Virginia-based lenders Hampton Roads Bankshares (HRB) and Xenith Bankshares have agreed to merge in a deal worth about $107.2m, creating the state’s fifth-largest community bank by deposits.
Based in Virginia Beach, HRB is the parent of the Bank of Hampton Roads and manages $2bn in assets. Richmond-based Xenith Bankshares is the parent of Xenith Bank and manages assets of about $1bn.
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The combined entity will be based in Richmond, Virginia, managing pro forma total assets of $2.9bn and combined deposits of $2.5bn.
As per the agreed terms of the transaction, Xenith shareholders will receive 4.4 shares of HRB common stock for each share of Xenith common stock, with HRB and Xenith shareholders holding about 74% and 26% of the stock respectively in the combined firm.
The merged company will operate under the name Xenith Bankshares for the holding company and the Xenith Bank name for all banking operations.
It will be governed by a 13-member board that will include 8 directors from HRB and 5 directors from Xenith.
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By GlobalDataXenith president and CEO T. Gaylon Layfield, III will assume the role of CEO of the combined entity, while Bank of Hampton Roads president Donna Richards will serve as president and chief operating officer.
The deal has already secured the go-ahead from the boards of directors of both companies. It is anticipated to close in the third quarter of 2016, subject to regulatory and shareholder approvals.
Commenting on the merger, Donna Richards said: "This is an exciting opportunity to combine two financially strong banks with very similar cultures, core values and guiding principles, as well as a shared commitment to building long-term customer relationships with exceptional customer service.
"As a combined company united under one name, we will bring together the relationship focus of a hometown bank with the sophistication and experience of a larger one. In addition, Xenith’s extensive business banking experience will complement Bank of Hampton Roads’ retail and consumer focus. "
