Financial Stocks Falling in Late Trade; Southern National Bancorp Acquires Minority Stake in Mortgage Firm

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Financial stocks were ending mostly lower with the NYSE Financial Sector Index sinking 0.6% while the S&P Financial 100 Index also was down less than 0.6%.

In company news, shares of Southern National Bancorp of Virginia ( SONA ) were swinging between small gains and losses Wednesday afternoon, unable to find firm footing in sporatic trade after the bank holding company today announced a deal to acquire a minority stake in a regional mortgage lender.

Financial terms of the management-led buyout transferring a 62% ownership stake in Southern Trust Mortgage from its current owner, Middleburg Financial Corp. ( MBRG ), were not immediately disclosed.

Southern Mortgage currently operates six locations in its home state of Virginia in addition to seven other branches in North Carolina, South Carolina and Maryland, according to the company's website. It also is licensed to conduct residential financing in Delaware, Florida, Georgia, Tennessee, West Virginia and Washington, D.C.

Joining SONA in the deal are Eastern Virginia Bankshares ( EVBS ) and Southern Trust founder Jerry Flowers. Once the deal closes, Flowers will own 51.1% of the company while SONA will have a 44% stake and EVBS receiving the remaining 4.9% interest. MBRG has been a significant shareholder in Southern Trust since 2003, initially acquiring a 40% stake.

SONA shares were ahead 0.5% at $10.13 each in light afternoon trade, moving between a session low of $10.05 to a high of $10.19 a share, up 1.1%. MBRG was down 0.9% at $17.61 in recent trading while EVBS was off 0.8% at $6.18 a share.

In other sector news,

(+) FII, Regulators are ready to exempt most retail funds from new rules calling on money-market funds to report floating net asset values from the current practice of a fixed $1 per share NAV, according to the Wall Street Journal.

(-) GCA, Said its contract with Caesars Entertainment ( CZR ) to supply automated teller machine, point-of-sale and credit card services will expire without renewal March 31. Reaffirms in-line FY14 cash earnings of $0.82 to $0.87 per share.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: SONA , MBRG , EVBS , CZR

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