Bullish indicating open at $55-$60, IPO prices at $37
Patriot National Bancorp Inc. (NASDAQ:PNBK), a commercial banking institution currently trading near its 52-week low of $0.99, has amended its articles of incorporation to introduce a new series of preferred stock, the company disclosed in a recent SEC filing. The amendment, effective as of March 13, 2025, establishes the Series A Non-Cumulative Perpetual Convertible Preferred Stock. According to InvestingPro data, the bank’s shares have declined over 73% in the past year, though analysis suggests the stock may be undervalued at current levels.
According to the SEC Form 8-K filed on Wednesday, the Certificate of Amendment was filed with the Secretary of State of Connecticut, where the company is incorporated. This move does not immediately result in any shares of Series A Preferred Stock being outstanding, but it lays the groundwork for potential future issuance. With a market capitalization of just $4.17 million and a price-to-book ratio of 0.25, the bank appears to be seeking strategic options to strengthen its capital position.
The details of the Series A Preferred Stock, including its specific rights, preferences, and limitations, were not disclosed in the summary provided in the SEC filing. However, the full text of the Certificate of Amendment is attached to the filing as Exhibit 3.1 for those seeking more in-depth information. InvestingPro subscribers can access additional insights, including 11 more ProTips and comprehensive financial metrics to better evaluate this strategic move’s potential impact.
The introduction of a new preferred stock series can be a strategic move for companies looking to raise capital or provide investors with alternative investment options. Preferred stocks typically offer dividends and have priority over common stocks in the event of liquidation, but they may come with different voting rights. This move comes as the bank reported a loss per share of $7.41 over the last twelve months, highlighting the potential need for additional capital resources.
Patriot National Bancorp’s filing also clarifies that this report does not constitute an offer to sell or a solicitation of an offer to buy any securities. Moreover, there will be no sale of these securities in any jurisdiction where such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction.
Investors and stakeholders can access the SEC filing for complete details on the amendment and the characteristics of the new preferred stock series. This information is based on a press release statement and should be verified independently for accuracy.
In other recent news, Patriot National Bancorp Inc. reported a preliminary net loss of approximately $9.5 million for the last quarter of 2024, contrasting with a net income of $0.9 million from the previous year. The bank attributed this loss primarily to a provision for credit losses related to two large commercial real estate loans. Additionally, the company announced a significant amendment to its financial obligations by extending the grace period for interest payments on its Senior Notes. Patriot National Bancorp is also exploring strategic alternatives, including potential capital raises or mergers, with non-binding term sheets received for a $60 million investment. In regulatory developments, the bank entered into an agreement with the Office of the Comptroller of the Currency, which requires the establishment of a Compliance Committee and maintaining specific capital ratios. The company appointed Steven Sugarman as President amid these strategic evaluations, aiming to enhance shareholder value. Furthermore, the bank secured an exception from Nasdaq’s shareholder approval rules to maintain its listing. Lastly, at its recent Annual Meeting, shareholders elected six directors and ratified RSM US LLP as the independent auditor for the 2025 fiscal year.
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