Professional depositor Jerome Davis joined California hedge fund Genesis Financial Partners in urging First Keystone Financial Inc. to sell immediately.
In a sharply worded May 1 letter to management of the Media, Pa.-based thrift, Mr. Davis, the largest shareholder in First Keystone, blasted officials for being "prepossessed by self-interest and seemingly unconcerned with what should be their real concern - the rights of shareholders to recognize maximum value from their investment."
Mr. Davis attacked the thrift for not promptly revealing its $3.9 million exposure to investments from Bennett Funding Group, a Syracuse- based lease securitization company that declared bankruptcy in early April after its chief financial officer was accused of securities fraud.
By not disclosing the "disastrous dealings," Mr. Davis said, the thrift might have allowed some shareholders to have an advantage in selling stock prior to the thrift's formal announcement last week.
He said the inaction by thrift officials is symptomatic of their lack of concern for shareholder interests, and he urged the thrift to sell immediately to PNC Bank Corp., JeffBanks Inc., Keystone Financial Inc., or Royal Bancshares of Pennsylvania, if those potential buyers are not deterred by the Bennett problems.
Mr. Davis, who holds 9.9% of the thrift's stock, said shareholders could receive about $27.07 per share if the bank is sold, about 59% higher than the current stock price.