VersaBank Unveils New Offering of Common Shares to Elevate Capital Structure

VersaBank's Latest Common Shares Offering

In a significant move to enhance its capital base, VersaBank, headquartered in London, Ontario, has officially filed a preliminary prospectus supplement regarding a public offering of its common shares. This announcement was made on December 16, 2024, indicating the bank's strategic approach toward growing its equity capital in a rapidly changing financial environment.

VersaBank, listed on both the Nasdaq and TSX under the ticker VBNK, has laid the groundwork for this offering by filing its preliminary supplement alongside an existing short form base shelf prospectus dated November 22, 2024. The planned offering aims to expand its capital structure by enabling investors across Canada—excluding Quebec—to take part, as well as engaging interest from U.S. investors under the registration statement filed with the U.S. Securities and Exchange Commission (SEC).

Acting as the sole bookrunning manager for this offering is Raymond James Associates, Inc. The underwriting team also includes notable firms such as Keefe, Bruyette & Woods, a Stifel Company, and Roth Canada, Inc. To further augment investor interest, VersaBank will provide the underwriters with an option to purchase an additional 15% of the common shares offered. This option reflects the bank's commitment to establishing a robust market presence while catering to investor demand over an initial 30-day timeframe following the final prospectus.

The bank projects that the net proceeds resulting from this offering will be utilized for general banking purposes, which may include enhancing its Common Equity Tier 1 capital—a critical measure for the financial stability of banking institutions. By bolstering its capital composition, VersaBank aims to maintain competitive advantages in the banking sphere and ensure sustainable growth.

The conclusion of the offering is contingent on typical closing conditions, including the successful listing of common shares on both Nasdaq and TSX, accompanied by necessary regulatory approvals.

In light of this offering, it's important to highlight that no securities regulatory authority has vetted the content of the announcement, and it should not be construed as an offer to sell or a solicitation to buy these securities in regions where such offers would be deemed unlawful. Potential investors are urged to thoroughly read the entire set of documentation concerning the offering, including the Base Shelf Prospectus and related amendments, which has been made publicly available via SEDAR+ and EDGAR.

About VersaBank

VersaBank differentiates itself in the banking landscape with a unique, branchless, digital banking model focused on business-to-business operations. This model allows VersaBank to provide efficient banking solutions particularly to segments of the market that have remained underserved, leveraging their advanced technological infrastructure.

Notably, in March 2022, the bank launched its innovative Receivable Purchase Program (RPP), a funding solution that aims to capitalize on opportunities within the U.S. market, a multi-trillion-dollar sector that has faced limited banking services thus far. Additionally, the bank boasts ownership of DRT Cyber Inc., a prominent cybersecurity firm, ensuring robust protective measures against the increasing threats in the digital landscape that financial institutions endure today.

Forward-Looking Statements

As with many financial maneuvers, the announcement contains forward-looking statements about the proposed offering and anticipated conditions affecting its completion. Various risks—ranging from economic fluctuations to potential regulatory hindrances—could impact the realization of the outcomes envisaged by the Bank.

This deliberate move by VersaBank is not just a strategic investment in its present but a calculated preparation for a more resilient financial future, echoed by its innovative banking approach and market responsiveness.

Investors and market watchers alike will be keen to observe how this offering unfolds and how it positions VersaBank within the competitive landscape of banking services across North America.