Eager to lower its overhead, Hampton Roads Bankshares Inc. in Norfolk, Va., will close nine branches this year and move customers' accounts into other nearby branches.
The $2.7 billion-asset company said late Thursday that it shuttered two branches in Chesapeake, Va., in April and that it intends to close six more in Virginia and one in North Carolina by Sept. 23.
In a news release, President and Chief Executive Officer John A.B. "Andy" Davies Jr., said that the consolidation should "generate a significant reduction in operating expenses and improve profitability." The company did not say how many jobs would be eliminated as a result of the consolidation but that it would record a charge in the second quarter to cover severance costs and other expenses.
Hampton Roads, a two-bank holding company, has been battered of late by losses on real estate loans. It lost $31.7 million in the first three months of this year and has not turned a quarterly profit since the first quarter of 2009. It also had been running dangerously low on capital until it raised $295 million late last year, largely from private-equity groups. Its subsidiaries are now well capitalized.
