Calling All Bank Directors Episode 16: Should your bank raise capital now and if so, how and in what form?
This week, host and AABD President David Baris is again joined by Bill Boyan, a Managing Director at Piper Sandler, who has been involved as an investment banker in numerous capital raises and bank mergers. He will share his perspective on whether your bank should raise capital now and, if so, how and in what form.
Click here to listen to episode 16, or subscribe wherever you get your podcasts.
So far in 2020, there have been at least 71 bank sub debt offerings totaling about $4.7 billion. So far, sub debt has been the most prevalent form of capital raised in 2020.
Why is that? Bank holding companies can issue sub debt that can qualify as tier 2 capital and then downstream the proceeds to their bank as tier 1 capital, without diluting their stockholders of common stock.
Why are bank boards now deciding to raise capital? Is it the unknown losses that may arise in 2021 that may place some banks in jeopardy of survival? Is it for “insurance”? Is it for other purposes such as support for organic growth, stock buybacks down the road, or payment of cash dividends?
How will your bank board and management know whether this is the time to raise capital?
Our guest Bill Boyan will address these and other questions to help your board and management make the right decisions.
Thanks to our guest, Bill Boyan: http://www.pipersandler.com/2col.aspx?id=5777
Calling All Bank Directors is the podcast of the American Association of Bank Directors. AABD has been your advocate since 1989 and our podcast, hosted by AABD President David Baris, is designed to keep you well informed to help protect both you and your bank.
Questions? Contact [email protected].