<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE EXCHANGE ACT OF 1934
(AMENDMENT NO.__)
SOUTHERN FINANCIAL BANCORP, INC.
- --------------------------------------------------------------------------------
(Name of Issuer)
COMMON STOCK
- --------------------------------------------------------------------------------
(Title of Class of Securities)
842870107
-------------------------------------------------------------------
(CUSIP Number)
RICHARD J. PERRY JR., ESQUIRE
PERRY & ASSOCIATES, P.C.
1826 JEFFERSON PLACE, N.W.
WASHINGTON, D.C. 20036
TEL: (202) 775-8109
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
FEBRUARY 11, 1998
-----------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box ___ .
Check the following box if a fee is being paid with this statement._X_. A fee is
not required only if the reporting person (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item (1); and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.
<PAGE> 2
CUSIP NUMBER 842870107 PAGE 2 OF 14 PAGES
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<TABLE>
<S> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON/ S.S. OR I.R.S. IDENTIFICATION OF ABOVE PERSON
Financial Institution Partners II, L.P. /36-4131559
- ---------------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ____
(b) ____
- ---------------------------------------------------------------------------------------------------------------------------------
3. SOURCE OF FUNDS
WC OO
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4. IS DISCLOSURE OF LEGAL PROCEEDING REQUIRED PURSUANT TO ITEMS 2(d) AND 2(e)
NO
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5. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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NUMBER OF 6. SOLE VOTING POWER
SHARES -------------------------------------------------------------------------------------------------------
7. SHARED VOTING POWER
OWNED BY
100,000 SHARES
EACH -------------------------------------------------------------------------------------------------------
8. SOLE DISPOSITIVE POWER
REPORTING
-------------------------------------------------------------------------------------------------------
PERSON WITH 9. SHARED DISPOSITIVE POWER
100,000 SHARES
- ---------------------------------------------------------------------------------------------------------------------------------
10. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
100,000 SHARES
- ---------------------------------------------------------------------------------------------------------------------------------
11. DOES THE AGGREGATE AMOUNT IN BOX 10 EXCLUDE CERTAIN SHARES?
NO
- ---------------------------------------------------------------------------------------------------------------------------------
12. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (10)
6.28%
- ---------------------------------------------------------------------------------------------------------------------------------
TYPE OF REPORTING PERSON
13. PN
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</TABLE>
Page 2 of 14 Pages
<PAGE> 3
CUSIP NUMBER 842870107 PAGE 3 OF 14 PAGES
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<TABLE>
<S> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON/ S.S. OR I.R.S. IDENTIFICATION OF ABOVE PERSON
Hovde Capital, L.L.C./ 91-1825712
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) ____
(b) ____
- ---------------------------------------------------------------------------------------------------------------------------------
3. SOURCE OF FUNDS
AF
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4. IS DISCLOSURE OF LEGAL PROCEEDING REQUIRED PURSUANT TO ITEMS 2(d) AND 2(e)
NO
- ---------------------------------------------------------------------------------------------------------------------------------
5. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- ---------------------------------------------------------------------------------------------------------------------------------
NUMBER OF 6. SOLE VOTING POWER
SHARES
OWNED BY -----------------------------------------------------------------------------------------------------------
EACH 7. SHARED VOTING POWER
REPORTING
PERSON WITH 100,000 SHARES
-----------------------------------------------------------------------------------------------------------
8. SOLE DISPOSITIVE POWER
-----------------------------------------------------------------------------------------------------------
9. SHARED DISPOSITIVE POWER
100,000 SHARES
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10. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
100,000 SHARES
- ---------------------------------------------------------------------------------------------------------------------------------
11. DOES THE AGGREGATE AMOUNT IN BOX 10 EXCLUDE CERTAIN SHARES?
NO
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12. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (10)
6.28%
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TYPE OF REPORTING PERSON
13. CO
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</TABLE>
Page 3 of 14 Pages
<PAGE> 4
ITEM 1. SECURITY AND ISSUER
The class of security to which this statement relates is the common
stock, par value $.01 per share (the "Shares"), of Southern Financial Bancorp,
Inc. (the "Issuer"). The address of the principal executive offices of the
Issuer is 37 East Main Street, Warrenton, VA 20186.
