Eastern Virginia Bankshares plans to repay up to $15 million preferreds

By Jennifer Chiou

New York, May 22 - Eastern Virginia Bankshares, Inc. intends to repay up to $15 million of its series A fixed-rate cumulative perpetual preferred stock issued under the Troubled Asset Relief Program, according to an 8-K filing with the Securities and Exchange Commission.

The U.S. Department of the Treasury sold at auction $24 million of the series A preferreds in October 2013.

In connection with the repayment, the Tappahannock, Va.-based bank said it will also pay $4.1 million of previously accumulated dividends and will pay $1.1 million of previously accrued but deferred interest on its trust preferred securities.

"This repayment will eliminate a high cost source of capital and improve our financial results for our common shareholders," president and chief executive officer Joe A. Shearin said in a press release.

"This announcement represents great progress in implementing the company's strategic plan."

In 2013, a total of 24,000 shares were priced at $1,104.11 per share, resulting in total proceeds of $26.5 million.

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