First Bank moves forward on sale
First Bank has cleared a major regulatory hurdle toward closing a deal in which the bank will buy six Bank of America branches in the Shenandoah Valley and Central Virginia.
First Bank announced in November it was acquiring Bank of America branches in Woodstock, Staunton, Waynesboro, Elkton, Farmville and Dilwyn for $377.3 million. On Wednesday, the Federal Reserve Bank of Richmond and the Bureau of Financial Institutions, a division of the Virginia State Corporation Commission, gave approval for the sale, which is expected to close on April 17.
First Bank President Scott Harvard said getting approval was expected.
“It [regulatory approval] was part of our agreement with Bank of America,” Harvard said. “So while you hope its perfunctorily and you’re moving forward on that basis, it’s always good to get rid of contingencies and check those off the contract.”
He added, “It is a transaction that’s going to be transformational for our company and we’re really excited to have that contingency cleared so we can move forward with this transaction.”
Harvard said while the Federal Reserve and the Bureau of Financial Institutions are looking at different aspects of the sale, they both examine the bank to see if it is financially strong enough to handle the transaction.
“They want to see if you have enough capital to grow the balance sheet, to see if you have risk management practices in place to expand into a market,” Harvard said. “As you grow, you create additional risk to your company … I think to the extent we met those requirements is really positive for our company.”
As April 17 comes ever closer, Harvard said the bank is going “full throttle” preparing to close the deal by hiring 15 to 20 new employees in addition to the 35 employees who are being hired from Bank of America.
Harvard said the 15 to 20 new hires will work on increasing the company’s customer service base.
“A lot of it is going to be for what I call “call center support,” Harvard said. “We get a lot of calls already for Internet banking questions and the like, so this addition of new accounts means we will be increasing our call volume by 50 percent. We need more personnel to handle that.”
Harvard added, “There’s also hiring for broader operational support, as well as management level employees, too … it’s really across the board, but its driven, at the bottom line, by customer service.”
First Bank is also seeing internal promotion as a result of the purchase, Harvard said.
“It’s really neat for us because we’re adding additional bench strength to the team and also giving folks at our bank an opportunity to take on more responsibility because of the addition of six more branches and the accounts that go along with them,” he said.
First Bank is owned by First National Corporation, which is headquartered in Strasburg.
Contact staff writer Henry Culvyhouse at 540-465-5137 ext. 184, or firstname.lastname@example.org