MainStreet BankGroup, Martinsville, Va., has agreed to buy Richmond- based Regency Financial Shares Inc. for $17.2 million.

MainStreet said it would pay $13 per share for $74.9 million-asset Regency.

The price is 2.5 times Regency's book value.

"Regency has a very attractive location in downtown Richmond," said James E. Adams, chief financial officer of MainStreet. "It services a very upscale group of customers, which we feel fits into our strategic plan."

This year MainStreet has extended itself north of its southwest Virginia base into some of the state's larger markets. The proposed acquisition of Regency would give the $1.5 billion-asset MainStreet its second bank in Richmond.

MainStreet this summer announced plans to buy two other banks-Tysons Financial Corp., McLean, Va., and Commerce Bank, College Park, Md.-which would give it a presence in the lucrative Washington suburbs.

The Regency acquisition is expected to close in the second quarter.

Once all three deals closed, MainStreet would own 11 banks and a trust company.

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