Compass Trust issues $100 million capital securities.BIRMINGHAM Birmingham, cities, United States Birmingham (bûr`mĭnghăm') 1 City (1990 pop. 265,968), seat of Jefferson co., N central Ala., in the Jones Valley near the southern end of the Appalachian system; founded and inc. , Ala ALA aminolevulinic acid. Ala alanine. ala (a´lah) pl. a´lae [L.] a winglike process. .--(BUSINESS WIRE)--Jan. 16, 1997--Compass Trust I, a special purpose financing subsidiary of Compass Bancshares Compass Bancshares, Inc. is a privately held company based in Birmingham, Alabama. Its subsidiary, Compass Bank, is a Southwestern financial holding company with $47 billion in assets and 417 full-service banking offices in Alabama, Arizona, Colorado, Florida, New Mexico, and Texas. , Inc., (NASDAQ/NMS:CBSS CBSS Council of Baltic Sea States CBSS Craft and Boat Support System CBSS Coastal Border Surveillance System (MSSC) CBSS Closed-Breach Scavenging System (compressed air system for removing smoke from tank gun tubes) ) sold $100 million of capital securities in a public offering. -0-
A summary of the terms of the transaction is provided below.
Issuer's Name: Compass Trust I
Parent Name: Compass Bancshares, Inc.
Co-managers: Goldman, Sachs & Co. and Credit Suisse First
Boston
Moody's Rating: a3
S&P's Rating: BBB-
Amount/Type: $100 million Capital Securities
Coupon: 8.230%
Issue Price: 100.00%
Maturity: January 15, 2027
Settlement: January 21, 1997
Spread: 139 basis points over the 6.75% August 2026
Treasury
Early Redemption: Callable at a premium in ten years
-0- Capital securities are a debt/equity hybrid security Hybrid Security A security that combines two or more different financial instruments. Notes: Hybrid securities generally combine both debt and equity characteristics. structured to provide tax advantages to the bank holding company. The capital securities are actually issued by a single purpose trust created for the financing. The trust lends the proceeds to the bank holding company which, in turn, issues a junior subordinated deferrable interest debenture debenture (dəbĕn`chər), document acknowledging indebtedness. In Great Britain a debenture is practically the same as a bond, and debenture stock is similar to preferred stock. with matching payment structure to the trust. This security form is advantageous to the bank holding company in that it is treated as equity for regulatory capital purposes. Additionally, fixed semi-annual distributions on the capital securities can be deferred for up to five years. Like debt, however, the fixed semi-annual payments can be deducted de·duct v. de·duct·ed, de·duct·ing, de·ducts v.tr. 1. To take away (a quantity) from another; subtract. 2. To derive by deduction; deduce. v.intr. for the purpose of calculating taxes. As a result, capital securities represent an efficient form of raising additional regulatory capital. Compass Bancshares, Inc. is a multi-state bank holding company with operations in Alabama Alabama, indigenous people of North America Alabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). , Texas, and Florida. Compass continues to expand aggressively in Texas and Florida, and currently has four pending acquisitions totalling nearly $400 million in these two states. Once these acquisitions are completed, Compass will operate over 100 full-service banking offices with more than $5 billion of assets in Texas, 36 banking offices with over $1 billion of assets in Florida, and 87 banking offices with over $6 billion of assets in Alabama. CONTACT: Compass Bancshares, Inc., Birmingham Terrell Graves, 205/933-3331 Ellen Laden, 205/933-3554 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion