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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
PEOPLE'S BANCSHARES, INC.
(Name of issuer)
COMMON STOCK, PAR VALUE $.10 PER SHARE
(Title of class of securities)
709795105
(CUSIP number)
THOMAS F. GILLEN
c/o RCG KINGSTON, LLC
757 THIRD AVENUE, 27TH FLOOR
NEW YORK, NEW YORK 10017
(212) 845-7990
(Name, address and telephone number of person
authorized to receive notices and communications)
September 30, 1999**
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box/ /.
NOTE. Six copies of this statement, including all exhibits, should
be filed with the Commission. SEE Rule 13d-1(a) for other parties to whom copies
are to be sent.
* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
** This filing is a voluntary disclosure.
CUSIP No. 709795108 Page 1 of 6 Pages
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1 NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION
NOS. OF ABOVE PERSONS (entities only)
RCG Kingston Fund, Ltd.
The Partnership For Bank Capital, L.P. - IRS ID
No.23-2613411
Vincent A. Smyth and Mary E. Smyth
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)/X/
(b)/ /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
RCG Kingston Fund, Ltd - WC
The Partnership For Bank Capital - WC
Vincent A. Smyth and Mary E. Smyth - PF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
RCG Kingston Fund, Ltd - Cayman Islands
The Partnership For Bank Capital, L.P. - Delaware, USA
Vincent A. Smyth and Mary E. Smyth - USA
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NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY -0-
OWNED BY ------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING RCG Kingston Fund, Ltd. - 129,800
PERSON WITH The Partnership For Bank Capital, LP - 32,002
Vincent A. Smyth and Mary E. Smyth - 131,500
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9 SOLE DISPOSITIVE POWER
RCG Kingston, Fund, Ltd. - 129,800
The Partnership For Bank Capital, L.P. - 32,002
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10 SHARED DISPOSITIVE POWER
Vincent A. Smyth and Mary E. Smyth - 131,500
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
RCG Kingston Fund, Ltd. - 129,800
The Partnership For Bank Capital, L.P. - 32,002
Vincent A. Smyth and Mary E. Smyth - 131,500
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* / /
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP No. 709795108 13D Page 2 of 6 Pages
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
RCG Kingston Fund, Ltd. - 3.90%
The Partnership For Bank Capital, L.P. - 0.96%
Vincent A. Smyth and Mary E. Smyth - 3.95%
TOTAL= 8.80%
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14 TYPE OF REPORTING PERSON*
RCG Kingston Fund, Ltd. - PN
The Partnership for Bank Capital, L.P. -PN
Vincent A. Smyth and Mary E. Smyth - IN
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Item 1. Security And Issuer.
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This statement relates to the shares ("Shares") of common
stock, $.10 par value ("Common Stock"), of People's Bancshares, Inc. ("Issuer").
The principal executive offices of the Issuer are located at 545 Pleasant
Street, New Bedford, Massachusetts 02740.
Item 2. Identity and Background.
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(a) Name: RCG Kingston Fund, Ltd., The Partnership For Bank
Capital, L.P. and Vincent A. Smyth and Mary E. Smyth (the "Reporting Persons").
(b) The principal business addresses of the Reporting Persons
are:
RCG Kingston Fund, Ltd. - 757 Third Avenue, 27th Floor,
New York, NY 10017. The Partnership For Bank Capital, L.P. - 757 Third Avenue,
27th Floor, New York, NY 10017. Vincent A. Smyth and Mary E. Smyth - 202 East
Main Street, Huntington, New York 11743.
(c) The present principal businesses of the Reporting Persons
are:
RCG Kingston Fund, Ltd. - investment. The Partnership For
Bank Capital, L.P. - investment. Vincent A. Smyth and Mary E. Smyth - Attorney
and Housewife, respectively.
(d) None of the Reporting Persons has, during the last five
years, been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
(e) The Reporting Persons have not, during the last five
years, been party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
CUSIP No. 709795108 13D Page 3 of 6 Pages
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(f) The Reporting Persons are citizens of:
RCG Kingston Fund, Ltd. - Cayman Islands
The Partnership for Bank Capital - Delaware, USA
Vincent A. Smyth and Mary E. Smyth - USA
Item 3. Source And Amount Of Funds Or Other Consideration.
The funds for this purchase were acquired from the personal
funds of Vincent and Mary Smyth and the working capital of RCG Kingston Fund,
Ltd and The Partnership For Bank Capital.
Item 4. Purpose Of Transaction.
The acquisitions of Common Stock to which this statement
relates have been made for the purposes of investment. Attached as Exhibit A, a
letter to Board of Directors of People's Bancshares sent by Reporting Persons on
September 30, 1999.
Item 5. Interest In Securities Of The Issuer.
RCG Kingston Fund, Ltd. is the beneficial owner of 129,800
shares of the Issuer's Common Stock (representing 3.90% of the issued and
outstanding Common Stock). Of these 129,800 shares. RCG Kingston Fund, Ltd. has
shared voting and dispositive power over 129,800 shares.
CUSIP No. 709795108 13D Page 4 of 6 Pages
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The Partnership For Bank Capital, L.P. is the beneficial
owner of 32,002 shares of the Issuer's common stock (representing 0.96% of the
issued and outstanding Common Stock). Of these 32,002 shares, The Partnership
For Bank Capital, L.P. has shared voting and dispositive power over 32,002
shares.
Vincent A. Smyth and Mary E. Smyth, his wife, are the
beneficial owners of 131,500 shares of the Issuer's common stock (representing
3.95% of the issued and outstanding Common Stock). Of these 131,500 shares,
Vincent A. Smyth and Mary E. Smyth have shared voting and dispositive power over
131,500 shares.
