Intervest Bancshares Corporation (NASDAQ-GS: IBCA), the holding company for Intervest National Bank, announced today that it intends to redeem the remaining 18,750 shares of its outstanding Series A Fixed Rate Cumulative Perpetual Preferred Stock (the “Preferred Stock”) that were issued as part of the Capital Purchase Program (“CPP”), established under the Troubled Asset Relief Program (“TARP”). The effective date of the planned redemption is August 15, 2013. The shares are being redeemed from third parties that purchased the Preferred Stock from the U.S. Treasury (“Treasury”) in a modified Dutch auction in June of this year.
The purchase price for shares of the Company’s Preferred Stock in the redemption will be the stated liquidation value of $1,000 per share, plus any accumulated and unpaid dividends that have been earned thereon up to, but not including the date of redemption. The Company anticipates the total cost of redeeming the remaining shares of Preferred Stock will be approximately $22,590,000. The Company has received all necessary regulatory approvals to complete the redemption.
The Company previously repurchased the other 6,250 shares of its Preferred Stock from the Treasury in the auction at a purchase price of $970 per share, plus accumulated and unpaid dividends, for an aggregate purchase price of $7,290,000. That transaction closed on June 24, 2013. Following the planned redemption of the remaining shares of Preferred Stock on August 15, 2013, no shares of the Company’s Preferred Stock will remain outstanding, and the Company will pay no further dividends on the Preferred Stock. The common stock purchase warrant issued to the Treasury in connection with the Company’s participation in the CPP, remains outstanding.
“We are pleased to have the opportunity to complete this redemption,” said Lowell Dansker, Chairman and Chief Executive Officer of the Company. “Completion of the redemption is consistent with our plans to exit the TARP program. Our capital ratios following the redemption will continue to exceed all applicable requirements of our regulators and the standards for well capitalized banks. We are pleased that actions we have taken to respond to regulatory issues and to strengthen our balance sheet are enabling us to exit the TARP program.”
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