American National Bankshares MHC said yesterday that it plans to convert from a mutual savings bank holding company to a stockholder-owned corporation, a move it says will beef up capital and position the Baltimore S&L; to capitalize on coming bank industry restructuring.
"As far as the services provided to the depositor, nothing will change," American National Chief Financial Officer James Uveges said. "What it allows the bank to do is take advantage of opportunities that may come down the road in the next few years."
As big banking companies acquire and restructure, they are likely to shed branches or operations, and it will take cash to take advantage of those buying opportunities, Mr. Uveges said. The company has been preparing for several years to take itself public to raise that money. American National sold 45 percent of its stock to the public in 1993 to raise about $9.3 million.
The plan announced yesterday, which Mr. Uveges said had long been in the works but whose timing has been moved up, would sell the other 55 percent of the bank for a yet-undetermined price per share. The company has not yet made the required filings with the U.S. Securities and Exchange Commission, Mr. Uveges said, but plans to complete the deal late this year.
In addition to providing money to make purchases, converting to a stockholder-owned company could make American National itself an acquisition target, said a Rockville banking consultant.
"It ought to help the stock price, and the extra capital should help earnings," said Arnold Danielson, president of Danielson and Associates in Rockville. "Even if they never sell, the acquisition premium has a chance to play a role in the stock price."
Mr. Danielson also said the move could make management more accountable to the bank's owners.
A mutual savings bank holding company is owned by its depositors. The conversion is subject to the approval of American National depositors, who will be offered a chance to buy shares in the new stockholder-owned holding company.
Also yesterday, American National said it lost $30,000 during the three months that ended April 30, compared with a $340,000 profit in the same months of 1994. The period is the third quarter of American National's fiscal year.
Management blamed the reversal on lower fee income and a $610,000 gain in the amount of money the bank sets aside to cover potential losses from unrepaid loans. The bank has $425 million in assets.
For the first nine months of the fiscal year, American National lost $167,000, compared with a $1.1 million profit in the same months a year earlier.