I don't know any of the particulars on the head
man in Va. leaving the bank but if I had to guess his
non compete clause is over (3years) and he will jump
out and start up another bank. This happens all the
time. No big deal. A small bank in SC sold out to
Wachovia back about six or seven years ago. The #2 man
stayed on for three years, and sure enough he left and
joined up with the #1 man and they fired up again.
I, like the rest of you have enjoyed the ride in
bank stocks. Great efficiency has been wrung out of
the system and the shareholders (and CEOs have been
rewarded). Problem I see is who is holding the cards when
the house topples. It will too. Not because
management is not doing the job, but because every good
thing comes to an end. End will come when the economy
turns down or smart money decides valuations are just
too high. I cannot predict when. My shares are 401K
shares, so I am less inclined to live and die over a
pullback in the next ten years. However, if BBT was
acquired, I believe I would have to deversify and wait for
more sane valuations. Just and opinion.
(With apoligies to Mick Jagger!)
What you might want (i.e., BBK as "growth stock" for
5-10 years) is unlikely to happen unless they move
very quickly. If the economy turns down - which I
don't see soon - BBK will be hurt (portfolio is suspect
in down econ.) and the stock will dive. It may not
be good candidate for sale at that point because of
risk in loan portfolio and other bank's stock will
probably be off as well, so no big premium. If Mr. Allison
dosn't do a MOE soon, he will be stuck with slowing
earnings via slowing loan growth and poor expense controls
(or so I am told). A big merger would possibly give
them the mass to survive and pick off weaker rivals,
but they need to move now. If not, BBK will move
sideways until stock goes down on weakening fundimentals
(I know they have been great the last few years, but
that accelerates the shift away when the deterieration
begins) or a poor economy.
What to do? Either
sell now (or on the next uptick) or prepare for a much
lower & slower stock price than you have had in the
last three years. That does not sound like a growth
stock to me. ButI've been wrong before (havn't we
I understand your investing
position. Bue I have a question for you:
you rather see BBT continue to be a good growth stock
over the next 5-10 years than to get a onetime bump up
from a buyout? What if someone buys out BBT, you get
there stock, and they do nothing? Maybe even go down.
Not all banks will suceed in this new environment.
Someone is going to get hurt ESPECIALLY now that a number
of home town banks are starting up.
a bigger BBT, one that can fend off the sharks and
continue to REALLY serve their customers. And fills its
These 2 guys are only a very visible bankers that
reflect the ongoing trend that runs rampant in the bank
as a whole. Seasoned bankers are leaving by the
ten's and maybe hundreds as King and Allison continue
the stategy dumbing down the officer force in the
field. Those positions that are filled when vacancies
occur cost the bank much less, to make fewer and fewer
independent loan decisions. It's all numbers, boys, and for
the short term pre-sell out mode, that is all that
The word up here is that the two top men in the
Tidewater area left. And yes, it was because their
contracts were not renegotiated! This is normal - but BBK
will probably see more of this in the future. With the
exception of Glenn Orr, they have left too many S&L kings
in place. These folks are good people, but for
another time. Fast Eddie dosn't do it that way - here
today, big payoff, and gone tommorow. This allows FU to
get their folks in quick, cuts dead weight and start
paying for the merger.
Re: Glenn -- He always
does what is best for Glenn.
He's been gone for
a while. Word is he asked off the Board. Why? Maybe
he didn't want the same criticism he received when
on the NC Banking Commision before he quit, i.e.,
the Chairman of the Commision accused him of using
his position on the commision to pressure folks to
sell and/or used his position to gain insider
information. So, Glenn either dosn't want to mess up brokering
a sale to BBK of one of his clients or he dosn't
want to mess up his sale of BBK to someone else. Don't
think he'd try to sell BBK? He sold Forsythe and SNB
with a smile on his face and a payoff in his pocket.
At $1.6MM for life, he'd do it again!!
Glenn if you chose - but the NC Banking Commision
choses not too. Maybe we can still make some $ on BBK,
but only if they sell out - at least for the near
future. Keeping results up this year will be very, very
hard. $64 dosn't sound so bad now and forget $70! We
all missed it!
Interesting posts. Enjoyed
I disagree on one front, and thats BBK is
definately a growth bank. There saying is "if we ain't
growing, we ain't surviving." They got a whole group that
does nothing but acquisitions. I still hold hope that
they move bigger into Virginia and Maryland over the
next few months.
I still say they offer the
public a great product with superior service (BBT has a
very loyal following). I also don't see 70 by the
split date in July, but mark my word, after the split,
this one continues major growth!
Its sad, but
I'll bet the big boys have been salivating over this
bank. How long can Allison hold out?