WashingtonFirst Bankshares said Tuesday it raised approximately $20 million in equity through a private placement of 1,377,219 shares of newly issued common stock at a price of $15 per share.
Purchasers of stock consisted of institutional investors that were existing stockholders in the company, according to a release. A private placement is the opposite of a public issue, where stock is made available for sale on the open market.
Reston-based WashingtonFirst (NASDAQ: WFBI) said it intends to utilize the new capital primarily to support the continued growth of its wholly-owned subsidiary, WashingtonFirst Bank. The b ank, which has $1.3 billion in assets, opened its 17 th branch this fall in McLean and reported its loan portfolio grew by 22 percent in the first nine months of 2014. It acquired the failed Millennium Bank during the first quarter.
WashingtonFirst said it also might use some of the money to redeem a portion of the preferred stock issued to the Treasury Department as part of the Small Business Lending Fund program. Interest rates on that capital will increase from 1 percent to 9 percent in early 2016.
“We are delighted that a number of our existing institutional shareholders have confidence in the company and were interested in participating in this private placement,” WashingtonFirst President and CEO Shaza Andersen said in a release. “This new capital will help the company continue to grow and realize our goals.”
Two other community banks in Greater Washington, Freedom Bank of Virginia and MainStreet Bank, also have undertaken capital raises in December. Both those banks have less than $500 million in assets.
