Shareholders of FNB Corp. of Christiansburg, Va., who tried but ultimately failed to block its deal with Virginia Financial Group Inc. of Culpeper are not going away quietly.
The shareholders are looking to start a rival bank in Christiansburg. The plans are still in the preliminary stage, but organizers said they want to move quickly to take advantage of any market disruption caused by the deal, which created the largest banking company based in Virginia.
That $3 billion-asset company has taken the name StellarOne Corp. and established a headquarters in Charlottesville. Its operational headquarters will be in Christiansburg.
Kendall Clay, an FNB director and a vocal opponent of the deal, said in an interview Wednesday that the new bank would be called NewRiver Bank. Rather than start the bank from scratch, his group plans to initially team up with an out-of-market bank holding company, which would then open a branch in Christiansburg under the NewRiver name.
Mr. Clay, a lawyer, said that he has been in talks with a number of community banking companies (which he would not name) inside and outside of Virginia, and that his group was close to a deal with one.
Ken Bolling, another FNB shareholder who opposed the deal with Virginia Financial, said calls for other companies started coming in almost immediately after the deal closed last month.
The other companies noticed the opposition to the deal and drew the conclusion that FNB could face some customer attrition as a result, Mr. Bolling said. "They saw an opportunity, and we can jump in there and pick up a lot of that business."
He said that the organizers would prefer to team up with an existing banking company, because of the long lead time it takes to raise money to start a bank and apply for a charter. The new bank could become independent later, he said.
There are shareholders, customers, and "disgruntled employees" who supported the dissident group's efforts and "are waiting to see what we'll do," Mr. Bolling said. "We don't feel we could wait a year to put together a totally new bank."
Virginia Financial and FNB announced their deal in July. They billed it as a "merger of equals," but FNB shareholders who opposed the deal argued that their company was being acquired for little premium.
In the end, 50.3% of FNB shares were voted in favor of the deal, and 32.4% were voted against it. William P. Heath Jr., the chairman of StellarOne Corp. and the former president and chief executive officer of FNB, said he had heard rumors that the dissident shareholders would establish a bank.
"It's very interesting," he said. "They were touting for months that they wanted to preserve the employees of our company and wanted to do the right thing for our customers, and now two weeks after the vote, they're going to go out and do things that will have an impact on customers and employees. That doesn't make any sense to me."
There has been no "significant migration" of customers from StellarOne, Mr. Heath said, and he does not expect one.
Bryce W. Rowe, an analyst with Robert W. Baird & Co., was dubious of any new bank's chances.
"It's not going to be easy … to open a bank and expect all of this business to follow them," he said. "For employees to leave a more stable situation and go to a start-up like this, I think, is very risky."
