Two local banks are calling off their merger.
Eastern Virginia Bank and First Capital Bank are no longer going to combine operations in a $27 million deal, as they agreed to in April. The reason, according to a news release, is the series of delays caused by regulation.
“The current economic and regulatory environment is such that obtaining regulatory approval has taken much longer than we ever anticipated and has reached a point, we believe, that continuing to wait for this approval is not in the best interest of either company,” said Joe Shearin, president and CEO at EVBS, in a statement.
In the bank’s quarterly report filed with the Securities and Exchange Commission, the bank said that it hoped to close the deal by the end of 2009, but that was not going to happen. The quarterly report makes no other mention of the scrapping of the deal.
EVB lost $8.5 million in the third quarter of 2009. The bank lost $3 million in the same quarter of 2008.
The bank’s stock closed Monday at $7.32, down 1.6 percent.
Look for a BizSense update as soon as we can reach executives at the two banks.
