Under the terms of the agreement, Xenith Bank will acquire total loans of approximately $60m at a price of 96.23%, and assume total deposits of approximately $71m for a premium of 3.92%. All of the acquired loans are located within Xenith’s target markets.
The bank said that the loans are primarily commercial and industrial, owner-occupied real estate and commercial real estate loans.
Xenith Bank also expects to retain key employees of the branch. It is expected that Paragon’s existing Richmond branch will be closed and its operations consolidated into Xenith’s existing Richmond downtown location after the required regulatory notices have been obtained.
Xenith Bank president and CEO Gaylon Layfield said that the bank views this transaction as a premium opportunity to grow and strengthen its competitive position in the desirable Richmond market.
"This acquisition enables us to leverage the infrastructure we built in 2010 as well as some of the capital that was raised during our recent stock offering, which was completed in April 2011," Layfield said.
The transaction is subject to state and federal bank regulatory approvals and other customary closing conditions and is expected to close during the third quarter of 2011.
Xenith Bankshares is headquartered in Richmond, Virginia and currently has five branch locations in Tysons Corner, Richmond and Suffolk, Virginia.
