Federal agents reportedly are investigating the possibility that a small bank in the southwest Virginia coalfields, taken over last year by Virginia National Bank, may have been used to handle large undocumented cash transactions.

Investigators are trying to find out why First State Bank of Wise did not file certain required federal documents, thereby allowing an unreported flow of large sums of money, officials told the Roanoke Times & World-News.

Without the required documents, called currency transaction reports, the government cannot quickly monitor major transactions. Unless exemptions are granted, the reports are required whenever a bank takes in or gives out more than $10,000 in a single transaction, the officials said.

Failure to file these reports can result in felony charges against bank officials if the amount involved reaches at least $100,000 within 12 months. Conviction could bring as much as five years in jail and a fine up to $500,000.

Investigators said the bank, before it was acquired by Virginia National, handled many large transactions but filed only a handful of the reports, the newspaper reported last week.

In addition, investigators have received information that a southwest Virginia coal operator, suspected of involvement in an international drug smuggling operation, may have been involved in at least one large unreported transaction, the newspaper said.

The Internal Revenue Service conducted the probe and information has been given to a federal grand jury in Roanoke.

Carl Snodgrass, senior vice president of VNB's office in the Wise and Norton area and former president of First State Bank, has submitted his resignation. Virginia Electric and Power Co. says the "potential" for a coal-slurry pipeline helped the utility save $7 million in a three-year coal-hauling contract with CSX Corp.

But a railroad spokesman said Friday coal slurry "had nothing to do with this contract."

Under the new contract, CSX will reduce railroad single-car and trainload rates. The contract will save Vepco $7 million annually, the utility and CSX said, and the savings "are passed on to Vepco customers."

"The potential for a coal-slurry pipeline worked to our advantage in negotiating favorable rates in this contract with CSX," said Vepco spokesman Dennis Hedgepeth.

Vepco is pushing for legislation in the 1983 General Assembly to end a ban on coal-slurry pipelines, which the utility said it could use to transport coal to power stations at a cheaper rate.

CSX, which hauls 70 percent of the coal used by Vepco, and Norfolk-Southern say the pipelines will take coal-hauling business from the railroads. "Our position is that we're going to fight like hell on coal slurry," said Ed Edel, CSX vice president for corporate communications. "But it had nothing to do with this contract."

Vepco burned 3.7 million tons of coal in 1982 at Virginia coal plants and is expected to use about 6 million tons annually by 1986 as the utility switches oil-burning plants to coal. Dividends: Avemco Corp. declared a quarterly dividend of 14 1/2 cents per share, payable Jan. 26 to stockholders of record Dec. 28.

About 500 workers at the Lynchburg Foundry, laid off from the Lower Basin plant on Nov. 19, will begin returning to their jobs this month, according to a company spokesman. About 50 will remain jobless.

About 250 of the workers were recalled to their jobs Jan. 3. The company had planned to recall the workers when it announced the layoffs.

About 250 additional workers will be recalled gradually when new precision moulding and machine and support equipment is installed. The plant has been closed since the layoffs.

Mead Corp., the foundry's parent company, spent $3 million for the new machinery and renovations. Jay's, the discount women's fashion chain based in Pikesville, Md., has opened its eighth Washington-Baltimore location at the Montgomery Village Fashion Center in Gaithersburg. Marriott Corp. has broken ground for a 403-room hotel in downtown Richmond. The hotel is scheduled for completion in the fall of 1984. The Richmond Marriott Hotel and Convention Center will be owned and operated by Marriott. Marriott has also broken ground for a 506-room hotel in Houston, Texas. The hotel, which will be the company's seventh in the city and 16th in the state, will be owned and operated by Marriott and is scheduled for completition in mid-1984. The Maryland Community Development Administration (CDA) is now loaning $4.9 million at 8 1/2 percent interest under the Maryland Housing Rehabiliation Program. The MHRP will will provide 20-year, below-market-rate loans to qualified borrowers for the repair and renovation of single- and multifamily rental properties (up to 20 units) and nonresidential properties.

Eligible owners of single-family homes may borrow up to $30,000, and multifamily owners may borrow up to $30,000 for the first unit and $20,000 for each additional unit, but not to exceed $200,000. Nonresidential owners can borrow $50,000 a unit on up to 20 units, not to exceed $200,000.

Loans may be used to correct housing code violations; interior and exterior deficiencies and for the replacement of heating, electrical or plumbing systems. Also eligible are modifications for the handicapped and energy conservation measures.

The program funds were generated from a recent state sale of general obligation bonds. Funds are allocated to each Maryland county and will be held for the exclusive use of county residents for six months.

The number of businesses filing with the federal bankruptcy court in western Virginia increased by more than 40 percent last year, according to Howard Beck, clerk of the U.S. Bankruptcy Court for western Virginia.

The overall number of cases filed for western Virginia declined slightly, but 875 businesses, most of them small companies, sought protection in 1982, up from 625 in 1981. The total number of bankruptcy cases was 3,338 in 1982, down 1.3 percent from 3,382 in 1981.

The number of people filing for bankruptcy decreased by 7.5 percent, down from 4,912 in 1981 to 4,875 in 1982. Every individual involved in a case is counted. Riviere Realty Trust of Washington has sold two motels in Indianapolis for $1.8 million and will earn a $695,000 capital gain on the sale.

President David H. Hoster II said Riviere acquired the two motels in 1979 when the owners could not make payments on a mortgage held by Riviere. Riviere Trust took over the properties to avoid foreclosure. The Federal Communications Commission has agreed to assign a second commercial channel--UHF channel 68--to Hagerstown, Md., effective Feb. 11. Interested parties may file applications with the FCC to construct a new station using the channel.