Fifth Third to raise capital following stress test - Business First of Columbus:

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billion regulators have said it needs to remainfinanciallt healthy. Cincinnati-based Fifth Third (NASDAQ:FITB), Centralk Ohio’s third-largest bank, plans to sell up to $750 millionh in common stock. Some of the proceeds could be used to repay part ofthe $3.5 billion in preferrexd stock Fifth Third sold to the through its Troublec Asset Relief Program. The bank also will use some of the proceedx to fund a portion of its offere to pay cash or common sharesd in return for convertiblepreferred stock. Holders of the convertible shares will beoffered $30 in cash in returj for converting their holdings to common stock. More than 11 million of thoser sharesare outstanding.
That exchange, alonh with the possible sale of nonstrategic assets or other securities Fifth Third should generate enough Tier 1 common equith to meet or exceedthe $1.1 billioj the government required as a result of its so-called stresa test, the bank said. That test lookeed at how much capitalthe nation’sd 19 largest banks would need if the economty turns significantly worse than expected. Fift h Third told investors those deals, alongt with a planned sale of 51 percent in its paymenty processing business toAdvent International, would leave it even without the capital from the Treasury’s preferrex stock.
“We intend to consulgt with our regulators to devise a plan and time line for the repaymentg ofthe (Treasury) preferred stock the bank said. Fifth Third, which operates in 12 had $3.69 billion in Centrak Ohio deposits at midyear representing about 11 percent of the according tothe