A group of dissident shareholders failed to take control of Glen Burnie Bancorp yesterday in a contentious annual meeting.
The dissident group, led by Susan Demyan, a former director of the company, failed in its bid to remove the current board of directors.
The vote, which took auditors nearly three hours to tally, was 55 percent for the board and 45 percent against, said F. William Kuethe Jr., president of the banking corporation, the parent of Bank of Glen Burnie.
"I have to consider it a pyrrhic victory, because the bank itself suffered so much through this," Kuethe said.
Demyan was trying for the second straight year to oust the board, which includes her cousin, John E. Demyan, Keuthe and 10 other directors.
Bank of Glen Burnie was founded 49 years ago by the fathers of Kuethe and John Demyan, who is chairman of the $231 million asset company.
Yesterday's vote keeps the company and its subsidiary, Bank of Glen Burnie, firmly in the hands of current management.
Susan Demyan began soliciting voters two weeks ago for her slate of directors, which included former Gov. William Donald Schaefer, who attended the meeting.
Edwin Hale Sr., chairman of First Mariner Bancorp, also attended. His two offers to buy Glen Burnie Bancorp were rebuffed by the current management, but First Mariner has an agreement to acquire more than 19.5 percent of Glen Burnie Bancorp's stock.
Hale addressed the hundreds of shareholders who packed a ballroom at La Fontaine Bleu Catering in Glen Burnie.
"Elect a new board," Hale said into a microphone. "We are not going away. We will be back, and we will be back strong."
In his opening remarks, Kuethe acknowledged problems at the company, but he said they are mending.
He cited profits of $747,247 for 1997 and a new strategic plan, and he introduced the company's new chief operating officer, Michael P. Gavin, who eventually will be in charge of the bank's day-to-day operations.
"The bank is recovering," Kuethe said. "We are committed to remaining a local, independent bank."
Susan Demyan told shareholders that a "cloud" has been hanging over the bank for three years.
She said the bank's performance has been poor. Loans, assets, deposits and the company's stock prices have fallen at a time when the banking industry is raking in profits, she said.
"Let's get the bank back on the growth track, because it has stopped growing," she said.
Kuethe rebutted her, saying that the families and directors who own 34 percent of the company are just as concerned about its falling stock price.
"Everyone here is concerned about the value of the stock," he said. But he defended the current management, saying, "We are not going to do anything to shoot ourselves in the foot."
The dissident shareholders last year lost their first attempt to overthrow the board. Last year's annual meeting turned into a melee of charges and countercharges.
Susan Demyan's group claims that the banking company has been mismanaged and has tried to cover up fraudulent loans to a single borrower that went bad and resulted in millions of dollars in write-offs.
More than five hours after yesterday's meeting had started, dozens of shareholders were milling about, waiting for the returns. When the official figures were read, there was applause.
"I'm relieved and tired," Kuethe said.
"We are going to keep on trying," said Susan Demyan.
Pub Date: 3/13/98