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Eagle Bancorp, Inc. And Alliance Bankshares Corporation Announce Merger Agreement

On July 27, 2011, Eagle Bancorp, Inc. (“Eagle”) (NASDAQ: EGBN), the parent company of EagleBank (“EagleBank”), and Alliance Bankshares Corporation (“Alliance”) (NASDAQ: ABVA) announced that Eagle, Alliance and Alliance’s wholly owned subsidiary, Alliance Bank Corporation (“Alliance Bank”) have entered into a definitive merger agreement (the “Agreement”), pursuant to which Alliance will be merged into Eagle with Eagle being the surviving corporation and all of the outstanding shares of Alliance will be converted into shares of Eagle. Alliance has approximately $536 million in assets and $412 million in deposits. The merger will accelerate Eagle’s growth in Northern Virginia with the addition of Alliance’s 6 branches, which are all located in the attractive Northern Virginia market.

The merger is structured as a stock-for-stock transaction, under which Alliance shareholders will receive 0.4317 shares (the “Conversion Ratio”) of Eagle common stock for each share of Alliance common stock, subject to adjustment based upon certain factors set forth in the Agreement. Please refer to the Forms 8-K to be filed by each of Eagle and Alliance for additional information regarding the adjustment factors.

Based on the closing price of Eagle common stock on July 26, 2011, the aggregate value of the transaction would be approximately $31.2 million, or $6.11 per share of Alliance common stock. The value of the transaction at closing may be higher or lower, depending on whether there is any adjustment to the Conversion Ratio, and the change in the value of Eagle common stock. As of June 30, 2011, Eagle Bancorp, Inc. had $2.35 billion in assets and Alliance had $536 million in assets. Eagle expects that the transaction will be accretive to Eagle’s earnings within twelve months following the closing of the merger.

In connection with the transaction, Alliance Bank will be merged into EagleBank, with EagleBank being the surviving entity. One member of Alliance Bank’s Board of Directors will join the EagleBank Board. EagleBank operates 7 offices in Montgomery County, Maryland, 5 offices in the District of Columbia and 1 current office and 4 offices under development in Northern Virginia. Alliance Bank operates 6 branches in Northern Virginia.

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