Sound Financial Bancorp, Inc. Completes Private Placement of $12.0 Million of Subordinated Notes
SEATTLE, Sept. 18, 2020 (GLOBE NEWSWIRE) -- Sound Financial Bancorp, Inc. (Nasdaq: SFBC) (the “Company”), the parent company of Sound Community Bank (the “Bank”), today announced the completion of a private placement of $12.0 million in aggregate principal amount of 5.25% Fixed-to-Floating Rate Subordinated Notes due 2030 (the “Notes”). The Company intends to use the proceeds of the private placement for general corporate purposes.
The Notes will initially bear interest at a fixed rate of 5.25% per annum from September 18, 2020 to October 1, 2025, with interest during this period payable semiannually in arrears. From October 1, 2025 to the stated maturity date or early redemption date, the interest rate will reset quarterly to an annual floating interest rate equal to Three-Month Term Secured Overnight Financing Rate plus 513 basis points, with interest during this period payable quarterly in arrears. The Notes are redeemable by the Company, in whole or in part, on or after October 1, 2025, and at any time upon the occurrence of certain events. The Notes have been structured to qualify as Tier 2 capital for the Company for regulatory capital purposes.
In connection with the issuance of the Notes, the Company recently obtained a rating from Egan-Jones Ratings Company (“Egan-Jones”), a nationally recognized statistical rating organization. Egan-Jones assigned the Notes an investment grade rating of BBB.
Keefe, Bruyette & Woods, A Stifel Company acted as the sole placement agent for the Notes offering. Silver, Freedman, Taff & Tiernan LLP served as legal counsel to the Company and Squire Patton Boggs (US) LLP served as legal counsel to the placement agent.
The Notes have not been registered under the Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release is for informational purposes only and shall not constitute an offer to sell, or the solicitation of an offer to buy any security, nor shall there be any sale in any jurisdiction in which such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. The indebtedness evidenced by the Notes is not a deposit and is not insured by the Federal Deposit Insurance Corporation or any other government agency or fund.