Bank is Valley’s fourth publicly traded company
- May 31, 2019
Scott Harvard saw a slight jump in First National Corp.’s stock in April the day after an announcement that the bank would begin trading on the Nasdaq Capital Market stock exchange.
“That jump was a positive,” says Harvard, the president and CEO of First National, the parent company of Strasburg-based First Bank. “The price of the stock two weeks later had increased by 10 percent.”
Trading on Nasdaq is a plus for the company. While large banks, such as Wells Fargo & Co. and Capital One, are traded on the New York Stock Exchange, “the majority of banks across Virginia are not publicly traded on a national exchange,” Harvard says, “That puts us in nice company.”
First National is now one of only four publicly traded companies headquartered in the Shenandoah Valley. The others are Edinburg-based Shenandoah Telecommunications (Shentel), American Woodmark Corp. and Trex Co. Inc., both based in Winchester.
Being on the Nasdaq creates more visibility for the company and its stock, Harvard says. “It validates us as a company and gives us credibility,” Harvard says.
Companies listed on Nasdaq have to meet and abide by certain criteria related to issues ranging from share prices to governance. “We had best practices in place for governance and that was a positive,” Harvard says.
The company chose to list on Nasdaq rather than the New York Stock Exchange because it was a “little more affordable,” Harvard says. “It has a much broader population. It’s able to accommodate large, moderate and small cap companies. We also like its ease of use.”
Being on a national exchange makes the company’s stock available to additional investors, including individual retirement accounts (IRAs) and 401(k) plans.
“Brokerage houses won’t allow clients to buy stock in small companies that aren’t listed on a national exchange,” Harvard says. “Now more people can buy our stock. Large mutual funds can buy our stock and put it in their pool of stocks.”
The Nasdaq listing also will help if the company decides to acquire or merge with other banking companies. “In the banking industry, it’s good to have currency [stock] that is credible and traded on a national exchange,” Harvard says.
In January, First National reported record net income of $10.1 million for the year that ended Dec. 31. The following month it announced an 80% increase in the quarterly cash dividend on common stock to 9 cents per share.