Pinnacle Financial in Nashville, Tenn., has sold $120 million in subordinated notes and will use the proceeds to retire existing debt and bolster its capital levels.

The $10.9 billion-asset company disclosed in a regulatory filing recently that the notes it sold to institutional investors will bear a fixed interest rate of 5.2% until 2021, when the rate will adjust to three months Libor plus 3.8%. The notes will mature in 2026. The net proceeds will qualify initially as Tier 2 capital.

Pinnacle said that it used about $57 million of the proceeds to retire all outstanding debt under its $75 million revolving credit facility that it entered in March 2016.

The remaining proceeds will be used to enhance capital at its Pinnacle Bank unit and for other general corporate purposes.

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