Magazine article American Banker

California Bank Insiders Unloading Their Shares

Magazine article American Banker

California Bank Insiders Unloading Their Shares

Article excerpt

California's stumbling economy has prompted insiders at banks in the state to cash in some of their chips this summer.

Sales of stock by officers and directors have risen significantly since May at banks ranging from Wells Fargo & Co., the huge San Francisco superregional, to smaller community institutions.

While insiders sell for a variety of reasons, including options-related transactions, the concentration of activity in California is too unusual to ignore, said Robert J. Gabele, president of Invest/Net Group Inc., Fort Lauderdale, Fla. The firm tracks insider buying and selling through filings with the Securities and Exchange Commission.

Message from Best Informed

"It has to be seen as a sip that some of the best-informed people do not see a serious business recovery in the cards soon," Mr. Gabele said.

California banks have been hit by real estate lending woes, while unemployment in the state has been driven up by retrenchment in the defense and aerospace industries. In addition, a budget impasse has led the state to issue scrip to pay its bills for the first time since the 1930s.

At Wells, 127,600 shares have been sold, according to Invest/Net. The largest seller was David M. Petrone, a former vice chairman of the bank and one of the banking industry's best known real estate lenders. He left the bank in March. Under SEC rules, Mr. Petrone is considered an insider because he left the bank only five months ago.

The other large seller of Wells stock was Donald M. Koll, who recently quit as a director of the banking company. He is the chairman and chief executive officer of the Koll Co., Newport Beach, a real estate development company.

Neither Mr. Petrone nor Mr. Koll was available for comment.

"The selling doesn't surprise me," said Campbell K. Chaney, the banking analyst at Sutro & Co. …

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