The way has been cleared for the marriage of two local banks.
Regulators and shareholders have given the green light to C&F Financial’s pending acquisition of Powhatan-based Central Virginia Bank.
Under the deal, C&F Financial will pay $855,000 in cash or $0.32 per share to acquire CVB and its holding company, Central Virginia Bankshares. The package includes CVB’s seven branches. C&F Financial is the parent company of C&F Bank.
C&F said it would also pay $3.35 million to redeem the preferred stock and common stock CVB has yet to buy back from the U.S. Treasury as part of the TARP Capital Purchase Program.
CVB shareholders approved the acquisition at a special meeting Sept. 24, the company announced Tuesday.
C&F has received approval from state and federal regulators for the deal. The banks said they expect to complete the buyout next month.
The deal, first announced June 10, gives West Point-based C&F a stronger presence in the southwestern part of the Richmond market. It will have 25 branches once it adds CVB’s locations. It was founded in 1927 and was one of the few banks in the area to remain profitable throughout the recession. The addition of CVB’s assets will also help C&F crack the $1 billion asset threshold.
A $387 million bank, CVB ran into trouble after losing tens of millions of dollars between 2008 and 2010 amid soured investments in Lehman Brothers, Fannie Mae and Freddie Mac, as well losses on commercial real estate and business loans.
Regaining large-scale growth and high levels of profitability has been a struggle for the 40-year-old bank.
CVB chief executive Herb Marth referred all questions on the acquisition to Tom Cherry, chief financial officer at C&F.
Cherry could not be reached by press time.