THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Wednesday, July 10, 1996 TAG: 9607100331
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY TOM SHEAN, STAFF WRITER
LENGTH: 70 lines
A garage-sized space in the midst of produce, specialty coffees, and cereals will become Centura Bank's entry into Virginia later this year.
Centura, based in Rocky Mount, N.C., will open its first Virginia branch in a Hannaford supermarket in the Pembroke area of Virginia Beach. Another Centura branch is due to open later this year at a Hannaford store in the Ward's Corner section of Norfolk.
One of the reasons for expanding to Hampton Roads is the region's population growth, said Bob James, Centura's group executive for market planning and customer development. Another reason is the proximity to northeastern North Carolina and the Outer Banks, where Centura already has a strong presence.
The planned Virginia Beach and Norfolk branches are part of Centura's three-state expansion effort. In May, the bank reached an agreement with Hannaford to open branches in 33 of the grocery chain's supermarkets in North Carolina, South Carolina and Virginia. Centura now has 152 branches, all in North Carolina.
Using supermarket locations will provide Centura with a less expensive way to reach more people, James said.
``For the last two or three years, Centura has been embarked on a course of being more convenient for its customers,'' he said. ``We're taking the bank to where customers shop.''
Opening one of the 400-square-foot branches will cost about a quarter of what it takes to buy or build a conventional, free-standing branch, he said.
Centura's branches in Virginia Beach and Norfolk will be open 62 hours a week, including four hours on Sunday afternoons. Each location will have about five employees.
``We are looking to hire most of those people locally,'' James said.
Opening supermarket branches has become a routine way for area banks to expand their reach. Central Fidelity National Bank, for example, has operated branches at several Farm Fresh supermarkets in Hampton Roads since the late 1980s.
But Centura's alliance with Hannaford is the first case in which an out-of-state bank has used supermarket locations for establishing its foothold in the region.
Three North Carolina-based banking companies - NationsBank Corp., First Union Corp. and Southern National Corp. - have entered Hampton Roads by acquiring Virginia banks. Earlier this year, Wachovia Bank & Trust of Winston-Salem, N.C., entered by opening a single office in Norfolk for its commercial customers.
If Centura attracts a sufficient number of local customers with its Hannaford branches, it's likely to open freestanding offices or acquire a bank with branches in Hampton Roads, said David West, an analyst with the Richmond-based securities firm Davenport & Co. of Virginia.
Centura is no stranger to Hampton Roads. One of its predecessor banks agreed in late 1987 to buy the former Seaboard Savings & Loan Association in Virginia Beach. The two institutions called off their agreement in early 1988, blaming the regulatory complexities of the transaction. Seaboard was acquired late last year by Life Savings Bank in Norfolk.
Centura and its parent, Centura Banks Inc., are the products of a 1991 merger of two Rocky Mount banks, Peoples Bank & Trust and Planters Bank & Trust. With $5.5 billion in assets, Centura Banks ranks sixth among North Carolina-based banking companies. ILLUSTRATION: CENTURA'S STRATEGY
Opening supermarket branches is a routine way for banks to expand
their reach, but Centura is the first out-of-state bank to use
supermarket locations to establish a foothold in the region. Opening
a 400-square-foot branch costs about a quarter of what it takes to
buy or build a free-standing branch. by CNB