A relationship bank that completed three acquisitions between April 2025 and January 2026, hired WesBanco's former CIO to run technology, runs member service on Talkdesk's AI contact-centre platform and analytics on SAS, has Microsoft Copilot on bankers' computers but is still working on getting them to use it, and gives AI a stand-alone risk factor in its 10-K.
How is TowneBank using AI?
TowneBank, the Hampton Roads bank with about $22 billion of assets after acquiring Village Bank, Old Point Financial ($203 million, 2025) and Dogwood State Bank ($476 million in stock, completed 12 January 2026), has disclosed little about AI beyond its annual report. Its 2025 10-K, filed with the FDIC in February 2026, devotes a stand-alone risk factor to AI: the bank or its vendors 'may develop or incorporate AI technology in certain business processes, services, or products', generative models 'may produce output or take action that is incorrect' or biased, and the bank 'may rely on AI models developed by third parties' over which it 'may have limited visibility'. In operations the visible AI is vendor-supplied: TowneBank runs member service on Talkdesk's cloud contact-centre platform, starting with Talkdesk Copilot and Interaction & Quality Analytics, for which Talkdesk reports a 23-second reduction in average handle time and a 97% satisfaction rate (the vendor's figures), and it has built credit-loss modelling and member analytics on SAS, whose executive calls it 'AI-driven'. Bankers also have Microsoft Copilot on their computers, though many rarely use it; Triad president Scott Baker said 'we have this resource sitting right there, and we don't always go grab it', and a UNC Greensboro MBA capstone team, reported in June 2026, gave the bank a prompt manual and a training plan for safe use. Denys Diaz, chief information officer in 2025, said that 'there's nothing AI can't fix or help with'. Technology leadership changed in February 2026 when Varun Chandhok, formerly chief information officer of WesBanco Bank and a 22-year M&T Bank technology executive, became senior executive vice president and CIO, charged by chief operating officer Lee Clark with expanding 'our technology capabilities so we can continue providing exquisite service to our members'. A vendor, Marquis Software Solutions, suffered a data incident in 2025 that involved some TowneBank member information held in Marquis's environment, disclosed in a December 2025 8-K. The second quarter of 2026 was transformed by the sale of the Towne Vacations resort-management business for a gain of about $198.6 million, lifting reported earnings to $193.2 million, or $2.09 per share, against core earnings of $72.0 million, or $0.78, and funding a $25 million foundation gift and a $0.70 special dividend; deposits reached $18.71 billion and the Carolinas expansion added bankers and treasury officers. Executive chairman Robert Aston and president and CEO William Foster III run what they call the 'Main Street Banking model'. TowneBank is a Virginia state nonmember bank supervised by the FDIC, with which it files its 10-K and 10-Qs; no AI leader, model inventory or AI budget has been disclosed.
Lead bank
TowneBank
Assets (lead bank, Mar 31, 2026)
$22 billion
Charter
Virginia state nonmember bank (FDIC)
Headquarters
Portsmouth, VA
Flagship platform
Technology organisation under CIO Varun Chandhok; Talkdesk contact centre, SAS analytics and Microsoft Copilot
AI leadership
William I. Foster III · G. Robert Aston, Jr. · Varun Chandhok · Lee Clark · Denys Diaz · Scott Baker · Erich Reuter
- 2025 10-K (filed with the FDIC): a stand-alone AI risk factor covering evolving AI law, incorrect or biased generative-AI output, model opacity and reliance on third-party models.
- Vendor AI in operations: Talkdesk contact centre with Talkdesk Copilot and Interaction & Quality Analytics (vendor-reported: 23-second cut in average handle time, 97% satisfaction rate) and SAS cloud analytics for CECL and member analytics.
- Microsoft Copilot sits on bankers' computers but is under-used; a UNC Greensboro MBA capstone (June 2026) produced a prompt manual and a training plan for safe use.
- New CIO Varun Chandhok (February 2026), ex-WesBanco CIO and M&T Bank technology executive, tasked with expanding technology capabilities.
- Three acquisitions completed between April 2025 and January 2026 (Village, Old Point, Dogwood State Bank) added about $3.5 billion of loans, $3.8 billion of deposits and a Carolinas footprint.
- Q2 2026 reported earnings $193.2 million ($2.09) on a $198.6 million gain from selling Towne Vacations; core earnings $72.0 million ($0.78); deposits $18.71 billion.
- Customer AI content covers voice cloning and deepfake scams (May 2026).
