BRYN MAWR, Pa.–(GLOBE NEWSWIRE)–Bryn Mawr Bank Corporation (NASDAQ:BMTC) (the “Corporation”), parent of The Bryn Mawr Trust Company (the “Bank”), today announced that it has completed a private placement to certain institutional accredited investors of $30 million in aggregate principal amount of 4.75% fixed-to-floating subordinated notes (the “Notes”) which have been assigned an investment grade rating of BBB+ by Kroll Bond Rating Agency (“Kroll”). The Notes are non-callable for five years, and have a stated maturity of August 15, 2025. They will bear interest at a fixed rate of 4.75% until August 14, 2020, and thereafter will bear interest, until maturity or early redemption, at a variable rate that will reset quarterly to a level equal to the then current 3-month LIBOR plus 306.8 basis points.
The Notes were issued at the holding company level, and have been structured to qualify as Tier 2 capital under regulatory guidelines. The Corporation intends to use the proceeds from the sale for general corporate purposes including share repurchases, funding of the termination of the Corporation’s pension plan, possible acquisitions and organic growth.
“We are extremely proud of the vote of confidence the market has signaled by achieving an initial 4.75% interest rate on our subordinated debt, which we understand to be the lowest rate ever achieved in a BBB range Kroll-rated subordinated debt issuance with a 10 year maturity,” Frank Leto, President and Chief Executive Officer of the Corporation commented. “This offering, along with the recent decisions of our Board of Directors to approve a new stock repurchase plan and terminate our frozen pension plan, are part of our ongoing capital planning strategies. The pension plan termination will alleviate volatility and unpredictability that we have recently experienced in our earnings as a result of this defined benefit plan. Having made these strategic moves, we believe we are in a strong position to increase our earnings per share, and to enhance our Tier 2 regulatory capital position.”