When Webster Financial Corp. bought the tiny Ridgefield bank where Jim Belote was a shareholder 10 years ago, Webster promised conservative growth and lending.
At Webster's annual meeting Thursday, Belote told the bank's senior management that isn't how it turned out: The bank got burned by out-of-market lending, saw its stock price tank and was forced to slash its shareholder dividend.
"It was almost speculative," Belote said after the meeting at the Courtyard Marriott. "They got away from what they originally said they were going to be."
Belote and other shareholders grilled Chairman and Chief Executive James C. Smith for nearly an hour, frustrated by a dividend chopped from 30 cents to 1 cent and a stock price that has sunk from nearly $50 a share two years ago to $4.90 Thursday, up from a previous low of about $3.
Smith apologized several times at the meeting for Webster's poor performance in the past two years. He said he never considered business decisions to be speculative.
"We took risks that we thought were appropriate," Smith said. "I can assure you we have learned from our experience."
Smith said it was difficult to cut the dividend but necessary to bolster capital, the bank's cushion against losses. He couldn't predict when the dividend would increase.
Shareholder Kazik Skoczylas of Windsor, a retired banker, said he invested retirement savings in Webster shares and has seen his quarterly dividend payout fall from $4,110 to $137.
Several shareholders said they were concerned the bank would be taken over with such a weak stock price, but Smith said the price doesn't reflect the true value of the company.
After the meeting, an older couple was riding in the elevator in the hotel's parking garage when the man observed: "I'm glad they got chastised a little. From $50 to $3. My God!"