Constellation Bancorp of Elizabeth, N.J., on Monday announced a rights offering and debt-for-equity conversion aimed at raising capital ratios to regulatory minimums at the holding company and its main subsidiary.

The recapitalization is expected to raise approximately $75 million, including $58 million from the rights offering and $17 million from the conversion of debt, according to a filing with the Securities and Exchange Commission.

Pricing of the offering has not been determined, said Michael Marinelli, executive vice president and chief financial officer.

Agreements with Regulators

Constellation's principal subsidiary, National State Bank, had 2.82% leverage and 4.1% Tier 1 capital ratios at the end of June. The bank has signed agreements with regulators to raise its leverage ratio to 5.25% and its Tier 1 ratio to 6%, Mr. Marinelli said.

Constellation, with $2.6 billion in assets lost $88.7 million last year as a result of special charges and heavy loan-loss provisioning. But it earned $2.5 million in the first half of 1992.

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