Peapack-Gladstone Financial Corporation (NASDAQ: PGC), the holding company for Peapack Private Bank & Trust, has announced a $50 million preferred stock commitment from affiliates of Strategic Value Bank Partners, a long-term investor in the banking sector. The commitment includes an initial $30 million private placement of non-cumulative perpetual convertible preferred stock, with the ability to issue up to an additional $20 million of preferred stock through the end of 2027.
The preferred stock carries a dividend rate of 6.00% per annum, is non-callable for the first five years, and may be redeemed thereafter, subject to applicable terms. It is convertible to common stock at the holder's option after five years. The issuance is not listed on any securities exchange and is expected to qualify as Tier 1 capital, subject to regulatory requirements.
Proceeds will be used for general corporate purposes, which may include supporting organic growth, investments at the holding-company or bank level, acquisitions or other business combinations, and the reduction or refinancing of existing debt. This capital injection is significant for Peapack-Gladstone as it provides additional resources to execute its expansion strategy in the competitive New York metropolitan market.
Douglas L. Kennedy, President and CEO, noted, "We are pleased to partner with Strategic Value Bank Partners, whose long-term orientation aligns well with our strategy. Over the past two years, we have made significant investments in our expansion across the New York metropolitan market and are seeing strong results reflected in positive operating leverage and improving earnings momentum. This capital raise provides flexibility to continue executing on that growth while maintaining capital levels consistent with our long-standing targets. Importantly, it reflects our disciplined approach to capital management, including actions we have taken to improve the efficiency and quality of our capital structure."
Marty Adams, Co-Founder and Principal of Strategic Value Bank Partners, added, "We have been a long-time investor in PGC common stock and are excited to support the Company's continued growth. We have strong conviction in the management team and the progress made in building a premier private banking and wealth management franchise serving clients across the New York metropolitan market. This investment reflects our confidence in the Company's trajectory and our interest in deepening our long-term partnership."
The transaction underscores Peapack-Gladstone's focus on strengthening its capital base while maintaining flexibility for strategic initiatives. The preferred stock's Tier 1 capital qualification is particularly important as it enhances the company's regulatory capital ratios, providing a buffer for future growth or economic uncertainty. Additional details regarding the transaction, including the terms of the preferred stock and related agreements, are included in the Company's Current Report on Form 8-K filed today with the Securities and Exchange Commission.
This announcement comes as Peapack-Gladstone continues to build momentum in its private banking and wealth management business. With total assets of $7.5 billion and assets under management and/or administration of $13.1 billion as of December 31, 2025, the company is well-positioned to leverage this capital to further expand its client base and service offerings. The partnership with Strategic Value Bank Partners, a seasoned investor in the banking sector, also signals confidence in Peapack-Gladstone's strategic direction and management team.
