CHANTILLY, Va.--(BUSINESS WIRE)--Alliance Bankshares Corporation (NASDAQ:ABVA) announces a major
restructuring of its mortgage banking unit, Alliance Home Funding, LLC.
Today, approximately 43 employees were told of the business decision to
cease operations as a stand alone mortgage banking subsidiary.
Thomas A. Young, Jr., President and Chief Executive Officer of Alliance
Bankshares, said, “Since inception in 2001,
Alliance had the goal to have a small, customer focused, profitable
mortgage banking unit. Our business results over the past several years
have fallen short of that objective. In 2006, management of Alliance
Home Funding, LLC in concert with senior executives of the bank
undertook a series of steps designed to improve results, regrettably,
our actions have not yielded the desired outcome. As we enter 2007, with
a continued modest outlook in the housing sector, we felt a radical
change was necessary.”
Alliance Bankshares will take a fourth quarter pre-tax charge in a range
of $540,000 and $675,000 to wind down the operations of Alliance Home
Funding, LLC. This charge will have an after-tax impact on fourth
quarter earnings of $350,000 to $450,000. The costs are directly related
to the decision to exit the operating business of Alliance Home Funding,
LLC. The charges cover staff severance, systems charges, estimated
subleasing costs and various other costs associated with the closure of
Alliance Home Funding, LLC.
“Our mortgage banking services will continue
in a dramatically new fashion. Approximately ten people will join the
Alliance Bank organization as part of a mortgage banking division. This
division will offer home mortgages to bank customers, prospects and home
builder clients. The focused approach of this division should lead to
better performance metrics,” said Thomas A.
Young, Jr.
Harvey E. Johnson, Jr., Chairman of the Board of Directors said, “The
Board and Management strongly feel this action to revamp the mortgage
banking operations is the proper course for Alliance. We remain
committed to delivering high quality financial services in the Greater
Washington, DC metropolitan marketplace yet we must constantly assess
and modify our delivery channels.”
Alliance Bankshares Corporation is a locally managed community banking
organization based in Northern Virginia. The independent status of the
organization allows the bank's management to create, implement and
maintain banking services with a level of flexibility, creativity and
discretion that is not possible with larger institutions.
Some of the matters discussed herein may include forward-looking
statements. These forward-looking statements may include statements
regarding profitability and financial and other goals. These statements
are based on certain assumptions and analyses by the Company and other
factors it believes are appropriate in the circumstances. However, the
Company's expectations are subject to a number of risks and
uncertainties and other factors that could cause actual results, events
and developments to differ materially from those contemplated by any
forward-looking statements herein. Consequently, all forwarding-looking
statements made herein are qualified by these cautionary statements and
cautionary language in the Company's most recent report on Form 10-K and
other documents filed with the Securities and Exchange Commission
More information on Alliance Bankshares Corporation can be found
online at www.alliancebankva.com,
or by phoning an Alliance office.
