Cross River, a bank that delivers advanced financial and compliance products/services to the fintech industry, recently announced the closing of its $106 million private placement of subordinated notes.
According to Cross River, the Notes have a maturity date of September 1, 2030, and carry a fixed rate of interest of 6.50% for the first five years. Thereafter, the Notes will pay interest at 3-month SOFR plus 638 basis points, payable quarterly in arrears. The Notes include a right of prepayment without penalty on or after September 1, 2025. While sharing more details about the offering, Gilles Gade, Founder, President and CEO of Cross River, stated:
“This offering was oversubscribed, and we appreciate the strong support and positive response of the investment community.”
Cross River further revealed the net proceeds from the offering will be used for general corporate purposes, including to support the growth of the company. The company’s current offerings include marketplace lending, payments, and strategic financing, as well as small business and commercial real estate lending. The company then added that the subordinated notes have been structured to qualify as Tier 2 capital for regulatory purposes. Kroll Bond Rating Agency assigned an investment rating of BBB- to the Notes.