News Details

TowneBank (OTC Bulletin Board: TOWN) and Newport News based Harbor Bank (OTC Bulletin Board: HBRB) announced today they have formally completed the merger of Harbor Bank into TowneBank. The combined bank is the largest independent bank headquartered in Hampton Roads with total assets of approximately $1.3 billion and 16 full-service banking locations throughout Hampton Roads.

G. Robert Aston, Jr., Chairman and Chief Executive Officer of TowneBank, stated, “We welcome the customers and employees of Harbor Bank to the TowneBank family. Our merger results in the natural extension of our market area and fits well into our plans to become the dominant community bank on the Virginia Peninsula.”

Harbor Bank President and Chief Executive Officer Jerry Passaro, who will serve as President of TowneBank on the Peninsula, stated, “We are thrilled to announce the culmination of the significant efforts on the part of our directors and management team and the loyal support of our stockholders. We are combining with an institution that has enjoyed tremendous success in building shareholder value. Our combined organizations will provide all of Hampton Roads with a powerhouse, service focused, community bank that will offer an enhanced menu of financial products and services, including an increased lending limit in excess of $20 million that will allow us to greatly expand our ability to serve the growing Peninsula corporate community.”

As a result of the merger, each share of Harbor Bank common stock outstanding at the merger closing was exchanged into two shares of TowneBank common stock. In addition, TowneBank has assumed all of the obligations of Harbor Bank under the outstanding 6% Convertible Subordinated Harbor Bonds due November 30, 2017. The new conversion price at which the bonds are convertible into TowneBank common stock is $13.155 per $1,000 principal amount of bonds (or 76 shares per $1,000 principal amount).

TowneBank operates 16 banking offices out of five Hometown Banking Groups located in Virginia Beach, Portsmouth, Chesapeake, Williamsburg, and the Peninsula. Additionally, the Bank provides residential and commercial mortgage brokerage services within its office network and from within 14 offices of William E. Wood and Associates Realtors. TowneBank also provides employee benefit, commercial and residential property and casualty, life and title insurance services through its subsidiary Towne Insurance. Recently, TowneBank through its newly formed Towne Investment Group began providing investment and asset management services. Local decision-making is a hallmark of its hometown banking strategy that is delivered through the leadership of each of the business group’s President and Board of Directors.

This press release contains forward-looking statements as defined by federal securities laws. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Actual results could differ materially from current projections.

TowneBank
6001 Harbour View Boulevard
Suffolk, Virginia 23435

Contacts:
G. Robert Aston, Jr.
Chairman & CEO
(757) 638-6781