A Massachusetts thrift, faced with increasing pressure from Genesis Financial Partners to sell, revealed late last week that it would close three branches and cut staff in an effort to enhance profitability and shareholder value.
The restructuring by Somerville-based Central Co-operative Bank should reduce operating expenses by more than $1 million annually. Central's executives hope to implement the restructuring, which also includes closing an operations facility and loan origination center, in three to nine months.
The bank has projected one-time pretax charges of about $700,000 to $900,000 in the year ending March 31.
Central officials also plan to form a holding company and adopt a stock repurchase program. No details were released.
The announcement caught officials of Genesis, a Newport Beach, Calif.- based hedge fund, off-guard. For several months, Stephen H. Gordon, president of Gen Fin Inc., the hedge fund's general partner, has been blasting Central for high overhead and low return on equity, but bank executives have ignored his demands for action.
Central officials, however, insist that the restructuring plan is not the result of Genesis' pressure.