Peapack-Gladstone Financial Corporation, the holding company for Peapack Private Bank & Trust, announced a $50 million preferred stock commitment from affiliates of Strategic Value Bank Partners, a long-term investor focused on the banking sector. The commitment includes an initial $30 million private placement of non-cumulative perpetual convertible preferred stock, with the ability to issue up to an additional $20 million of preferred stock through the end of 2027.
The preferred stock carries a dividend rate of 6.00% per annum, is non-callable for the first five years, and thereafter may be redeemed subject to applicable terms. The preferred stock is convertible to common stock at the option of the holder after five years, subject to applicable terms. The issuance is not listed on any securities exchange and is expected to qualify as Tier 1 capital, subject to applicable regulatory requirements.
Proceeds will be used for general corporate purposes, which may include supporting organic growth, investments at the holding-company or bank level, acquisitions or other business combinations, and the reduction or refinancing of existing debt. This capital raise provides flexibility to continue executing on growth while maintaining capital levels consistent with long-standing targets.
Douglas L. Kennedy, President and CEO, noted that the partnership with Strategic Value Bank Partners aligns well with the company's strategy. "Over the past two years, we have made significant investments in our expansion across the New York metropolitan market and are seeing strong results reflected in positive operating leverage and improving earnings momentum," Kennedy said. "Importantly, it reflects our disciplined approach to capital management, including actions we have taken to improve the efficiency and quality of our capital structure."
Marty Adams, Co-Founder and Principal of Strategic Value Bank Partners, added, "We have been a long-time investor in PGC common stock and are excited to support the Company's continued growth. We have strong conviction in the management team and the progress made in building a premier private banking and wealth management franchise serving clients across the New York metropolitan market. This investment reflects our confidence in the Company's trajectory and our interest in deepening our long-term partnership."
Additional details regarding the transaction, including the terms of the preferred stock and related agreements, are included in the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission, available at https://www.sec.gov/edgar.shtml. The company's most recent financial information can be found in its Annual Report on Form 10-K at https://www.sec.gov/Archives/edgar/data/0001073421/000107342125000010/pgc-20251231.htm.
This capital commitment is significant as it demonstrates investor confidence in Peapack-Gladstone's growth strategy during a period of expansion in the competitive New York metropolitan banking market. The transaction provides the company with additional financial flexibility to pursue strategic initiatives while maintaining regulatory capital requirements. For the banking industry, this type of private capital investment highlights continued interest in well-positioned regional banks with strong wealth management franchises, particularly those demonstrating positive operating leverage and earnings momentum.
