Unity Bancorp of Clinton, N.J., has repurchased $5 million of subordinated debt it issued before the financial crisis.
The $1.1 billion-asset company said in a press release Monday that it repurchased the debt, issued in December 2006 and due in December 2036, at a price of nearly 55 cents per dollar. The move will result in a nearly $2.3 million pretax gain.
Unity, which said it still has $10 million of subordinate debt, said the action lowered its Tier 1 leverage ratio to 10.92% from 11.18%. The company's total risk-based capital ratio fell to 12.17% from 12.43%. The company remains well capitalized for regulatory purposes.
"Although the securities were an inexpensive form of capital, the discount was too large to pass up," James Hughes, Unity's president and chief executive, said in the release.