Peoples Financial Services Corp. Completes $85M Private Placement

By Greg Peters • Saturday, June 07 06:01 • Permanent Link

Peoples Financial Services Corp. (NASDAQ: PFIS) has successfully completed a private placement of $85.0 million in aggregate principal amount of 7.75% fixed-to-floating rate subordinated notes due 2035. The company intends to use the proceeds for general corporate purposes and the redemption of existing subordinated debt.

The notes will initially bear interest at a rate of 7.75% per annum from issuance until June 15, 2030, with interest during this period payable semi-annually in arrears beginning December 15, 2025. From June 15, 2030, to the stated maturity date or early redemption date, the interest rate will reset quarterly to an annual floating rate equal to three-month term secured overnight financing rate plus 411 basis points, with interest during this period payable quarterly in arrears beginning September 15, 2030.

In connection with the issuance and sale of the notes, the company entered into a registration rights agreement with the purchasers of the notes. The notes have been structured to qualify as tier 2 capital for the company for regulatory capital purposes.

The company's Chief Executive Officer, Gerard A. Champi, expressed satisfaction with the successful completion of the offering, highlighting robust demand and favorable terms. He noted the company's strong position following continued excellent execution on its merger with FNCB Bancorp, Inc., as reflected in the first-quarter performance numbers.

The company's President, Thomas P. Tulaney, emphasized the disciplined approach to capital management, prioritizing balance sheet strength and being mindful of implications for shareholders.

Performance Trust Capital Partners, LLC acted as the sole placement agent for the notes offering, while Troutman Pepper Locke LLP served as legal counsel to the company and Luse Gorman, PC served as legal counsel to the placement agent.

Peoples Financial Services Corp. is the bank holding company of Peoples Security Bank and Trust Company, serving its retail and commercial customers through 39 full-service community banking offices located in Pennsylvania, New Jersey, and New York.

Following these announcements, the company's shares moved 1.22%, and are now trading at a price of $48.14. For more information, read the company's full 8-K submission here.

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