Southampton, Pa.-based Quaint Oak Bancorp Inc. on Dec. 27 completed the private offering of $8.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due Dec. 31, 2028, to qualified institutional buyers and institutional accredited investors.
For regulatory purposes, the notes have been structured to qualify as tier 2 capital for the company.
The notes will bear interest at 6.50% annually, payable quarterly in arrears, until Dec. 31, 2023. The interest rate will then be reset quarterly to an annual floating rate equal to three-month London interbank offered rate, plus 375.2 basis points, payable quarterly in arrears.
Quaint Oak expects to use the net proceeds of the offering for general corporate purposes, including for the provision of additional liquidity and working capital.
Ambassador Financial Group Inc. served as sole placement agent for the offering. Silver Freedman Taff & Tiernan LLP served as legal counsel to the company, and Barley Snyder LLP served as legal counsel to the placement agent.