December 29, 2022 –Community First Financial Corporation (the “Company”), the parent holding company of Community First Bank of Indiana (the “Bank”), today announced the successful completion of a private placement of $13.5 million aggregate principal amount of its 8.00% Fixed-to-Floating Rate Subordinated Notes due December 30, 2032 (the “Notes”) to various qualified institutional buyers and accredited investors (the “Offering”). The price for the Notes was 100% of the principal amount of the Notes. The Notes are intended to qualify as Tier 2 capital for regulatory purposes. The Company intends to use the net proceeds from the Offering for general corporate purposes, including but not limited to financing organic growth and investments in the Company’s bank subsidiary for regulatory capital purposes.
Interest on the Notes will accrue at a rate equal to (i) 8.00% per annum from the original issue date to, but excluding, December 30, 2027, payable semi-annually in arrears, and (ii) a floating rate per annum equal to a benchmark rate, which is expected to be the Three-Month Term SOFR (as defined in the Notes), plus a spread of 445 basis points from and including December 30, 2027 until maturity, payable quarterly in arrears. Beginning on December 30, 2027 through maturity, the Notes may be redeemed, at the Company’s option, on any scheduled interest payment date. Any redemption will be at a redemption price equal to 100% of the principal amount of Notes being redeemed, plus accrued and unpaid interest.
Robert D. Blume, President, CEO & Director of Community First Financial Corporation stated, “We are very excited to announce the successful completion of our recent subordinated debt offering on favorable terms in a challenging economic environment. A substantial portion of the new capital will be downstreamed to the Bank to finance our continued organic growth.”
Janney Montgomery Scott, LLC served as financial advisor to the Company and acted as the sole placement agent for the Offering and was represented by Barnes & Thornburg LLP as legal counsel. Amundsen Davis LLC served as the Company’s legal counsel in the Offering.
About Community First Financial Corporation: Community First Financial Corporation is a financial holding company headquartered in Kokomo, Indiana. Its banking subsidiary, Community First Bank of Indiana is primarily engaged in providing a full range of banking and financial services to individual and corporate customers in Howard, Hamilton, and surrounding counties of Indiana. The locally owned and operated bank has grown to approximately $600 million in asset size and has three branches in Kokomo, two branches in Westfield, one branch in Indianapolis, and one branch and one loan production office in Noblesville. On December 31, 2020, the Bank acquired 50.01% of outstanding member units of 1st Signature Lending, LLC (“1st Signature”). 1st Signature is a non-bank mortgage company focused on the U.S. residential mortgage market. 1st Signature originates and sells residential mortgage loans, with an emphasis on single-close, construction to permanent loans.
Forward Looking Statements:This press release contains certain forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Certain factors that could cause actual results to differ materially from expected results include the COVID-19 pandemic, changes in the interest rate environment, changes in general economic conditions, legislative and regulatory changes that adversely affect the business of the Company and the Bank, and changes in the securities markets. Except as required by law, the Company does not undertake any obligation to update any forward-looking statements to reflect changes in belief, expectations or events.
