Eagle Bancorp Montana, Inc. announced that it has issued and sold $40 million in aggregate principal amount of its 3.50% fixed-to-floating rate subordinated notes to certain institutional accredited investors and qualified institutional buyers through a private placement offering. The subordinated notes were issued on January 21, 2022 and will mature on February 1, 2032. The subordinated notes will bear interest at an annual fixed rate of 3.50% per annum, payable semi-annually in arrears on February 1 and August 1 of each year from August 1, 2022 to, but excluding, February 1, 2027.

From and including February 1, 2027 to, but excluding, February 1, 2032 or the earlier redemption date, interest will accrue at a floating rate per annum equal to a benchmark rate, which is expected to be three-month term SOFR (as defined in the Indenture under which the subordinated notes were issued), plus a spread of 218.0 basis points, payable quarterly in arrears on February 1, May 1, August 1 and November 1 of each year. The Company estimates that the net cash proceeds from the sale of the subordinated notes will be approximately $39.1 million, and the subordinated notes are expected to qualify as Tier 2 capital for regulatory purposes. The Company intends to use the net proceeds from the offering for general corporate purposes, including but not limited to providing capital to support its acquisition of First Community Bancorp, Inc. (“First Community”) and the redemption of the Company's outstanding $10 million of 5.75% senior notes due February 15, 2022.