Advanta Corp. is preparing to issue $100 million of trust- preferred securities.

These instruments,which qualify as Tier I capital, will be issued through a Delaware trust, Advanta Capital Trust I.

The statutory business trust has been formed for the sole purpose of issuing and selling capital securities with the sales proceeds used to acquire junior subordinated debentures of Advanta.

The company will use the proceeds for general corporate purposes.

Debt service paid by Advanta on the junior subordinated debentures will provide cash flow to the trust, used to pay dividends on the capital securities.

Thompson BankWatch assigned a rating of BBB-minus, reflecting that the sole assets of Advanta Capital Trust I are debentures, junior to all senior and subordinated obligations.

Additionally, BankWatch affirmed all previously assigned ratings for Advanta Corp. and its subsidiaries.

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