By Lisa Kerner
Charlotte, N.C., Aug. 26 – First Business Financial Services, Inc. issued $15 million of 10-year subordinated notes to three accredited investors on Tuesday.
Interest is fixed at 6.5% for the first five years. From and including Sept. 1, 2019 to the maturity date, the interest rate will reset quarterly to an interest rate per annum equal to Libor plus 470 basis points, payable quarterly in arrears.
Beginning with the interest payment date of Sept. 1, 2019 and on any interest payment date thereafter, First Business may redeem the notes, in whole or in part, at a redemption price equal to 100% of the principal amount plus accrued interest.
Sandler O'Neill + Partners, LP acted as placement agent.
Proceeds of about $13.5 million will used as the cash portion of the merger consideration in the company’s acquisition of Aslin Group, Inc. and its subsidiary, Alterra Bank.
Remaining proceeds will be used to increase regulatory capital and for general corporate purposes, according to an 8-K filing with the Securities and Exchange Commission.
The bank holding company is based in Madison, Wis.
| Issuer: | First Business Financial Services, Inc.
|
| Issue: | Subordinated notes
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| Amount: | $15 million
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| Coupon: | 6.5% for first five years, then Libor plus 470 bps
|
| Maturity: | Sept. 1, 2024
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| Call option: | At par on any interest payment date from Sept. 1, 2019 onward
|
| Agent: | Sandler O'Neill + Partners, LP
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| Settlement date: | Aug. 26
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