The Bank Slate


First National in Virginia agrees to buy Touchstone Bankshares

First National in Strasburg, Va., has agreed to buy Touchstone Bankshares in Prince George, Va.

The $1.4 billion-asset First National said in a press release that it will pay $47 million in stock for the $658.7 million-asset Touchstone. The deal, which is expected to close in the fourth quarter, priced Touchstone at 106% of its tangible book value.

Touchstone has 12 branches, $508.8 million of loans and $542.2 million of deposits.

First National expects the transaction to be about 36% accretive to its earnings per share. It should take about three years for the company to earn back any dilution to its tangible book value.

“We are thrilled to have found a partner with an equally long history of serving and supporting local customers and businesses in their communities,” Scott Harvard, First National’s president and CEO, said in the release.

“Combining our companies will help ensure that we continue to be part of the fabric of the communities we serve, which we believe enables us to deliver superior service and financial performance,” Harvard added. “We are incredibly excited about this opportunity to expand our Richmond metro presence.”

First National plans to cut about 35% of Touchstone’s annual noninterest expense, or $7.2 million. The company will incur $12.3 million of merger-related expenses.

Three Touchstone directors will join First National’s board. James Black, Touchstone’s president and CEO, will become South Region President.

Hovde Group and Nelson Mullins Riley & Scarborough advised First National. Piper Sandler and Williams Mullen advised Touchstone.

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