Fifth Third Bancorp Prices $1B Equity Offering

Fifth Third Bancorp ("Fifth Third;" Nasdaq: FITB) today announced the successful completion of its previously announced "at the market" common equity offering program. The program was increased in size from $750 million to $1 billion and has been completed. Through this offering, Fifth Third will have issued 157,955,960 shares at an average price of $6.33 per share.
The net proceeds from the offering will be available for general corporate purposes. These purposes would include funding the cash premium portion of our pending tender offer for Series G depositary shares as well as the future repayment of the preferred stock and warrants we issued to the U.S. Department of Treasury as part of the Capital Purchase Program, subject to consultation with and approval from regulatory authorities.
As previously announced, Fifth Third has committed to increase its Tier 1 common equity by $1.1 billion as a result of the Supervisory Capital Assessment Program ("SCAP") announced May 7, 2009. We believe the completed $1.0 billion common equity offering, combined with actions on other capital alternatives that remain available to us, could potentially generate approximately $2 billion in aggregate Tier 1 common equity, which would more than satisfy the SCAP required buffer. We also continue to expect $1.2 billion in additional Tier 1 common equity from our pending processing joint venture transaction with Advent International, which is expected to close in the second quarter of 2009.
"We are pleased to have demonstrated strong access to the public common equity markets through a successful completion of this transaction," said Kevin T. Kabat, Chairman, President and CEO of Fifth Third Bancorp. "This offering largely fulfills our commitment under the SCAP assessment. We continue to pursue options we've discussed to generate Tier 1 common equity. The combined effect of these actions will significantly enhance our Tier 1 common equity ratio and other capital ratios and place our capital levels at very strong levels relative to our targets and to industry peers. Upon completion of these transactions, the establishment of the Tier 1 common equity buffer, and meeting other requirements under the Capital Purchase Program, we intend to consult with our regulators to devise a plan and timeline for the repayment of the CPP preferred stock investment."
Morgan Stanley and Merrill Lynch & Co. acted as joint agents in connection with the equity offering