HBT Financial, Inc. Announces \$85 Million Subordinated Notes Issuance
BLOOMINGTON, IL – March 11, 2026 – HBT Financial, Inc. (NASDAQ: HBT), the holding company for Heartland Bank and Trust Company, has announced a significant financial move with the issuance and sale of \$85 million in aggregate principal amount of Fixed-to-Floating Rate Subordinated Notes due 2036. This transaction was conducted via private placement to certain qualified institutional buyers and institutional accredited investors.
Key Details of the Issuance
- Principal Amount: \$85 million in Subordinated Notes
- Interest Rate: The Notes will bear an initial fixed interest rate of 5.75% for the first five years. After the fixed period, the interest rate will reset quarterly to the then-current three-month SOFR rate plus 233 basis points.
- Redemption Terms: The company may redeem the Notes, in whole or in part, at its option, on or after March 15, 2031. Before this date, redemption is only allowed in whole, under certain limited circumstances.
- Regulatory Treatment: The Notes are intended to qualify as Tier 2 capital for HBT Financial under regulatory capital requirements.
- Use of Proceeds: Net proceeds from the offering are expected to be used for general corporate purposes, which may include potential share repurchases.
- Agents and Legal Advisors: Piper Sandler & Co. served as the sole placement agent. Vedder Price P.C. acted as legal counsel to the placement agent, and Barack Ferrazzano Kirschbaum & Nagelberg LLP served as legal counsel to HBT Financial.
Company Overview & Financial Position
HBT Financial, Inc., headquartered in Bloomington, Illinois, is the parent of Heartland Bank and Trust Company, with roots dating back to 1920. The company operates 83 full-service branches, serving customers in Illinois, eastern Iowa, and suburban St. Louis. As of December 31, 2025, HBT Financial reported:
- Total Assets: \$5.1 billion
- Total Loans: \$3.5 billion
- Total Deposits: \$4.4 billion
Shareholder and Market Impact
- Potential Share Repurchases: The company explicitly stated that it may use the proceeds for share buybacks, which could be accretive to earnings per share and potentially support or boost share price.
- Interest Rate Sensitivity: The Notes’ transition from a fixed rate to a floating rate linked to SOFR plus a spread introduces interest rate risk/benefit depending on future rate environments, potentially impacting the company’s net interest margin and interest expense over time.
- Regulatory Capital: As the Notes qualify as Tier 2 capital, this issuance is likely to improve HBT’s regulatory capital ratios, enhancing the company’s financial stability and growth capacity.
- Long-term Maturity: The 10-year maturity (with potential early redemption) positions HBT for long-term capital management flexibility.
What Investors Should Watch
- Capital Deployment: Investors should monitor how HBT deploys the new capital, especially if it proceeds with share repurchases, which could be viewed positively by markets.
- Interest Rate Environment: Fluctuations in the SOFR benchmark will affect the company’s future interest obligations on the Notes from 2031 onward.
- Balance Sheet Strength: The improved regulatory capital position can support further growth, acquisitions, or dividend increases, all of which may impact shareholder value.
Contact Information
For further inquiries, shareholders and analysts can contact Peter Chapman at [email protected] or call (309) 664-4556.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should perform their own due diligence or consult a financial advisor before making investment decisions.
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