Bay Banks of Virginia Inc. announced initiatives to decrease its noninterest expenses.
The Richmond, Va.-based company will be offering an early retirement program, for which about 25 of its staffers qualify. Management of Bay Banks of Virginia will further assess staffing levels based on the results of the program.
The company expects the program to result in annualized savings of about $500,000, beginning in the first quarter of 2019. In addition, the company will be closing its branch in Hopewell, Va., which will result in expected annualized savings of approximately $200,000. The branch is expected to close in the first quarter of 2019. In addition, the company will not open a branch in downtown Richmond, Va., which was under consideration.
These initiatives will result in estimated one-time charges of approximately $300,000, primarily related to the early retirement program.
Bay Banks of Virginia also announced that management restructuring in the third quarter will result in annualized savings of approximately $700,000, a part of which will be realized in the beginning of the third quarter. Further, the company has discontinued providing for contributions to certain benefit plans for the remainder of 2018, resulting in savings of about $400,000 in the second half of 2018.
In addition to these initiatives, the company expects approximately $600,000 of reduced noninterest expenses in the last half of 2018 from other operational projects, a portion of which will be realized in the third quarter. The company is also planning corporate governance changes for the second quarter of 2019. It expects these to result in annualized savings of about $140,000.
Bay Banks of Virginia is the holding company of Virginia Commonwealth Bank.