SunTrust gets needed consents to terminate capital covenants

By Toni Weeks

San Diego, Sept. 26 - SunTrust Banks, Inc. said it received the consent of holders of about 68% in principal amount of its 6% subordinated notes due 2026 to terminate the four replacement capital covenants executed by the company in connection with various hybrid securities offerings.

As previously announced, SunTrust began a consent solicitation on Sept. 12 for its 6% notes. The company needed consents from holders of at least a majority of the outstanding notes by the consent solicitation deadline, 5 p.m. ET on Sept. 23, to terminate the covenants. The holders needed to be on record as of 5 p.m. ET on Sept. 9 to participate in the consent solicitation.

The termination of the replacement capital covenants became effective on Sept. 23. Holders who consented by the deadline will receive a consent fee of 1% of par.

Under the terms of the replacement capital covenants, SunTrust could only repurchase, redeem or repay the hybrid securities if a specific portion of the funds used were proceeds of the sale of equity or certain equity-like securities and if the sale took place within a specified time period prior to the repurchase, redemption or repayment.

Citigroup Global Markets Inc. (800 558-3745) and SunTrust Robinson Humphrey, Inc. (404 926-5051) are the solicitation agents. The information and tabulation agent is Global Bondholder Services Corp. (866 470-3800).

The bank is based in Atlanta.

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