Columbia Banking System Announces Pricing of Subordinated Notes
Columbia Bank plans to use $250 million in new Tier 2 notes to bolster capital and enable Columbia to redeem certain trust preferred securities.
Rhea-AI Summary
Columbia Bank, subsidiary of Columbia Banking System (COLB), priced $250 million 6.721% subordinated notes due 2036 on September 14, 2026.
The notes carry a fixed coupon of 6.721% per annum, paid semi-annually, through September 18, 2031, then reset to the Five-Year U.S. Treasury Rate plus 195 basis points until maturity, unless redeemed earlier. Closing is expected on September 18, 2026, subject to customary conditions. The notes are intended to qualify as Tier 2 capital of the Bank. Net proceeds will support general corporate purposes, including growth, capital adequacy, and returning up to $250 million of capital to Columbia, which plans to redeem certain trust preferred securities.
Positive
- $250 million Tier 2 subordinated notes priced, enhancing the Bank’s regulatory capital
- Structure allows return of up to $250 million of capital to Columbia
- Columbia plans to use returned capital to redeem certain outstanding trust preferred securities
Negative
- Bank adds $250 million of unsecured, subordinated debt to its capital structure
- Notes carry a fixed coupon of 6.721% per annum through September 18, 2031
News Explained
The notes add unsecured, subordinated debt at Columbia Bank: depositors and other senior creditors rank ahead of them, while the parent company does not guarantee them, so the disclosure changes the subsidiary’s obligations without describing an issuance of new parent-company shares.
AI-generated analysis. How Rhea-AI works. Not financial advice.
The Notes have an initial fixed interest rate of
The Notes are intended to qualify as Tier 2 capital of the Bank for regulatory capital purposes.
The Bank intends to use the net proceeds from the offering for general corporate purposes, including to support growth and capital adequacy, and to return up to
The Notes will be unsecured, subordinated obligations and will be subordinated in right of payment to all of the Bank's existing and future senior debt, whether secured or unsecured, including claims of depositors and general creditors. The Notes will be obligations of the Bank only and will not be obligations of, and will not be guaranteed by, Columbia.
This press release is for informational purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Notes in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. The Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), and are being offered and sold only to institutional accredited investors within the meaning of the Securities Act in reliance on the exemption contained in Section 3(a)(2) of the Securities Act. The indebtedness evidenced by the Notes is not a deposit and is not insured by the Federal Deposit Insurance Corporation or any other government agency or fund.
About Columbia
Columbia is headquartered in Tacoma, Washington and is the parent company of Columbia Bank, an award-winning preeminent regional bank with offices in Arizona, California, Colorado, Idaho, Nevada, Oregon, Texas, Utah, and Washington. Columbia Bank combines the resources, sophistication, and expertise of a national bank with a commitment to deliver superior, personalized service. The bank supports consumers and businesses through a full suite of services, including retail and commercial banking, Small Business Administration lending, institutional and corporate banking, and equipment leasing. Columbia Bank customers also have access to comprehensive investment and wealth management expertise as well as healthcare and private banking through Columbia Wealth Management.
Investor Relations Contact:
Jacquelynne "Jacque" Bohlen
ir@columbiabank.com
(503) 727-4100
Note Regarding Forward-Looking Statements
This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as "may," "expected," "anticipate," "continue," or other comparable words. In addition, all statements other than statements of historical facts that address activities that Columbia expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of Columbia, particularly its Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and its Quarterly Reports on Form 10-Q for the three months ended March 31, 2026 and June 30, 2026, for meaningful cautionary language discussing why actual results may vary materially from those anticipated by management.
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SOURCE Columbia Banking System, Inc.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How do the interest terms on Columbia Bank’s new subordinated notes work over time?
From issuance through September 18, 2031, the notes pay a fixed interest rate of 6.721% per annum, payable semi-annually in arrears. From and including September 18, 2031 through maturity, unless redeemed earlier, they bear interest at a fixed rate equal to the Five-Year U.S. Treasury Rate plus 195 basis points, also payable semi-annually in arrears.
What does Columbia Bank intend to do with the net proceeds from the subordinated notes offering?
The Bank plans to use the net proceeds for general corporate purposes, which the company said includes supporting growth and capital adequacy, and to return up to $250 million of capital to Columbia. Columbia intends to use that returned capital to redeem certain of its outstanding trust preferred securities.
Who can purchase these subordinated notes and are they insured deposits?
The notes have not been registered under the Securities Act of 1933 and are being offered and sold only to institutional accredited investors in reliance on the exemption in Section 3(a)(2). The indebtedness evidenced by the notes is not a deposit and is not insured by the Federal Deposit Insurance Corporation or any other government agency or fund.
Are the subordinated notes obligations of Columbia Banking System or only of Columbia Bank?
The notes will be obligations of Columbia Bank only. They will not be obligations of, and will not be guaranteed by, Columbia Banking System. They are unsecured, subordinated obligations and are subordinated in right of payment to all of the Bank’s existing and future senior debt, including claims of depositors and general creditors.