US Metro Bancorp Completes $31.9 Million Subordinated Note Capital Raise and Redemption of $16.0 Million Subordinated Note

US Metro Bancorp, the parent company of US Metro Bank, has successfully closed a private placement raising $31.9 million through the issuance of 6.00% Fixed Interest Rate Subordinated Debt Notes. This significant transaction, completed on October 31, 2025, will mature on October 31, 2028. The Notes will bear interest at an annual rate of 6.00%, with payments made quarterly. The proceeds from this capital raise are intended for general corporate purposes, particularly for organic growth and the repayment of existing debt instruments.

In conjunction with this capital raise, US Metro Bancorp announced plans to redeem $16.0 million in existing 5.65% Fixed to Floating Rate Subordinated Notes, with the redemption scheduled for November 7, 2025. The decision to redeem this debt aligns with the Bancorp's strategy to refinance higher floating rate obligations, thereby improving its cost of capital and supporting ongoing growth initiatives.

CEO Dong Il Kim expressed satisfaction with the outcome of this capital raise, emphasizing its role in facilitating the bank's expansion efforts. US Metro Bank, headquartered in Garden Grove, California, has been operational since September 2006, offering a variety of banking services including deposit and loan products.

The announcement also included a cautionary note regarding forward-looking statements, acknowledging various risks and uncertainties that might affect future performance. These include fluctuations in interest rates, changes in the national economy, and maintenance of key client relationships. The bank's management underscored that past results do not guarantee future outcomes, and a comprehensive understanding of potential risks is important for stakeholders.

Overall, this capital raise and redemption strategy signify a proactive approach by US Metro Bancorp to strengthen its financial position and foster growth in a competitive banking environment.

US Metro Bancorp's recent completion of a $31.9 million subordinated note offering, alongside the planned redemption of $16.0 million in higher-rate subordinated notes, signals strategic financial management aimed at fostering growth and improving cost structures. The issuance of fixed-rate notes at 6.00% provides a stable funding source while effectively replacing the higher 5.65% floating rate debt, thereby potentially reducing interest expenses amid fluctuating market conditions.

From an investment perspective, investors should assess US Metro Bancorp’s move as a proactive strategy to enhance its capital base and manage financial liabilities efficiently. The proceeds from the capital raise are intended for general corporate purposes that could include financing organic growth, which is vital for expanding the bank’s service offerings and customer base. Given US Metro Bank's full-service commercial banking model and focus on diversified loan products, this funding could position the bank to seize market opportunities in the burgeoning Californian economy.

Additionally, the scheduled redemption of the floating rate notes highlights a response to rising interest rate environments, mitigating the risks associated with variable interest rate obligations. This adjustment not only enhances financial stability but also reassures investors about the bank’s commitment to maintaining a robust balance sheet.

Despite the positive aspects, potential investors should remain vigilant about market risks, including interest rate fluctuations and economic conditions that could impede growth. The bank’s ability to cultivate strong client relationships and navigate the competitive landscape will also be crucial for its success. Therefore, while the recent developments may create bullish sentiment around US Metro Bancorp, careful consideration of broader economic indicators and internal strategic execution will be essential in evaluating investment potential.