because of the promise to cut expenditures.
In heavy trading Thursday, BankAtlantic's stock rose 0.38%, to close at $13.33 a share.
The decision to cut expenses was announced in its fourth-quarter earnings report, which was released late Wednesday.
The $6.5 billion-asset company said income from continuing operations in the fourth quarter was $1 million, compared to a $2.2 million loss the year earlier. For the full year, income from continuing operations dropped 37%, to $26.9 million.
The company said that, though it continues to open low-cost deposit accounts, it has been unable to achieve the core deposit growth it had hoped for.
BankAtlantic said it opened more than 73,000 core deposit accounts in the fourth quarter, increasing the number of such accounts opened last year to nearly 270,000 - a 19% boost from the year before. But average legacy account balances have fallen about 11%, or $500 per account.
"The net growth in core deposits in 2006 didn't meet our expectations," Mr. Levan said.
BankAtlantic has opened 17 branches since Jan. 1, 2005, and plans to open an additional 19 by the end of 2007.
On Jan. 9, it announced that it would sell its investment banking subsidiary Ryan Beck Holdings Inc. to Stifel Financial Corp. for $91 million of stock, a move that Wall Street had long urged.
