A London banker confirmed yesterday that Bert Lance is negotiating with a Middle Eastern financial source to sell his interest in National Bank of Georgia of Atlanta.
A. H. Abidi, a Pakistani-born banker who is managing director of the bank of Credit and Commerce International in London, described the would-be purchaser of the NBG stock a friend and client.
Reached by the phone in London, Abidi refused to name either the buyer or his country. "It is a private matter," he said. "He is a Middle East person - an individual. And he is well known."
Abidi denied a report published Tuesday in the Atlanta Constitution that suggested he was acting as an intermediary in the bank stock sale. He said he would "absolutely not" get a commission if the deal were consummated, adding; "I am not involved in a personal capacity or as a banker."
He said he recently met in New York City with the Middle Easterner, who confirmed to him that he was negotiating for the stock.
On Thursday, Lance's attorney announced that his client was negotiating to sell an undisclosed portion of his 200,000 shares of NBG for $20 each. Following this report, the value of NBG common stock, which is traded over-the-counter, rose $4.75 to $15 a share on Friday. The price jump caused the bank to request a trading suspension of up to 10 days in the stock.
NBG stock has been depressed since last summer when the bank reported a $1.4 million loss brought on by loan write-offs. Lance headed NBG for two years before becoming U.S. budget director last January.
He resigned in September after questions were raised about his personal and bank finances. Several government agencies are investigating his financial affairs.
The Securities and Exchange Commission, one of those agencies, has told his lawyer that it might ask Lance to stay out of banking as part of a settlement of a civil suit it is expecting to file against the banker.
Lance and two other investors bought control of NBG in June, 1975. Lance personally acquired 200,000 shares at an average price of about $17 a share.
Presumably any investor willing to pay the premium price of $20 a share for NBG would want to acquire enough stock to control the bank, not just Lance's interest of about 17 per cent.
Abidi said he knew of Lance through former Georgia State Sen. R. Eugene Holley, who has sought aid from Middle Eastern sources for his troubled petroleum and real estate ventures.
Holleh, who was chairman of the State Senate Banking and Finance Committee, has said in court papers that he could be forced into bankruptcy at a loss of $100 million. Reached in Augusta, Holley said: "I am not making any comment whatsoever. You're going to have to get everything from Bert Lance."
Lance could not be reached, nor could his Washington attorney, Robert Altman.
In another banking development, the Comptroller of the Currency yesterday proposed a new policy to crack down on certain inside dealings by bankers.
Some of the practices described in the release were commonly used by Bert Lance, his wife, her family and insiders at Calhoun (Ga.) First National Bank, where Bert was also chairman before becoming budget director.
In the proposed policy statement, Comptroller John G. Heimann specified certain "imprudent" banking practices that "when discovered by national bank examiners . . . will be criticized and corrections requested.
Among the practices he cited were:
Special lending terms given by bankers to themselves, other insiders or their business or family interests that are not available to other borrowers of comparable credit standing.
Preferential term loans on a reciprocal basis between directors and officers of different banks.
Unwarranted fee concessions on trust services to officers, directors, and significant shareholders, among others.
A spokesman for the comptroller said yesterday that the changes in policing national banks had been under consideration before the Lance affair suggested that reforms were needed in bank regulation.
The Senate has enacted legislation that sets strict limits on loans to bank insiders, among other things. But a similar measure in the House, known as the Safe Banking Act, has apparently been shelved after pressure from the banking lobby.