Italy, Retirement Will Have to Wait for Start-Up Duo

When Georgia Derrico and Roderick Porter sold the Virginia bank they had run for nearly two decades, their plan was to retire and split their time between their homes in northern Virginia and southern Italy.

They stuck to the plan for a few months - until they got a call last fall about investing in a start-up. Now, due to unforeseen circumstances, the husband-and-wife team is back in Virginia full time, running the state's newest bank.

Sonabank opened last week in Charlottesville with Ms. Derrico as its chief executive and Mr. Porter as its president. Reenergized by the challenge of starting a business from scratch - and with $30 million of capital - they aim eventually to have Sonabank stretch from the Washington suburbs to Charlottesville to Richmond.

"We certainly hope to be the Virginia bank one day," Ms. Derrico said. Ms. Derrico started Southern Financial Corp. of Warrenton in 1986 and slowly built it into a 28-branch operation with $1.1 billion of assets. Her husband was Southern's chairman from the outset, and joined full-time as president in 1998, soon after the company went public. Southern was sold last year to Provident Bankshares Corp. of Baltimore for $330 million.

Sonabank hopes to pick up where Southern left off, catering to midsize businesses in several metropolitan markets. It has roughly five times the capital of a typical Virginia start-up, so it should be able to make loans as large as $4.5 million, Ms. Derrico said.

Sonabank intends to open a second branch in Manassas, in Northern Virginia, later this year and has set a goal of having five branches within three years.

Laurence C. Pettit, a senior vice president at Anderson & Strudwick Inc. in Richmond, said Ms. Derrico and Mr. Porter should have little trouble deploying the capital, since they are so well known in the business community. They also have the capability to take Sonabank statewide, he said, but he expects the bulk of its assets to be in northern Virginia.

"In my opinion, they will have a much higher success rate in the metro Washington market than the suburban and southern Virginia marketplace, because that is where most of their business was and what they know best," Mr. Pettit said. Ms. Derrico, 59, and Mr. Porter, 60, became involved with Sonabank after two former Southern Financial employees, Tom Baker and Donna Richards, contacted them in Italy about joining Sonabank's board.

They proposed starting the bank with about $8 million of capital, but Ms. Derrico told them that she and Mr. Porter would not be interested unless it came out of the gates with much more capital so that it could grow quickly.

"I did that before, and it took too long," Ms. Derrico said of her experience at Southern Financial.

Mr. Baker and Ms. Richards agreed to start a larger bank on the condition that Ms. Derrico and Mr. Porter be active board members, helping out at the bank one or two days a week. In October the couple returned from Italy to help the bank get off the ground.

But on New Year's Eve, Mr. Baker, who was to be Sonabank's CEO, had a massive (though not fatal) heart attack.

"Rod and I went for a jog when we heard the news, and said, 'What do we do now?' " Ms. Derrico recalled. "And we said, 'What else can we do but see it through?' "

They started by raising capital, and by the time they and others had finished, Sonabank had taken in $50 million from 230 shareholders - $20 million of which was returned.

Ms. Derrico says she is settling in and has put retirement plans on hold indefinitely.

"There's been lots of excitement, but it's nice to finally get going and start closing loans," she said.

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