First Interstate BancSystem redeems 5.25% subordinated notes due 2030

Published 18/08/2025, 22:44
First Interstate BancSystem redeems 5.25% subordinated notes due 2030

First Interstate BancSystem, Inc. (NASDAQ:FIBK), a regional bank with a market capitalization of $3.2 billion and an overall "Fair" financial health score according to InvestingPro, announced on Friday that it redeemed all of its outstanding 5.25% Fixed-to-Floating Rate Subordinated Notes due 2030. The redemption was completed at 100% of the principal amount, plus accrued and unpaid interest up to, but not including, August 15, 2025, in line with the terms of the original indenture agreement. The company maintains a strong dividend track record, having paid dividends consistently for 16 consecutive years, with a current yield of 6.2%.

The company had previously notified holders of the notes on July 3, 2025, that it would redeem the notes on the August 15 redemption date. The redemption was carried out according to the Indenture dated May 15, 2020, and the First Supplemental Indenture between First Interstate BancSystem and U.S. Bank Trust Company, National Association, as trustee.

According to the SEC filing, First Interstate BancSystem deposited sufficient funds with the trustee to cover the redemption price and has satisfied and discharged its obligations under the notes and the related indenture. The company’s debt management appears prudent, with a debt-to-equity ratio of 0.37x, suggesting a conservative financial approach. InvestingPro analysis indicates the stock is currently undervalued, with additional insights available in the comprehensive Pro Research Report covering over 1,400 US stocks. As a result, the company has been released from all obligations under these notes and the First Supplemental Indenture, effective as of the redemption date.

The filing also notes that the company’s obligations regarding its $125 million aggregate principal amount of 7.625% Fixed-to-Floating Rate Subordinated Notes due 2035 remain governed by the base indenture, as supplemented by a second supplemental indenture dated June 10, 2025.

This information is based on a press release statement included in First Interstate BancSystem’s Form 8-K filed with the Securities and Exchange Commission.

In other recent news, First Interstate BancSystem reported its financial results for the second quarter of 2025, exceeding earnings expectations with an earnings per share (EPS) of $0.69, surpassing the forecasted $0.58. However, the company’s revenue did not meet projections, recording $248.3 million against the anticipated $253.14 million. Additionally, First Interstate BancSystem has appointed Michael L. Scudder as a Class I director on its board. This appointment fills a vacancy due to the board’s decision to increase its size. Mr. Scudder, who retired as Executive Chairman of Old National Bancorp (NASDAQ:ONB) in January 2024, has an extensive background in commercial banking. His term as director will expire at the company’s 2028 annual meeting of shareholders. These developments are part of the company’s recent activities.

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