Many of you will know Bove as one of the more respected or at least as one of the more influential analysts in the financial services sector.

BankAtlantic filed a lawsuit in state court for Broward County,Florida, against both the firm and against the analyst.  The company isseeking damages for defamation and negligence stemming from a widelydistributed and frequently republished report by Bove and Ladenburg.

This report from fairly recent days was titled "Who Is Next?" andthis was trying to identify the "at-risk" financial institutions aroundthe time of the IndyMac failure.

Bankatlantic said that the data analyzed was from the holdingcompany and calls the data worthless. Here is what the company shows asdata from March 31, 2008 (which it says will not be significantlydifferent at June 30, 2008):

• (i) in every measurable category, BankAtlantic is "well capitalized;"
• (ii) BankAtlantic’s ratio of non-performing loans to total loans is, in this market, an enviable 1.25%;
• (iii) BankAtlantic’s ratio of non-performing loans to its capital and reserves is 12.5%; and,
• (iv) Bove’s "Danger Zone" was above 5% of non-performing loans tototal loans and above 40% of non-performing loans to total commonequity plus reserves.

In the release, it says "BankAtlantic’s numbers are not even close."

Interestingly enough, this refers to being in or near ‘the danger zone’ in this release.

Frankly, this is shocking that a bank would sue a brokerage firm andsuch a respected analyst on Wall Street over their analysis.  Everyoneconducts their own analysis and has their own methodology.  If Bovewould have reported the firm IS going under or IS imploding or if heattempted to cause a scare with no data to point to then we’dunderstand, but the fact that BankAtlantic is going after a right to anopinion or a right to openly present data is one which very few largefirms ever attempt.

Last week the firm issued a release to clarify what it callederroneous and misleading analyst information in a press release.  Thisweek it is getting more aggressive. 

In the new age of media and Web 2.0 where anyone with an internetconnection, email, and instant messenger account, and a blog there havebeen many questions of where the line has to be drawn between and amongresearch, reporting, and intent to harm or influence.  At the end,freedom of speech issues come into play (and usually win as long as nointent to harm of influence is the reason behind such data).

As of 2:30 PM EST, BBX shares are down 10% at $1.51 and that islower than before the company issued its press release at $2:15 PM EST.

Jon C. Ogg
July 21, 2008

Punk, Ziegel & Company is a specialty investment bank based in New York City that provides research, equity market making, corporate finance, retail brokerage, and asset management services within the industries of healthcare, technology, biotechnology, life sciences and financial services. Specifically, it will merge into Ladenburg’s principal operating subsidiaries; Ladenburg Thalmann & Co. Inc.

As previously announced, William J. Punk, Jr. will fill the Managing Director for Ladenburg Thalmann & Co. and as Chairman for the Punk Ziegel Healthcare division which will be in charge of growing the healthcare business for the investment banking and research divisions.

Ladenburg shares are down marginally, over 1%, in early morning trading to $1.87. The 52-week range is $1.49 to $2.76 and the market cap sits at about $302.45 million.

You can join our open email distribution list to keep up with other developments in the brokerage and investment banking field, plus other mergers, IPO’s, spin-offs, and other specialty financings.

Jon C. Ogg
May 5, 2008