John Allison of BB&T Corp. can't seem to get enough of Virginia.
The chief executive officer of the Winston-Salem, N.C., holding company had been aiming to build a $5 billion-asset operation in Virginia.
But last week, just after announcing a deal that would lift $32 billion- asset BB&T over that level, Mr. Allison said he was hungry for more.
"We're looking to continue building our franchise in Virginia," he said in an interview. "We want to be in the top four or five banks there in market share."
BB&T is No. 6 in Virginia, a rank that would not change even after the closing of the $554 million stock deal for MainStreet Financial Corp. of Martinsville. The deal was announced Thursday.
The $2 billion-asset MainStreet was not Mr. Allison's first choice among Virginia banking companies. He said his sights had been on the $26.3 billion-asset Crestar Financial Corp. of Richmond.
Before Crestar announced in July that it would merge with SunTrust Banks Inc., BB&T had proposed a merger of equals but was rebuffed, Mr. Allison revealed.
"We were very disappointed," he said. "But they wanted to sell out."
With Crestar gone and just about every other sizable Virginia property snapped up by rivals such as First Union Corp. and Wachovia Corp., BB&T's options have narrowed.
First Virginia Banks Inc. of Falls Church, with $9 billion of assets and a strong consumer base, is still out there and might fit well with BB&T's broader commercial offerings, according to analysts.
But First Virginia is not for sale.
"BB&T is holding out hope First Virginia will change its mind," said A.G. Edwards analyst David C. Stumpf. "First Virginia seems to be playing hard to get."
First Virginia chief financial officer Richard Bowman declined to comment about the speculation and reaffirmed his company's commitment to independence.
Meanwhile, Mr. Allison said he sees both bank and nonbank acquisitions as key business lines and intends to expand his company's presence in Georgia, West Virginia, and Tennessee. He also wants to further improve his company's performance ratings. BB&T currently ranks 11th in return on assets, 15th in return on equity, and seventh in efficiency ratio.
"He is very driven," said David M. West, an analyst at Davenport & Co. in Richmond, Va. "He is consistently raising the bar."
As BB&T continues to build its conventional banking business, it is also emphasizing two other areas-insurance and investment banking.
BB&T has been in insurance since 1922 and it has grown into a significant business, generating $645 million in premium volume in the first half of 1998. Mr. Allison said he wants to double that within five years and be among the 10 largest insurance agencies in the country.
To get there he plans a statewide insurance network in Virginia that complements BB&T's banking presence, selling a full line of products.
This year BB&T's insurance operation, which includes 30 offices in three states, was the 16th-largest insurance broker in the country, according to Business Insurance, a trade publication. It jumped up from 30th in 1997.
"More insurance goes without saying," said Mr. Stumpf. "They feel like they've hit a home run in the insurance sector. They are really getting the critical mass now so the margins are going to improve and more revenue will flow to the bottom line."
Investment banking would get a big boost with the recently announced deal for Scott & Stringfellow of Richmond. The firm would be merged into Craigie Inc., which BB&T bought last year.
Craigie, also of Richmond, specializes in fixed-income securities, while Scott & Stringfellow is in full-service retail brokerage, institutional equity and debt underwriting, and corporate finance.
"Scott & Stringfellow is the platform on which we can build our investment banking operations," Mr. Allison said.
