United Community Banks Redeems All Outstanding Preferred Stock on September 15, 2025.

United Community Banks, Inc. is redeeming all outstanding shares of its 6.875% Series I Non-Cumulative Perpetual Preferred Stock on September 15, 2025. The redemption price is $25,000 per share, totaling $88 million, and will be paid using cash on hand. The company is actively managing its capital structure.

United Community Banks, Inc. (NYSE: UCB) has announced the redemption of all outstanding shares of its 6.875% Series I Non-Cumulative Perpetual Preferred Stock on September 15, 2025. The company will redeem $88 million in aggregate liquidation preference using cash on hand, with a redemption price of $25,000 per share, equivalent to $25 per depositary share. This strategic move aims to optimize the bank's capital structure and reduce higher-cost financing.

The redemption involves 3,661,650 depositary shares, each representing a 1/1000th interest in a preferred stock share. UCB, with $28.1 billion in assets as of June 30, 2025, operates 200 offices across six southeastern states and manages a national SBA lending franchise. The decision to redeem this preferred stock using cash on hand signals robust liquidity at UCB. By eliminating the 6.875% dividend obligation, the bank is effectively lowering its cost of capital, which should enhance long-term profitability metrics.

This move reflects strategic flexibility in UCB's balance sheet management. With $28.1 billion in assets as of June 30, 2025, this $88 million redemption represents approximately 0.31% of their asset base – a meaningful but manageable capital allocation decision. The bank's willingness to deploy cash reserves for this redemption rather than refinancing suggests confidence in their current liquidity position and future cash flow generation.

For existing preferred shareholders, while they'll lose this income stream after the redemption date, they'll receive their full principal investment plus the final dividend payment due on the redemption date. The termination of the 6.875% dividend obligation will modestly improve UCB's earnings available to common shareholders going forward.

This announcement is part of UCB's ongoing active management of its capital structure. The redemption price of $25,000 per share aligns with the standard liquidation preference, indicating this isn't a distressed transaction but rather prudent capital management.

References:
[1] https://www.stocktitan.net/news/UCB/united-community-banks-inc-announces-redemption-of-all-oustanding-u26t9msxx92z.html