- No AI leader, model inventory or AI budget disclosed; former CIO Denys Diaz (2025): 'there's nothing AI can't fix or help with'.
- Vendor cyber incident: a 2025 breach at Marquis Software Solutions involved some member data held by the vendor; no misuse identified (8-K, December 2025).
What is Technology organisation under CIO Varun Chandhok; Talkdesk contact centre, SAS analytics and Microsoft Copilot?
In February 2026 TowneBank announced Varun Chandhok as senior executive vice president and chief information officer, previously CIO of WesBanco Bank and chief information and operations officer of Premier Bank after a 22-year career in business-line CIO roles at M&T Bank, with a mandate to 'further advance our technology strategy' and 'expand our technology capabilities'; the 10-K dates his tenure from January 2026. Denys Diaz, CIO in 2025, said TowneBank had partnered with Talkdesk, whose cloud contact-centre platform 'is facilitating a more accommodating style of member service', and that 'there's nothing AI can't fix or help with'. Talkdesk says TowneBank began with AI tools that enhance rather than replace people, Talkdesk Copilot and Interaction & Quality Analytics, and reports, as the vendor's own figures, a 23-second cut in average handle time and a 97% satisfaction rate; it cites TowneBank among financial organisations 'scaling customer engagement with automation'. Microsoft Copilot is installed on bankers' computers, but many rarely use it: Triad president Scott Baker asked a UNC Greensboro MBA capstone team for recommendations, and in June 2026 the team delivered a prompt manual and a training plan for using Copilot safely within the bank's private network. Credit-loss (CECL) modelling and member analytics run on SAS in the cloud, with 15 years of data in a SAS warehouse. Customer-facing AI content covers voice cloning and deepfake scams. No AI leader, model inventory or AI budget has been disclosed.[3][6][11][12][9][5][10][8][4]
What has TowneBank done on AI, and when?
- Aug 18, 2026
Talkdesk cites TowneBank as an automation reference[9]
Talkdesk's bank-branch launch points to TowneBank and Merchants Bank as financial organisations scaling customer engagement with automation.
- Jul 22, 2026
Second-quarter 2026 results; Towne Vacations sold[13]
Reported EPS $2.09; core EPS $0.78; $198.6 million gain; special dividend $0.70.
- Jun 22, 2026
UNCG MBA capstone on Microsoft Copilot adoption[10]
Students recommended meeting-preparation uses, a prompt manual and a training plan for using Copilot safely within the bank's private network.
- May 14, 2026
Guide to recognising AI scams[4]
Voice cloning and deepfake videos.
- Feb 27, 2026
2025 10-K: stand-alone AI risk factor[8]
AI law is 'uncertain and rapidly evolving'; generative models may produce incorrect or biased output; opacity complicates explaining decisions; third-party models limit visibility.
- Feb 17, 2026
Varun Chandhok named chief information officer[3]
Ex-WesBanco CIO; mandate to expand technology capabilities.
- Jan 12, 2026
- Dec 4, 2025
8-K: data incident at vendor Marquis[7]
Information held by Marquis that may have included names, contact details and Social Security or account numbers was involved; TowneBank's own systems were not affected and no misuse has been found.
- Oct 30, 2025
Talkdesk CX Innovators honourable mention[12]
Talkdesk reports 200+ simultaneous calls handled during the system conversion, a 23-second reduction in average handle time and a 97% satisfaction rate (vendor-reported).
- Sep 25, 2025
Talkdesk customer story: AI tools in member service[11]
TowneBank started with Talkdesk Copilot and Interaction & Quality Analytics on Talkdesk's Financial Services Experience Cloud, choosing AI features that enhance rather than replace human interactions.
- Aug 19, 2025
Dogwood State Bank acquisition announced[2]
$476 million in stock; 17 Carolinas branches; 8% EPS accretion projected for 2027.
- Jun 18, 2025
CIO Denys Diaz on Talkdesk and AI[6]
Talkdesk's cloud contact-centre platform supports member service; Diaz: 'there's nothing AI can't fix or help with'.
- Apr 3, 2025
Old Point Financial acquisition announced[1]
$203 million in cash and stock; 13 Hampton Roads and Richmond branches.
- May 22, 2024
SAS case study: CECL and member analytics in the cloud[5]
SAS credit-loss (CECL) framework reused for peer analysis and member-needs analytics; answers 'in hours instead of days or months'.
