Virginia’s TowneBank strikes deal for a local rival

TowneBank in Suffolk, Virginia, plans to acquire a 102-year-old family-owned rival in a deal aimed at bolstering its presence in its home Hampton Roads market. 

The $18 billion-asset TowneBank, which completed a separate acquisition earlier this week, said Thursday that it’s agreed to pay $203 million in cash and stock for Old Point Financial in Hampton.

Old Point’s bank subsidiary, Old Point National Bank of Phoebus, operates 13 branches in the Hampton Roads and Richmond metropolitan statistical areas. 

Old Point has built a “legendary” reputation during more than a century of operation, TowneBank Executive Chairman Robert Aston said in a press release.  “Joining our two banking families together will create a combined franchise with a strong core deposit base, outstanding credit quality, and substantial synergies that will generate top tier financial performance for our shareholders,” Aston said. 

Old Point offers TowneBank a low-cost deposit franchise totaling $1,3 billion. The target bank’s 1.81% cost of funds sits well below the industry average of 2.61%, according to Federal Deposit Insurance Corp. statistics.

Given the substantial overlap in the two companies’ branch networks, TowneBank is projecting major cost savings, amounting to 45% of Old Point’s operating budget, which totaled $43.5 million in 2024.

TowneBank expects to close the deal in the second half of 2025. Once the cost savings are fully achieved, the deal should be 10% accretive to earnings, according to TowneBank. The combined company would have $19.5 billion of assets, loans totaling $13.1 billion and deposits of $16.3 billion. Its risk-based capital ratio would be 14%.

“Great competition builds better companies and TowneBank has raised the bar high,” Old Point CEO Robert Shuford said in a press release. “Under Bob Aston’s leadership, they have built an incredible franchise.”

Shufort’s father, Robert Shufort Sr., led Old Point for 52 years before retiring in 2020. The company first opened inside a Hampton candy store in 1923. It took its name from the Old Point Comfort Lighthouse in nearby Fort Monroe. 

TowneBank has been an active acquirer under Aston’s leadership. 

Its acquisition of Midlothian, Virginia-based Village Bank and Trust Financial Corp., which closed Tuesday, marked the company’s seventh deal since 2004. The acquisition of Village, announced in September, is expected to boost TowneBank’s presence in the Richmond market.  

Aston served as TowneBank’s CEO from 1998 to 2018, when he assumed the executive chairman role. TowneBank’s biggest deal came in 2018, when it paid $327 million for Paragon Commercial Bank in Raleigh, North Carolina.

Old Point, by contrast, has done just one acquisition, acquiring the one-branch Citizens National Bank in Windsor, Virginia, in 2018. 

Though economic uncertainty appeared to tamp down bank M&A activity in the first few months of 2025, the pace of deals appears to be picking up.

Wichita, Kansas-based Equity Bancshares agreed Wednesday to acquire the $909 million-asset NBC Corp. of Oklahoma in an $87 million cash-and-stock transaction. It marked the $5.3 billion-asset Equity’s third deal in two years.

On Monday, the $8 billion-asset HomeStreet Inc. in Seattle announced plans to sell itself to $16 billion-asset Mechanics Bank in Walnut Creek, California.