First US Bancshares in Birmingham, Ala., has agreed to buy Peoples Bank in Rose Hill, Va.

The $626 million-asset First US Bancshares said in a press release Tuesday that it will pay about $23 million in cash and stock for the $174 million-asset Peoples. The deal is expected to close in the third quarter.

The purchase price could change based on Peoples’ net book value at closing.

Peoples has branches in Virginia and Tennessee.

“This transaction is an important component of our strategic plan to expand into other markets in the Southeast in order to grow and diversify our business and customer base,” James House, First US Bancshares’ president and CEO.

“We have known the team [Peoples] for some time, and we recognize the value that they bring to their customers, who appreciate the benefits of working closely with talented bankers who understand their markets and have the authority to make decisions,” House added.

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