The Farmers Bank of Appomattox plans to buy a branch in Farmville from StellarOne Bank.
If regulators approve the deal, the sale could close in January. The Farmville branch would be Farmers Bank’s fifth location.
The sale was announced Sept. 28 and Farmers Bank is preparing its applications for regulatory approval. The price of the transaction was not disclosed.
John Caldwell, president and CEO of Farmers Bank, said the bank had wanted to expand to Farmville for some time. Customers in the town have been receptive to the community banking model used by Farmers Bank.
“We already are lending to customers in the Farmville area and want to expand on that lending,” Caldwell said.
In the early summer this year, bank leaders learned that StellarOne was selling its Farmville branch, he said.
StellarOne bought the branch from First Virginia Bank in 2003, and the branch holds about $14.5 million in deposits.
The decision to sell it “reflects our continuing efforts to streamline and improve the cost efficiency of our retail franchise,” said StellarOne Executive Vice President and Chief Financial Officer Jeffrey Farrar in a news release. “While certainly a successful and profitable financial center, the Farmville location did not fit well with our existing franchise or long-term strategies.”
Farrar said Wednesday he had no further comments on the sale.
Caldwell said that Farmers Bank studied the Farmville market and the StellarOne branch and decided to bid on it. It is buying the deposit accounts, real estate and other fixed assets.
Buying a branch and hiring its employees provides several advantages over opening a new branch in Farmville, Caldwell said. “We’ll be able to have … inroads to the customers that are currently working with that bank,” he said.
“We are confident that The Farmers Bank will provide our Farmville area customers an in-market convenience and an equally high level of community banking service,” Farrar said in the news release.
The sale needs approval from Virginia’s State Corporation Commission, as well as the Federal Reserve. Caldwell expects Farmers Bank to submit applications to both agencies next week.
If the regulators approve the sale, it should close about Jan. 15, he said.
Farmers Bank of Appomattox currently operates two locations in Appomattox and one each in Concord and Dillwyn. It is privately owned by investors. It has operated for 91 years.
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