Where does TowneBank use AI today?
| System | What it does | Status | Use case |
|---|---|---|---|
| Talkdesk cloud contact centre with Talkdesk Copilot[6][11][12][9] | Member service runs on Talkdesk's cloud contact-centre platform, starting with Talkdesk Copilot agent assistance and Interaction & Quality Analytics; Talkdesk reports a 23-second cut in average handle time and a 97% satisfaction rate (vendor-reported). | In production | Customer-facing chatbots |
| Microsoft Copilot for bankers[10] | Copilot is installed on bankers' computers but rarely used by many; a UNC Greensboro MBA capstone recommended meeting-preparation uses, a prompt manual and a training plan for safe use within the bank's private network. | Rolling out | Generative & agentic AI |
| SAS credit-loss modelling and member analytics[5] | Cloud-based SAS CECL solution with 15 years of historical and forecast data; the framework is reused for peer analysis and member-needs analytics. | In production | Credit scoring & underwriting |
| AI risk-factor disclosure[8] | A stand-alone 10-K risk factor: evolving AI regulation, incorrect or biased generative-AI output, limited transparency of AI models, and dependence on third-party model developers. | In production | Model risk management |
| Cyber risk management and vendor incident response[8][7] | Aligned to FFIEC and NIST frameworks, with a vendor management programme and internal-audit testing; a 2025 incident at vendor Marquis was disclosed by 8-K. | In production | Cybersecurity |
| Acquisition integration (Old Point, Dogwood)[8][13][12] | Integration of Village (April 2025), Old Point (September 2025) and Dogwood State Bank (January 2026) across Virginia and the Carolinas; the 10-K names system-conversion delays among technology risks, and Talkdesk reports its contact centre handled 200+ simultaneous calls during a system conversion. | In production | Third-party & vendor AI |
| Customer education on AI scams[4] | Voice cloning and deepfake awareness. | In production | Fraud detection |
Use-case links open the tracker's rules-by-use-case matrix: which documents govern each system type.
Which AI vendors and fintechs does TowneBank work with?
| Company | What TowneBank uses it for | Status | Category |
|---|---|---|---|
| Talkdesk | Talkdesk Financial Services Experience Cloud contact centre with Talkdesk Copilot and Interaction & Quality Analytics for member service; named again in Talkdesk's August 2026 branch launch. | In production | Conversational AI |
| Microsoft 365 Copilot | Microsoft Copilot is installed on bankers' computers, but many rarely use it; a 2026 MBA capstone produced adoption recommendations. | In production | Enterprise AI assistants |
Each vendor and fintech page cites the source for the relationship, and vendor pages list products, pricing and other bank customers. Compare AI tools for banks by category, or read the fintech and neobank AI dossiers.
What has TowneBank disclosed in numbers?
| Metric | Value | As of |
|---|---|---|
| Q2 2026 reported / core earnings | $193.2 million ($2.09) / $72.0 million ($0.78)[13] | Jul 22, 2026 |
| Gain on sale of Towne Vacations | ≈ $198.6 million[13] | Jul 22, 2026 |
| Total deposits | $18.71 billion[13] | Jun 30, 2026 |
| Dogwood State Bank acquisition | $476 million in stock[2] | Aug 19, 2025 |
| Talkdesk-reported contact-centre results (vendor figures) | 23-second cut in average handle time; 97% satisfaction rate[12] | Oct 30, 2025 |
| Historical data in the SAS warehouse | 15 years[5] | May 22, 2024 |
“Varun is exceptionally well-equipped to further advance our technology strategy and champion our continued growth.”[3]
Lee Clark · Senior EVP and Chief Operating Officer · Feb 17, 2026
“The sale of Towne Vacations generated a gain of nearly $200 million, significantly enhancing our capital levels and tangible book value.”[13]
G. Robert Aston, Jr. · Executive Chairman · Jul 22, 2026
“I believe there's nothing AI can't fix or help with. When I joined TowneBank, I promised management I would relentlessly pursue progress and that mission is never done.”[6]
Denys Diaz · Chief Information Officer · Jun 18, 2025
“We have this resource sitting right there, and we don't always go grab it.”[10]
Scott Baker · Triad President · Jun 22, 2026
“We have a tool in the SAS platform to get those answers in hours instead of days or months.”[5]
Erich Reuter · EVP, Quantitative Analytics and Enterprise Stress Testing · May 22, 2024
Who runs AI at TowneBank?
