A south Georgia bank company's bitter proxy fight-led by its two ousted founders-ended last week after shareholders rejected the pair's pleas for change.
Shareholders of Brunswick-based Golden Isles Financial Holdings last Tuesday voted down a proposal by Gregory S. Junkin and Paul D. Lockyer that would have added five new members to the bank's board of directors.
The two, who had been Golden Isles' top two officers until their ouster last fall, had petitioned shareholders, saying the new board members would help in making the coastal Georgia company a diversified financial services company.
But shareholders instead supported current management, which had called on investors to maintain Golden Isles' focus on community banking. Acting chairman J. Thomas Whelchel, who aggressively took on Mr. Junkin and Mr. Lockyer in letters to shareholders, did not return telephone calls seeking comment.
Mr. Lockyer, the former president, said there was a clash of cultures at the $87.4 million-asset company.
"Maybe the mixing of a south Georgia community bank with nonbank financial services was not meant to work," Mr. Lockyer said.
Mr. Lockyer and Mr. Junkin, the company's former chairman and chief executive officer, had been ousted from their positions by other board members last October. The two had been the organizers of the seven-year-old company and its banking, mortgage, and consumer finance subsidiaries.
Golden Isles, the parent of the First Bank of Brunswick, caters to the industrial port city of Brunswick and tony St. Simon's Island, a nearby resort. The bank has been a mediocre performer since its inception. In the first nine months of 1996, it posted a 0.81% return on assets and a 10.41% return on equity.
Mr. Lockyer, who said he's looking for a new bank job and new home, said he was never given a straight answer as to why he lost his position.
"Other directors told me and Mr. Junkin that they didn't care to discuss the reasons," Mr. Lockyer said. "Frankly, we were a little bit stunned, because we had started the company."
But in letters to shareholders, copies of which were filed with the Securities and Exchange Commission, Mr. Whelchel-pointing to a $400,000 operating loss by the mortgage subsidiary in the first nine months of 1996- said the two were removed for mismanagement. He called on shareholders to return to the original mission of community banking.
The mortgage company was dissolved after the ouster of Mr. Junkin and Mr. Lockyer.
Mr. Lockyer said he was told by the board the mortgage company was finally making money in October, so he's disappointed it was dismantled.
"I'm an advocate of community banking, but my regret is I believe we also could have been something bigger and better by getting into these nonbank financial services," he said.
Mr. Lockyer and Mr. Junkin said they won't pursue any additional proxy fights.
"I want the bank to be successful," said Mr. Junkin, who has a 3% stake in Golden Isles. "I've got a large stake in this thing." Mr. Lockyer owns 9,000 shares, or less than 1%.