Three thrifts are staking claims on wary neighbors in the New York area, where the pressure to sell is heating up.

And speculation is rising about several other metropolitan area institutions viewed as acquisition targets by analysts.

"It's one of those eat or be eaten situations," said Peter J. Ostrowski, managing director of Ostrowski & Co., a bank consulting firm in New York. "Nothing like a little fear and greed to help things along - and that's what you're seeing."

The pickup in activity in the New York metropolitan area comes after months of relative quiet in a region known for its highly fragmented and diverse banking market - the nation's largest. It also follows a year in which the number of deals involving small banks nationally has continued to decline.

Similar fragmentation also plagues the Los Angeles, Chicago, and Philadelphia markets, each of which still has dozens, if not several hundred, small institutions - even though mergers have occurred at a frenetic pace for several years.

"Most of the major cities still have a large number of neighborhood banks and thrifts," said James Benson, analyst at Ryan, Beck & Co., West Orange, N.J. "Do the little ones get bought? Sure. But as soon as you buy up one, another one enters the market."

Analysts have been predicting for more than a year that the New York region would undergo increased consolidation now that the institutions in the area have recovered from the economic troubles of the early 1990s.

Apparently not satisfied with past merger overtures made toward North Side Savings Bank, New York Bancorp has acquired a 7.84% stake in the Floral Park, N.Y.-based thrift in a not-so-veiled effort to pressure management toward talks.

Officials of Douglaston-based New York Bancorp plan to apply for regulatory approval to buy up to 20% of the stock and might make a formal offer for North Side, according to a filing with the Federal Deposit Insurance Corp.

Also in New York City, $6 billion-asset Emigrant Bancorp has received Federal Reserve Bank approval to buy up to 9.9% of the stock of $1.2 billion-asset Queens County Bancorp, despite some official reservations from the smaller thrift.

Queens County Bancorp officials, however, said they don't oppose Emigrant's current plan, but only wanted to preserve their right to object later if $6 billion-asset Emigrant should seek more than 10% of the stock.

Emigrant officials claim that they raised their stake purely for investment purposes.

"I think we're seeing a lot more people talking to each other, whether it's public information or going on behind the scenes," said Salvatore DiMartino, analyst for Advest Inc. in New York.

In nearby Fairfield County, Conn., Norwalk Savings Society has increased its stake in Darien-based Hometown Bancorp to 9.51% and plans to initiate merger talks. And one investment banker indicated that he was representing yet another institution interested in a friendly merger of equals with $220 million-asset Hometown.

"There's a scarcity factor for remaining institutions in Fairfield County, which is causing a real tug-of-war," said John Carusone, president of Hartford-based Bank Analysis Center. "All the big institutions have either already been acquired or failed."

According to a report by Mr. DiMartino and Advest colleague Anthony J. Polini, 287 financial institutions still populate the New York City and Long Island markets, with no institution dominating any county. And there are oodles of other small community banks just over the New York State border - in northern New Jersey and Fairfield County.

"The statistics just show that the greater New York City market is definitely overbanked and ready for consolidation," Mr. DiMartino said. "The deals you're going to start seeing now are going to be more focused on enhancing existing franchises as opposed to entering into new markets."

That began to change earlier this year, however, after Mahwah, N.J.- based Hubco agreed to buy Lafayette-American Bank and Trust Co. in Bridgeport, Conn. In fact, Lafayette had earlier turned down offers from UJB Financial, First Fidelity Bancorp, and Fleet Financial Group, several analysts say.

Several small banks and thrifts in the area are viewed as ripe for a hungry regional or large community bank to pick off. In particular, targets include Westport Bancorp in Connecticut, and Greater New York Savings Bank, Roosevelt Savings Bank, Astoria Financial Corp., and Long Island Bancorp in New York, bankers and analysts agree.

In fact, sources say, Westport has already turned down a hefty offer - almost three times book value - from Princeton, N.J.-based UJB. And other companies, reportedly including Bank of New York, have also taken a peek at the $300 million-asset bank.

"I think the New York market almost screams for some further consolidation," said Frank J. Barkocy, senior vice president at Josephthal, Lyon & Ross Inc. in New York. "Things have been a little quiet of late, but will start to pick up again."

Mr. Barkocy said the cases of New York Bancorp and Emigrant also show that banks are taking a more aggressive stance in seeking acquisitions. Combined with activist shareholders, that will turn up the heat on managements, he said.

"Institutions that get bids have to be pretty careful in turning down those bids that are forthcoming," he cautioned. "If there's no clear-cut game plan in place, either for a combination or to generate earnings momentum, you're going to get a lot of pressure coming from shareholders."

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