William I. Foster IIILinkedIn ↗
President and CEO[13]
G. Robert Aston, Jr.LinkedIn ↗
Varun ChandhokLinkedIn ↗
Senior EVP and Chief Information Officer[3]
Lee ClarkLinkedIn ↗
Denys DiazLinkedIn ↗
Former Chief Information Officer (CIO in 2025)[6]
Scott Baker
Triad President[10]
Erich ReuterLinkedIn ↗
EVP, Quantitative Analytics and Enterprise Stress Testing[5]
Which regulators govern TowneBank's AI?
| Authority | Why it matters here | Documents |
|---|---|---|
| FDIC | TowneBank is a state nonmember bank that files its 10-K with the FDIC; FDIC third-party and model-risk guidance govern its vendor AI (Talkdesk, SAS) and acquisition conversions. | FDIC FIL-29-2023 FDIC FIL-15-2026 |
| CFPB | Consumer and mortgage products bring adverse-action and UDAAP duties to any automated decisioning. | ECOA / Regulation B adverse action (15 U.S.C. 1691(d); 12 CFR 1002.9) |
| Federal Reserve | Interagency third-party guidance applies to the Talkdesk, SAS and Marquis relationships and acquired-bank vendors. | SR 23-4 |
Side by side: SR 11-7 vs SR 26-2 · OCC vs CFPB on AI lending · PRA SS1/23 vs SR 26-2 · all comparisons.
What does the public record suggest about TowneBank's AI strategy?
Analysis by BankingNewsAI from the sources cited on this page. Observations, not advice.
01
The risk factor is ahead of the programme
TowneBank's 10-K describes generative-AI bias, opacity and third-party model risk in detail while the bank discloses no AI inventory or governance owner; naming one would close the gap.
02
Vendor AI is the default route
Talkdesk in the contact centre and SAS in risk analytics mean most AI will arrive inside vendor platforms, which puts vendor due diligence, already stressed by the Marquis incident, at the centre of AI risk.
03
The new CIO arrives with an AI-capable stack
Chandhok's WesBanco and M&T background is in enterprise platforms; expect consolidation of three acquired banks' systems before new AI.
04
Copilot adoption is the cheapest AI win
Microsoft Copilot is already licensed and installed; turning the capstone's prompt manual and training plan into routine use by bankers would deliver productivity without a new vendor.
05
Capital from Towne Vacations could fund technology
A near-$200 million gain is an unusual opportunity to invest in platforms without pressuring core earnings.
Does TowneBank use AI?
Through vendors. Member service runs on Talkdesk's cloud contact-centre platform with Talkdesk Copilot and Interaction & Quality Analytics, for which Talkdesk reports a 23-second cut in average handle time and a 97% satisfaction rate, and risk analytics run on SAS, which calls its platform AI-driven. Bankers have Microsoft Copilot on their computers, and a UNC Greensboro MBA team produced a prompt manual and training plan in 2026 to raise its use. The bank's 2025 10-K, filed with the FDIC, has a stand-alone AI risk factor that says the bank or its vendors may incorporate AI in business processes, services or products. It hired a new chief information officer in early 2026 and publishes customer guidance on AI scams. No AI leader, model inventory or AI budget has been disclosed.
Where does TowneBank file its annual report?
With the FDIC, not the SEC: TowneBank has no holding company, so its 10-K, 10-Qs and 8-Ks are filed under the Securities Exchange Act with the FDIC, which publishes them on its securities-filings site.
What did TowneBank sell in 2026?
Its Towne Vacations resort property-management segment, generating a pre-tax gain of about $198.6 million in the second quarter of 2026. Reported earnings were $193.2 million, or $2.09 per share, against core earnings of $72.0 million, or $0.78, and the bank paid a $0.70 special dividend and made a $25 million foundation contribution.
- Virginia's TowneBank strikes deal for a local rival
- Virginia's TowneBank strikes deal to deepen N.C. footprint
- TowneBank Welcomes Varun Chandhok as Chief Information Officer
- How to Recognize AI Scams in 2026
- Banking on cloud: TowneBank primes for continued growth with SAS
- Information superhighway: Denys Diaz
- TowneBank Form 8-K (Item 8.01: data security incident at a third-party service provider)
- TowneBank Annual Report on Form 10-K for the fiscal year ended December 31, 2025
- Talkdesk transforms the bank branch into an AI-powered advisory hub
- Bryan School Students Bring Fresh Perspective to TowneBank's AI Strategy
- TowneBank Customer Story
- Celebrating the CX Innovators winners shaping customer experience
- TowneBank Reports Second Quarter 2026 Earnings
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