We have been working with multiple bank holding company clients with respect to the issuance of subordinated debt. There is currently a robust market for subordinated debt issued by bank holding companies of all sizes. The size of the issuance has been as low as $5 million. Many bank holding companies are taking advantage of historically low interest rates, with several recent issuances below 4% for the fixed rate period. Clients are using the proceeds from the subordinated debt for a wide range of purposes, including capital support for the subsidiary bank, funding acquisitions and growth, and stock repurchases. The proceeds of the issuance can be downstreamed from the holding company to the subsidiary bank in the form of Tier 1 capital. Click here for a presentation that provides more information on subordinated debt. Continue reading >