Alfred Lerner, the new chairman of troubled MNC Financial Inc., has a knack for simple, direct statements.
"I'm trying to get this place fixed," Lerner said about his new job at the helm of the state's largest bank. "I'm just trying to make a living."
In his characteristic low-key manner, Lerner has taken on the task of trying to turn around the parent of Maryland National Bank, a bank-holding company that ranks as the nation's 27th largest. In the second quarter, the company lost $74.7 million.
Lerner, the bank-holding company's largest stockholder, on Monday took over as chairman and chief executive officer, replacing Alan P. Hoblitzell, 59, who retired the same day.
The new MNC chairman, who lives in a suburb of Cleveland, is an unpretentious, straight-talking man who apparently cares little for socializing or getting publicity. What he seems to care about is work and money. "What is 24 times 7," Lerner replied when asked how many hours he works each week.
Lerner, 56, is the classic self-made man rising from a job as a sales representative for Broyhill Furniture Factories in the late 1950s to become the 270th richest person in the country with a fortune of $370 million, according to Forbes magazine's 1989 list of the country's 400 wealthiest Americans.
He has made his money in real estate, finance, insurance and banking.
He is chairman of the Progressive Corp., a Cleveland insurance holding company specializing in high-risk auto and motorcycle coverage.
He also was chairman of Realty ReFund Trust, a Cleveland company that refinances established office buildings and other properties. But he sold his holdings in that company a few months ago to two other principals.
An investor group headed by Lerner in 1987 had also held 4 million shares of Ameritrust Corp., a large Cleveland-based bank-holding company. He had also gained approval from the Federal Reserve Board to buy more, boosting his share of the company from 9.6 percent to 24.9 percent.
But Ameritrust did not welcome the attention and ended up buying back the stock from Lerner for $112 million in 1988 and 1989, prompting accusations of greenmail against Lerner.
Greenmail is a term used to describe the purchase by a company of a large block of its own stock from a selected shareholder at an above-market price not available to other shareholders.
While Donald Trump, with his glitzy style and staggering debt, was the epitome of the go-go 1980s, Lerner is the exact opposite.
Lerner does little socializing and has been married to the former Norma Wokloff since 1955. He has two grown children -- Nancy and Randolph.
As far as debt is concerned, he has none.
"I personally owe, direct and contingent, a total of exactly zero," Lerner said in an interview this week. "I don't mind borrowing money once in a while, but I hate owing it," he said. "Borrowing is for facilitating something, not to live off of," he said.
One of his few indulgences is football. He is frequently in the owner's box at Cleveland Browns football games, sitting beside his friend Art Modell, owner of the team. In fact, Lerner has a small ownership interest in the Browns and is a partner in the organization that owns the stadium where the Browns and the Cleveland Indians play home games.
He also has been involved in efforts to bring a new National Football League team to Baltimore. "That's just for fun," Lerner said about his involvement in football.
Lerner made his financial debut in Baltimore in 1979 when he and other investors bought from Monumental Corp. 11,000 apartment units in 27 locations in Maryland, Pennsylvania and Washington.
Lerner was the largest investor with a 50 percent share in the venture, the Town & Country Mangement Corp. Lerner became president and chief executive officer. About 7,000 of the garden-type apartments are in 16 complexes in the Baltimore area.
"He's the most fascinating human being I've met," said Michael H. Rosen, executive vice president and chief operating officer of Town & Country. Rosen, who worked for Monumental and stayed on when Lerner took over, is an unabashed admirer.
"I love my job and I love being with Al Lerner," he said. "He's the most intelligent, fairest human being I've ever met," he said.
He said Lerner is a "tremendously quick study" and maintains his cool in a crisis. "He doesn't panic, he takes things in his stride," Rosen said.
Town and Country, whose properties are now estimated to be worth more than $500 million, is one of the largest apartment companies in the region and primarily caters to young married or single people, according to Rosen.
While Lerner's purchase of Town & Country was little noted, his efforts to buy stock in Equitable Bancorporation in 1981 were closely covered by the local papers. At first, Equitable, the third largest bank in Baltimore, resisted the advances from Lerner and two partners.
Finally, the bank agreed to let Lerner, without his two partners, buy 27 percent of the stock of Equitable. By the end of 1989, Lerner owned 76.8 percent of the stock and was chairman.
Analysts have credited him with improving the operation of the bank and leading it to five consecutive years of earnings increases.
"I thought he was an extremely capable person with very broad business knowledge," said E. Neil Jacobs, a former executive vice president at Equitable and now the head of Bank Maryland Corp., a Towson-based bank-holding company.
He said Lerner's "very direct" style was attractive and his "very good insight" helped the bank.
In July 1989 Equitable and MNC announced a plan to merge. The action, which was completed in January, boosted MNC's total assets from $18 billion to $23 billion.
Although Lerner was the largest shareholder, the merger agreement called for him to take a back seat to MNC management and to hold no other position other than that of a rTC director and consultant. A "standstill" agreement prohibited Lerner from buying more stock.
But that was before the real estate market turned sour.
MNC has one of largest commercial real estate portfolios in the mid-Atlantic region and has been hard hit by the worsening real estate market. Of MNC's $16.4 billion loan portfolio, 4.7 percent was listed as non-performing assets as of June 30. That amounts to $757 million in non-performing loans, up sharply from $359 million as of March 31.
As the stock price of MNC skidded from about $20 in January to about $7 in recent weeks, Lerner lost more than $110 million on paper.
"Sure it bothers me," he said of the drop in the value of his stock. "But sometimes things go up, and sometimes it goes down. Markets fluctuate."
To help the company, Lerner in August agreed to buy up to $180 million worth of cumulative convertible stock, which could raise his ownership of MNC to 23 percent.
He said the decision to change the bank's leadership was not his, but Hoblitzell's.
Lerner acknowledges that MNC is looking for someone else to become chief executive officer, but he doesn't want to apply the word "interim" to himself. "This company is in full tilt," he said. "This company is not sitting there waiting for somebody."