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Equity Bancshares, Inc. (NYSE:EQBK), a $776.55 million market cap regional bank with a GOOD financial health score according to InvestingPro, announced Thursday the completion of a $75 million offering of 7.125% fixed-to-floating rate subordinated notes due 2035. The transaction was conducted through a private placement with qualified institutional buyers and institutional accredited investors.
According to a press release statement, the notes were issued under an indenture with UMB Bank, N.A. as trustee. The notes will mature on August 1, 2035. From July 17, 2025, through July 31, 2030, interest will be paid semi-annually at a fixed rate of 7.125% per year. Starting August 1, 2030, and until maturity or earlier redemption, interest will be paid quarterly at a floating rate equal to the then-current Three-Month Term SOFR plus 349 basis points, with a floor of zero for the benchmark rate. This debt offering adds to the company’s existing total debt of $444.22 million, maintaining a moderate debt-to-equity ratio of 0.7.
The company may redeem the notes in whole or in part beginning August 1, 2030, or in whole upon certain regulatory or tax events, at 100% of the principal amount plus accrued interest, subject to regulatory approval.
The notes are general unsecured, subordinated obligations of Equity Bancshares and rank junior to all existing and future senior indebtedness. They are equal in right of payment with other subordinated debt and senior to junior subordinated obligations. The notes are effectively subordinated to secured indebtedness to the extent of the collateral value.
There is no right of acceleration of maturity in case of default on principal or interest payments, except in the event of bankruptcy, insolvency, or similar proceedings.
Equity Bancshares entered into a registration rights agreement with investors, agreeing to conduct an exchange offer for registered notes with substantially the same terms. Failure to meet certain obligations under this agreement would result in additional interest payments to noteholders.
The company stated it intends to use net proceeds for general corporate purposes, including repayment of indebtedness. InvestingPro analysis shows the bank has maintained strong financial metrics, with a 25% dividend growth in the last twelve months and a price-to-book ratio of 1.22. For deeper insights into EQBK’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
This information is based on a press release statement and details provided in the company’s filing with the Securities and Exchange Commission.
In other recent news, Equity Bancshares reported its second-quarter 2025 earnings, which fell short of expectations. The company posted an earnings per share (EPS) of $0.86, missing the forecasted $0.888, while revenue was $58.39 million, below the expected $60.46 million. Despite the earnings miss, Equity Bancshares completed a merger with NBC Bank, which contributed to loan production growth. Keefe, Bruyette & Woods responded to the earnings report by raising Equity Bancshares’ stock price target to $45, noting lower provisions and tax rates as factors that exceeded expectations. DA Davidson also increased its price target to $44, highlighting the bank’s net interest margin strength and potential for future mergers and acquisitions. The firm, however, cautioned about credit quality concerns, particularly in the restaurant sector. Equity Bancshares maintains a positive outlook for credit conditions in 2025, with expectations for loan balance growth and stable margins. The company also anticipates continued strong performance in existing markets and expansion into Oklahoma City.
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