Profit-Taking Insiders Unload 100,000 Shares of C&S/Sovran
Aggressive insider selling has hit the shares of C&S/Sovran Corp., where seven officers and former directors opted to take profits before the upcoming merger with NCNB Corp.
The sellers unloaded nearly 108,000 shares valued at $3.2 million during October, according to reports filed with the Securities and Exchange Commission and compiled by Invest/Net Group Inc., Fort Lauderdale, Fla.
"The profit-taking is more aggressive than we are used to at other banks," said Robert Gabele, president of Invest/Net. "It's rare to see so many [insiders] acting at once like this."
|Clearing of the Decks'
Analysts do not sound surprised, however.
"Obviously this represents some |clearing of the decks' in advance of the deal being closed, but there is also probably concern about the credit quality in the company," said Thomas W. Brown, a banking analyst at Donaldson, Lufkin & Jenrette Securities Corp., New York.
Of the seven sellers, six were directors or officers of the former Sovran Financial Corp., where analysts say much of the credit problems are located. Sovran was a major real estate lender in the Washington area, where overbuilding of commercial properties has depressed values.
C&S/Sovran, based in Atlanta, was created early last year by the merger of Sovran with Citizens & Southern Corp., Atlanta. But the bank's industry's credit problems caused many analysts to view it as less than a success.
The largest seller was Toby S. Wilt, a large Virginia private investor who had been a Sovran director. He sold 40,000 shares on Oct. 17-18.
Also a large seller was Dennis C. Bottorff, who left earlier this month as president and chief operating officer of C&S/Sovran to become the president and chief executive officer of First American Corp., Nashville.
In announcing his resignation on Oct. 10, Mr. Bottorff said NCNB chairman Hugh L. McColl Jr. had not offered him a job with the merged organization, to be known as Nations-Bank. His stock sales occurred on Oct. 16, 21, and 28.
Other former Sovran directors selling stock in October were Joshua P. Darden, William Gorog and Robert G. Weeks. Page D. Cranford, who had been senior executive vice president and general counsel for Sovran, was the other seller.
The only seller from the former Citizens & Southern Corp., was James D. Dixon, formerly vice chairman and chief financial officer. He sold 2,300 shares.
Major banking stocks slipped another notch as the market continued to move lower on investor concerns about the nation's weak economy.
The largest loser was Republic New York Corp., off $1.875 to $38.625 on what analysts said was more profit taking. At the same time, the big gainer was State Street Boston Corp., which has been hit by profit taking in recent sessions. It was up $1.50 to $58 in late afternoon trading.
The decline was led by California banks. Wells Fargo & Co. was off $1.375 to $57.50, while BankAmerica Corp. slipped 62.5 cents to $33.50.