Irwin Financial redeems 8¾% convertible trust preferred securities

By Angela McDaniels

Seattle, March 8 - Irwin Financial Corp. redeemed 1.3 million of the 2.1 million shares outstanding of IFC Capital Trust III's 8¾% convertible trust preferred securities on Monday, according to a company news release.

The company paid par of $25 plus accrued interest through March 3 for a total purchase price of $32.1 million.

Irwin Financial estimated that its interest expense savings will be $500,000 for the current quarter.

The securities were convertible into Irwin Financial common stock at any time up to 5 p.m. ET on March 3. Each share was exchangeable for 1.2610 shares of common stock for a conversion price of $19.825 per share.

Roughly 800,000 shares of the convertible securities were converted into 1 million shares of common stock, according to the release.

As a result of the redemption, the company's pre-tax income for the current quarter will be reduced by $1.1 million due to capitalized issuance costs and the number of dilutive potential common shares to be included in its earnings-per-share calculation will decline by 1.6 million shares.

The Columbus, Ind.-based bank holding company said it plans to issue $32 million of tier 1 eligible, non-convertible trust preferred securities soon to "replenish its capital base."

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