ITEM 2. IDENTITY AND BACKGROUND
The persons filing this statement are Financial Institution Partners
II, L.P. (the "Limited Partnership") and Hovde Capital, L.L.C., who are
collectively referred to herein as the "Reporting Persons." The Limited
Partnership is a Delaware limited partnership formed for the purpose of
investing in, among other things, the equity securities of various financial
institutions and financial services companies. Hovde Capital, L.L.C., a Nevada
limited liability company, is the general partner (the "General Partner") of the
Limited Partnership.
Attached as Schedule 1 hereto and incorporated by reference herein is
a list containing the principal business and the address of its principal
business and office for the Limited Partnership and the General Partner as well
as information required by (a) through (f) of this Item as to each executive
officer, director and/or controlling person of the General Partner. The General
Partner controls the Limited Partnership.
None of the Reporting Persons or executive officers, directors or
controlling persons of the General Partner has, during the last five years, been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
The Reporting Persons do not believe that they constitute a "group"
within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934.
Nevertheless, the Reporting Persons are making this filing because of the
possibility that they may be deemed a group, although each of the Reporting
Persons disclaims any membership in, and the existence of, such a group. Neither
the making of this filing nor any statement contained herein shall be deemed to
be an admission by any of the Reporting Persons that a group exists.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Information regarding the source and amount of funds used by the
Reporting Persons in acquiring beneficial ownership of their Shares is set forth
in Schedule 2 attached hereto and incorporated herein by reference.
Page 4 of 14 Pages
<PAGE> 5
ITEM 4. PURPOSE OF TRANSACTION
The Reporting Persons have acquired the Shares for investment
purposes and as set forth below:
(a) Each of the Reporting Persons may independently acquire
additional Shares or dispose of some or all of its Shares.
(b) None.
(c) None.
(d) None.
(e) None.
(f) None.
(g) None.
(h) None.
(i) None.
(j) None.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) (b) Schedule 3 hereto, which is incorporated by reference herein,
sets forth, as of February 18, 1998, information relating to the aggregate
number of Shares of the Issuer and the percentage of the outstanding Shares of
the Issuer as of such date (based upon information provided by the Issuer, there
are 1,591,679 Shares outstanding as of that date) as to each of the Reporting
Persons.
(c) None.
(d) None.
(e) Not applicable.
Each of the Reporting Persons disclaims beneficial ownership of
Shares beneficially owned by any of the other Reporting Persons.
Page 5 of 14 Pages
<PAGE> 6
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
None.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS
Exhibit A- Consent Agreement pursuant to 17 C.F.R. Section 13d-1(F)(1)
Page 6 of 14 Pages
<PAGE> 7
Signatures
After reasonable inquiry and to the best of his/its knowledge and
belief, each of the undersigned Reporting Persons certifies that the information
set forth in this statement with respect to him/it is true, complete and
correct.
FINANCIAL INSTITUTION PARTNERS II,
L.P., by its General Partner,
HOVDE CAPITAL, L.L.C.
By: /s/ Eric D. Hovde
----------------------------------
Eric D. Hovde
Its: Manager
HOVDE CAPITAL, L.L.C.
By: /s/ Eric D. Hovde
----------------------------------
Eric D. Hovde
Its: Manager
Dated: 2/18/98
--------------
Page 7 of 14 Pages
<PAGE> 8
SCHEDULE 1
INFORMATION RELATING TO REPORTING PERSONS
<TABLE>
<CAPTION>
PRINCIPAL BUSINESS AND
ADDRESS OF PRINCIPAL BUSINESS
NAME OR PRINCIPAL OFFICE
---- -------------------
<S> <C>
Financial Institution Partners II, L.P. Limited partnership formed to make investments
primarily in equity securities of financial institutions
and financial services companies
1629 Colonial Parkway
Inverness, Illinois 60067
Organized: State of Delaware
Hovde Capital, L.L.C. Limited liability company formed to serve as the
general partner of the Limited Partnership
1629 Colonial Parkway
Inverness, Illinois 60067
Incorporated: State of Delaware
</TABLE>
Page 8 of 14 Pages
<PAGE> 9
INFORMATION RELATING TO EXECUTIVE OFFICERS, DIRECTORS AND/OR CONTROLLING PERSONS
<TABLE>
<CAPTION>
NAME PRINCIPAL OCCUPATION
ADDRESS BUSINESS ADDRESS CITIZENSHIP
- ----------- -------------------- ---------------
<S> <C> <C>
Steven D. Hovde Investment banker U.S.
