Glen Burnie Bancorp
When Mark Hanna told his banker friends that the Maryland-based community bank he leads was planning to buy a mortgage lender, they “looked at me as if I had five eyes,” he recalled this week.
The underwhelming reaction came as little surprise, said Hanna, who is the president and CEO of Glen Burnie Bancorp. After all, with interest rates still stubbornly high, mortgage origination activity is at less than half of its 2021 peak, according to data from the Mortgage Bankers Association.
And other banks continue to exit the mortgage market. Ally Financial in Detroit, Seattle-based WaFd and Blue Ridge Bankshares in Richmond, Virginia, all announced plans to quit residential lending this year.
Bucking that trend, the $351 million-asset holding company for the Bank of Glen Burnie announced Monday that it had closed its planned acquisition of VA Wholesale Mortgage. Under the deal’s terms, the bank agreed to pay $750,000, plus a share of profits over the next three years, Hanna said.
For Bank of Glen Burnie, which has struggled to book loans in recent years, the acquisition “makes a lot of sense,” Hanna said in an interview.
Bank of Glen Burnie is “very much in a growth mode,” and mortgage lending remains “a tremendous way to grow and retain relationships,” Hanna told American Banker. “We’re trying to bring as many new relationships to the bank as we can. We’re also trying to retain all our existing clients.”
VA Wholesale, based in Virginia Beach, Virginia, closed about $125 million of home loans in 2024. It’s well-versed in making loans to veterans, as well as Federal Housing Administration and first-time homebuyer transactions.
Bank of Glen Burnie has historically offered mortgages, but its lending was previously confined largely to 30-year fixed-rate deals with relatively large down payments. Its loan-to-value ratios generally went no higher than 80%.
“There were people in our communities that needed mortgages, but we didn’t have the products to serve them,” Hanna said. “Now, we’ll be able to help just about anybody who’s interested in buying a home.”
For his part, VA Wholesale Mortgage CEO Eric Tan said his company, which will operate as a division inside of Bank of Glen Burnie, should be able to do more business as a bank subsidiary.
“Having a committed funding source will broaden our reach, allowing us to grow and meet the needs of our customers more readily, while also increasing lending volume,” Tan said Monday in a press release.
While VA Wholesale serves all homebuyers, it specializes in offering loans to active-duty military personnel and veterans. That focus should work well in Bank of Glen Burnie’s footprint, which includes Fort Meade, one of the Army’s largest bases, the National Security Agency’s headquarters and the U.S. Naval Academy, according to Hanna.
“We think their business model translates nicely into the communities we serve,” Hanna said.
Hanna started as CEO of Bank of Glen Burnie in October 2023. The 76-year-old company excelled at service, but its cupboard was bare in terms of products, according to Hanna. “We needed to get back to growing client relationships, and embedded in that is having the products to compete,” he said.
Over the past year, Bank of Glen Burnie has rolled out a suite of treasury management tools, as well as a high-yield money market account. The bank’s loan and deposit portfolios, which had been trending down for several years, expanded in the second quarter. Hanna said he’s hopeful the acquisition of VA Wholesale, as well as plans to launch a credit card product, will spur even more growth.
“That’s really the path forward,” Hanna said. “There’s no secret sauce. We need to grow.”
