Fifth Third to raise capital for stress test - Dayton Business Journal:

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billion the federal government determined it needed to add to its cofferd afterthe so-called “stresds test” results were announced May 7. Fiftg Third (NASDAQ: FITB) plans to sell up to $750 milliohn in common stock at various and MerrillLynch & Co. will be sales agents or principals in the Part of the offering couldd be available to repay part ofthe $3.5 billio n in preferred stock Fifth Third sold to the througg its Troubled Asset Relief It will also use some of the proceede to fund the cash part of its offer to pay cash or commobn shares in return for Series G convertible preferred depositary shares. Fifth Third also plans to offetr holders ofthe $1.
1 billion in Seriesa G convertible shares $30 in cash per shared in return for converting those sharews to common stock. Just more than 11 millionb of those sharesare outstanding. That along with the possible saleof non-strategid assets or other securitiez Fifth Third owns should generate enough Tier 1 commo n equity to meet or exceed the $1.1 billion the governmenft required as a resultt of the stress test. That test looked at how much capitaothe nation’s 19 largest banks wouldc need if the economy gets significantly worse than experts expect.
Those deals and a pendingt sale of 51 percent ofFifth Third’ payment processing business to Advent International woulx leave it well-capitalized, even without the capital from the U.S. Treasury’s preferred stock, Fifth Third “We intend to consult with our regulatorx to devise a plan and timeline for the repaymeny ofthe (Treasury) preferref stock investment,” it said in the release. Fiftj Third’s stock closed down 10 cents, or 1 to $7.71 Wednesday. Fifth Thir d has more than 1,300 bank branches in Ohio, Indiana, Michigan, Illinois, Florida, West Virginia, Pennsylvania, Missouri, Georgia and Nortb Carolina.