The war of words continues between Provident Bankshares Corp. of Baltimore and an activist investor who has been pressuring the company to put itself up for sale.

The $4.9 billion-asset company said the latest argument made by Mid-Atlantic Investors of Columbia, S.C., for selling the bank is flawed and misleading, according to a document Provident filed last week with the Securities and Exchange Commission.

"Unfortunately, in their zeal to make a quick profit on their leveraged investment, they misstated numbers supposedly supportive to their argument," the proxy document said.

Mid-Atlantic, which owns 5% of Provident's shares, tried unsuccessfully last year to force a sale. And since then it has stepped up lobbying efforts and submitted a new proposal for shareholders to vote on at their annual meeting April 19.

In its latest proposal Mid-Atlantic sought to show that Provident underperforms when compared with other banking companies but chose $95 billion-asset SunTrust Banks Inc. of Atlanta and $67 billion-asset Wachovia Corp. of Winston-Salem, N.C., as its examples. Its comparison included extraordinary gains when stating earnings per share growth at SunTrust and Wachovia but excluded such gains from its calculation for Provident.

"No matter how hard Mid-Atlantic tries to muddy up the waters, Provident's numbers stand out as strong and fundamentally attractive," the company said.

But Jerry Shearer, managing partner of Mid-Atlantic, stands by his proposal. "What we stated is correct," he said, "and if Provident chooses to give it another spin, then so be it."

One observer said he believes Mid-Atlantic's analysis distorts the truth, however. Claus Hirsch, an analyst at Corinthian Partners in New York, said Mid-Atlantic makes an apples-to-oranges comparison.

"They are twisting the numbers and trying to mislead people," he said. "Any trained analyst will see right through it."

Provident also charged that a quick sale would particularly benefit Mid-Atlantic "due to its speculative, margin-based investment techniques."

Mr. Shearer dismissed the allegation. "When the company uses borrowed money, it's prudent. When we do it, we're nuts."

Though observers doubt that Mid-Atlantic will prevail, Mr. Shearer said he is encouraged by supportive phone calls from shareholders. "They're voting with us and appreciate our leading the charge," he said.

Provident urged shareholders to vote against the proposal, warning them that its adoption would put the company in a weak negotiating position in any potential deal.

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