The NCUA’s final rule on subordinated debt would, for the first time, allow many credit unions to increase capital outside of retained earnings through a subordinated debt issuance. The ability to raise capital through the issuance of subordinated debt could be attractive for many credit unions, as the proceeds can be utilized to grow and increase scale, reduce high member business lending concentrations, provide balance sheet protection and enhance regulatory capital ratios and liquidity. This presentation will focus on understanding the basics of a subordinated debt transaction, including the planning phase, pricing and key features of a subordinated debt instrument; the NCUA’s regulatory approval framework and application process; the offering documents and other disclosures required to be provided to potential investors; securities law considerations; and the regulatory capital treatment of subordinated debt.
Speaker: Jeff Cardone, Partner, Luse Gorman, PC
Jeff Cardone is a partner and attorney at Luse Gorman, PC. Jeff specializes in representing credit unions and other community-based financial institutions with respect to various transactional matters, including credit union mergers, credit union acquisitions of banks, branches and fee-based businesses, public and private equity and debt offerings, including subordinated debt transactions, and various other federal and state securities, corporate, regulatory and executive compensation and employee benefits compliance matters.
Educational Investment: Benefit of Membership