Banks reach agreement to purchase mortgage company Southern Trust Mortgage
- March 28, 2014
Two Virginia banks and the executives of Southern Trust Mortgage (STM) have bought out Middleburg Bank's equity in the Virginia Beach-based mortgage company.
Eastern Virginia Bankshares Inc., the holding company for EVB, and Southern National Bancorp of Virginia Inc., the holding company for Sonbank, and executives of STM are purchasing the 62 percent of the company that is owned by Middleburg Bank.
Following the transaction, STM founder Jerry Flowers and other STM executives will own 51.1 percent of STM, Sonabank will own 44 percent and EVB will own 4.9 percent.
STM is a mortgage banking company founded in 1998 by Flowers and has mortgage banking originators in Virginia, Maryland, North Carolina and South Carolina.
STM is an approved Fannie Mae, Freddie Mac, VA and FHA lender. In addition, Southern Trust Mortgage is one of few lenders to have received approval from Ginnie Mae to issue securities on its behalf.
"We are very excited to have Sonabank as our new banking partner along with EVB who we have been doing business with for the past seven years," Flowers said in a statement. "Having EVB and Sonabank as partners will allow us to expand in their market areas and will give us banking partners that not only want to be a part of STM's existing model but would like for us to expand our mortgage footprint."