JENNINGS, La., Jan. 13, 2017 /PRNewswire/ -- Jeff Davis Bancshares, Inc. (JDVB), the parent company of JD Bank, today announced the closing of a $17.5 million private placement of fixed-to-floating rate subordinated notes. The company plans to use the additional capital for general corporate purposes including organic growth initiatives at JD Bank as well as potential M&A opportunities.
The notes have a maturity date of January 15, 2027 and carry a fixed rate of interest of 6.75% for the first five years. Thereafter, the notes will pay interest at LIBOR plus 469 basis points. The notes include a right of prepayment, without penalty, on or after January 15, 2022. The subordinated notes have been structured to qualify as Tier 2 capital for regulatory purposes.
President and Chief Executive Officer Boyd R. Boudreaux discussed the offering: "We are pleased to announce the successful completion of our subordinated debt offering. This new capital will provide a strong base for continued growth without the dilutive impact of issuing new shares of stock. Furthermore, the tax-deductible nature of the instrument, combined with historic low interest rates, makes the overall cost of capital quite attractive."
Sandler O'Neill + Partners, L.P. served as the sole placement agent for the private offering. The company was advised by Fenimore Kay Harrison and Ford, LLP.
About JD Bank
JD Bank (www.jdbank.com) is a Louisiana state-chartered bank with twenty-three full-service branches and one loan production office in Jefferson Davis, Calcasieu, Allen, Evangeline, St. Landry, Lafayette, and Iberia parishes, Louisiana. With $809 million in assets as of December 31, 2016, JD Bank offers a traditional range of deposit and loan products to individuals and businesses throughout south Louisiana.
This news release contains certain forward-looking statements, either expressed or implied, which are provided to assist the reader in understanding anticipated future financial performance. These statements involve certain risks, uncertainties, estimates and assumptions made by management, which are subject to factors beyond JD Bank's control and could impede its ability to achieve these goals. These factors include those listed in our Annual Report, and general economic conditions, trends in interest rates, the ability of our borrowers to repay their loans, and results of regulatory exams, among other factors.
Boyd R. Boudreaux
President and CEO
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SOURCE JD Bank