Patriot Bank parent raises $10M in subordinated notes at 8.5%
What's the deal? Patriot National BancorpDealroom has a profile for this one. Try Dealroom → (Nasdaq: PNBK) issued and sold $10 million in 8.5% fixed-to-floating rate subordinated notes due 2036. The company sold the notes in a private placement to qualified institutional buyers, with Performance Trust Capital Partners as sole placement agent. Both the purchase agreements and the closing landed on September 18, 2026.
The terms: The notes carry a fixed 8.5% annual rate, paid semi-annually through September 30, 2031, then switch to a quarterly floating rate of three-month SOFR plus 416 basis points. Patriot can redeem them on or after September 30, 2031, subject to regulatory approval where required.
What's the money for? Patriot said it will use net proceeds for general corporate purposes, including future growth and capital contributions to its subsidiary, Patriot Bank, N.A.Dealroom has a profile for this one. Try Dealroom → The notes are intended to qualify as Tier 2 capital for regulatory purposes.
Why it matters: The structure adds $10 million of Tier 2 capital at the holding-company level without diluting shareholders through new equity. That is notable given the company reported 117,159,456 shares outstanding as of March 31, 2026, plus 12,789,103 warrants exercisable at $1.56.
What could go wrong? The 8.5% coupon is a meaningful fixed cost, roughly $850,000 a year during the fixed-rate period, which will weigh on earnings. The notes are unsecured, subordinated, unrated, and include a dividend-stopper: upon default, Patriot cannot pay dividends on its stock, with limited exceptions.
The signal: At $10 million, this is a small raise — the amount sits near the bottom of comparable deals. For a community-bank holding company, subordinated debt remains a familiar route to shore up regulatory capital and fund growth while keeping the equity base intact.
Read more: minichart.com.sg
Image credit: w_lemay
