Summary
FIRST CITIZENS BANCSHARES INC /DE/ (FCNCA) filed an 8-K on June 3, 2005, reporting a material definitive agreement related to the issuance of debt by its wholly owned subsidiary, First-Citizens Bank & Trust Company (the "Bank"). Specifically, the Bank completed the sale of $125 million in 5.125% Subordinated Notes due 2015. These notes are unsecured and subordinated to senior indebtedness and depositor claims. The proceeds from this issuance are intended to support the Bank's continued growth and general corporate purposes, and the notes are expected to be treated as Tier 2 capital for regulatory purposes, subject to FDIC approval. This transaction represents a key financing event for the Bank as it pursues expansion.
Key Highlights
- 1First-Citizens Bank & Trust Company issued $125 million in 5.125% Subordinated Notes due 2015.
- 2The notes are unsecured and subordinated to senior debt and depositor obligations.
- 3Proceeds are earmarked for supporting the Bank's continued growth and general corporate purposes.
- 4The Bank intends to classify these notes as Tier 2 capital for regulatory purposes, subject to FDIC approval.
- 5The issuance was conducted under an Indenture and First Supplemental Indenture dated June 1, 2005.
- 6The notes mature on June 1, 2015, with semi-annual interest payments beginning September 30, 2005.
- 7Redemption of the notes by the Bank is at its option, subject to receipt of regulatory approvals and certain conditions.
Frequently Asked Questions
The primary purpose of the issuance is to support the Bank's continued growth and for general corporate purposes. Additionally, the Bank intends to treat these notes as Tier 2 capital for regulatory purposes, subject to FDIC approval, which can bolster its capital position.
These notes are subordinated. They rank below all of the Bank's existing and future senior indebtedness, as well as claims from depositors, obligations under banker's acceptances and letters of credit, Federal Reserve Bank obligations, and other general or secured creditors.
The notes mature on June 1, 2015. Interest is payable semi-annually at an annual rate of 5.125%, with the first payment scheduled for September 30, 2005.
Yes, the Bank may redeem the notes in whole or in part, at its option, provided it receives the required approvals from the Federal Deposit Insurance Corporation and the North Carolina Commissioner of Banks. Certain conditions, such as the absence of an 'event of default,' also apply.