1629 Colonial Parkway Hovde Financial, Inc.
Inverness, Illinois 60067 1629 Colonial Parkway
Inverness, Illinois 60067
Investment banking firm
Eric D. Hovde Investment banker U.S.
1826 Jefferson Place, N.W. Hovde Financial, Inc.
Washington, D. C. 20036 1826 Jefferson Place, N.W.
Washington, D. C. 20036
Investment banking firm
</TABLE>
Page 9 of 14 Pages
<PAGE> 10
SCHEDULE 2
The following table sets forth the amount and source of funds used by
each Reporting Person in acquiring the Shares beneficially owned by it.
<TABLE>
<CAPTION>
AMOUNT
ORIGINALLY
TOTAL FINANCED/ SOURCE OF
NAME CONSIDERATION CURRENT BALANCE FUNDS*
- ---- ------------- --------------- -----------
<S> <C> <C> <C>
Financial $2,050,000.00 $1,025,000/ Working Capital/
Institution $1,025,000 Line of Credit
Partners II, L.P.
Working Capital/
$2,050,000.00 $1,025,000/ Line of Credit of
Hovde Capital, $1,025,000 Affiliate
L.L.C.
</TABLE>
- -------------
* $1,025,000 was financed through a line of credit with Harris Trust of Chicago
at Federal Funds rate +5/8.
Page 10 of 14 Pages
<PAGE> 11
SCHEDULE 3
The following table sets forth the number and approximate percentage
of Shares beneficially owned by each of the Reporting Persons. Each of the
Reporting Persons has shared power to vote or to direct the vote and to dispose
or to direct the disposition of the Shares of which each of them, respectively,
possesses beneficial ownership.
<TABLE>
<CAPTION>
APPROXIMATE
NAME NUMBER OF SHARES PERCENTAGE
- ---- ---------------- -----------
<S> <C> <C>
Financial Institution 100,000 6.28%
Partners II, L.P.
Hovde Capital, L.L.C. 100,000 6.28%
</TABLE>
Page 11 of 14 Pages
<PAGE> 12
SCHEDULE 4
DESCRIPTION OF TRANSACTIONS IN SHARES EFFECTED WITHIN 60 DAYS
The reporting persons effected the following transactions in the Shares within
sixty (60) days of February 16, 1998.
<TABLE>
<CAPTION>
TRANSACTION AMOUNT OF TRANSACTION TRANSACTION
DATE SHARES PRICE BROKER TYPE
- ----------- --------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
02/11/98 100,000 $20.50 Scott* Buy
</TABLE>
- --------------------------
* Scott and Stringfellow
Page 12 of 14 Pages
<PAGE> 13
EXHIBIT INDEX
<TABLE>
<CAPTION>
Page
<S> <C> <C>
Exhibit A Consent Agreement pursuant to 17 C.F.R. Section 13d-1(f)(1) 14
</TABLE>
Page 13 of 14 Pages
<PAGE> 1
EXHIBIT A
Consent Agreement Pursuant to 17 C.F.R. Section 13d-1(f)(1)
Each of the undersigned hereby consents and agrees to the filing on
behalf of each of them of the foregoing joint statement on Schedule 13D pursuant
to 17 C.F.R. 13d-1(f)(1) with respect to his/its beneficial ownership of the
shares of the Issuer.
FINANCIAL INSTITUTION PARTNERS II, L.P.,
by its General Partner, HOVDE CAPITAL, L.L.C.
By: /s/ Eric D. Hovde
--------------------------------------
Its: Manager
HOVDE CAPITAL, L.L.C.
By: /s/ Eric D. Hovde
--------------------------------------
Its: Manager
Page 14 of 14 Pages
