Guaranty Bancorp (Nasdaq: GBNK) has raised $59.1 million via a PIPE from Patriot Financial Partners, Relational Investors and Castle Creek Capital Partners.
Guaranty Bancorp (Nasdaq:GBNK) (the “Company”) announced that it consummated the previously announced private placement of mandatorily convertible Series A preferred stock. A total of 59,053 shares of Series A preferred stock were issued in this private placement for a total capital raise of $59.1 million. The primary investors include Patriot Financial Partners, L.P., Patriot Financial Partners Parallel, L.P., Relational Investors Mid-Cap Fund I, L.P., Relational Investors Mid-Cap Fund II, L.P. and Castle Creek Capital Partners III, L.P.
Additionally, the Company announced that, pursuant to the securities purchase agreement with Patriot Financial Partners, L.P. and Patriot Financial Partners Parallel, L.P., Kirk Wycoff has been appointed to serve on its Board of Directors and both the Audit and Corporate Risk Committees of the Company’s Board. Mr. Wycoff was also appointed to the Board of Directors of the Company’s bank subsidiary, Guaranty Bank and Trust Company. Mr. Wycoff is currently a managing partner of Patriot Financial Partners, L.P. and Patriot Financial Partners Parallel, L.P., private equity funds headquartered in Philadelphia focused on investing in community banks and thrifts throughout the United States. Mr. Wycoff has more than 25 years of entrepreneurial banking experience. He also currently serves as Chairman of Continental Bank, based in the Philadelphia metropolitan area. From 2005 to 2007, Mr. Wycoff served as President and CEO of Continental Bank.
John Eggemeyer, Chairman of the Board, stated, “We are very pleased and honored to have Kirk Wycoff join our Board. The addition of another Board member with a wealth of knowledge of, and extensive experience in, the banking industry further strengthens our Board. I, as well as each of the other members of the Board and management, welcome him and look forward to working with him.”
Dan Quinn, President and CEO, stated, “We are pleased to announce the closing of $59.1 million of capital. Prior to this capital issuance, the Company had an equity ratio-GAAP of 7.90% and a tangible equity ratio of 6.83% at June 30, 2009. This issuance of preferred stock significantly enhances the Company’s capital position. Giving effect to this new capital, the equity ratio-GAAP and tangible equity ratio on a pro-forma basis at June 30, 2009 are 10.57% and 9.56%, respectively.”
The Company’s and the bank subsidiary’s actual and pro forma capital ratios at June 30, 2009 are presented in the table below:
Actual Pro Forma for a “Well-
Ratio at Ratio at Minimum Capitalized”
June 30, June 30, Capital Bank
2009 2009(1) Requirement Institution
Consolidated 10.73% 13.79% 8.00% N/A
Guaranty Bank and
Trust Company(2) 10.71% 12.82% 8.00% 10.00%
Tier 1 Risk-Based
Consolidated 9.46% 10.04% 4.00% N/A
Guaranty Bank and
Trust Company(2) 9.44% 11.56% 4.00% 6.00%
Consolidated 8.96% 9.51% 4.00% N/A
Guaranty Bank and
Trust Company(2) 8.95% 10.95% 4.00% 5.00%
Ratio -GAAP 7.90% 10.57% N/A N/A
Equity Ratio(3) 6.83% 9.56% N/A N/A
(1) After issuance of $59,053,000 of Series A Preferred Stock, net of
$1,000,000 of issuance costs. The Series A Convertible Preferred Stock
is treated as a restricted core capital element for Tier 1 Capital
purposes at the consolidated level. Restricted core elements are
restricted to an amount not to exceed 25% of all core capital
(2) Assumes that the Company will immediately contribute $40 million
of additional capital to Guaranty Bank and Trust Company.
(3) The tangible equity ratio differs from the equity ratio – GAAP in
that intangible assets of $22.3 million are subtracted from both the
numerator (actual total equity of $153,607,000 and pro forma total
equity of $211,660,000 at June 30, 2009) and the denominator (actual
total assets of $1,944,867,000 and pro forma total assets of
$2,002,920,000 at June 30, 2009) of the ratio. The methodology of
determining tangible equity may differ among companies.
About Guaranty Bancorp
Guaranty Bancorp is a bank holding company that operates 34 branches in Colorado through a single bank, Guaranty Bank and Trust Company. The bank provides banking and other financial services including real estate, construction, commercial and industrial, energy, consumer and agricultural loans throughout its targeted Colorado markets to consumers and small to medium-sized businesses, including the owners and employees of those businesses. The bank also provides trust services, including personal trust administration, estate settlement, investment management accounts and self-directed IRAs. More information about Guaranty Bancorp can be found at www.gbnk.com.