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Virginia’s TowneBank, which is nearing completion of its
Hampton Roads-based TowneBank announced plans Tuesday to pay $476 million in stock for Dogwood State Bank in Raleigh, North Carolina. The deal would add Dogwood’s 17 branches in North Carolina and South Carolina to Towne’s existing 15 locations in the Tar Heel State.
The transaction would increase TowneBank’s presence down the East Coast, including a location in Charleston, South Carolina. It would also raise the bank’s profile along the stretch of I-85 between Richmond, Virginia, and Greenville, South Carolina.
“That’s a strong corridor,” North Carolina Bankers Association CEO Peter Gwaltney told American Banker on Tuesday. “There’s some major employers relocating there and just tremendous growth.”
TowneBank announced plans to acquire the $1.4 billion-asset Old Point in April. That transaction is expected to close Sept. 1.
As part of the deal announced on Tuesday, Dogwood CEO Steve Jones has agreed to join the merged bank as president of its Carolinas market.
“It has been my pleasure to know Steve for a number of years and we have always admired the great job he and his team have done building Dogwood State Bank,” TowneBank Chairman Robert Aston said in a press release. “We are excited to have Steve and his talented teammates join hands and hearts with our Towne family to take our Main Street Bank forward in the fast-growing North Carolina and South Carolina markets.”
Jones will be joined by Natasha Austin, Dogwood’s chief operating officer, who will serve as Carolinas director of retail banking, and Christopher Kwiatkowski, who will oversee government-guaranteed lending.
“I’ve known TowneBank and Bob Aston since he started the bank,” Jones told American Banker. “I’ve competed against him and watched what he’s grown over there the past 25 years. I always had a huge respect for Bob and his team.”
Joining TowneBank with several members of Dogwood’s management team will create continuity, Jones added. “If all of a sudden myself, my executive team and our bankers all left, then what would they be buying? I thought it was very critical for the success of the merger for our team to stay around, and I’m honored to play a big role in TowneBank’s future growth.”
Beyond geographic expansion, acquiring Dogwood would give TowneBank a major new business line in Small Business Administration lending. Through nearly 11 months of the SBA’s 2025 fiscal year, Dogwood has originated 140 SBA 7(a) loans for $135 million, according to the agency. TowneBank’s SBA production is minimal; so far this year, it has only originated three 7(a) loans totaling $820,000.
“I think TowneBank was very excited to have that added capability,” Jones said. “Starting an SBA group [from scratch] really takes a lot.”
Dogwood was founded in 2021 as the Sound Banking Company in Moorhead City, North Carolina. It was acquired by Raleigh-based West Town Bancorp in 2017. West Town announced a reorganization two years later,
Dogwood State executed its own southward expansion last year, acquiring the $683 million-asset Community First Bancorp in Seneca, South Carolina, in August 2024.
“Our team did a wonderful job in the conversion and integration of Community First onto the Dogwood platform,” Jones said. “The retention from a deposit standpoint has been outstanding. We were able to achieve the cost saves we said we were going to get. [Community] really has melded very nicely into Dogwood.”
Dogwood reported net income totaling $7.4 million for the quarter ending March 31, up from $1.8 million for the same three months in 2024.
With the deal for Dogwood, TowneBank becomes the latest regional or superregional bank to expand in North Carolina. PNC Financial Services Group and FNB Financial, both headquartered in Pittsburgh, along with the Cincinnati-based Fifth Third Bancorp and
North Carolina’s positive business climate is helping to attract banks, according to Gwaltney. “Our economic development partnership has been very aggressive and successful in bringing businesses to expand into North Carolina,” he said. “That’s where banks want to be. They want to be where the growth is. It’s attracting more banks, the regionals, as well as some of the largest banks.”
TowneBank expects to complete the acquisition of Dogwood early in 2026. After bringing both Old Point and Dogwood into the fold, it expects to have $22 billion of assets, $16 billion of loans and deposits totaling $19 billion. The company is projecting 8% earnings-per-share accretion in 2027 from the Dogwood deal.
Jones said he sees opportunities for growth “on multiple fronts.”
“What it does for our bankers is give us a bigger balance sheet, so we’re able to do bigger loans” and handle a different type of client, Jones said. In addition, TowneBank “has a huge property-and-casualty insurance business that we’ll be able to integrate into our client base. They have a great mortgage company, so it will allow us to expand that product.”
“This creates a really strong organization,” Gwaltney said. “Strong leadership with scale now. It will be interesting to see how and where they grow.”