8-KShareholder MattersCorporate ChangesOther Events+1

CITIZENS FINANCIAL GROUP INC/RI 8-K Report, Rights Modification (Jan 29, 2019)

Filed January 29, 2019For Securities:CFGCFG-PHCFG-PECFG-PI

Summary

This Current Report on Form 8-K for Citizens Financial Group, Inc. (CFG) primarily details the issuance and terms of its new Series D Fixed-To-Floating Rate Non-Cumulative Perpetual Preferred Stock. This new preferred stock, along with its associated depositary shares, introduces restrictions on CFG's ability to pay dividends or repurchase common stock if preferred stock dividends are not met. This filing is important for investors as it clarifies the capital structure changes and potential impacts on common shareholder distributions. The company has entered into an Underwriting Agreement for the public offering of 12,000,000 depositary shares, each representing a fraction of a share of the Series D Preferred Stock. The Certificate of Designations, filed with Delaware's Secretary of State, legally establishes the terms and preferences of this new series of preferred stock. Investors should pay close attention to these terms to understand how this new issuance affects their rights and the company's financial flexibility.

Key Highlights

  • 1Citizens Financial Group, Inc. (CFG) issued 6.350% Fixed-To-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series D.
  • 2The issuance of Series D Preferred Stock imposes restrictions on future dividend payments and share repurchases of common stock if preferred dividends are not paid.
  • 3CFG entered into an underwriting agreement for the public offering of 12,000,000 depositary shares, each representing an interest in the Series D Preferred Stock.
  • 4A Certificate of Designations was filed to establish the specific rights, preferences, and limitations of the Series D Preferred Stock.
  • 5The terms of the Series D Preferred Stock and related agreements are publicly filed as exhibits to this report.
  • 6This action affects the company's capital structure and potential distributions to common shareholders.

Frequently Asked Questions

The main purpose of this filing is to report on the issuance of a new series of preferred stock (Series D) and the related agreements, including the underwriting and deposit agreements for the associated depositary shares. It also details the new restrictions that come with this issuance on the company's ability to pay dividends or repurchase common stock.

The Series D Preferred Stock introduces restrictions. If CFG fails to declare and pay dividends on the Series D Preferred Stock, its ability to declare or pay dividends on, or repurchase, its common stock will be limited. This could impact the timing and amount of distributions available to common shareholders.

Depositary shares are issued by a depositary bank, representing an ownership interest in a larger number of underlying shares of preferred stock. In this case, 12,000,000 depositary shares were offered, each representing a fraction (1/40th) of a share of the Series D Preferred Stock. This is a common way to make preferred stock more accessible to a wider range of investors.

The detailed terms, including the preferences, limitations, and relative rights of the Series D Preferred Stock, are outlined in the Certificate of Designations, which was filed with the Secretary of State of Delaware. A copy of this Certificate of Designations is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated by reference.