The Middle Eastern ivestors who are trying to buy control of Financial General Bankshares of Washington yesterday filed an application to form a bank holding company, revealing, among other facts, that Bert Lance will not be involved in running the bank if the take-over bid succeeds.
The application also promised that "U.S. Citizens of high standing and respect" will hold a majority of the seats on the board of directors of the company. It said former U.S. Sen. Stuart Symington will control almost half of the stock.
The proposed new bank holding company's stock would be owned by investors from Saudi Arabia, Abu Dhabi, Kuwait and Iran. They plan to put up at least $50 million of their "personal funds" to buy control of Financial General, the application says.
Bank holding company applications are not normally made public, but this one was included in a report filed late yesterday with the Securities and Exchange Commission, which has monitored the Financial General takeover fight closely since it began last winter.
The application to organize an American bank holding company is the latest step taken by the Middle Eastern group which last January bought about 20 percent of the stock of Financial General.
Despite an investigation by the Securities and Exchange Commission and a massive legal battle by Financial General's management, the group has moved steadily ahead with plans to make a public offer to buy all of FG's stock.
Before that offer can be made, however, the Federal Reserve Board must approve the bank holding company application filed yesterday.
The application reveals that Lance - who first advised the Middle Eastern investors to try to take over Financial General - will have nothing to do with running the bank if the takeover succeeds.
Lance, the application states, "would not participate in the management of FGB or become a director of FGB" and he "will not be a shareholder" of the proposed new bank holding company.
Lance's ties to Financial General began when he purchased National Bank of Georgia from FG. After resigning a year ago as President Carter's budget director because of his activities as a Georgia banker, Lance began advising wealthy Middle Easterners about potential U.S. invesments.
Replacing Lance as the prominent American representing the Middle Eastern group is Symington, the former senator from Missouri and Secretary of the Air Force.
Symington, the bank holding company application discloses, will have voting control of 48 percent of the stock in Credit and Commerce American Holdings, a Netherlands Antilles company that will control Financial General.
Symington will act as trustee for stock owned by Sheikh Kamal Adham, the former chief of intelligence for Saudi Arabia who is "closely related to the royal family of Saudi Arabia" and by Sheikh Mohammed bin Zaid al Nahyan, son of the ruler of Abu Dhabi.
Because Sheik Mohammed is a minor his share of the Washington banking company will be controlled by Abdullah Darwaish, chief of personal affairs for the ruling family of Abu Dhabi.
U.S. District Court Judge Oliver Gasch ruled yesterday that another member of the ruling family of Abu Dhabi, Sheikh Sultan, could sell stock he owns in Financial General to Adham.
The bank holding company application shows the Abu Dhabi and Saudi Arabian royal family members would each own 24 percent of the Washington banking company. Another 12 percent would be owned by Faisal Saud al Fulaij, former chairman of Kuwait Airways, and an advisor to the royal family of that country.
Identified for the first time in the application is another Middle Eastern owner of the proposed Washington banking company, Mohammed Rahim Motaghi Irvani, founder of an Iranian industrial corporation. Irvani would own 5 percent. Another 5 percent would be in the hands of a Kuwait investment company and smaller blocks would be held by other unspecified investors.
In addition to detailing the proposed owners of the company formed to take over Financial General, the bank holding company application also spells out plans for the company.
Americans will make up a majority of the board of directors, the application says, but the board members have not yet been selected. With control of 48 percent of the stock Symington would probably be among them.
Sharply critical of Financial General's current management, the application says two top executives experienced in bank holding company operations will be hired to run the company.
Financial General, the application contends "has been the subject of significant management problems and has failed to take advantage . . . of opportunities that would enable FGB to realize its full potential growth and performance."
Because of poor management the application says, FG "is of relatively little consequence" in the markets it serves "compared to other bank organizations of comparable size."
With assets of $2.2 billion FG owns 13 banks including Union First National Bank of Washington, First American Bank of Virginia and American Bank of Maryland.
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Formerly controlled by International Bank, a Washington investment company, Financial General's biggest stockholders now are its chairman, real estate man B. F. Saul Jr., and a group headed by the bank's president, G. William Middendorf.