Keefe Managers has signed turnaround artist John J. Lyons and William M. Kearns, a Wall Street rainmaker, to lead a series of small-bank rescue efforts.

Keefe, a New York money management firm that invests mainly in banks, is forming a team that will find, repair, and turn a profit on ailing banks, said Harry Keefe, the firm's founder and president.

The firm is targeting banks with about $150 million of assets. "I've always looked at these troubled things to see if we could work it through to the end," Mr. Keefe said.

Mr. Lyons, 59, president of Lyons Advisors Inc., will join the advisory board of Keefe Managers. His experience includes a seven-year stint as a bank examiner for the Federal Deposit Insurance Corp.

Since 1994, Mr. Lyons has specialized in bank turnarounds. He was named chief executive officer of three banks in as many years: Jupiter Tequesta National Bank in Tequesta, Fla.; Monarch Savings Bank in Clark, N.J., and Regent National Bank in Philadelphia.

Mr. Keefe said Mr. Lyons will serve as an on-site chief executive for ailing banks in which Keefe has invested.

"We'll be able to go to the regulators and ask who needs help," Mr. Keefe said. "We can talk it over and we can do something about it. Now I have an in-house person. ... I have some experience, but I've never run a bank."

Mr. Kearns, 63, will lure investment and manage the Rainbow Fund, a $150 million private investment fund for troubled banks. Since 1994, he has headed his own private investment company, W.M. Kearns & Co.

A former managing director at Lehman Brothers, Mr. Kearns was involved in the initial public offering for Gibson Greetings Inc., the 1987 buyout of Piedmont Airlines for U.S. Air, and Allied Corp.'s buyout of Bendix Corp.

"He's had a lot of experience with the Street," Mr. Keefe said. "I've always treasured a relationship with the Street. I want to be included in that loop."

Mr. Keefe is best-known for another firm that he co-founded in 1962, Keefe Bruyette & Woods Inc. But it wasn't until the 1980s when Mr. Keefe, through Keefe Managers, began bank rescues.

The firm's first attempt, Mr. Keefe recalls, required a lot of patience. The bank, Lafayette American in Bridgeport, Conn., was caught in the real estate bust of the 1980s.

"I bought the stocks at $6," Mr. Keefe said. "It promptly went to $3, and my associates said 'Keefe strikes again.'" But a CEO was brought in and, in the end, "It got cleaned up, and we made a hell of a lot of money."

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