Berkshire Hills Bancorp, BHLB has entered into a subscription agreement for a private
placement of $75 million aggregate principal amount of fifteen year
Fixed-to-Floating Rate Subordinated Notes due 2027. The offering is expected
to close on September 28, 2012. The notes bear interest at a fixed rate of
6.875% for the first ten years. The notes convert to a variable rate of
interest in the final five years and are redeemable by Berkshire during that
period.
Berkshire expects to utilize the majority of the net proceeds from this
offering for the cash consideration portion of the pending merger with Beacon
Federal Bancorp, and to use the remaining net proceeds for other corporate
purposes. The notes qualify as Tier 2 capital under federal rules for bank
holding company regulatory capital.
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