As it moves toward a merger with a Northern Virginia peer, a Henrico-based bank disclosed this week that it has shed two dozen jobs in the last two months.
EVB and its holding company Eastern Virginia Bankshares said in a year-end earnings release filed Monday that it reduced its headcount by 10 full-time equivalent employees in December, and an additional 14 workers last month.
The company said the related reduction in salaries and employee benefits expenses will result in annual savings of $1.3 million.
The firm said the cuts came “through attrition and other job eliminations,” stemming in part from an assessment of EVB’s operations conducted by an independent consultant over the last 18 months.
Joe Shearin, EVB’s chief executive, said Thursday the cuts are aimed at taking advantage of technology to streamline and cut costs on certain processes.
“Most of it is us continuing to get more efficient and effective in the way we run our bank,” Shearin said.
He said the cuts are in part a reduction of positions added in the wake of the recession and while the bank was under a regulatory written agreement–a pact with its regulators aimed at shoring up the bank’s operations.
EVB has long since shed the extra oversight from that written agreement and has been on a growth track in recent years. It raised $50 million in capital in 2013, has been on a steady streak of profitability, moved into a new headquarters in Innsbrook last year, and is working on a new branch in Chester.
In December, the bank announced a pending deal to merge with McLean-based Southern National Bancorp, the holding company for Sonabank.
The deal, valued at $178 million, would create a combined institution with $2.4 billion in assets, which includes EVB’s $1.3 billion.
It will operate a combined 47 branches – 24 from EVB – under the Sonabank brand, stretching from Maryland and Northern Virginia to Hampton Roads.
Shearin said some additional job cuts are expected when the Sonabank deal closes. Those likely will include redundant positions, as is typical with mergers. EVB has around 300 employees.
“There will be more as we get into the merger, because this is truly a merger of equals,” Shearin said. “Unfortunately it is a casualty of mergers.”
The merger is expected to close by mid-year. The deal still must receive regulatory approval and a vote from the company’s shareholders.
EVB reported a profit of $1.62 million for the fourth quarter of 2016, down from $2.16 million the same period of 2015. Its full-year profit for 2016 was $7.75 million, up from $6.9 million in 2015.