Dive Brief:
- Commercial Bancgroup, a Tennessee-based, state-chartered commercial bank, aims to raise up to $103.7 million through an initial public offering, the company said in a press release Monday.
- Stricter regulations, higher compliance costs and volatile market conditions have made public listings increasingly rare for banks since the 2007-08 financial crisis.
- The bank expects to list on the Nasdaq under the ticker CBK.
Dive Insight:
Commercial, a $2.3 billion-asset lender that serves businesses in the Knoxville, Tennessee, area and neighboring southeast Kentucky – with outposts in Charlotte, North Carolina, and Nashville – is putting 3,738,317 shares of its common stock on the market for a price expected to range between $25.75 and $27.75 per share. The $103.7 million figure represents the upper end of that range.
A public listing would value the company at roughly $366 million if it fetches the top estimated price, according to a regulatory filing.
Roughly 935,000 of the shares are being offered by Commercial itself, with the remaining 2,800,000 or so coming from certain selling shareholders, the bank said in a release Monday.
Underwriters are expected to be granted a 30-day option to purchase up to 560,747 more shares of common stock from the selling shareholders at the IPO price, minus underwriting discounts and commissions, the bank said.
The company intends to use proceeds from the IPO to repay certain debts and redeem its outstanding subordinated debentures and related trust preferred securities, and to use the rest for general corporate purposes, the bank said. Commercial will not receive any proceeds from sales by shareholders.
The expected listing for Commercial marks a rare IPO push for a bank. While the fintech space has been brimming with IPO prospects – firms such as Gemini, Figure and Klarna have all pushed to go public this month – traditional banks have been far more reluctant.