Together, as a group, the Reporting Persons are the beneficial
owners of 293,302 shares of the Issuer's Common Stock (representing 8.80% of the
issued and outstanding Common Stock. Of these 293,302 shares, the Reporting
persons have shared voting and dispositive power over 293,302 shares.
During the last 60 days the following shares were acquired by
each of the Reporting Persons:
RCG Kingston Fund, Ltd. - 3,000 at $18.125 on
September 13, 1999 and 3,000 at $18.25 on September 14, 1999.
The Partnership For Bank Capital, L.P. - 2,000 at $18.125 on
September 13, 1999 and 2,000 at $18.25 on September 14, 1999.
Vincent A. Smyth and Mary E. Smyth, his wife - 16,500 at
$18.875 on August 27, 1999; 5,000 at $18.094 on September 1, 1999; and 10,000 at
$18.75 on September 27, 1999.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
To Securities Of The Issuer.
There is no contract between the Reporting Persons or any
other person with respect to any securities of the Issuer including, but not
limited to transfer or voting of any security, finder's fees, joint ventures,
loan or options arrangements, puts or calls, guarantees of profits, division of
profit or losses, or the giving or holding of proxies, except as described
herein.
Item 7. Exhibits
A. Correspondence from RCG Kingston, L.L.C. to People's Bancshares, Inc.
CUSIP No. 709795108 13D Page 5 of 6 Pages
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: September 30, 1999
RCG Kingston Fund, Ltd.
By: /s/Thomas F. Gillen
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Thomas F. Gillen
The Partnership For Bank Capital,
L.P.
By: /s/Donald B. Jennings
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Donald B. Jennings
/s/Vincent A. Smyth
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Vincent A. Smyth
/s/Mary E. Smyth
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Mary E. Smyth
CUSIP No. 709795108 13D Page 6 of 6 Pages
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RCG KINGSTON, L.L.C.
September 30, 1999
Board of Directors
Attn: Mr. Richard S. Straczynski
People's Bancshares, Inc.
545 Pleasant Street
New Bedford, MA 02375
Dear Board Members,
On Monday, September 27, 1999, we met with senior management and
certain members of the Board to discuss our concerns regarding the impact on the
value of PBKB's shares from the current operating strategy of the company. As a
group (the members of which are RCG Kingston, LLC, The Partnership For Bank
Capital, and Vincent Smyth, et al), we currently own and control 293,302 shares
of People's Bancshares, or 8.8% of the shares outstanding.
Our primary purpose for requesting the meeting was to express our view
on the lack of interest in PBKB's shares by investors and the need for the Board
to address this issue. While PBKB's absolute earnings have increased steadily in
recent years, investors have chosen not to recognize this performance as
indicated by the substantial discount at which PBKB's shares are valued relative
to its peers. Presently, the shares of PBKB have a price-to-earnings ratio of
approximately 7.0x 1999 estimated earnings versus an average price-to-earnings
ratio of 10.8x estimated 1999 earnings for all Massachusetts' thrift companies
with assets greater than $500 million. This discount to its peer group is
particularly striking since analysts' forecasts for PBKB call for next year's
earnings to continue to grow significantly.
While we understand that bank and thrift companies have been out of
favor with investors recently, this still leaves unanswered the question of why
investors do not apply a similar capitalization rate to PBKB's earnings that
they do to the peer group. A reasonable conclusion is that investors view the
earnings' stream of PBKB to be riskier than that of the peer group.
One contributing factor for this may be that PBKB has considerably more
borrowings on its balance sheet relative to its capital than the peer group. In
fact, our analysis shows those companies in the peer group with moderate amounts
of borrowings (less than 4 to 1) to equity were uniformly valued at
substantially higher p/e ratios than PBKB. Another way of looking at this is
that investors pay a premium for quality of earnings not just quantity of
earnings.
Another factor may be the unrealized tax-adjusted loss in PBKB's
securities portfolio that, by our estimate, was equivalent to 38% of PBKB's
tangible equity as of
757 Third Avenue, 27th Floor o New York, NY 10017 o Direct (212) 845-7990 o Main
(212) 845-7900 o Facsimile (212) 845-7997
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June 30, 1999. While we appreciate this unrealized loss is an "accounting
function" it is, nevertheless, a complicating factor for many investors in
determining the valuation of the company.
Finally, we also think that the recent expansion of the mortgage
origination operation with the purchase of Allied Bancshares Mortgage Group at a
time when others are leaving the business because of flat growth prospects needs
explanation by management.
In our judgement, some or all of these factors are a deterrent to
attracting investors to PBKB's shares. We believe it imperative that the Board
recognize their fiduciary responsibility to seek to maximize the value of the
company for its current shareholders. It is not reasonable to continue to accept
the stock's low market valuation because investors "misunderstand the company"
or "the thrift group is out of favor among investors." Therefore, we request
that the Board undertake the following two initiatives:
1. Retain an independent investment banker to review strategic
alternatives to maximize shareholder value including possible sale
of the company.
2. Provide the shareholders with a detailed letter (including
purchase price, terms and conditions, plan of integration, etc.)
on the recent acquisition of Allied Bancshares Mortgage Group.
As substantial owners of the company, we would appreciate a timely
response to our requests as well as the opportunity to participate in the
process of evaluating strategic alternatives.
Sincerely,
/s/Thomas F. Gillen
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Thomas F. Gillen
/s/Donald B. Jennings
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Donald B. Jennings
