Barnett stock in retreat after major block sale.

Shares of Barnett Banks Inc. slumped in active trading Wednesday after a large block transaction depressed its price.

The 250,000-share block was sold at $44.75 per share - 62.5 cents below Barnett's closing price on the previous day - just after trading opened, and consequently set the tone for the session.

Both the sale and purchase of the Barnett block were handled by Montgomery Securities, San Francisco.

Barnett was off 87.5 cents to $44.50 in late trading after having been down as much as $1.50 earlier. A bank spokeswoman said she did not know who the large buyer and seller were or "any reason why the stock would go down."

Several Reasons Cited

The drop highlights recent weakness in the shares of Jack-sonville-based Barnett, which has been a generally strong performer this year. Analysts on Wall Street suggested several reasons for the decline.

Barnett relies more heavily on net interest income for earnings than do some other banks, they noted. And concerns that banks' net interest margins will shrink as interest rates fall may thus have hit it harder.

Takeover speculation may also have withered, analysts said.

As the last large independent bank in Florida, Barnett has periodically been cited as a major acquisition target. NationsBank Corp. has been mentioned as a possible buyer.

The latest round of takeover rumors occurred last spring and caused a flurry in the stock.

"We may have passed day No. 91 since some investors bought the stock as an acquisition play and they are now moving on," said Peter W. Tuz of Morgan Keegan Inc., Memphis.

Some large investors set timetables, of ten 90 days, on investments made on the prospect of major developments affecting a company's stock.

Barnett shares also rallied in May, when other bank stocks were weak, after announcing a 9% increase in its quarterly dividend to 36 cents per share.

May Be Rejoining the Group'

The dividend news spurred a gain of 8.4% in one week for the stock.

Mr. Tuz noted the Florida bank had gotten well ahead of its southeastern superregional peers in price performance this year and "may now be rejoining the group."

As of Tuesday's close, Barnett shares were ahead 10% this year. By contrast, First Union Corp. was up 2.9%, Wachovia Corp. ahead 2.2%, and NationsBank up a mere 0.25%, while Sun-Trust Banks Inc. was off 1.7%.

Outstripping First Union

In particular, analysts said Barnett shares had appreciated more than First Union's. They noted that these two stocks often trade roughly in tandem because of their similar franchises.

Mr. Tuz also suggested that Barnett shares may be an early casualty of investor uncertainty about banks.

"There is a lot of confusion out there right now about the direction of the bank stocks," he said. "And some people could be in a mood to lighten up on their positions before earnings, rather than after, this time."

During the past two quarters, bank stocks have enjoyed strong gains in advance of quarterly earnings news and then fallen despite announcing good results, as investors took profits.

Bank stocks were mostly lower in line with other equities, as investors searched for economic clues amid preholiday trading.

First Interstate Bancorp was down 75 cents to $61.625, and Chemical Banking Corp. was off 50 cents to $40.125. PNC Bank Corp. was down 50 cents to $29.50 and Mellon Bank Corp. slipped 87.5 cents to $57.25 in late trading.

Among the few gainers in the session, Fifth Third Bancorp was up 75 cents to $54, Meridian Bancorp. was ahead 62.5 cents to $33.25, while Shawmut National Corp. advanced 25 cents to $24.125.

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